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Home › Calculators & Tools › Cap Rate Calculator
📉 Free Calculator

Cap Rate Calculator

Quickly determine capitalization rates to compare investment opportunities side by side. Evaluate which property delivers the best return.

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Property Information

Enter property details and operating expenses

$
$
$21,600 / year
$

💵 Annual Operating Expenses ?

$
$
$
~8% of annual rent
$
~10% of annual rent
$
~5% of annual rent
$
$
$
Cap Rate
0.0%
Capitalization Rate
Good Solid investment return
0% 4% 8% 12%+
Income
Gross Annual Rent $0
Other Income $0
Gross Annual Income $0
Operating Expenses
Total Annual Expenses $0
Net Operating Income (NOI) $0
$0
Annual NOI
--
Gross Rent Multiplier
--%
Expense Ratio
--%
1% Rule

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Cap Rate Formula

Cap Rate = NOI / Property Value

Net Operating Income divided by the property's current market value or purchase price.

NOI Formula

NOI = Gross Income - Operating Expenses

Operating expenses exclude mortgage payments (P&I), depreciation, and capital expenditures.

Gross Rent Multiplier

GRM = Property Price / Gross Annual Rent

Lower GRM = faster payback. Typically ranges from 4-12 depending on market.