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Key Features
Instant Calculation
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Whether a rental property is actually a good investment comes down to a few key numbers — cap rate, cash-on-cash return, and monthly cash flow — that are easy to eyeball wrong without doing the full calculation. This calculator finds all three from a property's purchase price, financing terms, rent, and expenses, with a full step-by-step solution.
How it works
Enter the purchase price, down payment percentage, loan terms, monthly rent, and monthly operating expenses. The calculator finds the mortgage payment on the financed amount, then the resulting monthly cash flow, cap rate, and cash-on-cash return.
- Enter purchase price ($).
- Enter down payment (%).
- Enter interest rate (%).
- Enter loan term (years).
- Enter monthly rent ($).
- Enter monthly expenses ($) — taxes, insurance, maintenance, etc.
- Click Calculate to see your results.
Examples
A $250,000 property with 20% down
With $2,200 monthly rent and $400 in monthly expenses, the property cash-flows $535.86/month, with an 8.64% cap rate and a 12.86% cash-on-cash return.
Who should use it
- Evaluating whether a potential rental property investment meets a target cash-on-cash return.
- Comparing cap rates across multiple prospective rental properties.
Industry applications
- Real estate investment analysis
- Property management and landlording
Advantages
- Calculates cap rate, cash-on-cash return, and monthly cash flow together from one set of inputs.
- Separately reports the mortgage payment for transparency.
Limitations
- Does not account for property appreciation, tax benefits, or vacancy rates — it models a fully-occupied property at the given rent.
Common mistakes to avoid
- Forgetting to include realistic maintenance and vacancy reserves in monthly expenses, which overstates cash flow.
- Confusing cap rate (financing-independent) with cash-on-cash return (which depends heavily on financing terms).
Best practices
- Compare cap rate across properties to judge the underlying investment quality independent of financing, and use cash-on-cash return to judge the return on your specific down payment.
Tips
- A common rule of thumb targets an 8%+ cap rate and a positive cash-on-cash return, but acceptable thresholds vary a lot by local market — use this as a starting comparison point, not an absolute rule.