Property ownership
Property net operating income and cap rate
Separate operating return from financing and capital spending.
Your inputs
Complete the fields for your selected method. Zero means intentionally zero, not unknown. Currency selection labels amounts; it does not convert exchange rates.
How this calculation works
NOI=effective income-operating expenses; cap=NOI/property value.
NOI excludes financing, income taxes, depreciation and capital expenditure. Value is supplied, not a market appraisal or investment recommendation.
What information do I need?
Use records for the same job, equipment or accounting period. Only the fields for your selected entry method are required. An unknown amount is not zero.
Input definitions and where to find them
- Annual effective property income (selected currency): Annual effective operating income after collection/vacancy loss.
- Annual operating expenses (selected currency): Annual operating expense before financing/depreciation/capital spending.
- Entered property value (selected currency): User-supplied value, not market appraisal.
Use the Where to find this value controls beside the inputs for available work-it-out helpers. Estimates remain your assumptions; a helper does not verify the source figures.
Worked example
Example amounts use US dollars (USD).
Example answer: Annual net operating income is $36,000.00 for the illustrative inputs below.
Example inputs
- Annual effective property income: $60,000.00
- Annual operating expenses: $24,000.00
- Entered property value: $600,000.00
- Annual net operating income
- $36,000.00
- Capitalization rate
- 6.00 %
These illustrative values are not recommended rates or industry averages. Replace every example input with your own figures.
Use the result well
Separate operating return from financing and capital spending.
Keep inputs on the same scope and time basis. Calculations retain precision internally; displayed values generally round to two decimal places, with extra precision for very small values and whole-unit rounding where required. Economic comparisons describe your supplied assumptions and do not guarantee future results.
This tool provides business arithmetic. It does not approve engineering designs, establish legal or tax treatment, select equipment or certify safe operating conditions.