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📊 Cap Rate Calculator

Capitalization rate measures a property's return independent of financing. Compare As-Is vs Pro Forma cap rates and see the implied value at your target cap rate.

📍 Property Address (optional)
InputsYour Numbers
Property Value
Purchase Price?
$
ARV / Stabilized Value?
$
As-Is Income
Monthly Rent?
$
Other Income / mo?
$
Vacancy %?
%
Pro Forma Income
Pro Forma Monthly Rent?
$
Pro Forma Vacancy %?
%
Operating Expenses
Property Tax / mo?
$
Insurance / mo?
$
Maintenance %?
%
Management %?
%
HOA / mo?
$
As-Is Cap RateCurrent Rents
Enter values to calculate cap rate
Cap Rate
--
target 5-7%+
Annual NOI
--
net oper. income
GRM
--
price / ann. rent
Gross Yield
--
rent / price
NOI Build-Up (Annual)
Gross Annual Rent--
Vacancy Loss--
Other Income--
Eff. Gross Income--
Property Tax--
Insurance--
Maintenance--
Management--
HOA--
Annual NOI--
Cap Rate = NOI / Price--
Value at Target Cap Rates
Implied Value at 5.0%--
Implied Value at 5.5%--
Implied Value at 6.0%--
Implied Value at 7.0%--
Pro Forma Cap RateAfter Plan
Enter pro forma rent to see upside
Pro Forma Cap
--
vs as-is
Annual NOI
--
vs as-is
Value Created
--
at market cap rate
Cap on ARV
--
NOI / stabilized val
Pro Forma NOI (Annual)
Pro Forma Gross Rent--
Vacancy Loss--
Eff. Gross Income--
Total Operating Expenses--
Annual NOI--
Cap Rate on Purchase Price--
Value Upside (at 5.5% market cap)
As-Is Implied Value--
Pro Forma Implied Value--
Value Created by Rent Increase--

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1
Enter Property Value
Input the purchase price. For pro forma analysis, also enter the ARV -- what the property will be worth after improvements.
2
Enter Current Rents
The monthly rent today. Include any other income (laundry, parking). Set vacancy at the realistic market rate for your area.
3
Enter Pro Forma Rents
What you expect to charge after improvements or lease-up. The calculator shows how much value you create by raising NOI.
4
Enter All Operating Expenses
Tax, insurance, maintenance, management, HOA. Do NOT include mortgage -- cap rate is calculated before debt service.
5
Read the Cap Rate
Cap Rate = Annual NOI / Property Value. 5-7% is typical for many markets. Compare to local market cap rates to judge if the deal is priced fairly.
6
Use the Implied Value Table
The table shows what the property is worth at different cap rates. If market cap rates are 5.5%, your NOI divided by 0.055 is the fair market value.

Cap rate is the most important metric in commercial and multifamily real estate valuation. It measures return on a property independent of how it's financed -- making it a pure measure of the asset's income productivity.


The formula: Cap Rate = NOI / Property Value. Rearranged: Property Value = NOI / Cap Rate. This means every $1 of additional annual NOI you create adds $18 of value at a 5.5% cap rate, or $14 at a 7% cap rate.


Cap rate targets vary by market and property type. Class A urban multifamily might trade at 4-4.5%. Class C Midwest SFR might be 7-9%. Always compare to local market cap rates -- a 6% cap rate might be great in one city and terrible in another.

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