Cap Rate Calculator
Understand a property's potential performance with a transparent estimate of annual net operating income and capitalization rate.
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What does a cap rate tell you?
A capitalization rate expresses the annual net operating income of a rental property as a percentage of the property's value. It is one way to compare properties with different prices, but it should be considered alongside location, condition, tenant mix, leasing risks and future capital repairs.
Example: A property valued at $400,000 with $20,000 annual net operating income has a cap rate of 5%.
Planning tool only. Results use your estimates and are not a valuation, appraisal, financing decision, investment recommendation or guarantee. Actual returns, cash flow and applicable taxes can vary. Consult qualified advisers for investment, tax or legal guidance.
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