What Is a Rental Property Calculator?
A rental property calculator is a powerful financial tool for real estate investors to analyze the potential profitability of an investment property. By inputting purchase details, income, and a comprehensive list of expenses, it calculates key performance metrics like cash flow, Cash on Cash Return, and Cap Rate, allowing for a clear and data-driven investment decision.
How to Use This Calculator
- Enter the property's purchase price and your loan details.
- Input the gross monthly rent you expect to collect.
- Fill in all monthly operating expenses, including property taxes, insurance, and percentages for vacancy and repairs.
- Click "Analyze Property" to see a full breakdown of the investment's financial performance.
Understanding Your Rental Property Analysis
- Monthly Cash Flow: The money left in your pocket each month after all expenses (including mortgage, taxes, insurance, vacancy, etc.) have been paid. This is your profit.
- Cash on Cash Return (CoC): Arguably the most important metric for a leveraged investor. It shows the annual return on the actual cash you invested (down payment + closing costs).
- Capitalization Rate (Cap Rate): This measures the property's return if you were to buy it with all cash. It's useful for comparing the profitability of different properties in the same market.
- Net Operating Income (NOI): This is the property's annual income after all operating expenses but *before* accounting for mortgage payments.