What metrics should I analyze before buying a rental property?

The five key metrics are: Cap Rate (NOI ÷ Price), Cash-on-Cash Return (Cash Flow ÷ Cash Invested), Gross Yield (Annual Rent ÷ Price), Net Cash Flow (monthly income after all expenses and mortgage), and Total ROI including appreciation. This calculator shows all five simultaneously.

What is NOI in real estate?

Net Operating Income (NOI) is effective gross income minus all operating expenses, excluding mortgage payments. NOI = Gross Rent − Vacancy − Property Tax − Insurance − Maintenance − Management Fees − HOA. It is the foundation for cap rate and DSCR calculations.

Is a rental property a good investment in 2026?

Rental properties can be excellent investments in the right market. At 2026 interest rates (7%+), achieving positive cash flow requires buying in high-yield markets (Cleveland OH, Memphis TN, Indianapolis IN) or making large down payments. Focus on net yield above 6% and positive monthly cash flow.

What down payment do I need for a rental property?

Investment properties typically require 20-25% down for conventional financing. FHA loans (3.5% down) require owner-occupancy. Some investors use portfolio loans or DSCR loans which evaluate property income rather than personal income, sometimes requiring 20-30% down.

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Rental Property Calculator (2026)

Full investment analysis — enter purchase details, financing, and expenses to instantly see cash flow, cap rate, cash-on-cash return, gross yield, and NOI.

🏘️ Rental Property Investment Calculator

Purchase & Financing

Purchase Price ($)

Down Payment (%)

Interest Rate (%)

Loan Term

Rental Income

Monthly Rent ($)

Vacancy Rate (%)

Annual Operating Expenses

Property Tax ($)

Insurance ($)

Maintenance ($)

~1% of value/yr

Management Fee (%)

HOA / Other ($/yr)

How to Analyze a Rental Property

A thorough rental property analysis checks five numbers: gross yield (screens the market), cap rate (compares properties), NOI (lender and valuation metric), cash flow (monthly profitability), and cash-on-cash return (return on your specific investment).

At 2026 rates (~7%), most properties need a gross yield above 9–10% to produce positive monthly cash flow with conventional financing. Focus on markets where rent-to-price ratios are strong: Cleveland OH, Memphis TN, Cincinnati OH, Indianapolis IN, and Birmingham AL.

Frequently Asked Questions

What numbers should I check before buying a rental?

Check: Gross Yield (target 7%+), Cap Rate (compare to local market), Monthly Cash Flow (target positive), Cash-on-Cash Return (target 6%+), and DSCR (target 1.25+ for financing). This calculator shows all five simultaneously.

What is NOI and why does it matter?

NOI (Net Operating Income) = Effective Gross Income − Operating Expenses (excluding mortgage). Lenders use NOI to calculate DSCR. Appraisers use NOI ÷ market cap rate to value commercial properties. It is the foundation of most professional investment analysis.

What cap rate should I look for?

A cap rate above the local risk-free rate (10-year Treasury) is a minimum threshold. In 2026, most investors target 6%+ cap rates for single-family homes and 7%+ for multifamily. Below 5% cap rate typically means you are buying appreciation rather than income.

How much should I budget for maintenance?

The 1% rule estimates annual maintenance at 1% of property value ($2,000 on a $200,000 home). Older properties and those in harsh climates may need 1.5–2%. This does not include CapEx reserves for major items like roof or HVAC replacement.

Rental Property Calculator (2026)

How to Analyze a Rental Property

Frequently Asked Questions

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