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Finance

Rental Property Calculator

Calculate monthly cash flow, gross rental yield, and cap rate for any rental property investment.

What is Rental Property Calculator?

A rental property calculator helps real estate investors quickly evaluate the profitability of an investment property. It computes monthly cash flow, gross rental yield, and cap rate — three key metrics used to compare properties and decide whether an investment makes financial sense.

How to use

  1. 1 Enter the property purchase price.
  2. 2 Enter the expected monthly rent.
  3. 3 Enter your monthly operating expenses (insurance, taxes, maintenance, vacancy).
  4. 4 Enter your mortgage rate, down payment percentage, and loan term.
  5. 5 Review monthly cash flow, rental yield, and cap rate instantly.

Formula

Monthly Cash Flow = Monthly Rent − Mortgage Payment − Monthly Expenses. Gross Rental Yield = (Annual Rent / Property Price) × 100. Cap Rate = (Annual Rent − Annual Expenses) / Property Price × 100.

Example calculation

A $300,000 property renting for $2,200/month with $600/month expenses, 20% down at 7% for 30 years: mortgage ≈ $1,596/month. Cash flow ≈ $4/month. Cap rate ≈ 6.4%.

Frequently asked questions

What is a good cap rate?

Cap rates typically range from 4–10%. Higher cap rates indicate more income relative to price but often come with more risk. A 5–7% cap rate is common in stable urban markets; higher rates appear in smaller or riskier markets.

What expenses should I include?

Include property taxes, insurance, property management (typically 8–12% of rent), maintenance (budget 1% of property value per year), vacancy allowance (5–10% of rent), and any HOA fees.

What is a good rental yield?

A gross rental yield of 6–8% is generally considered solid. Net yield (after expenses) is more meaningful — anything above 4–5% net is typically worthwhile depending on your market and financing.

How does leverage affect returns?

Financing a property amplifies both gains and losses. A leveraged property can produce strong cash-on-cash returns even with a modest cap rate, as long as the rent exceeds the mortgage payment and expenses.

Does this calculator include appreciation?

No. This calculator focuses on cash flow metrics. For a full return picture including appreciation, use the Rent vs Buy or IRR calculator.