Cash-on-Cash Return Calculator
This cash-on-cash calculator measures annual return on the money you actually put in. It counts down payment, closing costs and rehab together.
By Onias Derilus, Mortgage Capital · NMLS# 1859012 · Last Updated: June 2026
Pre-tax and before appreciation, loan paydown or depreciation. Cash-on-cash measures one year of cash return on cash invested, not total return. Estimate only.
Cash-on-cash return divides one year of pre-tax cash flow by the cash you actually committed. It answers a narrow question well: what is this money earning right now.
It deliberately ignores appreciation, principal paydown and tax treatment. Those often make up most of the real return on a Florida rental, so a modest cash-on-cash figure is not the same as a bad investment.
These figures are estimates. For neutral, official guidance on mortgage costs and what lenders can charge, see the CFPB's Owning a Home guide.
How to Use This Calculator
- 1
Enter the down payment and closing costs you will actually bring.
- 2
Add rehab or make-ready spending, and any reserves the lender requires you to hold.
- 3
Enter the monthly cash flow the property produces after every cost, including the mortgage.
- 4
Read the return, then read the payback period beside it — the years it takes for cash flow alone to return your investment.
The Formula & Assumptions
Cash invested = down
+ closing + rehab
+ reserves
Cash-on-cash =
(monthly cash flow × 12)
÷ cash invested
Every dollar that leaves your account to acquire and stabilize the property belongs in cash invested. Leaving out rehab is the usual reason a projected return fails to appear.
Because the denominator is cash rather than price, financing changes the answer. A larger down payment lowers the payment and raises cash flow, but it also raises the denominator and usually lowers cash-on-cash return.
Compare the result against what the same money would earn elsewhere at similar risk. In Florida, a rental returning 5% in cash while the property appreciates and the tenant retires the loan can outperform a higher cash-on-cash deal in a weaker submarket.
Frequently Asked Questions
What is a good cash-on-cash return?
Many Florida investors look for 6% to 10% on a stabilized rental, and more on a value-add deal that carries execution risk. The right threshold is whatever beats your alternative use of the same money at comparable risk.
Why is my cash-on-cash return lower with a bigger down payment?
A larger down payment reduces the loan and the monthly payment, which raises cash flow — but it raises the cash invested faster. Leverage magnifies cash-on-cash in both directions, which is why lower-down investors often show higher returns and carry more risk.
Should reserves count as cash invested?
If the lender requires you to hold them to close, yes — that money is committed to the deal. If they are ordinary savings you would keep regardless, many investors leave them out. Be consistent across the deals you compare.
Does this include appreciation?
No. Cash-on-cash is a single-year cash measure. Appreciation, loan paydown and depreciation are excluded, and in Florida those three frequently exceed cash flow over a full hold period.
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Rates are illustrative only. APR and payments vary by credit score, loan amount, and market conditions. Subject to credit approval. Not a commitment to lend. NMLS# 1859012. Equal Housing Lender.
It calculates the annual pre-tax cash flow on a rental divided by the cash you actually put in. Unlike cap rate, it reflects your financing.
Cash-on-Cash Return Calculator in Florida
Florida insurance renewals are the most common reason a cash-on-cash return falls in year two. A premium that jumps several thousand dollars takes the same amount straight out of cash flow. Investors here often model the return twice, once at today's premium and once at a renewal twenty percent higher.
How the Cash-on-Cash Return Calculator Works
The calculator subtracts operating expenses and the mortgage from gross rent to find annual cash flow. It divides that figure by your total cash in, including down payment, closing costs, and rehab.
The Cash-on-Cash Return Formula, Explained
Cash-on-cash return = annual pre-tax cash flow / total cash invested
Total cash invested is more than the down payment. It includes closing costs, any rehab, and reserves you had to leave in the deal to get it funded.
Because the mortgage sits in the numerator, leverage moves this number hard in both directions. A larger loan raises the return when the property performs and deepens the loss when it does not.
The Complete Cash-on-Cash Return Calculator Guide
Cash-on-cash answers a different question from cap rate. Cap rate asks whether the building is a good asset. Cash-on-cash asks whether your money is working, given the loan you actually took.
That makes it the honest number for a leveraged buyer. A 6% cap rate can produce a double-digit cash-on-cash return with the right financing, or a negative one if the debt service is too heavy.
Keep the cash-in figure complete. Leaving out closing costs or rehab flatters the result, and the error compounds when you compare two deals where one needed work and the other did not.
Cash-on-Cash Return Calculator FAQ
How is this different from cap rate?
Cap rate ignores the mortgage and measures the property. Cash-on-cash includes the mortgage and measures your money. The same building gives different answers to each.
Should I include principal paydown?
Not in this figure. Cash-on-cash tracks actual cash in and out. Principal paydown builds equity but does not arrive in your account, so it belongs in a total-return calculation instead.