function calculateCashFlow() {
// Get Inputs
var price = parseFloat(document.getElementById('purchasePrice').value);
var downPercent = parseFloat(document.getElementById('downPayment').value);
var rate = parseFloat(document.getElementById('interestRate').value);
var years = parseFloat(document.getElementById('loanTerm').value);
var rent = parseFloat(document.getElementById('rentalIncome').value);
var tax = parseFloat(document.getElementById('propertyTax').value);
var insurance = parseFloat(document.getElementById('homeInsurance').value);
var hoa = parseFloat(document.getElementById('hoaFees').value);
var vacancyPercent = parseFloat(document.getElementById('vacancyRate').value);
var repairPercent = parseFloat(document.getElementById('repairCosts').value);
// Validation
if (isNaN(price) || isNaN(downPercent) || isNaN(rate) || isNaN(years) || isNaN(rent) || isNaN(tax) || isNaN(insurance)) {
alert("Please fill in all required fields with valid numbers.");
return;
}
// Calculations
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
// Mortgage Calculation (P&I)
var monthlyRate = (rate / 100) / 12;
var totalPayments = years * 12;
var monthlyMortgage = 0;
if (rate === 0) {
monthlyMortgage = loanAmount / totalPayments;
} else {
monthlyMortgage = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, totalPayments)) / (Math.pow(1 + monthlyRate, totalPayments) – 1);
}
// Monthly Operating Expenses
var monthlyTax = tax / 12;
var monthlyInsurance = insurance / 12;
var monthlyVacancy = rent * (vacancyPercent / 100);
var monthlyRepairs = rent * (repairPercent / 100);
// Total Monthly Expenses (Operating + Mortgage)
var totalMonthlyExpenses = monthlyMortgage + monthlyTax + monthlyInsurance + hoa + monthlyVacancy + monthlyRepairs;
// Cash Flow
var monthlyCashFlow = rent – totalMonthlyExpenses;
var annualCashFlow = monthlyCashFlow * 12;
// Net Operating Income (NOI) = Income – Operating Expenses (No Mortgage)
var annualOperatingExpenses = (monthlyTax + monthlyInsurance + hoa + monthlyVacancy + monthlyRepairs) * 12;
var annualIncome = rent * 12;
var noi = annualIncome – annualOperatingExpenses;
// Returns
var capRate = (noi / price) * 100;
var cocReturn = (annualCashFlow / downPaymentAmount) * 100; // Simplified: assuming Initial Investment = Down Payment
// Display Results
document.getElementById('resMortgage').innerText = '$' + monthlyMortgage.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resExpenses').innerText = '$' + totalMonthlyExpenses.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
var cashFlowEl = document.getElementById('resCashFlow');
cashFlowEl.innerText = '$' + monthlyCashFlow.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
cashFlowEl.style.color = monthlyCashFlow >= 0 ? '#27ae60' : '#c0392b';
var annualFlowEl = document.getElementById('resAnnualCashFlow');
annualFlowEl.innerText = '$' + annualCashFlow.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
annualFlowEl.style.color = annualCashFlow >= 0 ? '#2c3e50' : '#c0392b';
document.getElementById('resCoC').innerText = cocReturn.toFixed(2) + '%';
document.getElementById('resCapRate').innerText = capRate.toFixed(2) + '%';
// Show Results Area
document.getElementById('resultsArea').style.display = 'block';
}
Why Use a Rental Property Cash Flow Calculator?
Investing in real estate is one of the most reliable ways to build wealth, but it relies heavily on the numbers. A Rental Property Cash Flow Calculator is an essential tool for investors to determine the profitability of a potential purchase before signing any papers.
Cash flow represents the net income from a real estate investment after all mortgage payments and operating expenses have been made. Positive cash flow means the property is putting money into your pocket every month, while negative cash flow implies a liability.
How to Calculate Rental Property Cash Flow
Calculating cash flow involves three main steps:
Determine Gross Income: This is primarily your monthly rent, but can also include other income sources like parking fees or laundry.
Deduct Operating Expenses: These are the costs to keep the property running, excluding the mortgage. Common expenses include:
Property Taxes
Insurance
Property Management Fees (if applicable)
Maintenance and Repairs (usually estimated as a percentage of rent)
Vacancy Reserves (money set aside for when the unit is empty)
HOA Fees
Subtract Debt Service: Finally, subtract your monthly mortgage payment (Principal and Interest).
The formula is simple: Cash Flow = Total Income – (Operating Expenses + Mortgage Payment).
Key Investment Metrics Explained
Beyond simple cash flow, this calculator provides two critical metrics for evaluating investment performance:
1. Cash on Cash Return (CoC)
This metric measures the annual return you earn on the cash you actually invested (down payment + closing costs). It is calculated as:
For example, if you invest $50,000 as a down payment and the property generates $5,000 in positive cash flow per year, your Cash on Cash return is 10%. A good CoC return typically ranges from 8% to 12% or higher depending on the market.
2. Capitalization Rate (Cap Rate)
The Cap Rate measures the property's natural rate of return, independent of debt financing. It is calculated by dividing the Net Operating Income (NOI) by the property's purchase price.
Cap Rate = (Net Operating Income / Purchase Price) × 100
Investors use Cap Rate to compare similar properties across different markets. A higher Cap Rate generally indicates a higher potential return but may come with higher risk.
Example Scenario
Imagine you purchase a property for $250,000 with a 20% down payment ($50,000). You secure a loan at 6.5% interest for 30 years.
Rental Income: $2,200/month
Mortgage Payment: ~$1,264/month
Taxes & Insurance: ~$350/month
Reserves (Vacancy/Repairs): ~$220/month
Using the calculator above, you can instantly see if the remaining margin is sufficient to meet your investment goals or if the expenses outweigh the income.