Rental Property Cash on Cash Return Calculator
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Cash on Cash Return (CoC):
0.00%
Monthly Cash Flow:
$0.00
Annual Cash Flow:
$0.00
Net Operating Income (NOI):
$0.00
Total Cash Invested:
$0.00
Monthly Mortgage Payment:
$0.00
Cap Rate:
0.00%
function calculateROI() {
// 1. Get Input Values
var purchasePrice = parseFloat(document.getElementById('purchasePrice').value) || 0;
var downPayment = parseFloat(document.getElementById('downPayment').value) || 0;
var interestRate = parseFloat(document.getElementById('interestRate').value) || 0;
var loanTerm = parseFloat(document.getElementById('loanTerm').value) || 0;
var closingCosts = parseFloat(document.getElementById('closingCosts').value) || 0;
var rehabCosts = parseFloat(document.getElementById('rehabCosts').value) || 0;
var monthlyRent = parseFloat(document.getElementById('monthlyRent').value) || 0;
var propertyTax = parseFloat(document.getElementById('propertyTax').value) || 0;
var insurance = parseFloat(document.getElementById('insurance').value) || 0;
var hoa = parseFloat(document.getElementById('hoa').value) || 0;
var maintenancePct = parseFloat(document.getElementById('maintenance').value) || 0;
var vacancyPct = parseFloat(document.getElementById('vacancy').value) || 0;
var managementPct = parseFloat(document.getElementById('management').value) || 0;
// 2. Calculate Mortgage
var loanAmount = purchasePrice – downPayment;
var monthlyRate = (interestRate / 100) / 12;
var numPayments = loanTerm * 12;
var monthlyMortgage = 0;
if (loanAmount > 0 && interestRate > 0) {
monthlyMortgage = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numPayments)) / (Math.pow(1 + monthlyRate, numPayments) – 1);
} else if (loanAmount > 0 && interestRate === 0) {
monthlyMortgage = loanAmount / numPayments;
}
// 3. Calculate Monthly Expenses
var monthlyTax = propertyTax / 12;
var monthlyInsurance = insurance / 12;
var monthlyMaintenance = monthlyRent * (maintenancePct / 100);
var monthlyVacancy = monthlyRent * (vacancyPct / 100);
var monthlyManagement = monthlyRent * (managementPct / 100);
var totalOperatingExpenses = monthlyTax + monthlyInsurance + hoa + monthlyMaintenance + monthlyVacancy + monthlyManagement;
var totalMonthlyExpenses = totalOperatingExpenses + monthlyMortgage;
// 4. Calculate Cash Flow and NOI
var monthlyCashFlow = monthlyRent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
var noi = (monthlyRent * 12) – (totalOperatingExpenses * 12);
// 5. Calculate Investment Totals
var totalCashInvested = downPayment + closingCosts + rehabCosts;
// 6. Calculate Returns
var cocReturn = 0;
if (totalCashInvested > 0) {
cocReturn = (annualCashFlow / totalCashInvested) * 100;
}
var capRate = 0;
if (purchasePrice > 0) {
capRate = (noi / purchasePrice) * 100;
}
// 7. Display Results
document.getElementById('results').style.display = 'block';
document.getElementById('resCoc').innerText = cocReturn.toFixed(2) + "%";
document.getElementById('resCoc').style.color = cocReturn >= 0 ? '#27ae60' : '#c0392b';
document.getElementById('resMonthlyCashFlow').innerText = formatCurrency(monthlyCashFlow);
document.getElementById('resMonthlyCashFlow').style.color = monthlyCashFlow >= 0 ? '#333' : '#c0392b';
document.getElementById('resAnnualCashFlow').innerText = formatCurrency(annualCashFlow);
document.getElementById('resNOI').innerText = formatCurrency(noi);
document.getElementById('resTotalInvested').innerText = formatCurrency(totalCashInvested);
document.getElementById('resMortgage').innerText = formatCurrency(monthlyMortgage);
document.getElementById('resCapRate').innerText = capRate.toFixed(2) + "%";
}
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
// Run on load
window.onload = function() {
calculateROI();
};
Understanding Cash on Cash Return for Rental Properties
Investing in real estate is one of the most reliable ways to build wealth, but not every property is a good deal. To separate the winners from the losers, savvy investors rely on specific financial metrics. One of the most critical metrics for rental property investors is the Cash on Cash Return (CoC).
This calculator is designed to help you quickly determine the potential profitability of a rental property by analyzing your initial cash investment against the annual cash flow generated by the asset.
What is Cash on Cash Return?
Cash on Cash Return is a percentage that measures the annual return on the actual cash invested in a property. Unlike Cap Rate, which looks at the property's purchase price regardless of financing, Cash on Cash Return focuses specifically on the money that leaves your pocket (Down Payment, Closing Costs, and Rehab Costs).
The formula is simple:
Cash on Cash Return = (Annual Pre-Tax Cash Flow / Total Cash Invested) x 100%
Why is this metric important?
For investors using leverage (mortgages), the CoC return provides a realistic view of how hard their money is working. If you buy a $200,000 property with $40,000 down, you care about the return on that $40,000, not necessarily the return on the full $200,000.
- Comparison Tool: It allows you to compare real estate returns against other investment vehicles like stocks or bonds.
- Financing Insight: It highlights the power of leverage. A lower down payment might increase your CoC return even if cash flow drops slightly.
How to Interpret the Results
What constitutes a "good" return varies by investor and market conditions, but here are some general benchmarks:
- 8-12%: Generally considered a solid return for long-term buy-and-hold properties.
- 15%+: Excellent returns, often found in higher-risk neighborhoods or through value-add strategies (BRRRR).
- Below 5%: Might be acceptable in high-appreciation markets (like coastal cities) where cash flow is secondary to equity growth.
Inputs Used in This Calculator
To get an accurate result, ensure you account for all expenses:
- Purchase Price & Loan Details: Determines your mortgage payment, the largest expense for most investors.
- Vacancy Rate: Properties don't stay rented 365 days a year. A 5% vacancy rate assumes the property sits empty for about 18 days a year.
- CapEx & Maintenance: Even if nothing breaks this month, you should set aside 5-10% of rent for future repairs (roofs, HVAC, etc.).
- Management Fees: Property managers typically charge 8-10% of monthly rent. If you self-manage, you "pay yourself" this fee, or you can set it to 0%.
Example Calculation
Imagine you purchase a property for $100,000. You put 20% down ($20,000) and pay $3,000 in closing costs. Your total cash invested is $23,000.
After paying the mortgage, taxes, insurance, and setting aside money for repairs, the property nets you $200 per month in pure profit.
- Annual Cash Flow = $200 x 12 = $2,400
- Total Investment = $23,000
- Cash on Cash Return = ($2,400 / $23,000) = 10.43%
This means your money is growing at a rate of 10.43% per year, excluding any property appreciation or loan paydown benefits.
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"name": "What is a good Cash on Cash return for rental property?",
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"text": "Most investors target a Cash on Cash return between 8% and 12%. However, in high-appreciation markets, investors may accept lower returns (4-6%), while in high-risk cash flow markets, they may demand 15% or higher."
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"name": "How does Cash on Cash return differ from Cap Rate?",
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"text": "Cap Rate measures the return on the property's full value as if it were bought with all cash. Cash on Cash return measures the return specifically on the actual cash you invested (down payment + closing costs), accounting for mortgage leverage."
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"name": "Should I include appreciation in Cash on Cash return?",
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