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Rental Property ROI Calculator

Calculate cash flow, cash-on-cash ROI, and cap rate for any rental property investment.

Last Updated: May 5, 2026
2 min read

Property Details

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Monthly Expenses

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Monthly Cash Flow

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Annual Cash Flow

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Cash-on-Cash ROI

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A rental property ROI calculator helps real estate investors evaluate whether a property will generate meaningful returns. By analyzing purchase price, rental income, expenses, and financing, you can compare properties and make data-driven investment decisions.

How to Use This Calculator

  1. Enter the purchase price and your down payment amount.
  2. Enter the expected monthly rent and all monthly expenses (mortgage, taxes, insurance, maintenance, vacancy).
  3. Enter the loan interest rate and term if financing.
  4. Click Calculate to see cash flow, cap rate, and cash-on-cash return.

What This Calculator Measures

  • Monthly cash flow — Rent income minus all monthly expenses including the mortgage payment.
  • Cash-on-cash ROI — Annual cash flow divided by total cash invested (down payment + closing costs).
  • Cap rate — Net Operating Income (NOI) divided by purchase price, expressed as a percentage.
  • NOI — Gross rent minus operating expenses (excluding mortgage payments).

Formula or Logic

NOI = Annual Gross Rent − Annual Operating Expenses (excluding debt service)

Cap Rate = (NOI ÷ Purchase Price) × 100

Cash-on-Cash ROI = (Annual Cash Flow ÷ Total Cash Invested) × 100

Example Calculations

Example 1: Purchase price $250,000, down payment $50,000, rent $2,000/month, expenses $1,400/month (incl. mortgage). Annual cash flow = $7,200. Cash-on-cash = 14.4%.

Example 2: $400,000 property, $80,000 down, NOI = $18,000/year. Cap rate = 4.5%. Annual cash flow after $15,600 debt service = $2,400. Cash-on-cash = 3%.

Understanding Your Results

A cap rate of 5–8% is generally considered healthy in most US markets. Cash-on-cash returns above 8% are attractive for leveraged rentals. Negative cash flow may still be acceptable if strong appreciation is expected.

Common Mistakes to Avoid

  • Underestimating vacancy rate — a common rule of thumb is 5–8% of annual rent.
  • Forgetting maintenance and capital expenditure reserves (budget 1% of property value per year).
  • Ignoring property management fees if you plan to hire a manager (typically 8–12% of rent).
  • Using optimistic rent projections instead of current market comparable rents.