Cap Rate Calculator
NOI Breakdown
Cap Rate Assessment
Value at Different Cap Rates
| Cap Rate | Property Value |
|---|
Understanding Cap Rate
The capitalization rate (cap rate) is a key metric in real estate investing that measures a property's potential return on investment. It's calculated as:
What is NOI?
Net Operating Income is the annual income generated by a property after deducting operating expenses (property taxes, insurance, maintenance, management fees) but before mortgage payments and income taxes.
Cap Rate Benchmarks by Property Type
| Property Type | Typical Cap Rate |
|---|---|
| Class A Multifamily (Prime Markets) | 3.5% - 5% |
| Class B/C Multifamily | 5% - 7% |
| Single Family Rentals | 4% - 8% |
| Retail (NNN) | 5% - 7% |
| Office Buildings | 5% - 8% |
| Industrial/Warehouse | 4% - 7% |
| Self Storage | 5% - 8% |
Higher vs Lower Cap Rates
- Higher cap rate (8%+): Higher potential return but usually more risk, older properties, less desirable locations, or value-add opportunities
- Lower cap rate (3-5%): Lower risk, prime locations, newer properties, stable tenants — typical in competitive markets
Important: Cap rate alone doesn't tell the whole story. Consider appreciation potential, financing terms, local market conditions, and your investment strategy when evaluating properties.
Privacy & Limitations
- All calculations run entirely in your browser -- nothing is sent to any server.
- Results are estimates for planning purposes and should not replace professional financial advice.
Related Tools
- Net Present Value Calculator -- Calculate NPV of an investment by discounting future cash flows, with IRR
- Overtime Calculator -- Calculate overtime pay at 1.5x or 2x rate
- FIRE Calculator -- Calculate your path to financial independence with FIRE number, savings rate
- Sales Commission Calculator -- Calculate sales commissions with flat rate, tiered, base+commission, and draw
Related Tools
View all toolsSimple Interest Calculator
Calculate simple interest and total amount
Loan Calculator
Calculate monthly payments and total interest
Loan Amortization Schedule
Generate a full payment-by-payment breakdown with principal, interest, and balance
Mortgage Calculator
Estimate mortgage payments and totals
Refinance Calculator
Calculate break-even point on mortgage refinancing and compare monthly savings
Compound Interest Calculator
Calculate compound growth over time
Cap Rate Calculator FAQ
What is Cap Rate Calculator?
Cap Rate Calculator is a free finance & money tool that helps you Calculate real estate capitalization rate and property value.
How do I use Cap Rate Calculator?
Enter your input values, review the calculated output, and adjust inputs until you reach the result you need. The result updates in your browser.
Is Cap Rate Calculator private?
Yes. Calculations run locally in your browser. Inputs are not uploaded to a server by default, and refreshing the page clears session data.
Does Cap Rate Calculator require an account or installation?
No. You can use this tool directly in your browser without sign-up or software installation.
How accurate are results from Cap Rate Calculator?
This tool applies standard formulas or deterministic processing logic for estimates. For medical, legal, tax, or investment decisions, verify with a qualified professional.
Can I save or share outputs from Cap Rate Calculator?
You can bookmark this page and copy outputs manually. Results are not persisted in your account and are typically not embedded in the URL.