Cap Rate Calculator — Cap Rate & Cash on Cash Return
Compare investment properties using capitalization rate, NOI, cash-on-cash return, and DSCR based on your assumptions. Verify all operating and financing inputs before making decisions.
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Cap Rate Calculator
Calculate capitalization rate from NOI and property value using your inputs.
Cash on Cash Return
Annual cash flow over total cash invested — accounts for financing.
Side-by-Side Compare
Compare multiple properties using standardized return metrics.
Full NOI Breakdown
Net Operating Income with line-item expense modeling.
AI Investment Score
Each property gets a 0–100 score based on returns and risk profile.
Income-Approach Valuation
Estimate fair property value from NOI and target cap rate.
Cap Rate Calculator — How Capitalization Rate Works
The cap rate measures a property's potential return based on income, independent of how you finance it:
Cap Rate = Net Operating Income (NOI) ÷ Property Value × 100
Example: A property with $50,000 NOI and $500,000 value has a 10% cap rate.
- Higher cap rate = higher potential return (often higher-risk markets)
- Lower cap rate = lower return (typically prime locations / lower risk)
- Because cap rate ignores financing, it's the cleanest way to compare deals across markets
Cash on Cash Return — The Real Investor Metric
Cash on cash return measures your actual cash return on the cash you put in:
Cash on Cash Return = Annual Cash Flow ÷ Total Cash Invested × 100
Unlike cap rate, this calculator accounts for:
- Down payment
- Closing costs and lender fees
- Mortgage payment (PITI) and debt service
- Real after-debt cash flow
This is the metric most experienced rental investors track because it reflects what actually hits your bank account.
Frequently Asked Questions
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