CompoundInterestCalc
Free online tool · Real estate

Rental Property ROI Calculator

Is that rental actually a good investment? This free rental property ROI calculator runs the numbers real estate investors care about: monthly cash flow, cap rate, cash-on-cash return and gross yield — all from the price, rent and operating costs.

It accounts for the mortgage, property tax, insurance, maintenance, management and vacancy, then projects your total profit over the years — cash flow, loan paydown and appreciation combined. No account, no sign-up.

The deal
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$
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10 years
▶ Operating expenses & assumptions
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$
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Monthly cash flow
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Cap rate
0%
Cash-on-cash
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Gross yield
0%
Where the monthly rent goes
Total profit over time
Cash flow Paydown Appreciation

Estimates are for illustration and education only — not investment advice. Real returns depend on rents, vacancies, repairs and market conditions that vary and are not guaranteed.

The math

The rental return formulas

Property investors judge a deal with a few key ratios. Each answers a different question — income yield, purchase quality, and the return on the actual cash you put in.

Cap rate = Net operating income ÷ Property value
NOI is annual rent minus operating expenses — before any mortgage. It measures the property's own earning power.
Cash-on-cash = Annual pre-tax cash flow ÷ Total cash invested
This is the return on the money you actually put in — down payment, closing costs and any upfront repairs.
Worked example. A $250,000 rental brings $24,000 a year in rent. After $8,000 of operating expenses, NOI is $16,000 — a 6.4% cap rate. Finance it with $62,500 down and, after the mortgage, say $4,500 is left as annual cash flow. That's a 7.2% cash-on-cash return on the money you invested.
See it in action

Three rentals, three return profiles

The same 25%-down, 7% loan produces very different results depending on the rent-to-price ratio. Load any deal to explore.

Quick guide

How to use the rental ROI calculator

Four short steps. Every field updates the cash flow, the return metrics and the profit projection instantly.

Step 1

Enter price and rent

The purchase price and the gross monthly rent are the two numbers that drive every return metric.

Step 2

Set your financing

Choose your down payment and mortgage rate. Less money down usually lifts cash-on-cash return but lowers cash flow.

Step 3

Add operating expenses

Property tax, insurance, maintenance, management and vacancy. Being honest here is what separates a real analysis from a fantasy.

Step 4

Pick your holding period

Slide the years to see total profit — cash flow, loan paydown and appreciation stacked together on the chart.

Good to understand

The metrics that matter

No single number tells you whether a rental is a good deal. Investors look at several, because each answers a different question. This calculator reports the four most important ones.

Monthly cash flow

The headline: what's left each month after the mortgage and every operating expense. Positive cash flow means the property pays you to own it; negative means you feed it. Cash flow is what keeps you solvent through vacancies and repairs.

Cap rate

The capitalization rate is net operating income (rent minus operating expenses, before the mortgage) divided by the price. It measures the property's return independent of financing, so you can compare deals on equal footing regardless of how they're funded.

Cash-on-cash return

Cash-on-cash is your annual pre-tax cash flow divided by the actual cash you put in — down payment plus closing costs. Because it accounts for leverage, it's the number that best reflects the return on your own money.

Total return over time

Cash flow is only one of three ways a rental builds wealth. The chart stacks all three: the cash flow you collect, the loan paydown your tenants fund, and the appreciation of the property. Together they're your total profit — and usually far larger than cash flow alone suggests.

Comparing buying to renting for yourself instead? Try the rent vs buy calculator, or see all our free tools.

Quick answers

Rental ROI FAQ

What's a good cap rate?
It depends on the market. In many US markets, investors look for cap rates between roughly 5% and 10% — higher cap rates usually mean more cash flow but often more risk or less desirable locations, while low cap rates tend to reflect premium, appreciating areas.
What's the difference between cap rate and cash-on-cash?
Cap rate ignores your mortgage — it's the property's return as if you paid all cash. Cash-on-cash includes financing and measures the return on the actual cash you invested. Leverage can push cash-on-cash well above the cap rate, for better or worse.
Why include vacancy and maintenance?
Because they're real. No rental stays occupied 100% of the time, and things break. Budgeting a few percent for vacancy and maintenance turns an optimistic pro-forma into a realistic one — and often flips a "great" deal into a marginal one.
Should I count appreciation as return?
Appreciation is real wealth but it's speculative — it isn't guaranteed and you can't spend it until you sell or refinance. Many investors buy for cash flow and treat appreciation as a bonus. The chart separates the two so you can judge each on its own.
Is this investment advice?
No. It's an educational tool using assumptions you provide. It doesn't include taxes, depreciation, financing fees or your personal situation. Always run a deal past your own numbers and a qualified professional before buying.