Cash-on-Cash Return Calculator
Calculate the cash-on-cash return for your real estate investment. This metric measures the annual pre-tax cash flow relative to the total cash you invested, helping you evaluate the actual return on your out-of-pocket investment.
Cash-on-Cash Return Calculator
FAQ
What is a good cash-on-cash return?
Most real estate investors target a cash-on-cash return of 8-12%. However, this varies by market. In high-appreciation areas, investors may accept lower cash returns (4-6%) in exchange for property value growth.
How is cash-on-cash return different from cap rate?
Cash-on-cash return measures the return on your actual cash invested (including leverage), while cap rate measures the return on the total property value as if purchased without financing. Cash-on-cash is more relevant for leveraged investments.
What counts as total cash invested?
Total cash invested includes your down payment, closing costs, renovation costs, and any other out-of-pocket expenses required to acquire and prepare the property for rental. It does not include the mortgage loan amount.