Business

Cap Rate Calculator

Net operating income against property price.

Enter your values

Purchase price($)

Enter the purchase price in $.

Gross monthly rent($)

Enter the gross monthly rent in $.

Vacancy allowance(%)

Enter the vacancy allowance in %.

Annual property tax($)

Enter the annual property tax in $.

Annual insurance($)

Enter the annual insurance in $.

Annual maintenance and capex($)

Enter the annual maintenance and capex in $.

Management fee(% of rent)

Enter the management fee in % of rent.

Target cap rate(%)

Enter the target cap rate in %.

Results update instantly as you type — no submit needed. Your values are remembered on this device, and the shareable link reopens the calculator with exactly these numbers.

Results

Cap rate: 5.56%
Net operating income: $23,646.08
Effective gross income: $37,224.00
Operating expenses: $13,577.92
Expense ratio: 36.5%
Value at your target cap rate: $363,785.85
Monthly NOI: $1,970.51

Quick answer

Cap rate = net operating income ÷ property value. NOI excludes mortgage payments, so cap rate measures the property, not the financing.

Cap rate = NOI ÷ purchase price

At a glance

What it does	Net operating income against property price.
Category	Business
Inputs needed	Purchase price, Gross monthly rent, Vacancy allowance, Annual property tax, Annual insurance, Annual maintenance and capex, Management fee, Target cap rate
Main output	Cap rate
Formula	Cap rate = NOI ÷ purchase price
Cost	Free — no sign-up, no download

How to use the Cap Rate Calculator

1Enter the purchase price and gross monthly rent.
2Add vacancy, tax, insurance, maintenance and management.
3Set a target cap rate to see the price that would deliver it.

Inputs explained

Purchase price($): Enter the purchase price in $.
Gross monthly rent($): Enter the gross monthly rent in $.
Vacancy allowance(%): Enter the vacancy allowance in %.
Annual property tax($): Enter the annual property tax in $.
Annual insurance($): Enter the annual insurance in $.
Annual maintenance and capex($): Enter the annual maintenance and capex in $.
Management fee(% of rent): Enter the management fee in % of rent.
Target cap rate(%): Enter the target cap rate in %.

Worked example

Using the values the calculator loads with:

Inputs

Purchase price425000 $
Gross monthly rent3300 $
Vacancy allowance6 %
Annual property tax5200 $
Annual insurance1600 $
Annual maintenance and capex3800 $
Management fee8 % of rent
Target cap rate6.5 %

Results

Cap rate5.56%
Net operating income$23,646.08
Effective gross income$37,224.00
Operating expenses$13,577.92
Expense ratio36.5%
Value at your target cap rate$363,785.85
Monthly NOI$1,970.51

Frequently asked questions

What is a good cap rate?

It depends on the market: 4–5% in expensive metros, 6–8% in mid-size cities and 9%+ in higher-risk areas. Compare against similar local sales, not a national number.

Should the mortgage be in NOI?

No. Cap rate deliberately ignores financing so two buyers with different loans value the same building identically.

What do I need to enter into the Cap Rate Calculator?

Just 8 values: purchase price, gross monthly rent, vacancy allowance, annual property tax, annual insurance, annual maintenance and capex, management fee, target cap rate. Every field starts with a realistic example, so you can change one number at a time and watch the result update instantly.

How does the Cap Rate Calculator work out the answer?

Cap rate = net operating income ÷ property value. NOI excludes mortgage payments, so cap rate measures the property, not the financing. It applies the formula Cap rate = NOI ÷ purchase price and shows the working so you can check each step by hand.

Is the Cap Rate Calculator free, and do I need an account?

It is completely free with no sign-up, no download and no usage limit. Everything is calculated in your browser, so the numbers you type never leave your device.

Results are estimates for general information. For medical, legal, structural or financial decisions, confirm with a qualified professional.