Rental Property ROI

Analyze cash flow and ROI on rental real estate.

Formula & Methodology

Cash flow = rental income − operating expenses − mortgage payment; ROI = net annual income / total cash invested.

Worked Example

$24,000 annual rent, $9,600 expenses, $10,000 mortgage interest on $50,000 cash invested yields roughly 8.8% cash-on-cash return.

Frequently Asked Questions

What is cash-on-cash return?

It is the annual pre-tax cash flow divided by the total cash you invested (down payment plus closing costs), expressed as a percentage.

Does this include property appreciation?

Cash-on-cash return measures yearly cash flow only. Total return also includes appreciation and loan paydown, which this calculator may not fully capture.

What expenses should I include?

Include property taxes, insurance, maintenance, property management, HOA fees, and a vacancy allowance, plus the mortgage payment.

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