Analyze cash flow and cash-on-cash return for your real estate investment.
Total Cash Needed (Down Payment):$0.00
Monthly Mortgage Payment (P&I):$0.00
Total Monthly Expenses:$0.00
Monthly Cash Flow:$0.00
Annual Cash Flow:$0.00
Cash on Cash Return (ROI):0.00%
function calculateRentalROI() {
// Retrieve inputs
var price = parseFloat(document.getElementById('rp_price').value);
var downPercent = parseFloat(document.getElementById('rp_down_percent').value);
var interestRate = parseFloat(document.getElementById('rp_interest').value);
var termYears = parseFloat(document.getElementById('rp_term').value);
var monthlyRent = parseFloat(document.getElementById('rp_rent').value);
var monthlyExpenses = parseFloat(document.getElementById('rp_expenses').value);
// Validation
if (isNaN(price) || isNaN(downPercent) || isNaN(interestRate) || isNaN(termYears) || isNaN(monthlyRent) || isNaN(monthlyExpenses)) {
alert("Please fill in all fields with valid numbers.");
return;
}
// Calculations
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
// Mortgage Calculation (Monthly P&I)
var monthlyInterest = (interestRate / 100) / 12;
var numberOfPayments = termYears * 12;
var monthlyMortgage = 0;
if (interestRate === 0) {
monthlyMortgage = loanAmount / numberOfPayments;
} else {
monthlyMortgage = loanAmount * (monthlyInterest * Math.pow(1 + monthlyInterest, numberOfPayments)) / (Math.pow(1 + monthlyInterest, numberOfPayments) – 1);
}
var totalMonthlyExpenses = monthlyMortgage + monthlyExpenses;
var monthlyCashFlow = monthlyRent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
var cocReturn = (annualCashFlow / downPaymentAmount) * 100;
// Display Results
document.getElementById('res_down_amt').innerText = "$" + downPaymentAmount.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res_mortgage').innerText = "$" + monthlyMortgage.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res_total_expenses').innerText = "$" + totalMonthlyExpenses.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
var cfElement = document.getElementById('res_cash_flow');
cfElement.innerText = "$" + monthlyCashFlow.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
if(monthlyCashFlow >= 0) {
cfElement.style.color = "#27ae60";
} else {
cfElement.style.color = "#c0392b";
}
var annualCfElement = document.getElementById('res_annual_cf');
annualCfElement.innerText = "$" + annualCashFlow.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
var cocElement = document.getElementById('res_coc_return');
cocElement.innerText = cocReturn.toFixed(2) + "%";
if(cocReturn >= 0) {
cocElement.style.color = "#27ae60";
} else {
cocElement.style.color = "#c0392b";
}
// Show result box
document.getElementById('rp_results').style.display = 'block';
}
Understanding Your Rental Property Investment
Investing in real estate is one of the most reliable ways to build long-term wealth, but not every property is a good deal. This Rental Property ROI Calculator is designed to help investors analyze the profitability of a potential purchase by looking at the two most critical metrics: Monthly Cash Flow and Cash-on-Cash Return.
What is Cash Flow?
Cash flow is the net amount of cash moving in and out of your investment each month. It is calculated by taking your total income (Monthly Rent) and subtracting all expenses, including your mortgage payment, taxes, insurance, and maintenance costs.
Positive Cash Flow: The property generates more income than it costs to own. This is the goal for passive income investors.
Negative Cash Flow: The property costs you money every month. While some investors accept this banking on future appreciation, it is generally riskier.
Understanding Cash-on-Cash Return
While cash flow tells you how much money you make monthly, Cash-on-Cash (CoC) Return tells you how hard your money is working for you. It measures the annual return relative to the actual cash you invested (your down payment and closing costs).
The formula is: (Annual Cash Flow / Total Cash Invested) × 100.
For example, if you invest $50,000 as a down payment and the property generates $5,000 in clear profit per year, your CoC return is 10%. This metric allows you to compare real estate returns directly against other investment vehicles like stocks or bonds.
Key Expenses to Consider
When using the "Other Monthly Expenses" field in our calculator, ensure you account for all holding costs to get an accurate result:
Property Taxes & Insurance: These are mandatory annual costs usually prorated monthly.
Maintenance & Repairs: A common rule of thumb is to budget 1% of the property value per year, or 10% of the rent.
Property Management: If you hire a professional manager, expect to pay 8-10% of the monthly rent.
Vacancy: Properties are rarely occupied 100% of the time. Budgeting 5-8% for vacancy ensures you aren't caught off guard during turnover periods.
How to Improve Your ROI
If the calculator shows a return lower than your target, consider negotiating a lower purchase price, shopping for a lower interest rate, or looking for ways to increase the rental income (e.g., adding amenities or renovating). A small change in the interest rate or rent can significantly impact your long-term compounding wealth.