Rental Property Cash Flow Calculator
Calculate the true monthly and annual cash flow on a rental property after mortgage, taxes, insurance, vacancy, repairs, and property management. See your cash-on-cash return to decide whether the deal clears a reasonable hurdle rate.
What Is Rental Cash Flow?
Rental cash flow is the money left in your pocket each month after the property pays all of its operating expenses and debt service. It equals gross rent minus vacancy, minus operating expenses (taxes, insurance, HOA, maintenance, management), minus the mortgage principal and interest payment. Positive cash flow means the rental pays for itself and puts money in your pocket; negative cash flow means you feed the property from other income.
The 50% Rule and Real Operating Expenses
Experienced investors often use the 50% rule: assume that half of gross rent will be eaten by operating expenses (not including mortgage). This captures property tax, insurance, vacancy, repairs, capital expenditures, and management fees. On a $2,000/month rental, only about $1,000 remains for debt service and cash flow. This calculator lets you enter each line item explicitly rather than using the rule of thumb.
Vacancy, Repairs, and CapEx Reserves
Three categories are commonly under-budgeted. Vacancy typically costs 5-10% of gross rent even in strong markets because of tenant turnover. Ongoing repairs average 5-10% of rent. Capital expenditures (roof, HVAC, appliances) amortize to 5-10% over a property's life. Skipping these lines produces a rosy cash-flow number that reverses the first time a water heater dies.
What Is a Good Cash-on-Cash Return?
Cash-on-cash return (annual cash flow ÷ cash invested) is the income yield on your actual money-in. Long-term investors often target 8-12% for stabilized single-family rentals. Value-add deals aim for 15%+ to compensate for execution risk. Below about 5% cash-on-cash, the deal depends heavily on appreciation — which may or may not materialize — so cash-flow-focused investors typically pass.