Online Tool Store
Cap Rate Calculator
Calculate a rental property's capitalization rate from its income, expenses, and value, to compare deals on equal footing. Runs entirely in your browser.
🔒 This tool runs entirely in your browser. Your files are never uploaded to a server.
Net operating income
$0
Cap rate
0%
How it works
- Enter the property's annual gross rental income and operating expenses.
- Enter the property's value or purchase price.
- Net operating income and cap rate update instantly.
The formula
Cap rate is net operating income divided by property value:
Cap rate = (Annual income − Operating expenses) ÷ Property value × 100
Example: $36,000 income − $12,000 expenses = $24,000 NOI. $24,000 ÷ $350,000 = 6.86% cap rate.
FAQ
What counts as an operating expense?
Property tax, insurance, maintenance, property management fees, and utilities you cover — but not mortgage payments, which are financing costs, not operating costs.
What is a "good" cap rate?
It depends heavily on the market and property type — cap rates in the 4-10% range are common, with lower rates typically in high-demand, lower-risk markets. Compare against similar properties in the same area rather than a fixed benchmark.
Why doesn't this include my mortgage or down payment?
Cap rate measures a property's return based on its price alone, independent of how it's financed — this lets you compare deals on equal footing regardless of your loan terms.
Is my data uploaded anywhere?
No — every calculation happens locally in your browser.
How we compare
| Feature | Online Tool Store | Spreadsheet formula | Real estate investment software |
|---|---|---|---|
| No formula to write | ✓ | ✗ | ✓ |
| Free, no sign-up | ✓ | ✓ | ✗ |
Full investment software adds portfolio tracking you may not need for a quick deal check. Cap Rate Calculator gets you the number in seconds.