Rental Income
Other income includes laundry, parking, storage, pet fees, etc.
Mortgage / PITI
Operating Expense Rates
Percentages are calculated against gross monthly income. Management fee uses effective income after vacancy.
Cash Flow Analysis
Enter rental property details and click calculate.
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What This Calculator Does
This rental property cash flow calculator provides a detailed monthly and annual cash flow analysis for residential investment properties. It calculates the complete expense picture including PITI (principal, interest, taxes, insurance), vacancy allowance, maintenance reserves, property management fees, and capital expenditure reserves. The tool shows your true net cash flow and cash-on-cash return so you can evaluate whether a rental property meets your investment criteria. All default assumptions use 2026 market data and industry-standard expense ratios.
The Formula
Gross monthly income includes rent plus any other income (laundry, parking, storage, pet fees). Vacancy is typically 5-8% of gross income. PITI covers principal and interest on the mortgage plus monthly property tax and insurance amounts. Maintenance, management, and CapEx reserves are calculated as percentages of income. Cash-on-cash return divides annual cash flow by the total cash invested (down payment plus closing costs).
Step-by-Step Example
Calculate gross income
Monthly rent: $2,400 plus $100 in other income (parking) = $2,500 gross monthly income.
Subtract vacancy
At a 5% vacancy rate: $2,500 x 5% = $125 monthly vacancy allowance. Effective income: $2,375.
Calculate PITI
$300,000 purchase at 25% down ($75,000 down, $225,000 loan) at 7.0% for 30 years: $1,497 mortgage + $300 tax + $125 insurance = $1,922 PITI.
Add operating expenses
Maintenance at 5%: $125. Management at 8%: $190. CapEx reserve at 5%: $125. Total additional expenses: $440.
Calculate cash flow
$2,500 gross - $125 vacancy - $1,922 PITI - $440 operating = $13 monthly cash flow ($156 annual). Cash-on-cash return: 0.21%.
Real-World Use Cases
Property Acquisition Analysis
Run cash flow numbers before making an offer to ensure the property generates positive cash flow at current market rents and 2026 interest rates.
Expense Ratio Benchmarking
Compare your property operating expense ratio against the industry benchmark of 35-50% to identify if any expense category is out of line.
Portfolio Performance Review
Analyze each property in your rental portfolio to identify underperformers and determine where rent increases, expense reductions, or refinancing could improve cash flow.
Common Mistakes to Avoid
Not including vacancy allowance. Even in hot rental markets, you should budget 5-8% for vacancy, tenant turnover, and collection losses.
Skipping CapEx reserves. Major items like roofs ($8,000-$15,000), HVAC ($5,000-$10,000), and water heaters ($1,500-$3,000) must be reserved for over time.
Using interest-only calculations instead of fully amortized mortgage payments. Your actual payment includes both principal and interest.
Ignoring property management costs even if you self-manage. Your time has value, and if you ever need to hire management, it will cost 8-12% of collected rent.
Not accounting for maintenance and repair costs. Budget at least 5-10% of gross rent for ongoing repairs, especially for older properties.
Frequently Asked Questions
Accuracy and Disclaimer
This calculator provides estimates for planning and analysis purposes only. Actual rental income, expenses, and returns vary by property, location, tenant quality, and market conditions. Tax benefits such as depreciation are not included. Consult a financial advisor or CPA for investment tax guidance.
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