Rental Cash Flow Calculator
Quick answer
Monthly cash flow ≈ effective gross rent − operating expenses − P&I (and escrows if you pay them). If you skip vacancy, turnover, or capex reserves, you are not measuring cash flow—you are measuring hope.
For a related estimate, see Cap Rate Calculator.
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What is included
Operating expenses: management, taxes, insurance, repairs, utilities you pay, HOA, and turnover. Debt service: P&I plus any escrowed taxes/insurance if you pay them with the loan. Excluded: principal paydown as “income,” depreciation, and your time—those matter for equity and tax, not monthly liquidity.
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Levered cash flow is what hits your account after operating expenses and debt service—the number that actually pays your life or your next deal. Use it when you are comparing two financed acquisitions, sizing reserves, or judging whether a refi helped or just stretched the amortization.
How to use this calculator
- Underwrite vacancy on seasonality: Student markets and winter STRs need more than one flat annual %—model the worst quarter.
- Include debt service you will actually pay: ARM resets, IO expiring, and tax-escrow changes move the cash line without rent moving.
- Book capex as cash out: A $6k HVAC bill is not “non-recurring” if it recurs every decade—amortize it into monthly reserves.
Positive cash flow vs “good investment”
You can have positive cash flow and a bad investment (overpaid, declining market) or thin negative with strong value-add—label the thesis.
Real-world examples
- Case study: $2,850/mo rent, $1,980/mo all-in: EGI $2,850; opex $640 (taxes, ins, mgmt, 5% vacancy reserve); P&I $1,340 → ~−$130/mo before capex reserves. Add $200/mo reserves → ~−$330/mo. If the play is appreciation, say so; if the play is yield, you need higher rent or lower basis.
- Refi: −$210/mo P&I: Same rent—cash flow swings positive by $210 without any operational improvement. That is why refi analysis belongs next to rent analysis—payment changes can mask weak operations.
What to decide
If you are negative at realistic vacancy and reserves, the deal is either a value-add story or a pass—there is no third “it will work out” category. If you are barely positive, map how many months of that surplus rebuild one month of vacancy. Cross-check DSCR and rent vs buy if you live in the unit.
FAQ
Should cash flow be positive day one?
Many operators want it; others accept early negative flow for heavy value-add—either way it must be intentional, not a spreadsheet accident.
Where do investors miss expenses?
Vacancy, turnover, management, and irregular capex (roof, HVAC) are the usual gaps—omitting them is how “cash flow” becomes hope.
Is mortgage principal included in cash flow?
Principal paydown is not an expense for cash flow in the classic sense, but it is cash leaving your pocket—track levered cash after all outflows.
How often should I recalculate?
After any rent change, tax reassessment, insurance renewal, or refi—your monthly number moves with all of those.