Using PortfolioBay’s Rental Property Calculator: A Comprehensive Guide


PortfolioBay offers the premier rental property calculator for astute property investors. This free and user-friendly tool is designed to swiftly calculate essential financial metrics, providing you with a clear insight into a property’s profitability and risk. In this step-by-step guide, we’ll show you how to maximize this calculator, interpret each financial metric, and leverage the results to inform your investment decisions.

1. Finance Section: Begin Your Calculation

  • Start by inputting the purchase price and the down payment for the property in question.
  • The default interest rate mirrors the estimated 30-year fixed mortgage rate. Adjust this based on your actual financing specifics.
  • Factor in your anticipated closing cost and rehabilitation expenses. For an accurate estimate of closing costs, consult your lender. If unsure, consider 3% of your loan amount as a standard. These costs influence your ROI, even if they don’t impact monthly cash flow or debt service.

2. Rental Income: Gauge Your Monthly Earnings

  • Key in the projected gross rental income, considering the cumulative monthly rent from all units.
  • For those considering house hacking, ensure you count the market rent for your unit.
  • Indicate the prospective vacancy rate. New to this? With properties on PortfolioBay, a 2-7% vacancy rate is typical. 5% is a safe bet if uncertain.

3. Monthly Expenses: Understand Your Outgoings

  • Start with the property tax, readily available on MLS listings. Convert the annual tax to a monthly sum by dividing by 12.
  • For insurance estimates, consult an insurance agent or explore platforms like Redfin or Zillow.
  • Input optional costs like mortgage insurance (relevant for low down payments) and HOA fees (for condo investments).
  • Repair and maintenance costs are influenced by the property’s age and state. Lacking a precise estimate? Allocate 25% of the gross rental income.
  • Utility costs are contingent on the property location and landlord-tenant agreements. Though no standard measure exists, estimating it should be straightforward.
  • Note: Management costs aren’t auto-included as PortfolioBay caters to self-managing investors. If outsourcing management, deduct the fee from your gross rental income.

Click “Calculate” to unveil key financial metrics.

4. Understanding Financial Metrics for Informed Decision Making

  • Cap Rate: This gauges property return sans financing considerations. For return optimization through loans, ensure the cap rate surpasses the financing interest rate.
  • Cash Flow: This estimates the monthly income, exclusive of equity buildup.
  • ROI (Return on Investment): A higher cap rate than your loan interest often leads to increased ROI but reduced cash flow.
  • Debt Service Coverage Ratio: This ratio showcases net operating income versus financing costs. A higher value signals a lower risk.

When leveraging the rental property calculator for deal analysis, look beyond ROI. Examine the cap rate in relation to your financing rate to assess deal viability. Fine-tune inputs to balance return and risk.

For a deeper dive, our partnering agents — all experts in their respective markets — can provide insights and assistance with your property analysis using PortfolioBay’s rental property calculator. They can also set up automated property searches tailored for you.


Chad Gipson

Content Director at PortfolioBay