function calculateRentalROI() {
// Inputs
var price = parseFloat(document.getElementById('rp_price').value) || 0;
var closingCosts = parseFloat(document.getElementById('rp_closing_costs').value) || 0;
var downPercent = parseFloat(document.getElementById('rp_down_payment').value) || 0;
var interestRate = parseFloat(document.getElementById('rp_interest_rate').value) || 0;
var years = parseFloat(document.getElementById('rp_loan_term').value) || 0;
var rent = parseFloat(document.getElementById('rp_rent').value) || 0;
var taxYear = parseFloat(document.getElementById('rp_tax').value) || 0;
var insYear = parseFloat(document.getElementById('rp_insurance').value) || 0;
var hoaMonth = parseFloat(document.getElementById('rp_hoa').value) || 0;
var vacancyRate = parseFloat(document.getElementById('rp_vacancy').value) || 0;
var repairsRate = parseFloat(document.getElementById('rp_repairs').value) || 0;
var capexRate = parseFloat(document.getElementById('rp_capex').value) || 0;
var mgmtRate = parseFloat(document.getElementById('rp_management').value) || 0;
// Loan Calculations
var downAmount = price * (downPercent / 100);
var loanAmount = price – downAmount;
var monthlyRate = (interestRate / 100) / 12;
var totalPayments = years * 12;
var monthlyMortgage = 0;
if (loanAmount > 0 && interestRate > 0) {
monthlyMortgage = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, totalPayments)) / (Math.pow(1 + monthlyRate, totalPayments) – 1);
} else if (loanAmount > 0 && interestRate === 0) {
monthlyMortgage = loanAmount / totalPayments;
}
// Expense Calculations
var vacancyCost = rent * (vacancyRate / 100);
var repairsCost = rent * (repairsRate / 100);
var capexCost = rent * (capexRate / 100);
var mgmtCost = rent * (mgmtRate / 100);
var taxMonth = taxYear / 12;
var insMonth = insYear / 12;
var totalOperatingExpenses = taxMonth + insMonth + hoaMonth + vacancyCost + repairsCost + capexCost + mgmtCost;
var totalExpenses = totalOperatingExpenses + monthlyMortgage;
// Income Metrics
var cashFlow = rent – totalExpenses;
var annualCashFlow = cashFlow * 12;
var noiMonth = rent – totalOperatingExpenses;
var annualNOI = noiMonth * 12;
var totalInvested = downAmount + closingCosts;
// ROI Metrics
var capRate = (price > 0) ? (annualNOI / price) * 100 : 0;
var cocReturn = (totalInvested > 0) ? (annualCashFlow / totalInvested) * 100 : 0;
// Display Formatting
function formatCurrency(num) {
return '$' + num.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
}
function formatPercent(num) {
return num.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2}) + '%';
}
document.getElementById('res_mortgage').innerText = formatCurrency(monthlyMortgage);
document.getElementById('res_expenses').innerText = formatCurrency(totalExpenses);
document.getElementById('res_noi').innerText = formatCurrency(noiMonth);
var cfElem = document.getElementById('res_cashflow');
cfElem.innerText = formatCurrency(cashFlow);
if (cashFlow >= 0) {
cfElem.className = "rp-result-value rp-highlight";
} else {
cfElem.className = "rp-result-value rp-highlight-bad";
}
document.getElementById('res_invested').innerText = formatCurrency(totalInvested);
document.getElementById('res_caprate').innerText = formatPercent(capRate);
var cocElem = document.getElementById('res_coc');
cocElem.innerText = formatPercent(cocReturn);
if (cocReturn >= 0) {
cocElem.className = "rp-result-value rp-highlight";
} else {
cocElem.className = "rp-result-value rp-highlight-bad";
}
// Show Results
document.getElementById('rp_results_area').className = "rp-results visible";
}
Mastering Rental Property Analysis with the Cash Flow Calculator
Successful real estate investing isn't about intuition; it's about the numbers. Whether you are a seasoned investor or looking to buy your first duplex, understanding the financial health of a potential deal is critical. This Rental Property Cash Flow Calculator helps you accurately predict profit, assess risk, and compare different investment opportunities.
What is Rental Property Cash Flow?
Cash flow is the net amount of cash moving into and out of a business—in this case, your rental property. It is arguably the most important metric for buy-and-hold investors. Positive cash flow means the property generates more income than it costs to operate, putting money in your pocket every month.
The formula is simple: Gross Rent – Total Expenses (Mortgage + Operating Costs) = Cash Flow
Understanding the Key Metrics
This calculator provides several critical outputs to evaluate a deal:
NOI (Net Operating Income): This is your annual income minus operating expenses, excluding mortgage payments. NOI is essential for calculating Cap Rate and is often used by lenders to value commercial properties.
Cap Rate (Capitalization Rate): Calculated as NOI / Purchase Price. This metric helps you compare the raw return of a property without factoring in financing. It measures the property's natural yield.
Cash on Cash Return (CoC ROI): This is the most practical metric for most investors. It measures the annual cash flow relative to the actual cash you invested (Down Payment + Closing Costs). It answers the question: "What percentage return am I getting on the dollars I put into this deal?"
Why You Must Estimate Expenses Accurately
New investors often make the mistake of only subtracting the mortgage from the rent to determine profit. This is a recipe for disaster. Real estate involves real costs:
Vacancy: Properties don't stay rented 365 days a year forever. Allocating 5-8% for vacancy accounts for turnover time.
Repairs & Maintenance: To fix leaky faucets, broken locks, or painting between tenants.
CapEx (Capital Expenditures): This is a savings fund for big-ticket items like a new roof, HVAC system, or water heater that will eventually fail.
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).
How to Use This Calculator
Enter Purchase Details: Input the asking price and your estimated closing costs (usually 2-5% of price).
Configure Financing: Adjust the down payment percentage and interest rate. High interest rates significantly impact cash flow.
Input Expenses: Be honest with these numbers. If you don't know the exact property tax, look up similar listings in the county assessor's database.
Analyze the Result: Look for a positive Cash on Cash return. Many investors target 8-12% or higher, depending on the market and appreciation potential.
Use this tool to run scenarios on multiple properties. A small change in the offer price or interest rate can turn a negative cash flow deal into a profitable investment.