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Calcimator

Income Approach Valuation Calculator

Value income-producing property using the capitalization rate method (NOI / Cap Rate = Value).

Inputs

$/mo
%
%
%

Results

Property Value

$1,368,000.00

≈ 3 average U.S. homes

Net Operating Income

$82,080.00

≈ 7 years of state college

Gross Annual Income$144,000.00
Effective Gross Income$136,800.00
Operating Expenses$54,720.00
Gross Rent Multiplier9.5
Price Per Unit$342,000.00
Cash-on-Cash Return24%
How to Use This Calculator
  1. Enter Monthly Rent per Unit and Number of Units.
  2. Set Vacancy Rate % and Operating Expense Ratio % (expenses as % of effective gross income).
  3. Enter Market Cap Rate for comparable income properties in your area.
  4. Review Property Value — the NOI divided by the cap rate.
  5. Check Gross Annual Income and Effective Gross Income to understand the income stack.
  6. Use alongside cost and sales comparison approaches for a complete multi-approach appraisal.

How the result changes with Cap Rate

Cap RateProperty ValueNet Operating Income
2.9$2,830,345.00$82,080.00
7.65$1,072,941.00$82,080.00
13$631,385.00$82,080.00
18$456,000.00$82,080.00

What each input means

Monthly Rent Per Unit
Average monthly rent per unit.
Number of Units
Total rental units.
Vacancy Rate
Expected vacancy percentage.
Operating Expense Ratio
Operating expenses as % of effective gross income.
Cap Rate
Market capitalization rate for the area/property type.

How this is calculated

Worked example, using the default values

  1. Identify Input Parameters
    4 parameters
    Monthly Rent Per Unit = 3000, Number of Units = 4, Vacancy Rate = 5, Operating Expense Ratio = 40 = 5 input(s) provided
  2. Calculate Property Value
    Property Value = noi / (capRate / 100)
    1368000 = $1,368,000
  3. Calculate Net Operating Income
    Net Operating Income = effectiveGrossIncome - operatingExpenses
    82080 = $82,080
  4. Calculate Gross Annual Income
    Gross Annual Income = grossRent * units * 12
    144000 = $144,000
  5. Calculate Effective Gross Income
    Effective Gross Income = grossAnnualIncome * (1 - vacancyPct / 100)
    136800 = $136,800

Engine last updated . Checked against 2 independently-derived tests — how we verify calculators.

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