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DealCalc calculator guide

Cap Rate Calculator

Cap Rate is a fast yield check, but DealCalc keeps it connected to NOI, DSCR, Monthly Cash Flow, Cash Required, and value spread.

Primary outputCap Rate
Primary outputNOI

Calculator

Use Cap Rate to check property yield, not the whole decision.

DealCalc shows Cap Rate inside rental and multifamily analysis so the yield never sits apart from debt coverage and cash flow.

Example inputs

  • NOI$115,539
  • Purchase Price$1,650,000
  • Target Cap %6.25%
  • Loan Amount$1,237,500
  • Cash Required$442,500
  • Monthly Cash Flow$3,420

In-app workflow

  • Pick the calculator in Analyze.
  • Enter assumptions and review Deal Score.
  • Save the deal when the numbers deserve a second look.
  • Upgrade for AI Insights, Project Tracker, portfolio, and investor-ready reports.

Results

Read the result like an investor, not a spreadsheet.

Cap Rate7.0%
NOI$115,539
Implied Value$1,848,624
Value Spread$198,624
Monthly Cash Flow$3,420/mo
DSCR1.35
Cash-on-Cash Return9.3%
Deal Score7.8 / 10

Metric explanations

DealCalc metric names used on this page

  • Cap RateNOI divided by property value or purchase price.
  • NOIThe income stream that supports cap rate and valuation.
  • Implied ValueNOI divided by the target cap rate. DealCalc uses this on multifamily-style analysis.
  • Value SpreadImplied Value minus Total Project Cost or basis.
  • Monthly Cash FlowDebt-adjusted monthly result that Cap Rate does not show.
  • DSCRDebt coverage check that keeps Cap Rate grounded in financing reality.

AI Insights

Use the guide to learn. Use the app to decide faster.

NOI quality

DealCalc AI Insights flags whether Cap Rate is supported by realistic income and expenses.

Debt context

The app keeps DSCR and Monthly Cash Flow nearby so a good Cap Rate does not hide bad leverage.

Value spread

On multifamily analysis, DealCalc connects Cap Rate to Implied Value and Value Spread.

Step-by-step guide

How to use this calculator workflow

  1. 01

    Estimate realistic NOI from effective income minus operating expenses.

  2. 02

    Divide NOI by purchase price or current value to calculate Cap Rate.

  3. 03

    Compare the result to market yield expectations and target cap rate.

  4. 04

    Review DSCR and Monthly Cash Flow before deciding the debt is safe.

  5. 05

    Use DealCalc to save the scenario and compare it against other opportunities.

Common mistakes

Where investors usually distort the answer

  • Using gross rent instead of NOI.
  • Comparing Cap Rate across markets without understanding risk and property quality.
  • Ignoring debt, DSCR, and Cash Required.
  • Treating a high Cap Rate as good when expenses are understated.

FAQs

What is Cap Rate?

Cap Rate is NOI divided by property value or purchase price. It measures unlevered property yield.

Does Cap Rate include debt?

No. Cap Rate ignores financing. DealCalc pairs it with DSCR, Monthly Cash Flow, and Cash Required.

Where does DealCalc use Cap Rate?

DealCalc uses Cap Rate in rental, BRRRR, multifamily, and valuation workflows.

Run it in DealCalc

Run Cap Rate with cash flow and DSCR in DealCalc.

This page is built to teach the workflow and drive search traffic. The full DealCalc experience adds saved deals, AI Insights, Project Tracker, portfolio dashboards, and investor-ready reports.

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