Rental Property ROI Calculator
Punch in the numbers on a deal and see monthly cash flow, cap rate, cash-on-cash return and DSCR update instantly. No sign-up, no spreadsheet.
How the rental ROI numbers work
Four metrics tell you most of what you need to know about a buy-and-hold rental. Here is what each one means and why it matters.
Monthly cash flow
This is what actually lands in your pocket each month: collected rent minus vacancy, operating expenses and your mortgage payment. Positive cash flow means the property pays you to own it; negative means you feed it every month. It is the single most important number for most small landlords.
Cap rate
Net operating income divided by purchase price, ignoring your loan. Because it strips out financing, cap rate lets you compare two properties on equal footing regardless of how each is funded. A higher cap rate usually means more income relative to price, though often with more risk or work.
Cash-on-cash return
Annual cash flow divided by the cash you actually put in — down payment, closing costs and upfront repairs. This is the return on your money rather than the property's full value, so it captures the leverage you get from a mortgage. Many investors look for 8% or more.
DSCR
Debt service coverage ratio compares net operating income to your annual mortgage payments. Lenders that offer DSCR loans often want at least 1.20 to 1.25, meaning the property earns 20–25% more than its debt costs.
Run a deal in four steps
Enter the purchase terms
Price, down payment, rate and loan term set your mortgage and the cash you tie up at closing.
Add income and a vacancy buffer
Use realistic market rent and a vacancy rate of 5–8% so a slow month doesn't blow up the math.
Fill in operating costs
Taxes, insurance, maintenance and management. If you'll self-manage, set management to 0%.
Read the verdict
Watch cash flow, cash-on-cash and DSCR. Tweak the down payment or rent to see how the deal shifts.
Frequently asked questions
What is a good ROI on a rental property?
It depends on your market and how much risk you'll take, but many investors target a cash-on-cash return of 8% or higher and a cap rate of roughly 5–10%. Expensive coastal markets tend to show lower cap rates than the Midwest or South, where prices are lower relative to rent.
How is cash-on-cash return calculated?
Divide your annual pre-tax cash flow by the total cash you invested — down payment plus closing costs plus any upfront repairs. It shows the yearly return on the money that actually left your account, which is why leverage from a mortgage can raise it.
What's the difference between cap rate and cash-on-cash?
Cap rate ignores your loan and divides net operating income by purchase price, so it compares properties independent of financing. Cash-on-cash includes your mortgage and down payment, so it reflects the return on your specific cash position.
Does this calculator include income taxes?
No. It estimates pre-tax cash flow and returns. Your actual after-tax result also depends on depreciation, your tax bracket and how the property is held — talk to an accountant for that side of the picture.
What is the 1% rule?
A quick screen some investors use: monthly rent should be at least 1% of the purchase price. It's only a rough filter — a property can pass the 1% rule and still have weak cash flow once taxes, insurance and management are counted, which is what this calculator does in full.
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