US Rental ROI Calculator
Estimate the return on a US rental. Enter a price and expected rent (the operating costs come pre-filled from a real launch market) and see monthly cash flow, cap rate, and cash-on-cash return.
For buyers abroad sizing up a US rental.
Share of the purchase price paid upfront. 100% is an all-cash purchase.
Operating costs seeded from illustrative Houston assumptions: property tax 2.81% of price, insurance $1,800/yr, management 10% of income, maintenance 5% of rent, vacancy 5%. Financed scenarios model an 8.5% fixed rate over 30 years. Cash-on-cash includes 3% modeled closing costs. Illustrative; confirmed per property at qualification.
Monthly cash flow
After operating expenses
Cap rate
Cash-on-cash
Net operating income / yr
What the numbers mean
- Cap rate
- The property's yearly net income as a percentage of its price. Because it ignores how you pay, you can line up two very different homes and compare their earning power directly.
- Cash-on-cash return
- Your yearly cash flow as a percentage of the cash you actually put in. Where cap rate judges the property, cash-on-cash judges the return on the money you tied up.
- Net operating income (NOI)
- Gross rent minus operating costs (property tax, insurance, management, maintenance, vacancy, and HOA) before any loan payment. It's the engine behind both rates above.
A worked example
Take the pre-filled Houston example, a $232,990 home renting for $1,724 a month, bought in cash:
With 3% modeled closing costs, the all-cash cash-on-cash result is about 3.29%. Lowering the down payment adds modeled mortgage payments, so cash-on-cash can rise or fall with the financing spread.
How to read your results
Positive cash flow is the first thing to look for
A positive monthly result means rent covers modeled operating costs and, when financed, debt service. A negative result means the scenario needs monthly cash support at these inputs.
A higher cap rate isn't automatically better
US rental cap rates commonly sit in a mid-single-digit range, but it varies widely by market and property. A high cap rate often signals a softer market or more risk rather than a free lunch; a lower one can reflect a stronger, higher-growth area. Use it to compare properties, not as a target. (Illustrative ranges, not advice.)
Cash-on-cash reflects your leverage
A lower down payment reduces upfront cash but adds modeled debt service. Cash-on-cash improves only when the property's after-expense yield outweighs that financing cost; otherwise leverage makes cash flow and return worse.
Common questions
Is a higher cap rate always better?
No. A higher cap rate frequently comes with higher risk or a slower-growing market. Read it alongside the location, the property's condition, and your own goals.
Does this include a mortgage payment?
Yes, when down payment is below 100%. The tool models debt service at the disclosed illustrative fixed rate and term. It does not include lender fees, mortgage insurance, or final underwriting terms.
Why are the operating costs pre-filled?
They're seeded from illustrative, market-specific underwriting references, so you start from a realistic baseline. Adjust any of them to match a specific deal.
Are these returns guaranteed?
No. Every figure is an educational estimate and is confirmed per property at qualification.
Keep going
How this is calculated
How the return is calculated
- Net operating income (NOI) = gross annual rent minus operating expenses: property tax, insurance, management, maintenance, vacancy, and any HOA.
- Cap rate = NOI ÷ purchase price.
- Cash-on-cash = annual cash flow after modeled debt service ÷ (down payment + 3% modeled closing costs). At 100% down, modeled debt service is $0.
Where the numbers come from
- Operating-cost assumptions are seeded per market from Dara's internal underwriting reference (property tax %, insurance, management %, maintenance %, vacancy %).
- You set price, expected rent, and down payment. Financed scenarios use the disclosed illustrative fixed rate and term; every result recomputes from those inputs.
What it isn't
- An estimate, not a guarantee. Costs are illustrative and confirmed per property at qualification.
- It does not include appreciation, sale costs, income taxes, lender fees, or changing rent and expenses.
The full method across every tool: How we calculate these →
Dara is a fintech company, not an FDIC-insured bank. Banking, card and property-financing services provided by licensed partners. Protections vary by product. Calculator results are illustrative educational estimates, not financial, tax, investment, lending, or rate advice. Property costs, financing terms, FX, and reward assumptions are confirmed by the relevant provider where applicable.