Enter the rent or lease income you expect from a duplex, office building, or storefront, and see what price would hit your target return — or check the return on an asking price you already have.
You tell it the things only you know: the property type, the rent or lease income you expect, and the return you're targeting. It estimates everything else — a starting vacancy rate, typical operating expenses, and property tax and insurance based on the state — and gives you two numbers:
Every automated number is labeled "Estimate" and editable — swap in a real number the moment you have one. Change any number, anywhere on the page, and the results update right away, so you can compare a few scenarios in a couple of minutes.
Rent or lease income, minus an estimated vacancy loss, gives effective gross income. Subtracting typical operating expenses (management, maintenance, and miscellaneous costs) and estimated property tax and insurance gives net operating income — the number that actually drives value.
The cap rate result divides that income by price, with no financing involved — it's the return the property itself produces. If you'd rather see what a loan does to your return, the results screen has an optional cash-on-cash section: enter a down payment, rate, and loan term, and it'll show the price for your target cash-on-cash return, plus the actual cash-on-cash and debt coverage at whatever asking price you entered.
Read the full methodology for every assumption and formula used.
Cap rate (capitalization rate) is a property's net operating income divided by its price. It's a way to compare investment properties on the income they produce, without factoring in how the purchase is financed — a higher cap rate generally means more income relative to the price paid.
Cash-on-cash return is your annual cash flow after the mortgage payment, divided by the actual cash you put in — the down payment plus closing costs. Unlike cap rate, it accounts for financing, so it reflects what an investor using a loan would actually see on the money they put down.
No. There's no public, free source for pulling a specific parcel's real tax bill nationwide, so this calculator estimates a tax rate based on the state instead. Type in the real number in the breakdown once you have the actual bill or an assessor's estimate.
Management, maintenance and repairs, and general miscellaneous costs, shown as one adjustable percentage of effective gross income. Property tax and insurance are estimated separately as a percentage of price, since they scale with the property's value rather than its income.
No. It's a starting-point estimate built from typical expense ratios and tax rates, meant to help you quickly screen a property before you invest time getting real numbers — an actual rent roll, a real tax bill, a real insurance quote, and a lender's underwriting.
Yes. Choosing a property type sets a reasonable starting vacancy rate and operating expense percentage for that kind of property — duplex or small multifamily, office, or retail/mixed-use — and you can adjust either number in the results.
DSCR (debt service coverage ratio) is net operating income divided by the annual mortgage payment. A DSCR of 1.0 means the property's income exactly covers the mortgage with nothing left over. Most lenders want to see at least 1.20 to 1.25 before they'll finance a property.