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Rental Property Calculator
Use this free rental property calculator for a full cash-flow analysis before you buy. Enter the price, down payment, mortgage terms, rent, and every monthly cost — taxes, insurance, maintenance, vacancy, and HOA — and it shows your monthly cash flow, cap rate, cash-on-cash return, and net operating income.
Vacancy is charged as a percentage of rent. "Other costs" covers property management, utilities you pay, or anything else monthly.
| Monthly rent | $2,400.00 |
| Vacancy (5%) | −$120.00 |
| Mortgage payment | −$1,516.96 |
| Taxes + insurance + maintenance + HOA | −$650.00 |
| Total monthly expenses | $2,286.96 |
| Monthly cash flow | +$113.04 |
| Annual cash flow | +$1,356.44 |
| Cash invested (down payment + closing) | $65,000.00 |
| Cap rate | 6.52% |
| Cash-on-cash return | 2.09% |
Where the rent goes
The diagram uses the default example: $2,400 of rent, a $1,516.96 mortgage payment, $650 of operating costs, and $120 of vacancy leave $113.04 of monthly cash flow.
Cash flow vs rent
Monthly cash flow as rent rises from $0 to $4,000, with your costs held fixed. The line crosses zero at your breakeven rent.
How it works
A rental property only makes sense if the numbers work, and the numbers have more moving parts than the rent cheque suggests. This calculator builds the full picture in four steps: the mortgage payment, the effective income after vacancy, the operating expenses, and finally the returns that let you compare one property with another.
First, the mortgage. The loan amount is the purchase price minus the down payment, and the monthly payment comes from the standard amortisation formula, using the annual rate divided by 12 and the term in months. With the defaults — a $300,000 price, 20% down, a 6.5% rate over 30 years — the loan is $240,000 and the payment is $1,516.96 a month. The rate and term matter enormously: a single percentage point on the rate can move the payment by more than $150 a month on a loan this size, which is often the difference between positive and negative cash flow.
Second, the income. Gross rent is not what you collect. Some months the property sits empty between tenants, so the calculator subtracts a vacancy allowance — 5% of rent by default, roughly three weeks a year. The result is the effective gross income: $2,400 of rent minus $120 of vacancy gives $2,280 a month with the defaults.
Third, the operating expenses: property taxes, insurance, maintenance, HOA fees, and anything else you entered. These total $650 a month with the defaults. Add the mortgage payment and the vacancy allowance, and total monthly expenses come to $2,286.96. Monthly cash flow is simply rent minus all of that: $2,400 − $2,286.96 = +$113.04. Positive, but thin — one big repair or a month of vacancy would wipe out several months of it.
Fourth, the returns. Net operating income, or NOI, is the property's yearly profit before the mortgage: effective gross income minus operating expenses, which is $19,560 a year here. The cap rate divides NOI by the purchase price — 6.52% — and it measures the property itself, ignoring how you financed it. The cash-on-cash return divides the annual cash flow after the mortgage by the cash you actually invested, down payment plus closing costs — 2.09% here, because most of the return is going to the bank as interest. A high cap rate with a low cash-on-cash return usually means the property is fine but the financing is expensive.
Cap rate = NOI ÷ Purchase price · Cash-on-cash = Annual cash flow ÷ Cash invested
The chart plots monthly cash flow against rent from $0 to $4,000 with your costs fixed. The point where the line crosses zero is the breakeven rent — the lowest rent at which the property pays for itself. With the defaults that is about $2,287 a month, uncomfortably close to the $2,400 actually charged.
Worked example
Take a $300,000 house bought with 20% down ($60,000) and $5,000 of closing costs, a 6.5% mortgage over 30 years, rent of $2,400 a month, taxes of $300, insurance of $150, maintenance of $150, a 5% vacancy rate, and $50 of HOA fees. Enter those values and the calculator works like this.
Step 1: The loan is $300,000 − $60,000 = $240,000. The monthly mortgage payment is $1,516.96.
Step 2: Vacancy is 5% of $2,400 = $120, so effective income is $2,280 a month.
Step 3: Operating costs are $300 + $150 + $150 + $50 = $650. Total monthly expenses are $1,516.96 + $650 + $120 = $2,286.96.
Step 4: Monthly cash flow is $2,400 − $2,286.96 = +$113.04, or $1,356.44 a year.
Step 5: NOI is ($2,400 − $120) × 12 − ($650 × 12) = $19,560 a year. Cap rate is $19,560 ÷ $300,000 = 6.52%. Cash invested is $65,000, so cash-on-cash return is $1,356.44 ÷ $65,000 = 2.09%.
The tool shows the same result: a monthly cash flow of +$113.04, a cap rate of 6.52%, and a cash-on-cash return of 2.09%. The property just about pays for itself — a buyer would want either a lower price, cheaper financing, or higher rent before calling it a good deal.
FAQ
What is a good monthly cash flow for a rental property?
A common rule of thumb is at least $100 to $200 per month of positive cash flow per unit after all expenses, including the mortgage, taxes, insurance, maintenance, and vacancy. The exact target depends on the price of the property and how much cash you put in. A property that cash-flows $100 a month on a $50,000 investment is far better than the same $100 on a $200,000 investment, which is why cash-on-cash return matters more than the dollar figure alone.
What is the difference between cap rate and cash-on-cash return?
Cap rate measures the property itself: net operating income divided by the purchase price, ignoring how you financed it. Cash-on-cash return measures your money: annual cash flow after the mortgage divided by the cash you actually invested. Two buyers can see the same cap rate on one property but very different cash-on-cash returns if one pays cash and the other borrows most of the price.
How do I estimate vacancy and maintenance costs?
A standard planning figure for vacancy is 5 to 8 percent of gross rent, which assumes the property sits empty for roughly three to four weeks a year. Maintenance is often estimated at 5 to 10 percent of rent, or about 1 percent of the property value per year for an older home. Newer properties cost less to maintain; older ones cost more. Use local figures when you have them, and the defaults here when you do not.
What is NOI on a rental property?
NOI, or net operating income, is the property's annual income after operating expenses but before the mortgage payment and income taxes. It equals effective gross income — rent minus vacancy — minus taxes, insurance, maintenance, and HOA fees. NOI is the number the cap rate is built from, and lenders use it to judge whether a property can support its loan.
Should I use a 15-year or 30-year mortgage for a rental?
A 30-year mortgage gives a lower monthly payment and higher monthly cash flow, but you pay much more interest over the life of the loan and build equity slowly. A 15-year mortgage costs more each month and can turn cash flow negative, but it builds equity fast and the interest rate is usually lower. Most rental investors pick the 30-year term for the cash flow cushion and pay extra when they can.