Cash-on-cash return calculator
The question that actually pays your bills: what is the money you personally put into this deal earning? This free calculator answers it with your own down payment, rate and term and real per-state property tax and insurance. No signup.
Fixed assumptions: 8% vacancy, 10% maintenance, 10% management. Property tax + insurance are per-state estimates, not a county assessment or insurance quote.
- Mortgage (P&I)$1,958/mo
- Operating expenses$1,447/mo
- Cash invested (down payment)$70,000
- Gross rent multiplier13.3
Estimates only. Verify rent comps, taxes and condition before making an offer. This is not financial advice or an appraisal.
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How the cash-on-cash formula works
Cash-on-cash = (monthly cash flow × 12) divided by cash invested. Monthly cash flow is rent minus the mortgage payment and every operating line: real per-state property tax and insurance, an 8% vacancy reserve, 10% maintenance and 10% management. Cash invested here is the down payment.
Because financing is in the formula, this is the number that moves when you negotiate a rate, change your down payment, or stretch the term. Open the financing assumptions above and watch how a single point of interest changes the return on the same house at the same price.
Frequently asked questions
How is cash-on-cash return calculated?
Cash-on-cash return is your annual pre-tax cash flow divided by the cash you put into the deal. Here that cash is the down payment, and cash flow is rent minus the mortgage payment and all operating expenses, including real per-state property tax and insurance plus reserves for vacancy, maintenance and management.
What is a good cash-on-cash return?
Many buy-and-hold investors look for 8% or better, which is the threshold this tool uses in its verdict. Context matters: a lower cash-on-cash with strong rent growth prospects can beat a higher one in a flat market. Treat the number as a screen, not a decision.
How is cash-on-cash different from cap rate?
Cap rate ignores financing and measures the asset itself. Cash-on-cash is all about your financing: the same property shows a different cash-on-cash at 15% down versus 30% down because both the cash invested and the mortgage payment change. Use cap rate to compare properties and cash-on-cash to judge the deal as you would actually finance it.
Does leverage always increase cash-on-cash return?
No. More leverage means less cash in but a bigger mortgage payment. When the property's unlevered yield is above your borrowing cost, leverage lifts cash-on-cash; when it is below, leverage cuts it. Try different down payments in the financing assumptions to see the crossover on your deal.
Is this financial advice?
No. Every figure is an estimate to help you screen deals quickly. It is not financial, investment or real estate advice, and it is not an appraisal. Verify rent comps, taxes and condition before making an offer.
More free calculators
The full screen: cap rate, cash flow, cash-on-cash and a verdict, with real per-state taxes and insurance.
Net operating income over price, computed with real per-state property tax and insurance.
Monthly rent minus mortgage and every honest expense line, including reserves.
Work backwards: the highest price at which a deal still clears your cash flow and return targets.
Prefer the full write-up? Read the Mortar blog on analyzing rentals.