🏘️ Rental Income Calculator
Enter property price, monthly rent, and all expenses to instantly calculate monthly cash flow, cap rate, cash-on-cash return, NOI, and overall ROI - with a full income and expense breakdown. Includes vacancy, CapEx reserve, property management, and mortgage. Get a clear investment verdict against real benchmarks.
🏘️ Rental Property Analyser
⚠️ Disclaimer: Projections for informational purposes. Past performance does not guarantee future results. Consult a financial advisor.
📊 Investment Metrics Explained
Run the calculator first to see your personalised metrics with benchmark comparisons.
📋 Benchmark Targets
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📐 Rental Investment Metrics
Net Operating Income (NOI)
Cap Rate (Capitalisation Rate)
Cash-on-Cash Return (CoC)
Gross Rent Multiplier (GRM)
The 1% Rule
50% Rule
❓ Frequently Asked Questions
Rental Income Calculator - The Metrics Every Real Estate Investor Needs to Know
The most common mistake first-time rental property investors make is projecting cash flow based on rent minus mortgage - and ignoring everything else. Vacancy, maintenance, CapEx reserves, property management, and property taxes together typically consume 35–50% of gross rent. Underestimating these costs is the primary reason rental investments underperform expectations. This calculator forces you to model all costs so the projections are accurate.
The Core Rental Metrics - What Each One Measures
Cap Rate and NOI
- NOI = Gross Rent − Vacancy − Operating Expenses (does NOT subtract mortgage payments)
- Cap Rate = NOI ÷ Property Price × 100
- Cap rate is financing-neutral - compares properties regardless of how they're funded
- Good cap rate benchmarks: coastal markets 4–6%, mid-tier 6–9%, secondary/midwest 8–12%
- High cap rate may indicate higher risk area or property class
Cash-on-Cash and Cash Flow
- Cash Flow = NOI − Annual Mortgage Payments
- Cash-on-Cash = Annual Cash Flow ÷ Total Cash Invested × 100
- Total cash invested = down payment + closing costs + immediate repairs
- CoC measures return on YOUR capital, not the asset's full value
- CoC below 6% is weak; 8–12% is solid; 12%+ is excellent
The Expenses Most Investors Underestimate
Accurate rental analysis requires modelling every recurring cost - not just the obvious ones:
- Vacancy (5–8% of gross rent): Even stable properties have turnover. Each vacancy costs one to two months of rent plus cleaning/repairs between tenants. Budget conservatively even if currently fully occupied.
- CapEx reserve (5–10% of rent monthly): Major systems wear out. Budget for: roof ($8,000–$20,000), HVAC ($5,000–$10,000), water heater ($1,000–$2,000), appliances ($2,000–$4,000), flooring ($3,000–$8,000). Without reserves, one unexpected repair can wipe years of cash flow.
- Maintenance (1% of property value per year): Plumbing, electrical, landscaping, pest control, minor repairs. On a $300,000 property: $3,000/year = $250/month.
- Property management (8–12% of rent): Even if you self-manage now, budget this - it represents the true cost of your time and makes the analysis valid if you ever hire a manager.
- Property tax increases: Tax assessments can rise significantly after a purchase - model with the expected assessed value, not the previous owner's tax bill.
The 1% Rule - A Quick Screening Tool
The 1% rule: monthly rent should equal at least 1% of the purchase price for the property to likely generate positive cash flow. A $300,000 property should rent for $3,000/month. It's a quick first filter - not a substitute for full analysis.
In expensive coastal markets, 0.7–0.8% is a more realistic adjusted benchmark. Properties below 0.6–0.7% typically generate negative or near-zero cash flow and depend on appreciation for returns. These can still be valid investments in high-appreciation markets - but they're appreciation plays, not cash-flow plays.