Four calculators we built for ourselves to decide which houses to buy and which tenants to approve. Same math that powers Tenantory's internal analytics. Given away because gatekeeping a cap rate formula is embarrassing.
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Cap rate calculator
Net operating income ÷ purchase price.
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Under 6% is thin — you're buying appreciation, not cash flow. 6–8% is a normal buy in a decent market. 8%+ is where real landlords live. Goes by market: 5% in San Diego isn't the same sin as 5% in Huntsville.
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Cap rate
Calculating…
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Net operating income
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Cash-on-cash return
What your actual cash is earning, after the mortgage.
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Cap rate ignores financing. Cash-on-cash tells you what your down payment is really making each year. Anything under 6% and you'd be better off in an index fund. 8–12% is healthy. Above 15% usually means you lied on expenses.
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Annual cash-on-cash
Calculating…
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Monthly cash flow
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1% rule checker
Monthly rent ≥ 1% of purchase price.
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Old-school back-of-napkin test. A $150k house should rent for $1,500+ to cash flow. The rule is a filter, not a verdict — nothing under 0.7% pencils, anything over 1.2% deserves a phone call today.
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Rent-to-price ratio
Calculating…
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Rent needed to hit 1%
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Tenant rent affordability
Rent-to-income ratio for applicant screening.
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Industry standard is 3x rent. Under 33% is safe. 33–40% is stretched and they'll be late when the car breaks down. Over 50% is a red flag — they'll either skip or ask you for relief in month three.
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Rent-to-income
Calculating…
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Income multiple
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Save this to the applicant's profile in Tenantory.
The shameless cross-sell
These calculators are nice. Running them on your whole portfolio is nicer.
Inside Tenantory, every property gets a live cap rate, cash-on-cash, and occupancy score — updated every time rent hits the bank. Stop opening a spreadsheet to know if your rentals are working.
Cap rate per property, auto-updated from your ledger
Applicant screening with affordability built in
Monthly investor report that does the math for you
Net Operating Income (annual rent minus operating expenses — tax, insurance, maintenance, vacancy, management fees, but NOT the mortgage) divided by purchase price. That's it. If somebody quotes you a cap rate that includes debt service, they're pitching you, not teaching you.
As a filter, yes. As a verdict, no. In most Sun Belt markets you can still hit 1% on smaller SFRs. In Denver, Austin, or coastal California, 0.6% is a "great" deal and you're buying for appreciation. Use it to eliminate obvious losers in 5 seconds — then do the real math.
In a stable market with a decent property, pencil 5–8%. In a rougher class-C neighborhood or a college town, 10%+ is honest. If you're modeling 0% vacancy you're lying to yourself — every unit turns, and every turn has 2–4 weeks of empty.
3x gross monthly rent is the industry standard and what Fair Housing attorneys recommend applying uniformly. 2.5x in hot rental markets is defensible if you're also requiring a cosigner or extra deposit. Below 2x is usually a late-rent story with extra steps.
Not on this page — these calculators are stateless on purpose. Bookmark the page, or if you want a cap rate and affordability score attached to every property and applicant in your portfolio, that's what Tenantory is for. Start the 14-day trial, no card.
Put the math on autopilot.
Tenantory runs these calculators on your whole portfolio, every day, automatically — plus it collects the rent, signs the leases, and ships the investor reports. 14-day free trial. No credit card.