Real Estate ROI Calculator
Calculate rental property ROI with cap rate, cash-on-cash return, and annual cash flow. Instantly analyze investment returns from purchase price and rental income.
How It Works
Measures the profitability of a real estate investment by comparing the Annual Cash Flow against the initial Cash Out of Pocket (Down payment, closing costs, rehab).
Formula
Cash-on-Cash Return = (Annual Cash Flow / Total Cash Invested) × 100
Annual Cash Flow is your total rental income minus all expenses (mortgage, taxes, insurance, vacancy, maintenance).
Worked Example
Calculating Cash-on-Cash Return
- Purchase Price: $200,000
- Cash Invested (20% Down + $5k closing): $45,000
- Monthly Rent: $2,000 ($24,000/yr)
- Monthly Expenses (P&I, Taxes, Maint): $1,600 ($19,200/yr)
- Annual Cash Flow = $24,000 - $19,200 = $4,800
- Cash-on-Cash ROI = ($4,800 / $45,000) × 100 = 10.6%
Common Mistakes
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Confusing ROI with Cap Rate
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Cash-on-Cash ROI factors in your specific mortgage financing. Cap Rate assumes you bought the property entirely in cash.
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Excluding capital expenditures (CapEx)
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Roofs and HVACs break. You must deduct 5-10% of rent for long-term reserves, or your ROI will look artificially high.
Frequently Asked Questions
Related Guide & Instructions
2026-07-10
How to Calculate ROI on Rental Property: Cash-on-Cash vs Cap Rate
Learn to evaluate rental properties like a professional investor. Discover the difference between Cash-on-Cash Return, Cap Rate, and total ROI.
Read full guide →Related Calculators
DisclaimerThe results provided by this calculator are estimates and for informational purposes only. They do not constitute financial, legal, or professional advice. Please consult with a qualified professional for your specific needs.