Rental Calculator for Landlords | Calculate ROI on Real Estate Investments

Thinking about buying a rental property? Use our free rental property calculator to quickly figure out whether a property is a good investment — even if you're brand new to real estate.

Rental Property ROI Calculator

What You Can Calculate

Monthly and annual rental income - using rent estimates and comps from www.rentometer.com
Expenses like maintenance, insurance, and property taxes
Net operating income (NOI)
Cap rate, cash-on-cash return, and more

Calculating Rental Property ROI

Rental ROI (Return on Investment) tells you how profitable a rental property is. It’s usually expressed as a percentage of your total investment, helping you understand how much money you’re earning compared to what you spent.

To calculate ROI, you need three key numbers:

Total Investment Cost – Includes purchase price, closing costs, and repairs
Monthly Income – Rent and any additional income (e.g. parking, laundry)
Monthly Expenses – Maintenance, taxes, insurance, HOA fees, mortgage, etc.

Basic ROI Formula: ROI = (Investment Gain – Investment Cost) ÷ Investment Cost

What Makes ROI More Complex?

If you're financing the property (using a mortgage), the formula becomes more nuanced. You’ll also need to consider:

Loan interest and amortization
Tax implications
Long-term capital expenses (CapEx)
Vacancy and management costs

That’s why using a rental ROI calculator is the easiest way to factor in all of these moving parts without missing anything.

Zero in on High-Yield Investment Opportunities

Quickly identify properties that match your investment criteria with the Yield Tracker. It scans active for-sale listings nationwide, pairs them with Rentometer rent estimates, and calculates gross yields—so you can find high-potential deals fast.

Explore the Rent Yield Tracker

How It Works — Step by Step

1. Add Your Total Property Cost

Include:

Purchase Price
Closing Costs (typically 2–5%)
Initial Repairs or renovations (skip for move-in ready properties)

Formula: Total Property Cost = Purchase Price + Closing Costs + Repairs

2. Enter Financing Details (Skip this step for all-cash purchases)

Down Payment (typically 10–25%)
Loan Amount
Interest Rate and Loan Term (15–30 years)

3. Estimate Rental Income

Monthly Rent (get property rental estimates from Rentometer)
Include other potential income (laundry, parking, pet rent, etc.) in the Monthly Rent box
Vacancy Rate (typically 5–7%)

4. Add Monthly & Annual Expenses

Property Taxes
Insurance
Utilities
HOA Fees
Add property management costs (8–12%, if applicable) and a monthly estimate for long-term maintenance and repairs to your other expenses box.

What the Calculator Shows You

Metric	What It Means
Cash-on-Cash Return	Annual Cash Flow ÷ Cash Invested
Total ROI	Cash Flow + Appreciation + Equity

Common Mistakes to Avoid When Using a Real Estate ROI Calculator

Using a calculator is helpful — but only when your numbers are realistic. Here are common mistakes investors make:

Underestimating Repairs
You budget $5K, but later discover the roof, plumbing, and HVAC all need work. Always inspect and set aside a 10–20% repair contingency. Even better, get a couple of quotes from local contractors before you purchase the property.
Ignoring Rent Growth or Declines
Some assume rents will grow 5–10% per year. In reality, 2–3% is more typical — and sometimes rents fall. Use conservative assumptions. For better informed decisions, check out Rentometer’s quarterly and yearly rental market reports which provide historical rent trends for over 800 cities in the US.
Forgetting Long-Term CapEx
Include big-ticket items (roof, appliances, water heater) in your projections. Plan to reserve ~$200–$300 per unit annually (more or less depending on whether your property is in a high- or low-cost wage area).
Being Too Optimistic or Pessimistic
Don’t fudge the numbers to make a deal look better — or talk yourself out of a good deal due to overly cautious assumptions. Run multiple ROI scenarios. If possible, talk to a few seasoned property owners and get their feedback on your numbers.
Skipping Property Management Costs
Even if you plan to self-manage, include an 8–12% management fee. That way, you’re covered if you hire help later. This is even more important if you plan on building a portfolio of rental properties – it’s feasible to manage one or a couple of properties, but it becomes a full-time job as you add more properties to your portfolio.
Not Accounting for Property Appreciation
Many investors focus only on cash flow but forget how much long-term appreciation can boost returns. A property's value can increase significantly over time — sometimes even doubling your ROI. While appreciation isn't guaranteed, using conservative projections (2–3% annually) can help paint a more realistic picture of your total return.

Learn More About Calculating the ROI of Your Property Investments

Understanding rental property ROI helps you compare opportunities, avoid bad investments, and build long-term wealth. The biggest mistake of any real estate investments is not using a calculator at all.

For help estimating rent, try Rentometer — our trusted source for real-time, hyperlocal rent comps.

Need Reliable Rent Data for Your Property?

Get accurate, hyperlocal rent estimates and comps for any U.S. address with Rentometer. Trusted by landlords, property managers, and real estate investors to price rentals, analyze deals, and stay ahead of the market.

Check Rents

Glossary of Key Terms

Property Repair Costs: The repair costs are the amounts you expect to pay for immediate repairs or upgrades upon closing the property (painting, replacing door locks, etc.).
Down Payment: The initial amount paid upfront when purchasing the property, typically expressed as a percentage of the property’s purchase price. This is typically 10-25% of the purchase price.
Closing Cost: The fees and expenses associated with completing the property transaction. These can include title insurance, attorney fees, appraisal fees, loan origination fees, and others. Closing costs typically range from 2-5% of the purchase price.
Mortgage Term: The length of time over which a mortgage loan is repaid, typically 15, 20, or 30 years. A longer mortgage term usually results in lower monthly payments but more interest paid over time.
Interest Rate: The percentage at which the lender charges interest on the borrowed money (the mortgage loan). The interest rate is a key factor in determining the total cost of the loan.
Monthly Rent: The total anticipated amount of rent that tenants will pay each month to occupy the property. This is the primary income for a rental property. 💡 Tip: Not sure how much rent a property could generate? Get a quick rent estimate from www.rentometer.com.
Other Property Income: Additional income generated by the property besides the rent. Examples include parking fees, laundry fees, pet rent, storage fees, or any other charges tenants may pay for additional services.
Vacancy Rate: The percentage of time a property is unoccupied and not generating rental income. This is usually estimated based on market averages or historical data for the property. A typical vacancy rate is around 7%. Both rent and other income entered above will be adjusted by this rate.
Monthly Maintenance: Costs related to regular upkeep of the property, such as landscaping, janitorial services, or other routine services necessary to keep the property in good condition.
Monthly/Annual Repairs: Costs for maintaining and repairing the property. These are often unpredictable costs that arise over time, such as fixing leaks, replacing appliances, or making structural repairs.
Monthly Utilities: Costs for utilities like electricity, water, gas, or heating that are either included in the rent or paid separately by the landlord. Sometimes, tenants pay these costs directly.
Monthly HOA / Dues: If the property is part of a Homeowners Association (HOA), there may be monthly or annual dues. These fees cover shared services or amenities like pool maintenance, landscaping, or building repairs in common areas.
Management Costs: Fees paid to a property management company or individual for overseeing the daily operations of the rental property, including handling tenant relations, maintenance requests, and rent collection. Typical property management fees range between 8%-12% of monthly rent.