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Thinking about buying a rental property? Our free rental property calculator estimates monthly cash flow, net operating income, cap rate, and cash-on-cash return from just five inputs — so you can screen any deal in under a minute and invest with confidence.
Running the numbers on a rental property takes less than a minute with this tool. Enter five numbers and the calculator instantly shows your monthly cash flow, annual cash flow, net operating income, cap rate, and cash-on-cash return — the five metrics professional investors check before making an offer. Here is how to use each field correctly.
Pro tip: run the calculator three times for every deal — once with optimistic numbers, once with realistic numbers, and once with pessimistic numbers (lower rent, higher expenses). If the property still produces positive cash flow in the pessimistic case, you have found a deal with a genuine margin of safety.
Rental property analysis is the process of estimating whether an income-producing property is a good investment before you buy it. Instead of relying on gut feeling, investors reduce each deal to a handful of standardized metrics so that a duplex in Ohio can be compared fairly against a condo in Florida. Four terms do most of the work, and this calculator computes all of them.
cash flow is the actual dollars left in your pocket each month after every expense and the mortgage payment are paid. Positive cash flow means the property pays you to own it; negative cash flow means you are subsidizing your tenant out of your own income. Monthly cash flow — the headline result of the calculator above — is simply rent minus operating expenses minus the mortgage payment. Experienced landlords often look for at least $200 to $300 of monthly cash flow per unit after budgeting honestly for vacancies and repairs.
net operating income, usually shortened to NOI, is the property’s annual income after operating expenses but before mortgage payments and income taxes. Because it deliberately excludes financing, NOI describes the asset itself rather than your particular loan — which means two buyers with different down payments will calculate the same NOI for the same property. A building with $19,200 of annual NOI earns $19,200 a year for its owner before debt service, regardless of who owns it.
cap rate, short for capitalization rate, expresses annual NOI as a percentage of the purchase price. A $250,000 property generating $19,200 of NOI has a cap rate of 7.68%. Cap rates are the industry-standard way to compare the unleveraged yield of different properties and different markets: higher cap rates generally signal higher returns paired with higher risk, while lower cap rates are typical of stable, expensive markets where investors accept thinner yields in exchange for appreciation potential.
cash-on-cash return is your annual cash flow after the mortgage, divided by the actual cash you invested, expressed as a percentage. While cap rate ignores financing, cash-on-cash return embraces it — so it answers the personal question of what your down payment is actually earning. A 16.80% cash-on-cash return means every $1,000 of cash you put in produces about $168 per year after all costs are paid. Because leverage magnifies this metric, it is the number most buy-and-hold investors watch closest.
Why look at all four metrics instead of just one? Because each answers a different question. Cap rate answers “how productive is this asset?” Cash-on-cash return answers “how productive is my money?” Net operating income answers “what does the property itself earn?” And cash flow answers “what do I actually keep each month?” A deal can show an attractive cap rate but weak monthly cash flow if it is heavily financed — which is exactly why this calculator displays every metric side by side instead of hiding the trade-offs.
Professional investors typically screen dozens of listings with these metrics before ever scheduling a viewing. A common workflow is to set personal minimum thresholds — for example, at least $200 per month of cash flow per unit, a cap rate above 7%, and a cash-on-cash return above 10% — and to discard anything that misses them. The calculator above makes that screening instant: type in a listing’s numbers and within seconds you will know whether the property deserves a deeper look or belongs in the reject pile.
Every result in the calculator comes from five simple formulas. Understanding them lets you sanity-check any deal by hand, even without the tool:
Notice that net operating income deliberately excludes the mortgage payment, while cash flow includes it. That single distinction is the source of most beginner confusion: a property’s NOI describes the asset, while cash flow describes your personal result after financing. Keep the two separate and the formulas stay intuitive.
Consider a $250,000 single-family home. You invest $50,000 of cash, collect $2,000 per month in rent, spend $400 per month on operating expenses, and pay $900 per month on the mortgage:
This is a textbook strong deal: $700 per month in your pocket, a 7.68% cap rate that beats most markets’ averages, and a 16.80% return on the cash you actually deployed.
Now take a $180,000 property where you invest $45,000 of cash, collect $1,500 in monthly rent, spend $350 on operating expenses, and pay $650 on the mortgage:
Compare the two examples: Example 2 has a nearly identical cap rate (7.67% vs. 7.68%) but a lower cash-on-cash return (13.33% vs. 16.80%), because more of its rental income is consumed by the mortgage relative to the cash invested. This is exactly the kind of insight the formulas reveal — and the reason seasoned investors always examine both metrics together rather than relying on either one alone.
Maya, a nurse in Columbus, Ohio, is buying her first investment property: a duplex listed at $220,000. Her total cash invested is $55,000, covering the down payment plus closing costs. Each unit rents for $1,100, giving her $2,200 in gross monthly rent. Her operating expenses — property taxes, insurance, a 5% vacancy allowance, an 8% maintenance reserve, and professional property management — total $620 per month. Her mortgage payment is $950.
Running the numbers: monthly cash flow is $2,200 − $620 − $950 = $630, or $315 per unit — comfortably above her personal minimum of $200 per unit. Annual NOI is ($2,200 − $620) × 12 = $18,960, producing a cap rate of $18,960 ÷ $220,000 = 8.62%. Annual cash flow of $7,560 on $55,000 invested gives a cash-on-cash return of 13.75%. Every metric clears her thresholds, so she schedules an inspection and makes an offer the same week.
Daniel has $90,000 to invest and is torn between two options. Deal A is a $300,000 condo in his expensive home city: $2,100 rent, $700 operating expenses, $1,250 mortgage. Deal B is a $180,000 single-family home two hours away: $1,600 rent, $420 operating expenses, $780 mortgage.
Deal A produces monthly cash flow of $2,100 − $700 − $1,250 = $150, an NOI of ($2,100 − $700) × 12 = $16,800, a cap rate of 5.60%, and a cash-on-cash return of just $1,800 ÷ $90,000 = 2.00%. Deal B produces $1,600 − $420 − $780 = $400 per month in cash flow, an NOI of $14,160, a cap rate of 7.87%, and a cash-on-cash return of $4,800 ÷ $90,000 = 5.33%. The cheaper, farther property wins on every single metric. Daniel realizes his home market’s appreciation story does not compensate for near-zero cash flow today — so he buys Deal B and hires a local manager.
The lesson from both scenarios is the same: disciplined investors let the numbers choose the property, not the neighborhood’s reputation or the listing photos. Five minutes with this calculator can prevent a five-figure mistake.
Keep analyzing your investment from every angle with these related tools:
Rental Property Calculator is a free online tool on Sigma Calculator that evaluates residential rental property investments. Inputs: purchase price, total cash invested, monthly rent, monthly operating expenses, and monthly mortgage payment. Outputs: monthly cash flow, annual cash flow, annual net operating income (NOI), cap rate, and cash-on-cash return. Formulas: monthly cash flow = rent − operating expenses − mortgage payment; annual NOI = (rent − operating expenses) × 12; cap rate = (annual NOI ÷ purchase price) × 100; cash-on-cash return = (annual cash flow ÷ cash invested) × 100.
Most buy-and-hold investors target a cash-on-cash return of 8% to 12% or higher, which compares favorably with long-term stock market averages once leverage is included. For cap rates, 7% to 10% is considered solid in most US markets, while 4% to 6% is typical in expensive coastal cities where investors accept lower yields in exchange for appreciation potential. Use the calculator above to see both metrics for your deal: a property clearing 10% cash-on-cash return with positive monthly cash flow is a strong candidate in almost any market.
Divide the property’s annual net operating income (NOI) by its purchase price, then multiply by 100. For example, a $250,000 property with $19,200 of annual NOI has a cap rate of 7.68%. Remember that NOI excludes mortgage payments: it is simply annual rent minus annual operating expenses, multiplied out over 12 months. The calculator above computes it automatically — enter the purchase price, monthly rent, and monthly operating expenses, and the cap rate appears in the results table.
A good cap rate depends on the market. Rates of 8% to 12% are excellent and common in cash-flow markets across the Midwest and South; 6% to 8% is solid for stable metro areas; and 4% to 6% is normal in high-cost coastal cities where appreciation does more of the heavy lifting. Be cautious of extremely high cap rates above 12%, which often signal a distressed property or a declining neighborhood. Always pair the cap rate with a cash-flow check, because a high cap rate means little if the mortgage leaves you with nothing each month.
Divide your annual pre-tax cash flow, after all expenses and mortgage payments, by the total cash you invested, then multiply by 100. For example, $8,400 of annual cash flow on $50,000 invested equals a 16.80% cash-on-cash return. Your cash invested should include the down payment plus closing costs, lender fees, and any upfront renovation costs — not just the down payment alone. Enter these figures in the calculator above and it will compute the return instantly, alongside cap rate and monthly cash flow.
Cap rate measures the property’s unleveraged yield: annual NOI divided by purchase price. It ignores how you financed the deal, which makes it ideal for comparing properties against each other. Cash-on-cash return measures your leveraged yield: annual cash flow after the mortgage divided by the cash you actually invested, which tells you what your down payment is earning. The same property can show a 7.68% cap rate and a 16.80% cash-on-cash return when financing boosts your results. Use cap rate to compare assets, and cash-on-cash return to compare financing strategies.
Many investors use 8% to 12% as a minimum target for cash-on-cash return, with 12% or more considered a strong deal. Because leverage magnifies this metric, small financing changes matter: putting less money down raises your cash-on-cash return but also raises your monthly mortgage payment and your risk. If your calculated return comes in below 8%, the deal can still work in an appreciating market — but you should demand a clear reason, such as below-market rents you can realistically raise, before accepting it.
Subtract monthly operating expenses and the monthly mortgage payment from the monthly rent. For example, $2,000 of rent minus $400 in operating expenses minus a $900 mortgage payment leaves $700 per month in cash flow, or $8,400 per year. Operating expenses include property taxes, insurance, maintenance, a vacancy allowance, property management, and HOA fees — everything except the mortgage, which is subtracted separately. Many investors look for at least $200 to $300 per unit per month after budgeting honestly for vacancies and repairs.
The 1% rule says a rental property’s monthly rent should be at least 1% of its purchase price: a $250,000 property should rent for at least $2,500 per month. It is a quick screening shortcut, not a full analysis. In expensive coastal markets almost nothing meets it, while in cash-flow markets many deals exceed it. Use the rule to filter listings quickly, then run the survivors through the calculator above for real cap rate and cash-on-cash numbers before making an offer.
APA: Sigma Calculator. (2026). Rental property calculator. https://sigmacalculator.net/financial-calculators/rental-property-calculator/
MLA: “Rental Property Calculator.” Sigma Calculator, 2026, https://sigmacalculator.net/financial-calculators/rental-property-calculator/.
Chicago: Sigma Calculator. “Rental Property Calculator.” Accessed October 8, 2026. https://sigmacalculator.net/financial-calculators/rental-property-calculator/.
Last updated: October 8, 2026