Cash on Cash Return Calculator is a way to measure your returns on your investments. This return is simply the amount of cash you initially invest into the property compared to the income generated by that property.
What is a good cash on cash return? Some say that anything above 8% is good, and aim for something in the range 8-12%. Other investors would not consider a rental property if it does not promise them a cash on cash return of 20%. The cash on cash return also varies based on the type of property and location.
Note: When you buy a home that needs a lot of repairs, it can take weeks or months to repair. When the home is sitting vacant, it is not making any money and actually costing you money. You may have to make mortgage payments, pay HOA fees, pay utilities or other costs while the home is vacant. These costs need to be considered when calculating cash on cash returns.