Rental Property Cash Flow Calculator: Calculate Monthly & Annual Cash Flow

Underwrite a rental the way investors do: rent, vacancy, every operating expense, financing and reserves - then see NOI, cap rate, cash-on-cash return, DSCR and break-even.

Use Our Cash Flow Calculator

Calculate Rental Property Cash Flow

Use rent supported by local rental comparables.

Assumption - adjust based on the property's market and expected occupancy.

Estimated Monthly Cash Flow
+$249/month
Annual: +$2,982 · NOI: $28,156/yr
Cash-on-cash: 2.71% · Cap rate: 7.04%
See full analysis ↓
Property & Purchase

Adds a current-value cap rate alongside the acquisition cap rate.

≈ $10,000 at the current purchase price. Loan costs, inspection, appraisal, title, transfer costs.

Counted in cash invested - not a recurring expense.

Financing

≈ $100,000 at the current purchase price. Loan amount: $300,000

Loan Term

Monthly payment: $1,946 · Annual debt service: $23,350

Rental Income

Gross potential rent: $3,200/month ($38,400/year) · Vacancy loss: $160 · Effective rental income: $3,040/month

Operating Expenses

Costs to run the property. The mortgage is financing, not an operating expense, and the CapEx reserve is a capital reserve - both are subtracted after NOI.

≈ $417/month.

≈ $125/month. A landlord (dwelling) policy.

≈ $0 at the current collected rent. Leave at 0 if self-managing - or enter a rate to see what management would cost.

≈ $152 at the current collected rent. Routine repairs.

≈ $152 at the current collected rent. Capital reserve for roof, HVAC, water heater, appliances and major systems.

Not required. Carries into a Reaixo property analysis with your price and rent. It doesn't change the numbers here and is never put in a share link.

ASSUMPTION Every input is your assumption; starting values are illustrative. Results update as you type.

How do you calculate rental property cash flow?

Rental property cash flow is generally calculated by subtracting vacancy, operating expenses, financing payments and modeled reserves from rental income. Positive cash flow means modeled income exceeds modeled cash requirements for the period.

Your Rental Property Cash Flow Analysis

Every figure below is calculated from your inputs and updates instantly.

Estimated Monthly Cash Flow
+$249/month
+$2,982/year
Positive Cash Flow

Income exceeds modeled expenses, debt service and reserves.

Gross Rental Income
$38,400/yr
$3,200/month incl. other income
CALCULATED
Effective Rental Income
$36,480/yr
After $160/month vacancy
CALCULATED
Operating Expenses
$8,324/yr
$694/month
CALCULATED
NOI
$28,156/yr
$2,346/month
CALCULATED
Debt Service
$23,350/yr
$1,946/month
CALCULATED
Total Cash Invested
$110,000
Down $100,000 · Closing $10,000 · Repairs $0
CALCULATED
Cap Rate
7.04%
NOI ÷ purchase price
CALCULATEDCalculator →
Cash-on-Cash Return
2.71%
Annual cash flow ÷ cash invested
CALCULATEDCalculator →
DSCR
1.21×
NOI ÷ annual debt service
CALCULATED
Operating Expense Ratio
22.8%
CALCULATED
Break-Even Occupancy
86.4%
Maximum vacancy before cash flow turns negative: 13.6%
CALCULATED
Break-Even Rent
$2,909/mo
Minimum rent for $0 cash flow, with vacancy, expenses, debt service and reserves
CALCULATED

Cash Flow Waterfall

Rent → vacancy → effective income → operating expenses → NOI → financing → capital reserves → cash flow.

ItemMonthlyAnnual
Gross rent$3,200$38,400
Vacancy & credit loss−$160−$1,920
Effective income$3,040$36,480
Property taxes−$417−$5,000
Insurance−$125−$1,500
Maintenance−$152−$1,824
Net operating income (NOI)$2,346$28,156
Mortgage (principal & interest)−$1,946−$23,350
CapEx reserve−$152−$1,824
Estimated cash flow (before tax)+$249+$2,982

For Every $1 of Collected Rent

  • $0.23 → Operating costs
  • $0.64 → Mortgage
  • $0.05 → CapEx reserve
  • $0.08 → Cash flow

Scenario Analysis

Test what happens when assumptions change. Nothing here alters your inputs above.

Scenario Analyzer

MetricYour inputsAdjusted
Monthly cash flow+$249+$249
NOI (annual)$28,156$28,156
Cap rate7.04%7.04%
Cash-on-cash2.71%2.71%
DSCR1.21×1.21×
Break-even occupancy86.4%86.4%
What If Rent Changes?
ScenarioRentMonthly Cash Flow
Rent -10%$2,880−$25
Rent -5%$3,040+$112
Current rent · your input$3,200+$249
Rent +5%$3,360+$385
Rent +10%$3,520+$522

Rows above your rent are what-ifs, not expectations.

Vacancy Stress Test
ScenarioMonthly Cash FlowDSCR
0%+$3931.28×
5% · your input+$2491.21×
10%+$1051.13×
15%−$391.05×
20%−$1830.97×
Expense Stress Test
ScenarioNOIMonthly Cash FlowCash-on-Cash
Current expenses · your input$28,156+$2492.71%
Expenses +10%$27,324+$1791.95%
Expenses +20%$26,491+$1101.20%

Scales every operating expense (CapEx reserve and debt service unchanged).

Interest Rate Sensitivity
ScenarioRatePaymentMonthly Cash Flow
5.75%5.75%$1,751+$444
6.25%6.25%$1,847+$347
6.75% (current) · your input6.75%$1,946+$249
7.25%7.25%$2,047+$148
7.75%7.75%$2,149+$45

Minimum Rent Needed to Break Even

$2,909/month

Solved with your vacancy, operating expenses, debt service and CapEx reserve. Percentage-based costs rise with rent, so this isn't a simple subtraction. Your rent is $291 above break-even.

What Rent Would Produce My Target Cash Flow?

Estimated required monthly rent: $3,494

Compare Scenarios

Save your current inputs as Scenario A, B or C - for example a lower price, higher rent, or cash vs financing - then compare side by side.

Scenario A
Empty
Scenario B
Empty
Scenario C
Empty

Saved in this browser only. Addresses are never saved with scenarios.

Want a Deeper Rental Property Analysis?

Cash flow is only one part of an investment decision. Reaixo can help you evaluate rental assumptions, operating costs, returns, risks and property-specific factors in one analysis.

Your purchase price and rent carry over so you don't re-enter them.

How Rental Property Cash Flow Is Calculated

  Rental Income
− Vacancy
− Operating Expenses
− Debt Service
− Capital Reserves
= Cash Flow

The order matters. Vacancy turns gross potential rent into effective rental income. Operating expenses turn that into net operating income (NOI) - the property's result before financing. Debt service and the CapEx reserve then turn NOI into cash flow. Annual cash flow is monthly cash flow × 12, with annual costs like taxes and insurance converted to monthly first.

What Expenses Should You Include in Rental Property Cash Flow?

Rental property expenses fall into three groups, and keeping them separate is what makes the analysis trustworthy:

Operating expenses

Required to run the property: property taxes, insurance, maintenance, property management, owner-paid utilities, HOA, landscaping and snow removal, pest control, leasing and turnover, accounting and legal, licensing.

Capital reserves

Money set aside for future replacements - roof, HVAC, water heater, appliances and other major systems. Not a monthly bill, but a real long-term cost.

Financing costs

Mortgage principal and interest. Deducted after NOI, never inside it.

NOI vs Cash Flow: What's the Difference?

NOI       = Effective income − Operating expenses
Cash flow = NOI − Debt service − Other modeled cash requirements (e.g. CapEx reserve)

NOI describes the property regardless of how it's financed, which is why cap rate uses it. Cash flow describes your investment after financing. A property can have healthy NOI and still produce negative cash flow if the debt service is large enough.

How Much Cash Flow Should a Rental Property Generate?

There's no universal dollar or percentage target. What's acceptable depends on the purchase price, how much you invested, the financing structure, your goals, the market, property type, risk, appreciation expectations and tax considerations. Instead of chasing one number, compare cash flow alongside cash-on-cash return, cap rate, DSCR and the downside scenarios above.

Cash Flow Example

A worked example, calculated by the same engine as the calculator (illustrative numbers - replace them with property-specific information):

Purchase price                    $400,000
Down payment (25%)                $100,000
Loan (6.75%, 30 yr)               $300,000

Monthly rent                        $3,200
Vacancy (5%)                         −$160
Effective rental income             $3,040
Property taxes ($5,000/yr)           −$417
Insurance ($1,500/yr)                −$125
Management (8%)                      −$243
Maintenance (5%)                     −$152
NOI                                 $2,103
Mortgage (P&I)                     −$1,946
CapEx reserve (5%)                   −$152
------------------------------------------
Monthly cash flow                       $5
Annual cash flow                       $64

Cap rate: 6.31% · Cash invested: $110,000 · Cash-on-cash: 0.06% · DSCR: 1.08× · Break-even rent: $3,193.

Common Rental Property Cash Flow Mistakes

Assuming zero vacancy

Rental properties may experience vacancy or nonpayment.

Ignoring maintenance

Small repairs accumulate.

Forgetting major replacements

Roof, HVAC and appliances are not monthly bills but still affect long-term economics.

Ignoring property management

Even self-managed investors should understand what management would cost.

Using gross rent instead of effective rent

Gross rent does not account for vacancy.

Treating mortgage principal as an NOI expense

NOI is calculated before debt service; principal and interest come after.

Forgetting HOA or condo fees

Especially important for condos and townhomes.

Ignoring owner-paid utilities

Water, sewer, trash or common-area power can materially affect cash flow.

Using unrealistically high projected rent

Verify rent assumptions with relevant local rental comparables.

Cash Flow Calculation Tips

  • Use realistic rent estimates backed by local comparables.
  • Include a vacancy allowance.
  • Separate recurring maintenance from capital reserves.
  • Model property management even if you'll self-manage at first.
  • Review insurance and property taxes carefully - taxes can change after a purchase.
  • Stress-test rent, vacancy, expenses and interest rates.
  • Evaluate cash flow alongside cap rate, cash-on-cash return and DSCR.
  • Recalculate whenever financing assumptions change.

How to Improve Rental Property Cash Flow

Possible approaches - results depend on the property and market, and none is guaranteed:

  • Increase rent where supported by the market and applicable laws.
  • Reduce vacancy and improve tenant retention.
  • Reduce avoidable operating costs and renegotiate selected services.
  • Review insurance costs and coverage.
  • Improve energy efficiency to lower owner-paid utilities.
  • Add legitimate ancillary income such as parking, storage or laundry.
  • Evaluate financing costs - see the interest rate sensitivity above.
  • Plan maintenance to avoid costlier emergency repairs.

Related Calculators

Frequently Asked Questions

How do you calculate rental property cash flow?

Rental property cash flow is generally calculated by subtracting vacancy, operating expenses, financing payments and modeled reserves from rental income. Positive cash flow means modeled income exceeds modeled cash requirements for the period. In formula form: Rental Income − Vacancy − Operating Expenses − Debt Service − CapEx Reserve = Cash Flow.

What expenses should I consider when calculating rental property cash flow?

Property taxes, insurance, maintenance, property management, owner-paid utilities, HOA or condo fees, a vacancy allowance, a CapEx reserve for major replacements, leasing and turnover costs, and - after NOI - the mortgage or other debt payments.

How do I improve rental property cash flow?

Common approaches include raising rent where the market and applicable laws support it, reducing vacancy through tenant retention, cutting avoidable operating costs, shopping insurance and service contracts, improving energy efficiency, adding legitimate ancillary income such as parking or storage, and reviewing financing costs. Results depend on the property and market; none is guaranteed.

Does mortgage principal count as an operating expense?

No - not for NOI. Mortgage payments (principal and interest) are financing, or debt-service, costs. They are deducted after NOI when calculating property cash flow.

Should vacancy be included?

Yes. A vacancy allowance makes the analysis more realistic than assuming twelve months of collected rent every year, since turnover and nonpayment happen.

Should I include CapEx?

Long-term investors commonly model a CapEx reserve separately from routine maintenance. Roofs, HVAC systems, water heaters and appliances aren't monthly bills, but they eventually need replacing, and a reserve spreads that cost across the years you own the property.

What is the difference between cash flow and NOI?

NOI is income minus operating expenses, before any mortgage payment. Cash flow is NOI minus debt service and other modeled cash requirements such as a CapEx reserve. NOI describes the property; cash flow describes your investment in it.

Is cash flow calculated before or after mortgage payments?

Both numbers are useful: NOI is calculated before mortgage payments, and cash flow is calculated after them. When investors say "cash flow," they usually mean the after-debt-service figure.

Can a property have positive NOI but negative cash flow?

Yes. If debt service (plus any reserves) is larger than the NOI left after operating expenses, cash flow is negative even though the property itself earns positive NOI.

What is break-even rent?

Break-even rent is the monthly rent at which modeled cash flow is exactly zero after vacancy, operating expenses, debt service and reserves. Because some costs are a percentage of rent, it has to be solved rather than found by simple subtraction - the calculator above shows it for your inputs.

What is considered good rental cash flow?

There is no universal dollar or percentage target. Acceptable cash flow depends on the purchase price, how much you invested, the financing, your goals, the market, property type, risk, appreciation expectations and taxes. Compare cash flow alongside cash-on-cash return, cap rate, DSCR and downside scenarios.

How much should I budget for vacancy?

It depends on local rental demand, the property and how it's managed. Use local vacancy information and your own turnover expectations, then run the vacancy stress test to see how sensitive the property is.

Disclaimer: Reaixo provides educational and informational estimates based on the assumptions entered and available data. Actual rental income, vacancies, expenses, financing costs, property values, taxes and investment results may differ. This calculator is not an appraisal, lending decision, tax advice, legal advice or investment recommendation. Verify property-specific information and consult qualified professionals where appropriate.