Real estate & rental
Real Estate Investment Property Calculator
Total return on an investment property: cash flow, principal paydown and appreciation together.
Result
Appreciation is the largest and least reliable component in most property returns, and this treats it as a steady rate, which it never is. It also ignores tax treatment, which for rental property is substantial and can change the answer materially in either direction. Not investment advice.
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About this calculator
Why is total return so much higher than cash on cash?
Because three things are working at once: the rent, the tenant paying down your loan, and the asset changing value. Cash on cash counts only the first.
Is appreciation reliable?
Over decades in most markets, yes on average. Over any particular five year period, no. A return that only works with appreciation is a bet on the market rather than on the property.
The formula
total return combines cash flow, principal paydown and appreciation, against the cash invested
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