Cash-on-Cash Return Calculator
Calculate cash-on-cash return on rental property.
Divides annual pre-tax cash flow by total cash invested — down payment, closing costs, and repair budget.
Cash-on-cash return (CoC) measures the annual pre-tax cash income you actually receive relative to the total cash you invested — not the property value, not the mortgage balance, just cash in vs. cash out. It is the most practical metric for rental property investors who use leverage (mortgages).
Formula: Cash-on-Cash Return (%) = (Annual Pre-Tax Cash Flow ÷ Total Cash Invested) × 100
Annual Pre-Tax Cash Flow: Cash Flow = Gross Rental Income − Vacancy Loss − Operating Expenses − Debt Service (mortgage payments)
Total Cash Invested: Cash Invested = Down Payment + Closing Costs + Initial Repairs + Reserves
Variable definitions:
- Gross Rental Income: total rent if 100% occupied for 12 months
- Vacancy Loss: typically 5–10% of gross rent (market dependent)
- Operating Expenses: property taxes, insurance, management fees (~8–12% of rent), maintenance, HOA
- Debt Service: annual principal + interest payments on any mortgage
- Down Payment: cash paid upfront (typically 20–25% for investment properties)
- Closing Costs: title, inspection, lender fees (~2–4% of purchase price)
CoC vs. Cap Rate: key distinction:
- Cap Rate ignores financing, useful for comparing properties on equal footing
- Cash-on-Cash includes your specific loan terms, measures YOUR actual return on YOUR cash
Benchmark targets:
- Below 4%: poor (index funds typically outperform)
- 4–7%: acceptable in high-appreciation markets
- 8–12%: solid performing rental property
- 12%+: excellent (usually in lower-cost markets or with value-add improvements)
Worked example: Purchase price: $250,000. Down payment (25%): $62,500. Closing costs: $4,500. Repairs: $3,000. Total Cash Invested = $70,000
- Monthly rent: $2,000 → Annual gross: $24,000
- Vacancy (7%): −$1,680
- Property taxes: −$2,500
- Insurance: −$1,200
- Management (10%): −$2,400
- Maintenance: −$1,200
- Mortgage P+I (6.5% on $187,500, 30yr): −$14,256/year
- Annual Cash Flow = $24,000 − $1,680 − $2,500 − $1,200 − $2,400 − $1,200 − $14,256 = $764
Cash-on-Cash = ($764 ÷ $70,000) × 100 = 1.09%
This example reveals the property barely cash-flows — a reminder to always run the full numbers before buying.
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This calculator runs entirely in your browser, so the numbers you enter stay on your device. The math behind it is written by hand and tested against worked examples and standard references before the page goes live.
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