Free Tool

Cap Rate Calculator

Calculate the capitalization rate for any investment property. Understand if your deal meets your return targets before you buy.

Input Method

Property Value / Purchase Price$400,000

$50K$5M

Net Operating Income (NOI) / Year$24,000

$1K$500K

NOI = Gross Rent − Operating Expenses (excluding mortgage)

Formula

Cap Rate = NOI ÷ Property Value × 100

= $24,000 ÷ $400,000 × 100

= 6.00%

Capitalization Rate

6.00%

Good

Net Operating Income

$24,000/yr

Gross Yield

N/A

Implied Value at 6% Cap

$400,000

Implied Value at 8% Cap

$300,000

Single Family

Lower risk, lower yield

4–6%

Multi-Family (2–4 units)

Balanced risk/return

5–8%

Small Apartment (5–20 units)

Good cash flow potential

6–9%

Commercial / Retail

Higher variance

5–10%

Industrial / Warehouse

Stable, long-term leases

5–7%

Analyze a Specific Property

Get crime, flood, climate risk + AI deal verdict for any US address.