Cap Rate Calculator

Calculate capitalization rate, cash-on-cash return, and other real estate investment metrics to analyze property profitability.

Quick Start Examples

Property Details

Property Type

Typical cap rate: 4% - 8%

Property Value ($)

Purchase Price ($)

Down Payment ($)

20% of purchase price

Loan Amount ($)

Interest Rate (%)

Loan Term (Years)

Monthly Mortgage Payment

$1,517

Rental Income

Total Annual Income: $28,800

Operating Expenses

Total Annual Expenses: $12,144

Cap Rate Guide

What is Cap Rate?

Capitalization rate = Net Operating Income ÷ Property Value

Good Cap Rates:

• 4-6%: Premium properties, stable areas

• 7-10%: Average market returns

• 10%+: Higher risk, potential value-add

Other Key Ratios:

• GRM: Lower is better (4-10 typical)

• Cash-on-Cash Return: Your actual return on investment

• 1% Rule: Monthly rent should be at least 1% of purchase price

How to Use

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Enter property value, purchase price, and financing details

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Add all rental income sources (rent, parking, laundry, etc.)

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Include all operating expenses (taxes, insurance, maintenance, etc.)

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Review cap rate vs. market averages for property type

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Analyze cash-on-cash return and other investment ratios

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Copy detailed report for investment analysis and comparison