NOI CalculationVacancy RateOperating ExpensesInvestment Grade RatingFree
Cap Rate Calculator
Calculate the capitalisation rate for any residential or commercial investment property. Cap rate is the most widely used metric in real estate investment for comparing property returns independent of financing — it tells you what your annual return would be if you paid cash. Enter the property value, gross rental income, vacancy rate, and all operating expenses to get an accurate NOI and cap rate, plus an investment grade rating based on standard market benchmarks. Use this to evaluate acquisition opportunities, compare properties, and set target return thresholds before investing.
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Property Value
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Rental Income
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Vacancy Loss
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Operating Costs
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Cap Rate
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Private
Property data never leaves your browser
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Full NOI
All expense categories included for accuracy
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Grade Rating
Instant investment quality assessment
Cap Rate Benchmarks
8%+
Excellent
High yield — secondary markets or higher risk
5–8%
Good
Typical for suburban residential rentals
3–5%
Average
Common in high-cost urban markets
<3%
Below Avg
Minimal cash flow — appreciation play
Frequently Asked Questions
Is this cap rate calculator free to use?
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Yes, the RoughTools Cap Rate Calculator is completely free with no account, subscription, or payment required. You can calculate NOI and cap rate for unlimited properties — adjusting income, vacancy, taxes, insurance, maintenance, and management fees — at no cost. RoughTools is funded through non-intrusive advertising, keeping every calculator permanently free for real estate investors, landlords, and property analysts worldwide.
Do I need an account to calculate cap rate?
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No account, email, or registration is required. Enter the property value, rental income, and operating expenses, then click Calculate. Your cap rate, NOI, and gross yield appear instantly. There is no paywall on any output, no upgrade required to see the full expense breakdown, and no data about your properties is stored anywhere. The calculator is completely anonymous and can be used as many times as needed without any sign-up process.
Is the property data I enter stored or shared?
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No. All calculations run entirely within your browser using JavaScript. The property value, rental income, expense figures, and all other inputs are never transmitted to RoughTools servers, never logged, and never shared with third parties. Once you close the browser tab, the data is gone. You can model real investment properties and evaluate actual purchase opportunities with complete confidence that your financial analysis remains private.
Does this cap rate calculator work on mobile and tablet?
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Yes, the calculator is fully responsive and works on all modern smartphones and tablets. Input fields, result displays, and rating indicators are all optimised for touch screens and small screen widths. This is useful when evaluating properties at open houses or investment showings — you can pull up the calculator on your phone, enter the numbers the agent provides, and immediately see whether the property meets your investment return requirements before making an offer.
Which browsers are supported?
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The Cap Rate Calculator works in all modern browsers: Google Chrome, Mozilla Firefox, Microsoft Edge, Safari, Opera, and Brave on both desktop and mobile. No plugins or extensions are required. The calculator uses standard JavaScript arithmetic that runs natively in every current browser. For the best experience with currency formatting and number display, any current version of Chrome, Firefox, or Safari on desktop or mobile is recommended.
How accurate is the cap rate calculation?
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The calculation uses the standard formula: Cap Rate = Net Operating Income ÷ Property Value × 100. The NOI is calculated as: Effective Gross Income (gross rent minus vacancy) minus all operating expenses (taxes, insurance, maintenance, management, and other costs). This is the same formula used by commercial real estate appraisers and investment analysts. Accuracy depends on the quality of your input figures — use actual lease income and real expense data for the most reliable results.
Can I use this calculator offline?
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Once the page has fully loaded in your browser, all calculations run in JavaScript without requiring an active internet connection. You can adjust property values, expenses, and income figures and view updated cap rate results offline. This is useful when evaluating properties in areas with poor mobile signal. The initial page load requires internet access, but after that the calculator functions entirely client-side for as long as the tab remains open.
How do I calculate cap rate step by step?
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To calculate cap rate: (1) Enter the property value (purchase price or current market value). (2) Enter the annual gross rental income at full occupancy. (3) Set the vacancy rate — typically 5–10% for residential, higher for commercial. (4) Enter annual operating expenses: property taxes, insurance, maintenance budget, and property management percentage. (5) Add any other annual expenses. (6) Click Calculate Cap Rate. The tool shows your NOI, cap rate percentage, and gross yield, along with an investment quality rating.
Why should I use RoughTools instead of a basic cap rate formula?
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The RoughTools Cap Rate Calculator separates each expense category so you can see the impact of each cost component on your NOI and cap rate. Many investors use simplified estimates and miss individual expense items, leading to an overestimate of cap rate that makes a poor investment look attractive. This calculator includes vacancy, property taxes, insurance, maintenance, management fees, and other costs separately — giving a more realistic and complete picture of actual cash flow and return.
How do I report a bug or suggest a new feature?
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To report a bug or request a feature — such as cash-on-cash return, debt service coverage ratio (DSCR), gross rent multiplier (GRM), or multi-property comparison — use the feedback link in the site footer or visit the RoughTools contact page. When reporting a bug, include the inputs you used, the browser and OS, and the expected versus actual result. Feature requests for amortisation schedules, refinancing scenarios, and tax depreciation estimates are reviewed and prioritised regularly by the development team.
What is a good cap rate for a rental property?
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Cap rate benchmarks vary by market and property type, but general guidelines are: 8% or above is considered excellent yield, typically found in secondary markets or higher-risk properties. 5–8% is good and typical for most suburban residential rental markets. 3–5% is average, common in high-cost urban markets like New York, San Francisco, or London where appreciation potential offsets lower current yield. Below 3% is below average and indicates minimal cash flow relative to property cost. There is no universal "good" cap rate — always compare against similar properties in the same market.
What is Net Operating Income (NOI) and how is it different from profit?
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Net Operating Income (NOI) is the annual income from a property after deducting all operating expenses, but before deducting mortgage payments, income taxes, and depreciation. NOI = Effective Gross Income − Operating Expenses. It differs from profit in that it excludes debt service (mortgage principal and interest) — this makes NOI useful for comparing properties regardless of how they are financed. Cap rate is calculated from NOI, making it a financing-neutral measure of property return. Cash flow (actual profit) equals NOI minus annual mortgage payments.
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