Calculate your cash-on-cash return on investment property. Accounts for mortgage, vacancy, expenses, and total cash invested.
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Tax, insurance, mgmt, maintenance
The Chen family is buying a $340,000 home in Columbus, Ohio. Combined income $115,000, 10% down payment, 30-year fixed at 7.125%.
Takeaway: Columbus/Franklin County averages are the reference baseline. Property tax rates and insurance premiums shift significantly by ZIP code and HOA status. Plug your actual numbers in above.
We default to state-average millage rates. County and municipal rates vary 40%+ within a single state. Ohio ranges from 0.8% (rural counties) to 2.4% (Cuyahoga/Cleveland area). Always cross-check your specific county assessor's published effective rate.
Property Tax by StateHomeowner association fees add $100-$800/month in condos and planned communities. Condos in urban markets often run $400-$700/month. If your property has HOA, add it manually to any payment estimate — it directly affects your debt-to-income ratio for loan qualification.
HOA Fee CalculatorClosing costs typically run 2-5% of the loan amount — around $6,000-$15,000 on a $300K home. Lender fees, title insurance, escrow, and prepaid taxes add up fast. These are due at closing in cash, not rolled into the mortgage by default.
Closing Costs CalculatorPrivate mortgage insurance (PMI) costs 0.5-1.5% of the loan annually until you reach 20% equity. On a $300K loan at 1%, that's $250/month. PMI cancels automatically at 78% LTV under federal law — but you can request removal at 80%.
National home price appreciation has averaged ~4% annually since 1968, but markets diverge dramatically. Sun Belt metros averaged 10%+ during 2020-2022; coastal markets often lag the national average during correction cycles. Local supply constraints are the main driver.
If you've lived in the home 2 of the last 5 years, you can exclude $250K (single) or $500K (married) of gain from federal capital gains tax. Many calculators show gross profit without applying this exclusion. Relevant when projecting sale proceeds.
Home Sale Capital Gains CalculatorBased on your inputs
Annual return on cash invested
After all expenses + mortgage
| Purchase Price | $300,000 |
|---|---|
| Down Payment (25%) | $75,000 |
| Closing Costs | $8,000 |
| Rehab Costs | $0 |
| Total Cash Invested | $83,000 |
| Monthly Rent Income | $2,200 |
| Vacancy (5%) | -$110 |
| Monthly Operating Expenses | -$600 |
| Monthly Mortgage Payment | -$1,497 |
| Monthly Cash Flow | -$7 |
| Annual Cash Flow | -$83 |
| Cash-on-Cash Return | -0.1002016504071347% |
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8–12% CoC is generally strong for rental properties. Below 5% may not justify illiquidity vs. other investments. Over 15% is excellent but often involves higher risk or significant leverage.
Cap rate ignores financing and measures property-level return. Cash-on-cash measures your personal return on the actual cash you invested (down payment + closing costs), accounting for mortgage debt service.
Down payment + closing costs + rehab/renovation costs + reserves. This is the actual cash out of your pocket — not the total purchase price.
No. CoC measures only cash income return. Add expected appreciation for total return analysis. Many investors accept lower CoC in appreciating markets for total return.
Increase rent, reduce vacancy, lower operating expenses, or refinance to a lower interest rate. Using more leverage (higher LTV) increases CoC but also increases risk. Adding value through renovations can boost rent and improve returns.
Short-term rentals typically target 15-25% cash-on-cash return to compensate for higher management costs, furniture expenses, and seasonal vacancy. After accounting for cleaning fees, supplies, and platform fees, net CoC of 12-18% is considered strong.
Leverage amplifies CoC return. A $200K property purchased all-cash yielding $16K NOI gives 8% CoC. With 75% LTV, your $50K cash investment might yield $6K after debt service, giving 12% CoC. However, leverage also amplifies losses.
Cash-on-cash measures year-one income return on invested cash. IRR accounts for all cash flows over the hold period including appreciation and sale proceeds. Use CoC for quick screening and IRR for comprehensive investment analysis over time.
Include down payment, loan origination fees, appraisal, inspection, title insurance, attorney fees, transfer taxes, and initial repairs. Typical closing costs are 2-5% of purchase price. Underestimating cash invested inflates your CoC calculation.
Cash-on-cash measures annual pre-tax cash flow divided by total cash invested, focusing on one year of income. ROI includes all returns over the holding period such as appreciation, principal paydown, and tax benefits. CoC is a snapshot metric while ROI captures total investment performance.
Cash-on-Cash Return = Annual Cash Flow ÷ Total Cash Invested × 100
Annual Cash Flow = (Rent × (1−Vacancy%) − Expenses − Mortgage) × 12
Total Cash Invested = Down Payment + Closing Costs + Rehab
Every formula on this page traces to a federal agency, central bank, or peer-reviewed institution. We cite the rule-makers, not secondhand blogs.
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Calculations are for educational purposes only. Consult a qualified financial advisor for personalized advice.