Is this rental actually a good investment? Enter the deal numbers below to see your cap rate, cash-on-cash return, and estimated total first-year ROI including appreciation and principal paydown.
Cap rate (NOI ÷ price) compares properties independent of financing. Cash-on-cash (annual cash flow ÷ cash invested) shows what your actual money earns after the mortgage. Total ROI adds principal paydown and appreciation — the full picture of year-one returns.
A 4–10% cap rate is typical for residential rentals depending on market. Below ~5% cash-on-cash, you’re betting heavily on appreciation — fine if that’s your strategy, risky if it isn’t.
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Most investors target 8–12% cash-on-cash. Total ROI including appreciation can run 15–25%+ in strong markets, but appreciation is never guaranteed.
Cap rate tells you how the property performs; cash-on-cash tells you how YOUR money performs given your financing. Watch both.
Yes — every mortgage payment builds equity you’ll recapture at sale or refinance. It’s real return, just not spendable this month.
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Manage your property free on 10DoorsThis template is provided for general informational purposes and does not constitute legal advice. Landlord-tenant law changes and local ordinances may impose additional requirements — verify current state and local rules before serving any notice. Last reviewed September 2026.