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Financial Calculators● INSTANT WASM ENGINE

Real Estate Cap Rate & Rental Yield Calculator

Analyze residential or commercial real estate acquisitions with Cap Rate, Net Operating Income (NOI), Cash-on-Cash Return, and monthly cash flow.

Input Parameters

$
$
$
$
Property Cap Rate Instant
7.14%

Monthly Cash Flow: $550/mo

Proportional Breakdown100% Total
Mortgage Debt Service:$1,950/mo
Operating Expenses:$700/mo
Net Discretionary Cash Flow:$550/mo

Analytical Summary

Net Operating Income (NOI)$30,000/yr
Gross Rental Yield9.14%
Monthly Net Cash Flow$550
Annual Operating Expenses$8,400

Mathematical Formula & Methodology

Underlying equations and mathematical logic governing this engine

Step 01

Net Operating Income (NOI)

NOI = (MonthlyRent * 12) - OperatingExpenses

Annual property revenue after subtracting operational overhead.

Step 02

Capitalization Rate (Cap Rate)

CapRate = (NOI / PurchasePrice) * 100

Unleveraged rate of return expected on a real estate investment property.

Step 03

Monthly Net Cash Flow

CashFlow = MonthlyRent - (Expenses/12) - Mortgage

Actual monthly discretionary cash deposited into bank account.

How to Use This Calculator

1

Input Asset Valuation

Enter acquisition cost including initial closing fees.

2

Account for Operating Costs

Factor in property tax, landlord insurance, HOA, and 5-10% maintenance reserves.

3

Verify Net Cash Flow

Ensure rental income adequately covers debt service and yields positive cash flow.

Frequently Asked Questions