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fetching live rate… 30yr fixed · Federal Reserve
Rent data · HUD Fair Market Rents
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Is Your Rental Property a
Real Investment?

Enter your numbers and get instant clarity on cash flow, ROI, and cap rate — with a straight verdict in seconds.

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Rental Property ROI Calculator

3 quick steps · under 60 seconds · rates & rents from live US government data

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Purchase Details
$
%
%
yrs
$
$
Select a metro to pre-fill rent · HUD 2BR Fair Market data
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Rental Income
$
%
$
📊
Monthly Expenses
$
$
$
$
%
$

📈 Your Results

Monthly Cash Flow
after all costs + mortgage
Cash-on-Cash Return
annual return on cash
Cap Rate
NOI ÷ property price
Gross Rent Multiplier
price ÷ annual gross rent
Annual NOI
net operating income
Monthly Mortgage
principal + interest

Monthly income breakdown
Gross Rent
Operating Expenses
Mortgage Payment
Net Cash Flow
📐 US Benchmarks
Cap Rate (strong)5–10%
Cap Rate (average)3–5%
Cash-on-Cash (strong)8–12%
Cash-on-Cash (average)4–8%
GRM (strong)Below 10×
1% Rule targetRent ≥ 1% price
Typical US vacancy5–8%
💡 Investor Tips
1
Budget 1% of property value/yr for maintenance.
2
Always model 8% vacancy, not 0%.
3
Property mgmt costs 8–12% of monthly rent.
4
Best cash flow markets: Midwest & Southeast.
5
Get a home inspection before any closing.
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How to Analyze a Rental Property

The key metrics every US real estate investor needs to understand.

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What is Rental Property ROI?

Best measured as cash-on-cash return — annual pre-tax cash flow ÷ total cash invested. A return of 8%+ is considered strong in the US. The Midwest and Sun Belt often outperform coastal cities on this metric.

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Cap Rate Explained

Cap rate is what you'd earn buying in cash — no mortgage. It's Annual NOI ÷ Property Value × 100. Single-family rentals in Sunbelt cities typically yield 5–8%. Major metro markets often trade at 3–5%.

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The 1% Rule

A fast screen: if monthly rent is ≥ 1% of purchase price, analyze further. A $250k home should rent for $2,500+. Common in the Midwest; rare in coastal markets. Use as a first filter only.

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Cash Flow vs. Appreciation

Cash flow = monthly profit now. Appreciation = long-term value growth. Cash flow markets: Cleveland, Memphis, Indianapolis. Appreciation plays: NYC, LA, Austin. A balanced strategy targets both.

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Frequently Asked Questions
What is a good ROI for a US rental property?
Most investors target 8–12% cash-on-cash return and a 5–10% cap rate. In high-cost markets like San Francisco, 4–5% is common due to appreciation potential. In the Midwest and Southeast, 7–10% is achievable.
How is cash-on-cash return calculated?
Cash-on-Cash = (Annual Pre-Tax Cash Flow ÷ Total Cash Invested) × 100. Total cash = down payment + closing costs + renovation. Annual cash flow = rental income − all expenses − annual mortgage payments.
What expenses should I always include?
Mortgage (P+I), property taxes, insurance, HOA, maintenance (1%/yr), vacancy (5–8%), and property management if used. Most first-time investors underestimate maintenance and vacancy — the two most common deal-breakers.
What is a good cap rate for US residential rentals in 2026?
5–10% is strong. Below 4% is common in expensive coastal markets. Above 10% may signal high risk, deferred maintenance, or a hidden opportunity. Always investigate why a cap rate is unusually high.
Does this calculator include rental income taxes?
No — all results are pre-tax. Rental income is taxable in the US, but real estate offers tax advantages including depreciation deductions. Consult a qualified CPA for your specific tax situation.
⚠ Disclaimer — Informational Purposes Only

All calculations are estimates based on figures you enter and standard real estate formulas. Results do not constitute financial, investment, tax, or legal advice. Real estate investing involves risk, including possible loss of principal. Always consult a licensed real estate professional, CPA, or financial advisor before making any investment decision.