🏘️ Investment Tool

Rental Property Calculator

Analyze any rental property deal with cash flow, cap rate, cash-on-cash return, NOI, break-even occupancy, and exit analysis. Built for buy-and-hold investors.

💵

Cash Flow

Monthly surplus

📊

Cap Rate

NOI / Price

💰

CoC Return

Cash-on-cash

📈

IRR

Internal rate

1Purchase & Financing

2Operating Expenses

3Rental Income

4Exit & Returns

Purchase & Financing

Purchase Price

Use Loan / Financing?

Toggle off for all-cash purchase

Down Payment ($)

Interest Rate %

Loan Term (yrs)

Closing Costs ($)

Repair / Rehab Costs ($)

Annual Operating Expenses

Property Tax ($/yr)

Insurance ($/yr)

Maintenance ($/yr)

HOA ($/yr)

Other Costs ($/yr)

Rental Income

Monthly Rent ($)

Other Monthly Income

Vacancy Rate %

Mgmt Fee % of rent

Exit & Hold Analysis

Holding Period (yrs)

Annual Appreciation %

Cost to Sell %

Annual Rent Growth %

Monthly Cash Flow

+$237

After mortgage, expenses, vacancy & management

6.0%

Cap Rate

5.7%

Cash-on-Cash

1.23×

DSCR

10.4×

GRM

📋 Income Statement

📈 Exit Analysis (10-Year Hold)

$335K

Future Value

$168K

Total Profit

12.4%

Est. IRR

📏 Rules of Thumb Check

📊 Monthly Income vs Expenses

How to Analyze a Rental Property Investment

Our rental property calculator gives you the complete financial picture: monthly cash flow, cap rate, cash-on-cash return, DSCR, GRM, and exit IRR. Enter your purchase price, financing, income, and expenses to see whether a deal pencils out — and by how much. For broader real estate analysis including Fix & Flip and Rent vs Buy, see our real estate calculator. For mortgage comparisons, use our mortgage calculator and refinance calculator.

📐 Key Formulas

NOI = EGI − Operating Expenses

Cap Rate = Annual NOI / Purchase Price × 100

Cash-on-Cash = Annual Cash Flow / Total Cash Invested × 100

DSCR = NOI / Annual Debt Service

EGI (Effective Gross Income) = Gross Rent − Vacancy Loss + Other Income

📊 Good Numbers to Target

Cap Rate: 5–10% depending on market risk
Cash-on-Cash: 8–12%+ for good returns
DSCR: 1.25+ preferred by lenders
GRM: 8–12× is typical in most markets
Vacancy: Budget 7–10% conservatively
1% Rule: Monthly rent ≥ 1% of purchase price

💡 50% Rule Explained

A quick rule of thumb: expect 50% of gross rent to be absorbed by operating expenses (excluding mortgage).

$2,000/month rent → ~$1,000 in operating expenses
Remaining $1,000 covers mortgage + cash flow

If your mortgage is $900/month, cash flow = $100/month. Use our calculator for the precise number.

⚠️ Common Mistakes

Skipping vacancy — budget at least 7% even in hot markets
Ignoring management fees — 8–12% even if self-managing
Low maintenance budget — budget 1%+ of property value/year
Assuming appreciation — deals must work on cash flow alone
Forgetting closing costs in total cash invested

Always run a conservative scenario first — 10% vacancy, higher expenses, lower rent.

Frequently Asked Questions

Most buy-and-hold investors target 8–12% cash-on-cash return. Below 5% is generally considered weak unless the market has strong appreciation potential. Above 12% often signals higher risk (high vacancy area, older property, intensive management). Cash-on-cash measures your actual return on the cash invested — down payment plus closing costs plus repairs — making it the most relevant metric for leveraged purchases. Use our rental property calculator to find your exact CoC return.

The 1% rule (monthly rent ≥ 1% of purchase price) is increasingly hard to meet in high-cost markets. In major cities, 0.5–0.7% is more typical. The rule remains a quick screening filter — if a property doesn't meet it, investigate carefully. In secondary and tertiary markets, 1%+ deals still exist. More importantly, run the full analysis with our calculator regardless of the 1% rule: actual expenses, financing costs, and vacancy determine real profitability.

NOI (Net Operating Income) = Effective Gross Income − Total Operating Expenses. EGI = Annual Gross Rent − Vacancy Loss + Other Income. Operating expenses include property tax, insurance, maintenance, management fees, HOA — but NOT mortgage payments. NOI is a pre-financing metric that shows property performance regardless of how it's financed. Our calculator computes this automatically from your inputs.

Property management typically costs 8–12% of monthly rent plus leasing fees. Self-managing saves money but requires your time and local presence. In our calculator, even if you self-manage, budget 8% as an implied management cost — this keeps projections realistic if you ever hire out, and accounts for your time's value. If the deal doesn't work with a management fee included, it's a thinner deal than it appears.

Use 7–10% as a conservative estimate. Even in tight rental markets, tenant turnover creates vacancy — preparing, cleaning, showing, and re-leasing a unit typically takes 2–4 weeks. Using 5% vacancy for a first analysis, then testing 10% as a stress test, reveals how sensitive the deal is. Deals that only work at very low vacancy assumptions carry more risk than those that remain positive at 10% vacancy.