Rental property ROI calculator: combine rental cash flow, expenses, and property appreciation into total return on investment. Free, editable rates, no signup.
Paydown is principal paid off by the mortgage over the hold — check your amortization schedule.
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Calculation details
Every figure above is calculated locally in your browser from the assumptions shown. No inputs are sent anywhere. See the methodology section below for how this tool works.
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Three streams produce $193,175 total return and 322.0% ROI.
Method & verification
How This Tool Works
fact-checked against our calculation methodology
Calculation Method
Reads Down payment, Annual cash flow, Annual appreciation, Holding period, Property value and Annual principal paydown, then returns the result shown on this page.
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A Worked Example You Can Check by Hand
Put in $60,000 down, $6,000 of net cash flow per year, a $300,000 property appreciating at 3%, a 10-year hold, and $30,000 of loan paydown. The calculator adds three streams. Cash flow: 6,000 x 10 = $60,000. Appreciation: the formula compounds the value each year, so 300,000 x 1.03^10 = $403,175, and the gain is 403,175 minus 300,000 = $103,175. Paydown is entered directly as $30,000.
Total return = 60,000 + 103,175 + 30,000 = $193,175. ROI = 193,175 / 60,000 x 100 = 321.96%, which rounds to the 322.0% the tool displays. Two things the arithmetic exposes: appreciation dominates this example at $103,175, more than cash flow, and paydown is counted in full even though the mortgage payments that funded it came out of the same rent. If the property instead depreciated 2% a year, 1.03^10 becomes 0.98^10, value falls to about $245,600, and total return drops to roughly $27,600, or 46.0% ROI, showing how much of the headline rests on one assumption.
What the Single Number Hides
The output is a raw multiple of cash invested, not an annualized rate, and it ignores timing. The 322.0% figure above treats a dollar of rent in year 10 the same as a dollar of down payment on day one, so it overstates returns compared with an IRR or annualized figure, which would be closer to 12.5% per year in that scenario. It also counts total paydown without checking it is plausible: $30,000 of principal reduction implies a loan near $250,000, and at 7% over 30 years principal paydown in the first 10 years is closer to $33,000, so verify the number against an actual amortization rather than guessing.
Missing costs are the larger trap. Selling a $403,000 property can cost 6 to 8% in commissions and closing, or $24,000 to $32,000, and capital gains tax may take 15% or more of the gain on top. Vacancy, repairs, and capital items like a $12,000 roof commonly eat 1 to 2 months of rent per year, which on a $2,000 rent is $2,000 to $4,000 off the $6,000 annual figure. Treat the result as an upper bound for screening, then subtract those items before comparing against a plain index fund.
