Cap Rate Calculator
Calculate the capitalization rate (cap rate) for any rental property. Cap rate measures the annual return on an investment property based on its net operating income relative to the purchase price. Enter your numbers below to get your cap rate, NOI, and full expense breakdown.
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What is cap rate?
Capitalization rate (cap rate) is the ratio of a property's net operating income (NOI) to its purchase price or current market value. It answers the question: "If I bought this property with cash, what percentage annual return would the rental income provide?"
Cap Rate = Net Operating Income / Purchase Price
Cap rate is the standard metric for comparing rental properties because it normalizes returns regardless of financing. Two properties at different prices and rents can be compared directly by cap rate. For a full explanation, see our guide on cap rate explained.
Related
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- DSCR Calculator
- Rental Analysis for Wholesalers
For informational purposes only. Results are estimates based on the inputs you provide and are not an appraisal, broker price opinion, or investment advice. Actual values, costs, and returns vary by market, property condition, financing, and other factors. Consult a licensed appraiser, broker, accountant, and/or attorney before making investment decisions.