function calculateCashFlow() {
// 1. Get Input Values
var price = parseFloat(document.getElementById('purchasePrice').value) || 0;
var downPercent = parseFloat(document.getElementById('downPayment').value) || 0;
var interestRate = parseFloat(document.getElementById('interestRate').value) || 0;
var termYears = parseFloat(document.getElementById('loanTerm').value) || 0;
var rent = parseFloat(document.getElementById('monthlyRent').value) || 0;
var taxesYearly = parseFloat(document.getElementById('propertyTax').value) || 0;
var insuranceYearly = parseFloat(document.getElementById('insurance').value) || 0;
var hoaMonthly = parseFloat(document.getElementById('hoa').value) || 0;
var vacancyPercent = parseFloat(document.getElementById('vacancy').value) || 0;
var maintPercent = parseFloat(document.getElementById('maintenance').value) || 0;
// 2. Calculate Mortgage (Principal & Interest)
var downPaymentAmount = price * (downPercent / 100);
var loanAmount = price – downPaymentAmount;
var monthlyRate = (interestRate / 100) / 12;
var numPayments = termYears * 12;
var mortgagePayment = 0;
if (interestRate === 0) {
mortgagePayment = loanAmount / numPayments;
} else {
mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numPayments)) / (Math.pow(1 + monthlyRate, numPayments) – 1);
}
if (isNaN(mortgagePayment) || !isFinite(mortgagePayment)) {
mortgagePayment = 0;
}
// 3. Calculate Monthly Expenses
var vacancyCost = rent * (vacancyPercent / 100);
var maintenanceCost = rent * (maintPercent / 100);
var taxMonthly = taxesYearly / 12;
var insuranceMonthly = insuranceYearly / 12;
var operatingExpenses = taxMonthly + insuranceMonthly + hoaMonthly + vacancyCost + maintenanceCost;
var totalExpenses = operatingExpenses + mortgagePayment;
// 4. Calculate Returns
var netOperatingIncome = rent – operatingExpenses;
var monthlyCashFlow = netOperatingIncome – mortgagePayment;
var yearlyCashFlow = monthlyCashFlow * 12;
// Estimate closing costs at 3% of purchase price for CoC calculation
var closingCosts = price * 0.03;
var totalCashInvested = downPaymentAmount + closingCosts;
var cashOnCashReturn = 0;
if (totalCashInvested > 0) {
cashOnCashReturn = (yearlyCashFlow / totalCashInvested) * 100;
}
// 5. Update DOM
document.getElementById('totalExpensesResult').innerText = '$' + totalExpenses.toFixed(2);
document.getElementById('noiResult').innerText = '$' + netOperatingIncome.toFixed(2);
document.getElementById('mortgageResult').innerText = '$' + mortgagePayment.toFixed(2);
var cfElement = document.getElementById('cashFlowResult');
var cfRow = document.getElementById('cashFlowRow');
cfElement.innerText = '$' + monthlyCashFlow.toFixed(2);
if (monthlyCashFlow >= 0) {
cfElement.style.color = '#27ae60';
cfRow.classList.remove('negative');
} else {
cfElement.style.color = '#c0392b';
cfRow.classList.add('negative');
}
document.getElementById('cocResult').innerText = cashOnCashReturn.toFixed(2) + '%';
// Show results
document.getElementById('resultsBox').style.display = 'block';
}
Understanding Rental Property Cash Flow
Calculating cash flow is the single most important step in analyzing a potential real estate investment. Positive cash flow means your property generates more income than it costs to own and operate, providing you with passive income and financial stability.
How This Calculator Works
Our Rental Property Cash Flow Calculator takes into account not just your mortgage, but the hidden costs that often catch new investors off guard. Here is a breakdown of the key metrics:
Net Operating Income (NOI): This is your total rental income minus all operating expenses (taxes, insurance, HOA, maintenance, vacancy) before paying the mortgage. It measures the profitability of the property itself.
Cash Flow: This is what ends up in your pocket every month. Calculated as NOI minus your mortgage debt service. Ideally, you want this number to be positive.
Cash on Cash Return (CoC): This percentage shows the efficiency of your invested capital. It compares your annual pre-tax cash flow to the total cash invested (Down Payment + estimated Closing Costs).
Key Expenses to Consider
When using this calculator, ensure you are realistic about your expenses:
Vacancy Rate: No property is occupied 100% of the time. A standard conservative estimate is 5-8% (about 2-3 weeks per year).
Maintenance & Repairs: Even new homes need work. Setting aside 5-10% of monthly rent ensures you have funds for leaky faucets or roof repairs.
Capital Expenditures (CapEx): While not explicitly a monthly line item, smart investors group this with maintenance. These are large, infrequent costs like replacing a HVAC unit or water heater.
What is a Good Cash on Cash Return?
While "good" is subjective, many real estate investors aim for a Cash on Cash return of 8% to 12%. However, in high-appreciation markets, investors might accept a lower cash flow return (e.g., 4-6%) banking on the property value increasing over time. Conversely, in stable, low-appreciation markets, investors typically demand higher cash flow yields of 10% or more.
Frequently Asked Questions
Should I include the principal paydown in my return?
While principal paydown increases your net worth, it is not "cash in hand." This calculator focuses on Cash Flow and Cash on Cash Return to determine liquidity. Total ROI (Return on Investment) would include principal paydown, appreciation, and tax benefits.
How do I estimate property taxes?
Property taxes vary significantly by county. Check the local county assessor's website for the specific property address or use an average rate (typically 1% to 2.5% of the property value) for your target area.