Free Cap Rate Calculator for Real Estate Investors
Cap rate, short for capitalization rate, is one of the most important metrics for evaluating rental properties and investment opportunities. It helps investors quickly understand how much income a property generates relative to its value.
What is Cap Rate?
Cap Rate (%) = (Net Operating Income ÷ Property Value) × 100
- Net Operating Income (NOI): Total rental income minus all operating expenses.
- Property Value: The purchase price or current market value of the property.
In simple terms, the cap rate shows you the percentage return you can expect if you bought the property outright.
Cap Rate Calculator
Enter your property details below:
Estimated Cap Rate:
0%
Example
For a property valued at $300,000 with $24,000 in annual rental income and $6,000 in expenses, the net operating income is $18,000. The cap rate is ($18,000 ÷ $300,000) × 100 = 6%.
Advanced Cap Rate Tools in MyDoorsPro
While this calculator gives you a simple estimate, MyDoorsPro offers advanced cap rate tools for multiple properties, detailed ROI analysis, and investment comparisons. Track your properties, expenses, and potential income—all in one platform to make smarter investment decisions. Learn more about MyDoorsPro.
FAQ
Q: What is a good cap rate?
A: A “good” cap rate depends on the market, location, and your investment goals. Generally, 5–8% is considered healthy for rental properties, but this varies.
Q: How can I use cap rate to compare properties?
A: Calculate the cap rate for each property to quickly see which generates better returns relative to its value. MyDoorsPro makes this easy across multiple properties with automated calculations.