Rental Property ROI & Cap Rate Calculator
Analyze a rental deal the way investors and lenders do. Enter the purchase, financing, income, and operating costs to get cash flow, cap rate, cash-on-cash return, and the debt-service coverage ratio lenders check.
Monthly rent split
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Get itThe full picture, including the lender's view
This now accounts for closing costs, rehab, management, and maintenance/capex reserves — the expenses that quietly turn a 'positive' deal negative. Cap rate compares income to price. Cash-on-cash measures return on the actual cash you invest. DSCR — net operating income divided by debt payments — is what lenders use to approve investment loans; most want 1.20 or higher. It still excludes appreciation, depreciation, and taxes, so true total return may be higher.
How it’s calculated
NOI = effective rent − operating expenses. Cap rate = NOI ÷ price. Cash flow = NOI − annual mortgage. Cash-on-cash = annual cash flow ÷ cash invested. DSCR = NOI ÷ annual debt service.
Results update as you type and are estimates, not professional advice — verify important decisions with a qualified professional.
Worked example
A $250k rental, 25% down at 7%, $2,200 rent: ~$141/mo cash flow, 6.7% cap rate, 2.5% cash-on-cash, DSCR 1.11.
Common mistakes
- Leaving out management, maintenance, and capex reserves.
- Forgetting closing costs and rehab in the cash invested.
Where it is used
- Screening a rental deal before making an offer.
- Checking whether the numbers clear a lender's DSCR.
Frequently asked questions
What DSCR do lenders want?
Commonly 1.20–1.25 or above, meaning income covers the mortgage with a cushion. Below 1.0 the property doesn't cover its own debt.
What should maintenance and capex be?
Many investors reserve 5–10% of rent each for maintenance and capital expenses. Older properties need more.
Does this include appreciation?
No — it focuses on income return. Appreciation and tax benefits can add to total return but are less certain.
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