Rental Property Calculator

Category: Mortgage and Real Estate

Rental Property Calculator

Evaluate the potential return on investment for rental properties. Calculate cash flow, cap rate, cash-on-cash return, and more to make informed investment decisions.

Property Information

$
%
$50,000
$
$

Financing

$200,000
%
years
$1,264

Income

$
$

Laundry, parking, storage, etc.

%

Expected percentage of time property is vacant

Expenses

$
$
%

Percentage of rental income for repairs/maintenance

%

Percentage of rental income (enter 0 if self-managing)

$

Only include what you pay, not tenant-paid utilities

$
$

Lawn care, snow removal, etc.

Appreciation & Future Value

%
years
%

Percentage of sale price (agent commission, etc.)

%

Your marginal tax rate for rental income

Advanced Options

%

Expected annual increase in rental income

%

Expected annual increase in expenses

Rental Property Calculator Overview

The Rental Property Calculator is a simple tool for estimating the financial performance of a real estate investment. It helps you assess potential cash flow, cap rate, return on investment, and more—all essential for making informed property investment decisions.

Whether you’re comparing properties, exploring rental income potential, or planning your next investment, this calculator acts as your rental income analysis and real estate ROI metric guide.

Monthly Cash Flow:
\( \text{Monthly Income} - \text{Monthly Expenses} \)

Cash-on-Cash Return:
\( \frac{\text{Annual Cash Flow}}{\text{Total Cash Invested}} \times 100 \)

Cap Rate (Capitalization Rate):
\( \frac{\text{Net Operating Income}}{\text{Purchase Price}} \times 100 \)

Total ROI:
\( \frac{\text{Total Profit Over Holding Period}}{\text{Initial Investment}} \times 100 \)

How to Use the Calculator

This tool walks you through several steps. Here's how to use it:

  • Enter the purchase price of the property and your expected down payment percentage.
  • Input closing costs and any initial repair costs needed before renting.
  • Define your loan details: interest rate and term.
  • Fill in your expected income from rent and other sources like laundry or parking.
  • Specify all monthly and yearly expenses: taxes, insurance, maintenance, and more.
  • Adjust advanced settings such as appreciation rate, tax benefits, and expected income/expense growth.
  • Click “Calculate ROI” to view your results, including cash flow, ROI, cap rate, and a 10-year financial projection.

What the Calculator Tells You

Once you've entered your numbers, you'll see a full financial summary:

  • Monthly Cash Flow: Your net profit or loss each month after all expenses.
  • Cash-on-Cash Return: Your annual return on the money you’ve invested upfront.
  • Cap Rate: A useful metric for comparing property performance across markets.
  • Total ROI: The complete return over time, including equity and appreciation.
  • Projection Tables: A 10-year outlook showing income growth, expense increases, property value, and equity buildup.

Why This Calculator Is Useful

Real estate investing involves many moving parts. This rental property ROI calculator brings clarity to your decision-making by giving you a structured look at potential returns.

It helps answer questions like:

  • Is this rental worth the investment?
  • How much can I expect to earn monthly?
  • Will the property generate enough income to cover the mortgage?
  • What’s my projected return after 10 years?

This calculator also complements tools like a mortgage payment tool, cap rate calculator, home loan estimate, and mortgage affordability analysis.

FAQs

What is cash-on-cash return?

Cash-on-cash return measures the annual pre-tax cash flow compared to the total cash you’ve invested. It helps assess how efficiently your cash is working for you.

How is the cap rate calculated?

Cap rate is calculated by dividing net operating income (rental income minus operating expenses) by the purchase price. It ignores financing to give a clearer picture of the property's performance.

What does total ROI include?

Total ROI includes all gains—cash flow, appreciation, loan paydown, and profits from the sale—over the entire holding period, minus your initial investment.

Can I include tax benefits in the analysis?

Yes. The calculator gives you the option to include tax benefits like depreciation and mortgage interest deductions in your return estimates.

How do projections help me?

The 10-year projection outlines how your rental might perform over time, showing changes in income, expenses, property value, and equity. It acts as both a rental cash flow tool and a long-term property investment returns planner.

Related Tools to Explore

Looking at the full picture of your finances? These tools can complement your rental property evaluation:

Using this calculator puts you in control of your investment decisions by helping you assess risk, project returns, and compare properties with ease.