Rental Property Cash Flow Calculator
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Analysis Results
Cash on Cash Return (CoC)
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Net Operating Income (NOI) / Mo
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Rental Property Cash Flow Analysis Guide
Investing in real estate is one of the most reliable ways to build wealth, but the difference between a successful investment and a money pit often comes down to one thing: Positive Cash Flow. This calculator is designed to help real estate investors analyze the profitability of a potential rental property by breaking down income, expenses, and financing costs.
Why Cash Flow is King
Cash flow represents the net amount of cash moving into and out of a business. In rental property terms, it is the money left over after all bills are paid. While appreciation (the property increasing in value) is a nice bonus, positive cash flow ensures that the property pays for itself today.
A property with negative cash flow requires you to contribute money from your own pocket every month to keep it afloat—a risky strategy for most investors.
Key Metrics Explained
1. Net Operating Income (NOI)
NOI is a calculation used to analyze the profitability of income-generating real estate investments. It equals all revenue from the property, minus all reasonably necessary operating expenses. Note that NOI does not include mortgage payments (debt service).
Formula: Gross Operating Income – Operating Expenses = NOI
2. Cap Rate (Capitalization Rate)
The Cap Rate helps you compare the return on investment of different properties regardless of how they are financed. It assumes you paid cash for the property. A higher Cap Rate generally implies a better return (but often higher risk).
Formula: (Annual NOI / Current Market Value) x 100
3. Cash on Cash Return (CoC)
This is arguably the most important metric for investors using financing. It measures the annual return on the actual cash you invested (Down Payment + Closing Costs + Rehab Costs).
Formula: (Annual Cash Flow / Total Cash Invested) x 100
Understanding Operating Expenses
New investors often underestimate expenses. This calculator includes the most common pitfalls:
- Vacancy Rate: You won't have a tenant 100% of the time. Budgeting 5% to 8% (roughly 2-3 weeks a year) is standard.
- Maintenance & Repairs: Things break. Setting aside 5% to 10% of the rent prevents panic when a water heater fails.
- Property Management: Even if you self-manage, you should account for your time or the future cost of a manager (typically 8% – 10% of rent).
- CapEx (Capital Expenditures): These are big-ticket items like a new roof or HVAC system. While not monthly, they should be saved for monthly.
How to Interpret the Results
Positive Cash Flow: If the "Est. Monthly Cash Flow" is green and positive, the property generates income. Most investors aim for at least $100-$200 per door in pure profit.
CoC Return: The stock market historically returns about 7-10% (adjusted for inflation). If your CoC return is lower than this, you might be better off investing passively elsewhere, unless the property has significant appreciation potential.
function calculateRentalCashFlow() {
// 1. Get Inputs
var price = parseFloat(document.getElementById('purchasePrice').value);
var downPaymentPercent = parseFloat(document.getElementById('downPayment').value);
var interestRate = parseFloat(document.getElementById('interestRate').value);
var loanTermYears = parseFloat(document.getElementById('loanTerm').value);
var closingCosts = parseFloat(document.getElementById('closingCosts').value);
var monthlyRent = parseFloat(document.getElementById('monthlyRent').value);
var propertyTax = parseFloat(document.getElementById('propertyTax').value);
var insurance = parseFloat(document.getElementById('insurance').value);
var hoa = parseFloat(document.getElementById('hoa').value);
var maintenancePercent = parseFloat(document.getElementById('maintenance').value);
var vacancyPercent = parseFloat(document.getElementById('vacancy').value);
var managementPercent = parseFloat(document.getElementById('management').value);
// 2. Validate Inputs
if (isNaN(price) || isNaN(monthlyRent) || isNaN(interestRate) || price 0) {
mortgagePayment = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
mortgagePayment = loanAmount / numberOfPayments;
}
// 4. Calculate Variable Expenses based on Rent
var maintenanceCost = monthlyRent * (maintenancePercent / 100);
var vacancyCost = monthlyRent * (vacancyPercent / 100);
var managementCost = monthlyRent * (managementPercent / 100);
// 5. Total Operating Expenses (Excluding Mortgage)
var totalOperatingExpenses = propertyTax + insurance + hoa + maintenanceCost + vacancyCost + managementCost;
// 6. Net Operating Income (NOI)
var monthlyNOI = monthlyRent – totalOperatingExpenses;
var annualNOI = monthlyNOI * 12;
// 7. Cash Flow
var monthlyCashFlow = monthlyNOI – mortgagePayment;
var annualCashFlow = monthlyCashFlow * 12;
// 8. Returns
var totalCashInvested = downPaymentAmount + closingCosts;
var cashOnCashReturn = (annualCashFlow / totalCashInvested) * 100;
var capRate = (annualNOI / price) * 100;
// 9. Display Results
var currencyFormatter = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' });
var percentFormatter = new Intl.NumberFormat('en-US', { minimumFractionDigits: 2, maximumFractionDigits: 2 });
document.getElementById('monthlyCashFlow').innerText = currencyFormatter.format(monthlyCashFlow);
document.getElementById('monthlyCashFlow').style.color = monthlyCashFlow >= 0 ? '#27ae60' : '#c0392b';
document.getElementById('cocReturn').innerText = percentFormatter.format(cashOnCashReturn) + '%';
document.getElementById('cocReturn').style.color = cashOnCashReturn >= 0 ? '#333' : '#c0392b';
document.getElementById('capRate').innerText = percentFormatter.format(capRate) + '%';
document.getElementById('monthlyNOI').innerText = currencyFormatter.format(monthlyNOI);
// Total monthly outflow (Operating Expenses + Mortgage)
var totalMonthlyOutflow = totalOperatingExpenses + mortgagePayment;
document.getElementById('totalExpenses').innerText = currencyFormatter.format(totalMonthlyOutflow);
document.getElementById('mortgagePayment').innerText = currencyFormatter.format(mortgagePayment);
}