Cash on Cash Return Calculator Instructions

Overview:

Our Cash on Cash Return Calculator is an indispensable tool for real estate investors and financial analysts. It's designed to calculate the Cash on Cash return on investment for a property. This metric is crucial in evaluating the profitability of rental properties and other real estate investments. It considers the total cash income earned relative to the total cash investment made in the property.

How to Use:

1. Enter Purchase Price: Input the total purchase price of the property. This is the full amount paid for acquiring the property.

2. Enter Rehab Price: If applicable, input the total cost of any rehabilitation or improvements made to the property. This should include all renovation expenses incurred to make the property ready for rental or sale.

3. Input Gross Rental Income: Enter the total expected or actual gross rental income from the property. This is the total rental income before any expenses are deducted.

4. Add Other Income: If there are other sources of income from the property (like laundry facilities, parking fees, etc.), add this amount in the 'Other Income' field.

5. List Operating Expenses: Input all operating expenses associated with the property. This includes management fees, maintenance costs, property taxes, insurance, and other regular expenses.

6. Calculate: After filling in all the fields, click the "Calculate Cash on Cash Return" button to get the results.

Result Interpretation:

The calculator will display:

• Annual Cash Flow: The total annual cash flow from the property, calculated as (Gross Rental Income + Other Income - Operating Expenses) * 12.

• Cash on Cash Return: The Cash on Cash return percentage, providing a clear view of the investment's profitability.

Note:

• Ensure all monetary values are entered in dollars. The calculator will format these values for clarity.

• The accuracy of the results depends on the accuracy of the input data.

• This tool offers a simplified view of investment returns. For a comprehensive financial analysis, consider consulting with a financial advisor or investment professional.

This calculator is an effective way to assess the potential returns on real estate investments. It aids in making informed decisions and understanding the financial performance of your property investments.