Cap Rate Calculator

How to use

1. 1Pick a property preset (single-family, multi-family, condo, short-term rental, or house hack) to seed realistic starting numbers, or just enter your own.
2. 2Enter purchase price, closing costs, and any rehab spending. Closing and rehab feed total investment, which drives net yield on cost.
3. 3Enter rent as a monthly or annual figure, add any other monthly income, and set a realistic vacancy rate.
4. 4Choose itemized or lump-sum operating expenses. Itemized covers property tax, insurance, maintenance, management, HOA, utilities, and other; lump sum is a single annual figure.
5. 5Read the cap rate, NOI, gross and net yield, GRM, 1% rule, expense ratio, and break-even occupancy in the results panel.
6. 6Optional: turn on Model financing and enter down payment percent, interest rate, and loan term to see cash-on-cash return and DSCR. Use Copy summary to paste the full underwriting block elsewhere.

About this tool

Cap Rate Calculator computes the capitalization rate of a rental property along with the supporting numbers most investors check at the same time: net operating income, gross rental yield, net yield on total cost, the gross rent multiplier, the 1% rule pass or fail, the operating expense ratio, break-even occupancy, and, when financing is enabled, leveraged cash flow, cash-on-cash return, and the debt service coverage ratio. The cap rate formula is straightforward: NOI divided by purchase price, where NOI is annual gross rental income minus a vacancy allowance and operating expenses, with no mortgage payment included. That deliberate exclusion of debt service is what makes cap rate useful as an apples-to-apples yield metric across deals, because it isolates the property's economics from how any one buyer chooses to finance it. The tool accepts rent as either a monthly or annual figure, lets you add other monthly income such as parking, pet rent, laundry, or storage, and applies your chosen vacancy rate to compute effective gross income. Expenses can be entered as a single lump sum if you only have a rough underwriting figure, or itemized across the standard categories: property tax, insurance, maintenance and repairs, property management, HOA dues, owner-paid utilities, and a catch-all line for capex reserves, lawn care, pest control, accounting, or HOA special assessments. Closing costs and rehab spending are tracked separately because they belong in total investment, which drives net yield on cost rather than cap rate itself. The headline results panel shows the cap rate as a percentage and classifies it into descriptive bands (very low, low, moderate, higher, very high), explains what each band typically signals about a market, and surfaces the conventional cross-checks: GRM as a single ratio, the 1% rule explicitly stated as the dollar threshold the monthly rent must clear, the operating expense ratio so you can compare your underwriting to the 40-50% range typical of single-family rentals and the 35-45% range typical of well-run multifamily, and the break-even occupancy that tells you how empty the property can be before NOI hits zero. Turning on the financing toggle adds a down payment percent, interest rate, and loan term, then computes the loan amount, total cash invested, monthly and annual debt service for a standard amortizing loan, the leveraged annual cash flow after debt service, the cash-on-cash return on actual cash deployed, and the DSCR that lenders use to size investor loans (most DSCR investor lenders want 1.20 to 1.25 at minimum, and below 1.00 means NOI does not cover the mortgage). Five property presets seed reasonable starting numbers for a suburban single-family rental, a small 2 to 4 unit multifamily, an urban condo with HOA, a short-term vacation rental with higher vacancy and management cost, and a house hack where the owner lives in one unit and rents the others; replace any preset value with the real numbers for the property you are evaluating before relying on the result. A copy-summary button produces a clean plain-text block for a spreadsheet, a deal memo, or a conversation with a partner, lender, or agent. Useful for first-time landlords screening their first deal, experienced investors building a quick underwriting filter before requesting a pro forma, BRRRR investors checking whether their refinanced loan still pencils, and analysts comparing yield across markets that quote rent in different cadences. All math runs locally in your browser. Nothing entered, including price, rent, expenses, or loan assumptions, is uploaded, logged, or sent to any server. The tool computes what you provide; it is not investment, tax, or legal advice, and it does not replace a professional inspection or formal underwriting before purchase.

Free to use. Works in your browser. No signup, no login.