Simple ROI Calculator for Real Estate Investors
Return on Investment (ROI) is one of the most important metrics for evaluating a rental property. ROI measures how much profit your investment generates compared to the total money you put in.
What is ROI?
ROI = (Annual Profit ÷ Total Investment) × 100
- Annual Profit: Total yearly rental income minus annual expenses.
- Total Investment: Purchase price plus closing costs, renovations, and other upfront costs.
A higher ROI means your investment is more profitable.
ROI Calculator
Enter your property details to estimate ROI:
Estimated ROI:
0%
Example
For a property purchased at $200,000, $5,000 closing costs, $10,000 renovations, $24,000 annual rental income, and $8,000 annual expenses:
Total Investment = $200,000 + $5,000 + $10,000 = $215,000
Annual Profit = $24,000 – $8,000 = $16,000
ROI = (16,000 ÷ 215,000) × 100 ≈ 7.44%
Advanced ROI Tools in MyDoorsPro
MyDoorsPro goes beyond simple ROI calculations by allowing investors to analyze multiple properties, include variable expenses, account for financing options, and forecast future returns. Track ROI trends over time and make informed investment decisions with our all-in-one platform. Learn more about MyDoorsPro.
FAQ
Q: Can ROI be negative?
A: Yes, if your expenses exceed your rental income, your ROI will be negative, indicating a loss.
Q: How can I improve ROI?
A: Increase rental income, reduce expenses, or optimize financing. MyDoorsPro allows you to simulate changes and see potential ROI improvements before making decisions.