Finance calculator
Analyze rental property investment returns. Calculate monthly cash flow, cap rate, cash-on-cash return, and determine if a property is worth buying.
Total acquisition price of the property.
Investment properties typically require 20–25% down.
Investment property rates are ~0.5–1% higher than primary home rates.
30-year term gives lower payment; 15-year builds equity faster.
Expected gross monthly rental income.
Taxes, insurance, maintenance, vacancy (~1% of value/mo).
Monthly Cash Flow
-$128.11
Rent minus all expenses and mortgage.
Formula verified 9 September 2026
Annual Cash Flow
-$1,537.38
Cap Rate
6.20%
NOI ÷ purchase price.
Cash-on-Cash Return
-2.56%
Annual cash flow ÷ down payment.
Monthly Mortgage P&I
$1,678.11
Estimate only — not financial advice; lender terms, fees, and taxes vary. Read the full disclaimer ↓
Where each month’s rent goes and the resulting cash flow, plus the annual totals and key return metrics, using the same formulas as the calculator.
| Line item | Monthly | Annual |
|---|---|---|
| Gross rent | $2,200 | $26,400 |
| Operating expenses | -$650 | -$7,800 |
| Mortgage (P&I) | -$1,678 | -$20,137 |
| Cash flow | -$128 | -$1,537 |
| Cap rate | 6.20% | — |
| Cash-on-cash return | -2.56% | — |
Estimates only — not financial, tax, or professional advice.
100% private — every number you enter is calculated in your browser and never sent to our servers.
What it calculates: Monthly Cash Flow, Annual Cash Flow, Cap Rate, Cash-on-Cash Return.
Updated 5 June 2026 · Transparent assumptions
Monthly mortgage calculated using standard amortization formula.
$300,000 property, 20% down, 7.5% rate, $2,200 rent, $650 expenses.
Purchase Price
$300,000
Down Payment (20%)
$60,000
Monthly Mortgage
$1,678
Monthly Cash Flow
−$128
Cap Rate
6.2%
Cash-on-Cash
−2.6%
Negative cash flow of $128/month but a 6.2% cap rate. The investor is betting on appreciation. Consider raising rent or making a larger down payment.
This is a first-pass filter for a rental purchase. From the price, down payment, mortgage terms, expected rent, and operating expenses, it returns three figures that together tell you whether a deal is worth a deeper look: monthly cash flow, the cap rate, and the cash-on-cash return.
None of the three is sufficient alone, but read together they sort the promising deals from the ones that only look good in the listing. Use it to screen candidates or to stress-test a property you already own.
The headline number is monthly cash flow: rent, minus operating expenses, minus the mortgage payment (itself amortised from the loan amount, rate, and term). Positive cash flow means the property pays for itself and then some; negative means you would subsidise it out of pocket every month.
The breakdown table shows exactly where the rent goes, which is usually the moment a "profitable" deal reveals how thin the margin really is once every expense is on the page.
The two return metrics answer different questions. The cap rate — net operating income before the mortgage, divided by price — describes the property regardless of financing, so it compares deals on equal footing. Cash-on-cash — annual cash flow divided by the cash you actually invested, mainly the down payment — reflects your specific loan.
Reading them together is informative: a strong cap rate paired with weak cash-on-cash usually signals an expensive or heavily leveraged purchase, where the asset is fine but the financing eats the return.
The biggest error is underestimating expenses. Beginners count only the mortgage and forget property taxes, insurance, maintenance, capital reserves, vacancy, and management — and those omissions routinely flip a deal from cash-flow-positive to a monthly drain.
Closely related is assuming 100% occupancy. Even good rentals sit empty between tenants, so a realistic vacancy allowance belongs in the expense figure, not an optimistic afterthought.
Run the numbers with rent a little lower and expenses a little higher to see whether the deal still works when reality is less generous than the advertisement. Test a larger down payment too — more equity lowers the mortgage and lifts cash flow, though it ties up capital and can reduce cash-on-cash return.
This model focuses on cash flow and basic returns; it does not capture appreciation, the depreciation tax shield, loan paydown, or selling costs. Treat it as one screen among several, and confirm the numbers with qualified real-estate and financial professionals before you buy.
A good cap rate depends on the market: 4–5% in expensive coastal markets, 6–8% in mid-tier markets, 8–12% in affordable markets. Higher cap rates compensate for lower appreciation prospects.
Property taxes, insurance, HOA fees, maintenance (budget 1% of purchase price/year), property management (8–10% of rent), vacancy (5–10%), and capital expenditure reserves.
Cash flow is the dollars left each month after the mortgage and operating expenses are paid. Cash-on-cash return expresses your annual cash flow as a percentage of the actual cash you invested, mainly the down payment. Two deals can have similar monthly cash flow but very different cash-on-cash returns if one required a much larger down payment.
Some investors accept a small monthly loss because they expect the property to appreciate, because tenants are paying down the loan and building their equity, or because depreciation provides tax benefits. That is a bet on future gains rather than current income, and it carries more risk — if appreciation does not materialize, you are funding the shortfall out of pocket every month.
No. Operating expenses cover the cost of running the property — taxes, insurance, maintenance, management, vacancy. The mortgage is a financing cost, so it is excluded from net operating income and the cap rate, but it is very much included when calculating actual cash flow, because it is real money leaving your account each month.
Build them into your monthly expenses rather than assuming full occupancy and no surprises. A common starting point is to reserve several percent of rent for vacancy and roughly one percent of the property value per year for maintenance and capital expenditures. Underbudgeting these is one of the fastest ways a deal that looked profitable turns into a money loser.
Figures on this page are checked against primary, authoritative sources. Links open in a new tab.
Investment disclaimer
Returns are assumptions, not guarantees. Actual results may vary because of market performance, taxes, fees, inflation, and timing. This is an educational projection, not investment advice.
How we calculate · Found an error? email us
Published 9 September 2026