Use this calculator to quickly estimate if the real estate you're interested in is worth investing in. This tool is designed to assist you, but it is not a replacement for a thorough financial analysis. Consider seeking advice from a real estate professional for comprehensive guidance.
When assessing the profitability of rental properties, several key metrics are crucial for making an informed decision.
The Capitalization Rate (Cap Rate) is fundamental, representing the annual return on investment relative to the property's value.
Cash Flow measures the net income generated after all expenses, including mortgage payments, taxes, and maintenance costs.
Return on Investment (ROI) evaluates the property's profitability relative to the initial investment.
Gross Rent Multiplier (GRM) provides a quick estimate of a property's value by dividing its price by the gross rental income.
Occupancy Rate indicates the percentage of occupied rental units, directly impacting rental income.
Net Operating Income (NOI) calculates the total revenue minus operating expenses, offering insight into the property's potential profitability.
Together, these metrics provide a comprehensive overview of a rental property's financial performance.