🏢 Real Estate
Cap Rate Calculator
Analyze rental property investments: cap rate, cash-on-cash return, and ROI.
🏠 Property Details
💰 Financing (optional)
📊 Investment Returns
Cap Rate
Cash-on-Cash
Total ROI
💵 Annual Cash Flow
🏦 Initial Investment
📋 Income & Expense Breakdown
Gross Rental Income
− Vacancy Loss
Effective Rental Income
− Property Tax
− Insurance
− Maintenance Reserve
= Net Operating Income (NOI)
− Annual Mortgage Payment
= Pre-Tax Cash Flow
📌 5 Cap Rate Tips
- ✓ Higher cap rate ≠ better deal — it usually means higher risk (older building, worse location, deferred maintenance).
- ✓ Target 1% rule as a quick filter: monthly rent should be ≥1% of purchase price. A $300K property should rent for $3,000+/mo.
- ✓ Cap rate ignores financing — use cash-on-cash return to compare leveraged deals. Leverage amplifies returns (and losses).
- ✓ 50% expense ratio is a common rule of thumb — if NOI is around half of gross rent, your numbers are reasonable for residential.
- ✓ Stress test with 10% vacancy + 10% maintenance — most landlords underestimate real-world expenses. If it still cash flows, it's a solid deal.
Disclaimer: This calculator provides estimates for educational purposes only and is not financial, tax, or investment advice. Actual returns depend on many factors not captured here (appreciation, tax benefits, repairs, tenant issues, market changes). Always perform thorough due diligence and consult licensed professionals before investing.