Rental Property CalculatorFree online financial calculator — instant results, no sign-up
Cash flow, cap rate and cash-on-cash return of a rental.
Estimates only, based on the inputs and assumptions shown. This is not financial, investment, tax, or legal advice. Prices, rates and local rules may change; crypto scenarios do not predict returns. Confirm important decisions with a qualified professional.
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About the Rental Property Calculator
This calculator estimates the ongoing profitability of a residential rental property for real estate investors. It calculates the monthly mortgage payment, net monthly cash flow, capitalization rate (cap rate), and annual cash-on-cash return based on property acquisition cost, financing terms, operating expenses, and expected vacancy.
- Purchase price
- Total agreed purchase cost of the real estate property in dollars (sensible range: $50,000 to $5,000,000).
- Down payment
- The upfront equity paid toward the purchase, entered as a percentage of the purchase price (sensible range: 0% to 100%).
- Interest rate
- Annual mortgage interest rate for a standard 30-year (360-month) fixed loan (sensible range: 2% to 15%).
- Monthly rent
- Gross monthly rental income expected from the property before vacancy deductions (sensible range: $500 to $25,000).
- Monthly expenses (tax, ins, upkeep)
- Total monthly operating expenses excluding debt service, such as property taxes, insurance, maintenance, and HOA fees (sensible range: $100 to $10,000).
- Vacancy
- Percentage of gross rental income set aside for unoccupied months or uncollected rent (sensible range: 0% to 25%).
Formula and method
Loan = Purchase Price × (1 − Down% / 100) Mortgage = Loan × [r(1 + r)^360] / [(1 + r)^360 − 1], where r = Rate / 1200 Effective Rent = Monthly Rent × (1 − Vacancy% / 100) Monthly Cash Flow = Effective Rent − Monthly Expenses − Mortgage NOI = (Effective Rent − Monthly Expenses) × 12 Cap Rate = (NOI / Purchase Price) × 100 Cash-on-Cash Return = ((Monthly Cash Flow × 12) / Cash Invested) × 100
- LoanPrincipal loan balance financed after subtracting the down payment
- rMonthly interest rate (annual interest rate divided by 12 and converted from a percentage)
- Effective RentGross monthly rent adjusted downward by the vacancy rate
- NOINet Operating Income on an annualized basis, excluding mortgage financing
- Cash InvestedTotal initial capital invested, defined in this tool strictly as the down payment amount
The tool computes the monthly mortgage payment assuming a 30-year fixed loan term (360 months) on the balance remaining after the down payment. It then deducts the vacancy allowance from the gross monthly rent to find effective income, subtracts operating expenses and debt service to yield monthly cash flow, and computes cap rate and cash-on-cash return as annualized percentages.
Worked example
These are the calculator's starting values and the results it actually produces for them.
Inputs
- Purchase price250000 $
- Down payment25 %
- Interest rate7 %
- Monthly rent2200 $
- Monthly expenses (tax, ins, upkeep)600 $
- Vacancy5 %
Results
- Mortgage payment$1,247.44
- Monthly cash flow$242.56
- Cap rate7.15%
- Cash-on-cash return4.66%
How to use the Rental Property Calculator
- 1Calculate the initial cash invested (Purchase Price × Down Payment %) and remaining loan balance.
- 2Determine the monthly mortgage payment using the standard 360-month amortization formula with the provided annual interest rate.
- 3Calculate effective monthly rent by reducing gross rent by the vacancy percentage, then subtract monthly operating expenses to find the monthly net operating income.
- 4Subtract the monthly mortgage payment to determine monthly cash flow, then annualize figures to calculate Cap Rate (annual NOI / Purchase Price) and Cash-on-Cash Return (annual cash flow / Cash Invested).
Reading your result
A positive monthly cash flow indicates the property generates surplus income each month after servicing debt and paying operating expenses. The cap rate evaluates property performance independent of financing leverage, while cash-on-cash return measures the actual cash yield produced relative to the down payment capital committed.
Limitations
The model assumes a fixed 30-year loan term and does not allow alternate amortization durations. It also excludes loan closing costs, upfront renovation expenses, loan points, property value appreciation, and income tax impacts like depreciation from the initial cash investment and returns.
Common questions
What is the difference between Cap Rate and Cash-on-Cash Return?+
Cap Rate measures the unleveraged rate of return of the property asset itself (Net Operating Income divided by total Purchase Price), ignoring any loans. Cash-on-Cash Return measures the cash yield on the actual cash invested (net annual cash flow after mortgage divided by down payment).
Why does this calculator assume a 30-year mortgage?+
The underlying formula is hardcoded to 360 monthly payments, which is the industry standard term for US residential mortgages. If you use a 15-year loan, your required principal-and-interest payment will be higher than the result shown.
Does the initial cash investment include closing costs or repair reserves?+
No, the cash invested is calculated strictly as the down payment percentage of the purchase price. Closing fees, inspection costs, and initial repair reserves must be factored in separately if you want an all-in cash-on-cash metric.
Does the calculator save my information?+
Calculations run in your browser. While signed in, inputs and results are automatically recorded in account history; saving a result creates a separate saved record.
Further reading
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Results are estimates for informational purposes and are not financial, medical or legal advice.