Rental Cash Flow Calculator

Cash flow is the lifeblood of rental property investing. Positive cash flow means your property generates more income than expenses each month, providing passive income and a buffer against unexpected costs.

This calculator accounts for gross rent, vacancy loss, operating expenses, and mortgage payments to determine true monthly and annual cash flow. A healthy vacancy factor (typically 5-8%) ensures realistic projections.

Even small positive cash flow of $100-200/month provides stability and compounds over time as rents increase and loans pay down.

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How to Use This Calculator

1 Enter gross monthly rental income
2 Enter your assumed vacancy rate (typically 5-8%)
3 Enter monthly operating expenses
4 Enter monthly mortgage payment (principal + interest)
5 Click Calculate to see monthly and annual cash flow

Formula

Cash Flow = (Gross Rent × (1 - Vacancy %)) - Expenses - Mortgage

Example Calculation

Single-family rental generating $2,200/month

Inputs:

Gross Rent: $2,200
Vacancy: 5%
Expenses: $500
Mortgage: $1,200

Result:

Effective Rent: $2,090. Cash Flow: $2,090 - $500 - $1,200 = $390/month ($4,680/year)

Pro Tips

Always include a vacancy factor
Positive cash flow = sustainable investment
Small margins can become big with rent growth

Important Considerations

• New construction may have higher initial vacancy during lease-up
• Student housing often has seasonal vacancy patterns
• Include all income sources: rent, laundry, parking, pet fees

Frequently Asked Questions

Target $100-200/month minimum per door for single-family; $50-100/door for multifamily. More is better, but positive cash flow of any amount means the property is self-sustaining. Negative cash flow requires out-of-pocket funding.

Include all operating expenses: property taxes, insurance, maintenance, repairs, property management, HOA fees, and utilities you pay. Also include reserves for vacancy, capital expenditures, and unexpected repairs.

Generally avoid negative cash flow unless you're betting on appreciation in high-growth markets AND can afford the monthly losses. Negative cash flow drains your reserves and limits your ability to scale. Cash flow is king for sustainable investing.

Strategies include: raising rent to market rates, reducing vacancy with better marketing, cutting expenses through better vendor contracts, adding income streams (laundry, parking, storage), and refinancing to lower mortgage payments.