Free Tool — 2026

Rental Property ROI Calculator

Analyze any investment property in seconds. Get cap rate, cash-on-cash return, monthly cash flow, and total ROI — including appreciation over your hold period.

Cap rate analysisCash-on-cash return1% rule checkTotal ROI with appreciation

Property

Purchase Price

Down Payment — 25% ($87,500)

5%50%

Closing Costs

Rehab / Repairs

Rental Income

Monthly Rent

Vacancy Rate

Other Income/mo

Parking, laundry, etc.

Expenses

Mortgage Rate

Loan Term

Property Tax/yr

Insurance/yr

Maintenance/yr

Property Mgmt

HOA / Month

Hold Period & Growth

Hold Period — 10 years

1 yr30 yrs

Appreciation/yr

Rent Growth/yr

Cap Rate

4.10%

Average

Cash-on-Cash

-5.20%

Below avg

Monthly Cash Flow

-$425

-$5,096/year

1% Rule

0.71%

✗ Fails

Total Cash Invested

Down Payment (25%)$87,500

Closing Costs (3%)$10,500

Total Cash In$98,000

Monthly Income vs Expenses

Effective Rent (92% occupied)+$2,300

Mortgage (P&I)−$1,620

Tax + Insurance−$583

Maintenance + Mgmt−$522

Net Cash Flow-$425

After 10 Years

Future Property Value$493,710

Remaining Mortgage−$221,238

Selling Costs (6%)−$29,623

Cumulative Cash Flow+-$50,961

Total Profit$93,888

Total ROI95.80%

Annualized ROI6.95%

Gross Rent Multiplier11.7x

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How It Works

How We Calculate Rental ROI

This calculator gives you a complete picture of rental property returns — not just monthly cash flow, but total ROI including appreciation over your planned hold period.

Cap Rate measures the property's income return independent of financing. A cap rate above 5% is generally considered strong for residential rentals in 2026.

Cash-on-Cash Return measures actual cash income relative to cash invested. It accounts for your mortgage, making it a better measure of your personal return than cap rate.

The 1% Rule is a quick screen: monthly rent should be at least 1% of purchase price. It doesn't guarantee positive cash flow but filters out obvious losers.

Benchmark Returns (2026)

Cap Rate

< 3%3–5%5%+

Cash-on-Cash

< 4%4–8%8%+

GRM

> 15x10–15x< 10x

Below avgAverageStrong

Key Rules of Thumb

1% Rule

Monthly rent ≥ 1% of purchase price

50% Rule

Operating expenses ≈ 50% of gross rent

70% Rule

Max buy price for flips: 70% of ARV minus repairs

DSCR ≥ 1.25

NOI ÷ debt service — lender minimum for investment loans

Cap Rate Benchmarks by Market — 2026

Expected returns vary significantly by market type. Primary coastal markets offer lower cap rates but stronger appreciation. Tertiary and Midwest markets deliver higher cash yields with more modest price growth. Use this table to benchmark your target market before running the calculator above.

Market Type	Cap Rate Range	Cash-on-Cash	Notes
Primary (NYC, LA, SF, Boston)	3–5%	2–5%	Low cap, appreciation play
Secondary (Austin, Denver, Miami)	4–6%	4–7%	Balanced growth & income
Tertiary (Memphis, KC, Cleveland)	6–10%	7–12%	High income, slower growth
Sun Belt (Phoenix, Tampa, Atlanta)	5–7%	5–9%	Strong rent & pop growth
Midwest (Columbus, Indy, STL)	6–9%	6–11%	Affordable, steady demand
Mountain West (SLC, Boise)	4–6%	4–7%	High appreciation potential

Benchmarks based on 2026 market data for single-family and small multifamily (2–4 unit) properties. Cap rates vary by property type, condition, and specific submarket. Always run property-specific analysis using the calculator above.

Ready to build your rental property?

You've run the ROI numbers — now get the exact construction cost for a new build. New construction rentals often outperform resales in long-term returns.