Home > Financial > Rental Property Calculator

Rental Property Calculator

Property Purchase

If did not use a mortgage loan, input down payment as 100%.

%
%
years
Recurring Operating Expenses
/year
% per year
/year
% per year
/month
% per year
/year
% per year
/year
% per year
Rental Income
/month
% per year
%
Property Sale

If you do not know sale price, enter 0.0 and input the house price increasing rate

If you input sale price, this value will not be used

%
%
years
Related Calculators
Mortgage Calculator House Affordability Calculator Buy vs Rent Calculator

Rental Property as an investment tool

To deversify your investment, consider of rental property as an invesment tool. Depends on the house pricing and the rental, the investment return for a rental property might be attracting because you can get a constant cash flow from the difference of rental income to cost that include mortgage payment and maintenance cost etc and the house price appreciation. Normally, if the home price will go up, it is a good time to invest in rental properties. However, there are many factors that will impact the return of a rental property, such as mortgage interest rate, home price changing rate, property tax rate, the rental fee and the vacancy rate. Therefore, before you dive into such kind of investment, make sure you use this calculator to work out with different settings to see if it makes sense or not.

The calculator will calculate the annualized IRR return that is considered as a good index to measure an invesment return. The IRR return use the cash flow of the whole investment life and discount it based on the time factor such that the net present value of the cash flow is equal to the front cost based on this formula: \[ Cost = \sum_{n=1}^{n=m} \frac{F_n}{(1+IRR)^n} \] Where \( F_n \) is the investment Cash flow for year n (that is the rental - all cost), m is the number of years of the investment. Cost is the initial cost that includes the down payment and closing cost.