A cash-on-cash return calculator measures the annual pre-tax cash flow you earn relative to the total cash you invested in a rental property. Unlike cap rate, cash-on-cash return accounts for your mortgage payment and financing structure, making it the most practical metric for investors who use leverage. Understanding this number helps you compare deals and decide where to deploy your capital most effectively.
Purchase & Financing
Loan Details
Monthly P&I: $0
Rental Income & Expenses
Monthly Operating Expenses
Total monthly expenses: $0
How to Use the Cash on Cash Return Calculator
Whether you are analyzing your first rental property or comparing multiple investment opportunities, cash-on-cash return is one of the most important metrics for evaluating a leveraged real estate deal. This free calculator gives you a complete picture — from monthly cash flow to a 5-year projection — in seconds.
Step 1: Enter Purchase and Financing Details
Start with the property's purchase price and your down payment. You can enter the down payment as a percentage or a dollar amount — both fields stay synchronized. Add your estimated closing costs (typically 2–5% of the purchase price), any rehab or renovation budget, and other upfront expenses. Then enter your loan details: the loan amount (purchase price minus down payment), interest rate, and term. The calculator shows your estimated monthly mortgage payment in real time.
Step 2: Enter Rental Income and Expenses
Enter the expected monthly rent and a vacancy rate (typically 5–8% for most markets). For operating expenses, you can choose between itemized mode — where you enter property taxes, insurance, maintenance, management fees, HOA dues, and utilities separately — or lump-sum mode for a single total figure. Toggle the "Itemize" switch to change modes. The calculator uses these expenses along with vacancy to determine your net operating income before debt service.
Step 3: Review Your Results
After clicking Calculate, you will see four headline metrics. Cash-on-cash return is the annual pre-tax cash flow divided by your total cash invested — the higher this number, the harder your money is working. Annual cash flow and monthly cash flow show the dollars remaining after all expenses and mortgage payments. Total cash invested is the sum of your down payment, closing costs, rehab, and other upfront costs. The deal is rated as Excellent (above 12%), Good (8–12%), Average (5–8%), or Below Average (under 5%).
Step 4: Analyze the 5-Year Projection
The projection table applies your chosen annual rent growth rate to estimate how your cash flow and cash-on-cash return will improve over five years. As rents rise while your fixed-rate mortgage stays the same, your return naturally increases. This is one of the key advantages of leveraged real estate investing — and this projection helps you see the long-term picture rather than judging a deal solely on year-one numbers.
Tips for Better Analysis
Always use conservative estimates for rent and vacancy. Budget at least 1% of the property value annually for maintenance and repairs. If you plan to hire a property manager, include their fee (typically 8–12% of monthly rent). Compare the cash on cash return to what you could earn in alternative investments like stocks or bonds to determine whether the risk-adjusted return justifies the deal.
FAQ
Is this cash on cash return calculator free?
Yes, this cash-on-cash return calculator is completely free with no signup, no hidden fees, and no usage limits. You can analyze as many properties as you want. Everything runs locally in your browser, so your financial data stays completely private.
Is my financial data safe?
Absolutely. All calculations run entirely in your browser using client-side JavaScript. Your investment details and financial figures are never sent to any server or stored anywhere. You can even disconnect from the internet and the calculator will continue working.
What is a good cash on cash return?
Most real estate investors consider a cash-on-cash return above 8% to be good and above 12% to be excellent. Returns between 5% and 8% are average for many markets. However, what counts as 'good' depends on your local market, risk tolerance, and whether you also expect property appreciation.
How is cash on cash return different from cap rate?
Cash-on-cash return measures the annual pre-tax cash flow as a percentage of your actual cash invested, including the mortgage payment in expenses. Cap rate measures the net operating income as a percentage of the total property value, ignoring financing entirely. Cash-on-cash is more useful for leveraged investments.
What expenses should I include in the calculation?
Include all recurring operating expenses: property taxes, insurance, maintenance and repairs, property management fees, HOA dues, utilities you pay, and vacancy allowance. Do not include mortgage principal and interest here — that is handled separately in the loan section. The calculator subtracts mortgage payments automatically.
Does cash on cash return include mortgage payments?
Yes. Unlike cap rate, cash-on-cash return includes your mortgage payment (principal and interest). It measures the actual cash flow you receive relative to the cash you invested out of pocket. This makes it the most practical metric for investors who use leverage to purchase rental properties.
What is included in total cash invested?
Total cash invested includes your down payment, closing costs, rehab or renovation expenses, and any other upfront costs you paid out of pocket to acquire and prepare the property. It does not include the portion of the purchase price covered by your mortgage loan.
How does the 5-year projection work?
The 5-year projection applies an annual rent growth rate (default 3%) to estimate how your cash flow and cash-on-cash return will change over time. Operating expenses are assumed to grow at the same rate. This helps you see the long-term potential of your investment beyond just the first year.