Cash-on-Cash Return Calculator
Cash-on-cash return measures the annual pre-tax cash flow your property produces on the cash you actually put in — down payment, closing costs and rehab. It is the number that tells you what your money is doing after the bank takes its share.
How cash-on-cash return works
Annual pre-tax cash flow = (monthly rent − operating expenses − mortgage payment) × 12. Operating expenses include tax, insurance, management, maintenance and vacancy allowance.
Total cash invested = down payment + closing costs + upfront rehab. Benchmarks: many US buy-and-hold investors underwrite deals at 6–10% cash-on-cash; above 10% in 2026's rate environment usually requires either distress, strong value-add, or a B/C-class market.
Frequently asked questions
What is a good cash-on-cash return?
With 2026 mortgage rates, 6–10% is a solid underwriting target for turnkey US rentals. Anything above 10% deserves extra scrutiny on vacancy and capex assumptions.
Is cash-on-cash the same as ROI?
No — CoC looks at one year of pre-tax cash flow only. ROI also counts appreciation, principal paydown and sale proceeds, and is only known reliably when you exit.
Related tools
- Formula: standard levered real-estate return metric. Benchmark ranges: US buy-and-hold underwriting practice, 2026.
Last updated: 2026-09-08