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Finance Calc Kit
Real estate

Real Estate Calculator

Calculate capitalization rate (Cap Rate), Net Operating Income (NOI), cash flow, and Cash-on-Cash Return for real estate properties.

Property and loan

$
%
%
years

Monthly income

$
$

Monthly operating expenses

$
$
$
$
$

Cap rate

5.68%

Cash-on-cash return

-1.69%

Monthly cash flow

-$96.96

Annual NOI

$17,040.00

Monthly income vs expenses

  • Monthly income$2,200.0048.9%
  • Operating expenses$780.0017.3%
  • Mortgage payment$1,516.9633.7%

Financial breakdown

Total cash invested (incl. 3% closing costs)$69,000.00
Down payment$60,000.00
Estimated closing costs (3%)$9,000.00
Loan amount$240,000.00
Monthly mortgage payment$1,516.96
Total monthly income$2,200.00
Total operating expenses$780.00
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How the real estate investment calculator works

This tool analyzes rental property investments using standard real estate metrics: capitalization rate (cap rate), net operating income (NOI), monthly cash flow, and cash-on-cash return. Enter purchase price, financing terms, rental income, and operating expenses. All math runs in your browser.

Cap rate measures property yield before financing. Cash-on-cash return measures your actual return on cash invested, including the down payment and estimated closing costs. For a dedicated cash-on-cash analysis, try the cash-on-cash return calculator. To estimate your monthly mortgage payment separately, use the mortgage calculator. For property tax estimates, open the property tax calculator. NOI concepts also relate to the net operating assets calculator.

Real estate investment formulas

Net operating income is annual rental income minus operating expenses, excluding mortgage payments:

NOI=(Monthly Income−Operating Expenses)×12\text{NOI} = (\text{Monthly Income} - \text{Operating Expenses}) \times 12

Cap rate divides NOI by purchase price:

Cap Rate=NOIPurchase Price×100\text{Cap Rate} = \frac{\text{NOI}}{\text{Purchase Price}} \times 100

Monthly cash flow subtracts the mortgage payment from net rental income:

Cash Flow=Income−Operating Expenses−Mortgage\text{Cash Flow} = \text{Income} - \text{Operating Expenses} - \text{Mortgage}

Cash-on-cash return compares annual cash flow to total cash invested (down payment plus 3% estimated closing costs):

Cash-on-Cash=Annual Cash FlowCash Invested×100\text{Cash-on-Cash} = \frac{\text{Annual Cash Flow}}{\text{Cash Invested}} \times 100

Worked example: $300,000 rental property

Consider a $300,000 property with 20% down, a 6.5% rate over 30 years, $2,200 monthly rent, and $780 in monthly operating expenses (tax, insurance, maintenance, management, and other):

  1. Annual NOI: ($2,200 - $780) x 12 = $17,040
  2. Cap rate: $17,040 / $300,000 x 100 = 5.68%
  3. Monthly mortgage: $240,000 loan at 6.5% over 30 years = $1,516.96
  4. Monthly cash flow: $2,200 - $780 - $1,516.96 = -$96.96
  5. Cash invested: $60,000 down + $9,000 closing (3%) = $69,000
  6. Cash-on-cash return: (-$96.96 x 12) / $69,000 x 100 = -1.69%

A negative cash flow does not always mean a bad investment. Appreciation, tax benefits, and principal paydown can offset monthly losses. Use the cash-on-cash return calculator to model different down payment scenarios.

Frequently asked questions

What is a good cap rate for rental property?
Cap rates vary by market and property type. Many investors target 5% to 10% for residential rentals. Higher cap rates often signal higher risk or lower-growth markets. Compare similar properties in the same area.
Does NOI include mortgage payments?
No. NOI includes rental income minus operating expenses like taxes, insurance, maintenance, and management. Mortgage principal and interest are financing costs, not operating expenses.
What closing costs are included in cash invested?
This calculator estimates closing costs at 3% of the purchase price, added to your down payment. Actual closing costs vary by lender, location, and loan type.
How is the mortgage payment calculated?
The tool uses the standard amortizing loan EMI formula with your loan amount (purchase price minus down payment), annual interest rate, and loan term in years.
Are the results stored?
No. Changing the fields only updates the page URL so you can copy and share your inputs.

Resources and references

The formulas and methods in this calculator were checked against these independent sources.