Real estate & rental
Real Estate Agent Cash Flow Calculator
Works agent cash flow, where the pipeline and the bank account are different things.
Result
Profit and cash are different things and a growing contractor can run out of cash while profitable, because the work is paid for before the invoice is. This models collection speed, not seasonality.
Get a Free Business AuditHow the calculation works
Expected closings by month times net compensation, against the monthly fixed cost base and the opening balance, giving the running position and months of runway. The fixed costs are level and the income is lumpy, which is the structural problem the calculation makes visible.
What moves the number
- Expected closings by month, not by activity.
- Monthly fixed cost base.
- Time from contract to closing.
- Opening reserve.
Where this one goes wrong
Contracts fall through and closings move, so a cash flow plan built on every pending transaction completing on schedule is the optimistic case rather than the plan. Apply a realistic completion rate and allow for slippage. The reserve is what absorbs it, and several months of fixed costs held in reserve is what keeps an agent from taking work or making concessions they would otherwise refuse.
Before you quote
- Apply a realistic completion rate to pending transactions.
- Allow for closing dates slipping.
- Hold several months of fixed costs in reserve.
Questions
About this calculator
Why do agents run short of cash with a full pipeline?
Because fixed costs are level and income is lumpy, and because contracts fall through and closings move. A plan built on every pending transaction completing on schedule is the optimistic case rather than a plan.
How much reserve does an agent need?
Several months of fixed costs, because that is what prevents taking work or making concessions out of necessity. The specific number depends on how seasonal the local market is and how long the contract to closing period runs.
Should pipeline be discounted?
Yes, by a realistic completion rate drawn from your own history. Treating pending transactions as certain is the most common reason an agent's cash plan fails, since the failures cluster rather than spreading evenly.
The formula
cash tied up = daily invoicing x days to get paid
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How to use this calculator
- Invoiced per month ($). Enter your own figure; the page starts at $38,000.
- Payment terms (days). Enter your own figure; the page starts at 30.
- Days clients actually take. Enter your own figure; the page starts at 46.
- Costs paid out per month ($). Enter your own figure; the page starts at $38,000.
- Cash in the bank now ($). Enter your own figure; the page starts at $22,000.
The result updates as you type, so you can try a figure, see what it does to days of funding gap, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Invoiced per month | $38,000 |
| Payment terms (days) | 30 |
| Days clients actually take | 46 |
| Costs paid out per month | $38,000 |
| Cash in the bank now | $22,000 |
What comes out
| Result | Value |
|---|---|
| Days of funding gap main result | 16 |
| Cash tied up in invoices | $58,267 |
| Monthly surplus | $0 |
| Months of cover | 999.0 |
There is $58,267 sitting in unpaid invoices, and customers take 16 days longer than your terms allow. That gap is the money you are lending them for free.
How sensitive the answer is
Holding everything else steady and changing only invoiced per month, this is what happens to days of funding gap. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Invoiced per month ($) | Days of funding gap |
|---|---|
| $19,000 | 16 |
| $28,500 | 16 |
| $38,000 example above | 16 |
| $57,000 | 16 |
| $76,000 | 16 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Invoiced per month ($)
- A money amount, starting at $38,000.
- Payment terms (days)
- A number, between 0 and 180, starting at 30.
- Days clients actually take
- A number, between 0 and 365, starting at 46.
- Costs paid out per month ($)
- A money amount, starting at $38,000.
- Cash in the bank now ($)
- A money amount, starting at $22,000.
What the results tell you
| Result | What it is |
|---|---|
| Days of funding gap | The headline result. A number. |
| Cash tied up in invoices | A money figure. |
| Monthly surplus | A money figure. |
| Months of cover | A decimal figure. |
What is not in this number
Property figures here exclude the costs that decide whether a deal works: vacancy, maintenance, management, capital expenditure and the transaction costs at both ends. A return that looks strong before those frequently does not survive them.
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.