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Rental Cash Investment Return Calculator

Calculate annual rental cash flow after operating costs and debt service.

  • Formula & worked example
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Calculator inputs

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How to use this calculator

  1. Enter the known values in the units shown. Results update as you type.
  2. Edit a calculated value to solve backwards, or lock a value to hold it fixed.
  3. Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

Gross annual rent of 30,000 with 10% vacancy gives 27,000 effective income. Subtracting 7,000 operating expenses and 12,000 annual debt service leaves 8,000. Against 100,000 cash invested, the annual cash-on-cash return is 8%.

Cash return = [gross rent × (1 − vacancy) − operating expenses − 12 × monthly loan payment] ÷ cash invested

Worked example

Enter these known values and leave the other values blank.

Total cash investment
100000 USD
Gross annual rental income (100% occupancy)
30000 USD
Vacancy rate
10 %
Annual expenses for this property
7000 USD
Monthly loan payment
1000 USD
Cash-on-cash return
8 %
Net operating income
20000 USD
Annual debt service
12000 USD
Annual cash flow
8000 USD

Assumptions and limitations

  • No. It measures the modeled annual cash left after the full debt payment, relative to cash invested. Appreciation, equity created by principal repayment, sale proceeds and income taxes are not added to the return. Keep debt service separate from operating expenses to avoid counting it twice.
  • Use consistent units, dates and financial definitions. The calculated result follows the stated assumptions and the amounts entered.

Common questions

Does this include appreciation or principal repayment as a gain?

No. It measures the modeled annual cash left after the full debt payment, relative to cash invested. Appreciation, equity created by principal repayment, sale proceeds and income taxes are not added to the return. Keep debt service separate from operating expenses to avoid counting it twice.

References

The calculation equations, inverse formulas, units, and input rules were imported from this source. Bookify provides the interface and equation solver.

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