Cash-on-cash return
Cash-on-cash return calculator
Cash-on-cash return shows how hard the money you actually put in is working. It divides annual pre-tax cash flow by the total cash you invested, making it the go-to metric for financed rentals.
Cash-on-cash return
Annual pre-tax cash flow ÷ Total cash invested × 100
Example: $3,000 annual cash flow ÷ $75,000 invested = 4.0% cash-on-cash
What counts as cash invested
Include the down payment, closing costs, loan points, upfront repairs or rehab, and any furnishing or setup costs. Leaving these out inflates the return and makes properties look better than they are.
Cash-on-cash vs. cap rate
Cap rate measures the property; cash-on-cash measures your deal structure. The same property can have a modest cap rate but a strong cash-on-cash return with favorable financing — or the reverse when rates are high.
How Envestor helps
- Captures down payment, closing costs, points, and rehab automatically
- Instantly see how rate, term, and down payment change your return
- Works for long-term rentals, short-term rentals, and multifamily
- Shareable reports for lenders and partners
Free account includes a property analysis. No credit card required.
Frequently asked questions
- What is a good cash-on-cash return?
- Many investors look for 6–10% or more, but targets depend on market, appreciation expectations, and interest rates. Compare against your alternative investments.
- Is cash-on-cash return the same as ROI?
- No. Cash-on-cash only counts cash flow. Total ROI also includes appreciation, loan principal paydown, and sometimes tax benefits.