Break Even Rent Calculator
Calculate the minimum rent needed to break even on a rental property.
Cover your mortgage, taxes, insurance, and maintenance costs.
Minimum Rent Needed
Break-even rent is the minimum monthly rent that covers all property expenses:
Break-Even Rent = (All Monthly Expenses) / (1 - Vacancy Rate - Management Fee Rate)
The denominator adjusts for the fact that you will not collect 100% of rent due to vacancies and management costs.
Monthly expenses include:
- Mortgage payment (P&I)
- Property taxes (annual / 12)
- Insurance (annual / 12)
- Maintenance reserve
- HOA fees
Example: Monthly expenses of $1,800, 5% vacancy, 10% management:
- Break-even rent = $1,800 / (1 - 0.05 - 0.10)
- Break-even rent = $1,800 / 0.85
- Break-even rent = $2,118/month
Tips:
- If market rent is below your break-even, the property will lose money monthly
- Properties can still be profitable if appreciation outweighs negative cash flow
- Lower your break-even by putting more money down (reducing mortgage)
- Self-managing saves 8-12% but requires your time