Analyze your real estate investment performance instantly.
Please fill in all fields with valid numbers.
Monthly Mortgage (P&I):$0.00
Net Operating Income (Monthly):$0.00
Net Operating Income (Annual):$0.00
Monthly Cash Flow:$0.00
Cash on Cash Return (CoC):0.00%
Cap Rate:0.00%
function calculateRentalProperty() {
var price = parseFloat(document.getElementById('purchasePrice').value);
var downPercent = parseFloat(document.getElementById('downPayment').value);
var interestRate = parseFloat(document.getElementById('interestRate').value);
var term = parseFloat(document.getElementById('loanTerm').value);
var rent = parseFloat(document.getElementById('monthlyRent').value);
var vacancy = parseFloat(document.getElementById('vacancyRate').value);
var expenses = parseFloat(document.getElementById('monthlyExpenses').value);
var closingCosts = parseFloat(document.getElementById('closingCosts').value);
// Validation
if (isNaN(price) || isNaN(downPercent) || isNaN(interestRate) || isNaN(term) || isNaN(rent) || isNaN(vacancy) || isNaN(expenses) || isNaN(closingCosts)) {
document.getElementById('rp-error-msg').style.display = 'block';
document.getElementById('rp-result-box').style.display = 'none';
return;
}
document.getElementById('rp-error-msg').style.display = 'none';
// 1. Calculate Loan Details
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
var monthlyRate = (interestRate / 100) / 12;
var totalPayments = term * 12;
// Mortgage P&I Formula
var monthlyMortgage = 0;
if (interestRate === 0) {
monthlyMortgage = loanAmount / totalPayments;
} else {
monthlyMortgage = (loanAmount * monthlyRate) / (1 – Math.pow(1 + monthlyRate, -totalPayments));
}
// 2. Calculate Effective Income
var vacancyLoss = rent * (vacancy / 100);
var effectiveGrossIncome = rent – vacancyLoss;
// 3. Calculate NOI
var monthlyNOI = effectiveGrossIncome – expenses;
var annualNOI = monthlyNOI * 12;
// 4. Calculate Cash Flow
var monthlyCashFlow = monthlyNOI – monthlyMortgage;
var annualCashFlow = monthlyCashFlow * 12;
// 5. Calculate Investment Returns
var totalInitialInvestment = downPaymentAmount + closingCosts;
var cocReturn = (annualCashFlow / totalInitialInvestment) * 100;
var capRate = (annualNOI / price) * 100;
// Display Results
document.getElementById('res-mortgage').innerText = '$' + monthlyMortgage.toFixed(2);
document.getElementById('res-noi-monthly').innerText = '$' + monthlyNOI.toFixed(2);
document.getElementById('res-noi-annual').innerText = '$' + annualNOI.toFixed(2);
var cashFlowEl = document.getElementById('res-cashflow');
cashFlowEl.innerText = '$' + monthlyCashFlow.toFixed(2);
cashFlowEl.style.color = monthlyCashFlow >= 0 ? '#27ae60' : '#c0392b';
var cocEl = document.getElementById('res-coc');
cocEl.innerText = cocReturn.toFixed(2) + '%';
cocEl.style.color = cocReturn >= 0 ? '#27ae60' : '#c0392b';
document.getElementById('res-caprate').innerText = capRate.toFixed(2) + '%';
document.getElementById('rp-result-box').style.display = 'block';
}
Understanding Rental Property Cash Flow
Calculating the cash flow of a potential rental property is the single most important step in real estate investing. Positive cash flow ensures that the property pays for itself while you build equity, whereas negative cash flow can quickly drain your reserves.
Our Rental Property Cash Flow Calculator takes into account not just your mortgage and rent, but also the critical factors that novice investors often overlook, such as vacancy rates, maintenance costs, and capital expenditures (CapEx).
Key Metrics Explained
1. Net Operating Income (NOI)
NOI is a calculation used to analyze the profitability of income-generating real estate investments. NOI equals all revenue from the property, minus all reasonably necessary operating expenses. Note that NOI does not include mortgage payments. It is purely a measure of the asset's ability to generate income.
2. Cash Flow
This is the money left over after all expenses, including the mortgage payment (Principal and Interest).
Formula: Effective Gross Income – Operating Expenses – Debt Service = Cash Flow
3. Cash on Cash Return (CoC)
Cash on Cash Return measures the annual return the investor made on the property in relation to the amount of mortgage paid during the same year. It is considered one of the most important ROI metrics because it tells you how hard your actual cash investment is working for you.
How to Interpret the Results
Negative Cash Flow: If the calculator shows a negative number, the rent does not cover the expenses and debt. You will need to contribute monthly from your own pocket to keep the property.
Cap Rate: A higher Cap Rate generally indicates a better return, but often comes with higher risk (e.g., properties in lower-income areas often have higher Cap Rates). A Cap Rate between 4% and 10% is typical depending on the market.
The 1% Rule: A quick rule of thumb used by investors is the 1% rule, which states that the monthly rent should be at least 1% of the purchase price. While this calculator provides a detailed analysis, the 1% rule is a good initial filter.
Tips for Improving Cash Flow
If your calculation isn't showing the numbers you want, consider these adjustments:
Lower the Purchase Price: Negotiate a better deal to reduce your loan amount.
Increase the Down Payment: Putting more money down reduces your monthly mortgage payment, instantly boosting cash flow (though it may lower your Cash on Cash return).
Value-Add Renovations: strategic improvements can allow you to increase the rent significantly.