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Cash-on-cash return calculator
Compare the annual cash a property produces for equity with the cash you put into it. Use cash flow after debt service and recurring capital spending.
Cash available to equity after operating costs, all debt service and recurring capital spending. Exclude sale and refinance proceeds.
Include the down payment, closing costs, loan fees and cash-funded improvements and reserves.
Cash-on-cash return
This annual measure excludes appreciation, sale proceeds, refinance proceeds and personal income taxes. It is different from IRR and equity multiple.
Example amounts are prefilled. Change any field to see your result instantly. Your financial inputs stay in this browser.
How to calculate cash-on-cash return
Cash-on-cash return measures annual cash flow relative to invested equity. Use the same year and a consistent cash flow definition. Include cash costs that reduce what equity actually receives. Negative cash flow produces a negative return.
Cash-on-cash return = annual before-tax equity cash flow / total cash invested × 100
Worked example
If you invest $2,500,000 and receive $200,000 in annual before-tax cash flow, cash-on-cash return is $200,000 / $2,500,000 × 100 = 8.00%.
Frequently asked questions
Is cash-on-cash return the same as cap rate?
No. Cap rate uses NOI and property price before financing. Cash-on-cash return uses cash flow after financing and the equity invested.
Do closing costs count as cash invested?
Yes, when funded with equity. Include all cash you contribute, including closing costs, loan fees, initial improvements and reserves.
Can cash-on-cash return be negative?
Yes. If annual equity cash flow is negative, the property needs additional cash that year and the ratio is negative.
See how the full model works in our engine methodology or review a worked property example.