Rental Property Cash Flow Calculator
Run the numbers on any rental property in 60 seconds. Real expenses, real returns, no fluff.
Type the purchase details and your monthly rent and expense assumptions. The calculator returns monthly cash flow, cash-on-cash return, cap rate, and a 1 percent rule check. Useful for evaluating a deal before you submit an offer, or for stress-testing a property you already own.
Purchase
Income
Fixed expenses (annual)
Reserves (% of monthly rent)
Quick example: $250,000 purchase, 20% down, 7% rate, 30 year loan, $2,500 monthly rent, $3,500 tax, $1,500 insurance, 8% PM, 5% vacancy, 5% maintenance, 5% capex returns roughly $200/mo cash flow and a 5% cash-on-cash return.
How to read the results
Monthly cash flow is the dollar amount left over each month after collecting rent and paying every expense, including reserves you should be setting aside for future repairs and capital expenditures. Positive means the property pays you each month. Negative means you are subsidizing it.
Cash-on-cash return is your annual cash flow divided by the total cash you put into the deal (down payment plus estimated closing costs of about 3 percent). It tells you what return your invested cash is earning, ignoring appreciation and principal pay-down. Investors typically want 8 percent or higher; 12 percent and up is strong; under 5 percent is usually not worth the headache unless you expect significant appreciation.
Cap rate is annual Net Operating Income (rent minus operating expenses, excluding mortgage) divided by the property's value. It is the standard metric for comparing rental properties regardless of financing. Higher cap rates mean more income relative to price. Cap rates vary wildly by market: 4 to 5 percent is common in expensive coastal cities, 8 to 12 percent in lower-cost markets and small towns.
1 percent rule is a quick screening filter, not a deal-evaluation tool. It says monthly rent should be at least 1 percent of the purchase price ($2,500 rent on a $250,000 house). If a property passes the 1 percent rule, it usually cash flows. If it fails, it usually does not. There are real exceptions in appreciation markets, but the rule is a useful gut-check.
Why reserves matter
The most common mistake new landlords make is forgetting to set aside money for the things that will happen: vacancies between tenants, a tenant who damages the place, an HVAC system that dies in year four, a roof that needs replacing in year ten. The default 5 percent maintenance reserve and 5 percent CapEx reserve in this calculator are middle-of-the-road for a property that is in good condition. Older properties, properties in rough shape, or properties with expensive systems (slate roofs, oil heat, etc.) need higher reserves.
If you skip the reserves and just count "rent minus mortgage minus taxes," you will appear to have great cash flow on paper while quietly losing money to deferred maintenance every year. Then a $20,000 repair bill arrives and wipes out three years of "profit." Use the reserves. Trust the math.
Vacancy and property management
Even great rentals have vacancies. Tenants move, leases end, repairs require an empty unit. A 5 percent vacancy assumption means about 18 days per year of no rent; 8 percent (about a month) is more realistic for some markets. If you self-manage, you can set property management to zero, but factor in your own time. If you hire a property manager, expect 8 to 12 percent of monthly rent.
What this calculator does not include
This is a cash flow tool, not a full investment analysis. It does not project appreciation, calculate IRR over a holding period, account for tax benefits (depreciation, deductions), include closing cost variations beyond the 3 percent estimate, or model rent growth and expense inflation over time. For a complete deal analysis, use the cash flow output here as one input alongside a tax-aware projection and a market-specific appreciation assumption.
Important disclaimer
This calculator is for general informational purposes only. It is not investment advice, real estate advice, or tax advice. Real estate investments carry significant risk including loss of principal. Always consult a qualified real estate professional, accountant, and attorney before purchasing investment property.