Rental Property Calculator — Cash Flow, Cap Rate & Returns
Evaluate a rental property investment in seconds. Enter the purchase price, mortgage details, monthly rent, vacancy and operating-expense rate, and instantly see monthly cash flow, NOI, cap rate and cash-on-cash return.
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%
years
%
% of gross income
Net income after mortgage, operating expenses and vacancy
- 1
Effective gross monthly income
2,000 × (1 − 5% ÷ 100) = 1,900Rent scaled down by the vacancy rate — time the property earns no income. - 2
Monthly operating expenses
22,800 × 35% ÷ 100 ÷ 12 = 665 - 3
Monthly mortgage payment (P&I)
1,516.96 - 4
Monthly cash flow
1,900 − 665 − 1,516.96 = -281.96
How does this calculator work?
Monthly cash flow = effective gross income − operating expenses − mortgage payment. Cap rate = annual NOI ÷ property value. Cash-on-cash return = annual cash flow ÷ down payment. Enter purchase price, mortgage details, rent, vacancy and expense rate to see whether the property pencils out.
Formula
How this is calculated
This calculator follows standard real estate investment analysis. The gross annual income is the monthly rent multiplied by 12, reduced by the vacancy rate (the percentage of time the property is expected to be empty). Operating expenses cover all non-financing costs — property tax, insurance, maintenance, property management fees, and reserves. A range of 30–50% of gross income is a common rule of thumb, though the exact figure depends on your market and management approach; adjust the slider to match your situation.
Net Operating Income (NOI) is gross income minus operating expenses and represents the property's pre-financing profitability. The cap rate divides NOI by the property value and expresses what an all-cash buyer would earn — a common benchmark for comparing investment properties regardless of financing. A higher cap rate implies either better income, lower price, or both; typical residential cap rates range from roughly 4–10% depending on market.
Cash-on-cash return compares the annual cash flow after debt service to the equity you actually invested (the down payment). It tells you what return you are earning on your out-of-pocket dollars. The Gross Rent Multiplier (GRM) divides the property price by the gross annual rent and is a quick screening ratio — lower is generally better. This model uses fixed-rate mortgage assumptions; it does not model appreciation, depreciation tax benefits, or variable expenses.
Frequently asked questions
Cap rates vary enormously by location and property type. As a rough guide, 4–5% is typical in premium urban markets (high prices, stable demand); 6–8% is common in secondary markets; 8%+ signals higher risk or a less competitive market. Always compare cap rates within your target area rather than against national averages.
Operating expenses include property tax, homeowners insurance, property management fees (typically 8–12% of rent), routine maintenance, repairs, HOA fees if applicable, and vacancy reserves. They do NOT include mortgage payments — these are debt service, not operating costs. A common shorthand is the 50% rule: assume operating expenses equal roughly half of gross rent.
Cap rate ignores financing — it tells you the unlevered yield on the asset value. Cash-on-cash return accounts for the mortgage and measures the actual return on your invested equity (down payment). If cap rate > mortgage interest rate, leverage amplifies your cash-on-cash return; if cap rate < mortgage rate, leverage hurts it.
Also known as
TG we-Calculate Editorial Team. (2026). Rental Property Calculator — Cash Flow, Cap Rate & Returns [Online calculator]. TG we-Calculate. https://we-calculate.com/calculator/rental-property-calculator
TG we-Calculate Editorial Team. "Rental Property Calculator — Cash Flow, Cap Rate & Returns." TG we-Calculate. 2026. https://we-calculate.com/calculator/rental-property-calculator.
TG we-Calculate Editorial Team, "Rental Property Calculator — Cash Flow, Cap Rate & Returns," TG we-Calculate, 2026. [Online]. Available: https://we-calculate.com/calculator/rental-property-calculator
@misc{wecalculate_rental_property_calculator, title = {Rental Property Calculator — Cash Flow, Cap Rate & Returns}, author = {{TG we-Calculate Editorial Team}}, howpublished = {\url{https://we-calculate.com/calculator/rental-property-calculator}}, year = {2026}, note = {TG we-Calculate} }
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