How to use the rental property cash flow calculator
- Enter the purchase price, deposit (percent or amount) and purchase costs paid in cash.
- Enter the loan rate and term, and choose principal and interest or an interest-only period.
- Enter rent per month or week, vacancy and annual operating expenses.
- Set your own rent growth and expense growth assumptions.
- Review year 1 cash flow, cap rate, cash-on-cash and DSCR, then the 10-year table and cumulative chart.
Worked example
$300,000 property, 20% down, 6% for 30 years, $2,000 per month rent
Loan $240,000; monthly P&I $1,438.92 ($17,267.04 a year). Rent $24,000 less 5% vacancy = $22,800. Expenses $3,000 tax + $1,200 insurance + $1,500 maintenance + 8% management ($1,824) = $7,524. NOI $15,276, so the cap rate is 5.09%. Cash flow is $15,276 − $17,267.04 = −$1,991.04 in year 1 (−$165.92 per month), cash-on-cash −2.84% on $70,000 invested, and DSCR 0.88. Expenses and growth rates are example values.
How it works
Loan = price − deposit. Repayments use the fixed-rate amortization engine (M = P × r ÷ (1 − (1 + r)−n), monthly, rounded to the cent); interest-only months pay balance × rate ÷ 12, then P&I over the remaining term. Year y rent = rent × 12 × (1 + rent growth)y−1; fixed expenses grow at the expense growth rate; management is a % of collected rent. NOI = collected rent − expenses. Cash flow = NOI − repayments. Cap rate = year 1 NOI ÷ price; cash-on-cash = year 1 cash flow ÷ (deposit + purchase costs); DSCR = NOI ÷ repayments.
Assumptions
- No tax modelling: income tax, depreciation, negative gearing, deductions and capital gains are excluded.
- Property value growth and sale proceeds are not projected.
- Rent growth, expense growth, vacancy and expenses are your own assumptions; starting values are examples.
- The interest rate is fixed for the whole projection.
- Purchase costs are paid in cash, not added to the loan.
Frequently asked questions
What is a good DSCR?
DSCR above 1 means the property’s net operating income covers the loan repayments. Lenders that use DSCR set their own minimums, so check with yours.
Why is my cash flow negative?
Repayments, especially with principal, often exceed net rent early on. Part of each P&I payment builds equity, which is not counted as cash flow here; the loan balance column shows it.
Does this include tax benefits?
No. Tax treatment depends on your country and circumstances. The figures are before tax; speak to a qualified adviser.
What is the difference between cap rate and cash-on-cash?
Cap rate ignores financing: NOI ÷ price. Cash-on-cash uses your actual cash invested and your cash flow after loan repayments.
Limitations
- No tax, capital growth, refinancing or variable rates.
- Capital expenditure (roof, kitchen) should be added as maintenance or other expenses.