How to Calculate Cash Flow on a Rental Property

Cash flow is the money left over each month after the property pays for itself. It's the number that decides whether a rental feeds you or bleeds you. Here's exactly how to calculate it — including the expenses most beginners forget.

The formula

Step 1: Income

Start with realistic monthly rent (use comps, don't guess high). Add any extra income — parking, laundry, pet fees.

Step 2: Subtract every expense

This is where deals get killed. Don't forget:

• Mortgage (principal + interest)
• Property taxes and insurance
• Vacancy — budget ~5–8% (it won't be rented 100% of the time)
• Repairs & maintenance — ~5–10% of rent
• Property management — ~8–10% if you hire it out
• HOA fees, if any
• CapEx — saving for big-ticket items (roof, HVAC)

The trap that bankrupts beginners

New investors calculate "rent minus mortgage" and think they're cash-flowing $900. Then vacancy, repairs, and CapEx hit — and the real number is negative. Always budget the hidden expenses. A deal that only works if nothing ever breaks is not a deal.

How much cash flow is good?

Many investors target $100–$200+ per unit per month after all expenses. Pair cash flow with cash-on-cash return and cap rate for the full picture.

Calculate it instantly

PropVision runs the full cash-flow math (with realistic expense assumptions) on any address in about 10 seconds.