Rental Property Cap Rate

Finance & Loans

Calculate real estate Capitalization Rate (Cap Rate), Net Operating Income (NOI), Cash-on-Cash Return, and Debt Service Coverage Ratio (DSCR) for rental investment properties.

%
Calculated Result
5.82%

Cap rate Β· NOI 20,360

Cash-on-cash
3.37%
DSCR
1.13
Formula: Cap = NOI / price

About this calculator

Evaluating residential and commercial rental properties requires looking past gross rental income to understand true operational profitability after vacancy allowances, property taxes, insurance, repairs, and management fees.

The Capitalization Rate measures the property's unleveraged rate of return, allowing real estate investors to compare investment properties across different regional markets independently of financing structures.

How It Works & Formula

FormulaCap rate = NOI / price Β· CoC = cash flow / cash invested

NOI = Gross Potential Rent - Vacancy Loss - Operating Expenses (excluding mortgage). Cap Rate = (NOI / Property Purchase Price) Γ— 100%. Cash-on-Cash = (Annual Net Cash Flow / Total Cash Invested) Γ— 100%.