Cash-on-Cash Return Calculator

Cash-on-cash return measures the annual pre-tax cash flow relative to the total cash invested. It is calculated as Annual Cash Flow (after debt service) divided by Total Cash Invested. Unlike cap rate, it accounts for financing and shows your actual return on equity.

Cap rate measures the unleveraged return (NOI / Value) and ignores financing. Cash-on-cash measures your leveraged return on actual cash invested. With favorable financing, CoC return can be significantly higher than cap rate.

For stabilized properties, 6-10% is solid. Multifamily typically yields 6-10%, industrial 7-10%, retail 8-12%, and value-add strategies can target 12-20%+. Returns below 5% may not justify the risk.

No. It only measures annual cash flow yield. For a total return picture including appreciation, principal paydown, and tax benefits, investors use Internal Rate of Return (IRR).