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Finance Calc Kit
Real estate

Rental Property Calculator

Analyze rental property investments with purchase costs, operating expenses, income projections, and comprehensive ROI metrics including IRR, cap rate, and cash flow analysis.

Purchase details

$
%
%
years
$
$

Annual operating expenses

$/yr
$/yr
$/yr
$/yr
$/yr

Income and fees

$
$
%
%

Sale projections

years
%
%

Monthly cash flow

$68.04

Annual cash flow: $816.44

Cash flow breakdown

Net operating income (NOI)$19,020.00
Effective gross income$28,500.00
Total operating expenses$9,480.00
Annual debt service$18,203.56

Key ratios

Cap rate6.34%
Cash-on-cash return1.26%
Gross rent multiplier (GRM)10.00
Debt coverage ratio (DCR)1.04
Operating expense ratio33.26%

Investment summary

Total cash invested$65,000.00
Down payment$60,000.00
Loan amount$240,000.00
Monthly mortgage$1,516.96

Sale analysis (5 year hold)

Future value$347,782.22
Total cash flow$4,082.20
Total profit$19,041.84
Total ROI29.30%
Annualized ROI5.27%
Report tool

How the rental property calculator works

This calculator models a rental investment from purchase through operating cash flow to an eventual sale. It computes cap rate, cash-on-cash return, gross rent multiplier, debt coverage ratio, and total ROI over your holding period.

Pair results with the capitalization rate calculator, cash-on-cash return calculator, gross rent multiplier calculator, and debt service coverage ratio calculator for deeper ratio analysis on the same deal.

Key formulas

Cap Rate=NOIPurchase Price×100\text{Cap Rate} = \frac{\text{NOI}}{\text{Purchase Price}} \times 100
Cash-on-Cash=Annual Cash FlowTotal Cash Invested×100\text{Cash-on-Cash} = \frac{\text{Annual Cash Flow}}{\text{Total Cash Invested}} \times 100
DCR=NOIAnnual Debt Service\text{DCR} = \frac{\text{NOI}}{\text{Annual Debt Service}}

Worked example: $300,000 rental with $2,500 rent

  1. Purchase: $300,000 price, 20% down, 6.5% rate, 30-year loan, $5,000 closing costs.
  2. Income: $2,500 monthly rent, 5% vacancy, 8% management fee.
  3. Expenses: $3,600 tax, $1,200 insurance, $600 HOA, $1,800 maintenance.
  4. Results: cap rate about 6.34%, GRM of 10.00, DCR about 1.04, and positive monthly cash flow near $68.

Frequently asked questions

What is a good cap rate?
Cap rates vary by market and property type. Higher cap rates often signal higher risk or lower growth markets. Compare against local comps rather than a single national benchmark.
What DCR do lenders require?
Many lenders look for a debt coverage ratio of at least 1.20 to 1.25 on investment properties. A DCR below 1.0 means NOI does not cover debt service.
Does the sale analysis pay off the full loan?
This model subtracts the original loan amount from sale proceeds rather than simulating amortization year by year. Use it for quick screening; refine with a full amortization schedule for precise exit math.
How is total ROI calculated?
Total profit equals sale proceeds after selling costs plus cumulative cash flow minus total cash invested. Total ROI divides that profit by cash invested.

Resources and references

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