Property ROI Calculator
Calculate the return on investment (ROI) for a rental property based on purchase price, rent, and expenses.
Property ROI Calculator
Calculate the return on investment (ROI) for a rental property based on purchase price, rent, and expenses.
Real-World Examples
Purchase: $200,000, annual rent: $24,000, expenses: $7,000
ROI: 8.50%
Purchase: $500,000, annual rent: $36,000, expenses: $12,000
ROI: 4.80%
Purchase: $300,000, annual rent: $30,000, expenses: $18,000
ROI: 4.00%
Common Mistakes to Avoid
Using gross rent instead of net income
Fix: ROI should use net income (rent minus all expenses). Using gross rent overstates your return and hides the true cost of ownership.
Ignoring the cost of renovations and closing costs
Fix: Your total investment includes the purchase price plus any rehab and closing costs. Add these to the investment base for an accurate ROI.
Forgetting vacancy and capital expenditures
Fix: Budget 5-10% of rent for vacancy and 5-10% for capital expenditures (roof, HVAC, etc.). These are real, recurring costs that erode ROI.