Cash on Cash Return Real Estate Calculator Nashville

With the help of Mashvisor’s cash on cash return real estate calculator, investors can pin down the best locations to invest in Nashville.

Are you considering investing in real estate properties in Nashville in 2023 and need a cash on cash return calculator that can help you find great deals? You’re not alone.

Table of Contents

Is the Nashville Real Estate Market a Great Place to Invest in 2023?
The Top 5 Neighborhoods in Nashville for Short-Term Rental Investment
The Importance of the Cash on Cash Return Calculator
How to Find the Best Investment Properties in Nashville Using Our Cash on Cash Return Calculator

Nashville’s real estate market changed quite a bit over the past year, and real estate experts across the US are starting to take the changes into account.

One of the main reasons for real estate investors’ growing interest in the area is the fact that its job market is currently at an enviable level and that the population is steadily growing.

Of course, it doesn’t tell you much about the investment potential or help you research the Nashville returns. That’s why you need a helping hand:

Mashvisor’s cash on cash return real estate calculator is here to fill in the blanks and do the math for you.

Investing in any real estate property implies extensive research, calculations, and knowledge of the real estate market.

To find out more about Nashville rental earnings and how to predict the success of your next investment with our cash on cash return calculator, read on.

Is the Nashville Real Estate Market a Great Place to Invest in 2023?

As we head into 2023, it becomes increasingly evident that Tennessee’s real estate market is in a different position than it was only a year ago. That is to say that Nashville investment properties gained some attention in recent months.

According to a recent Nashville real estate market analysis, the metro area population witnessed a 1.62% increase from 2022, sparking interest among investors. Also, it is a great predictor of success. It indicates that Nashville’s population is growing at a rate of 1.8% on a yearly basis.

Based on the strong local economy, home value growth, and several other factors, many experts predict that, in 2023, Nashville may rank as the fifth-hottest US real estate market.

If you’re considering investing in Nashville in 2023, here is what Mashvisor’s February 2023 location report looks like:

Median Property Price: $637,003
Average Price per Square Foot: $1,111
Days on Market: 67
Number of Long Term Rental Listings: 147
Monthly Long Term Rental Income: $1,980
Long Term Rental Cash on Cash Return: 2.33%
Long Term Rental Cap Rate: 2.37%
Price to Rent Ratio: 27
Number of Short Term Rental Listings: $3,772
Monthly Short Term Rental Income: $3,333
Short Term Rental Cash on Cash Return: 3.64%
Short Term Rental Cap Rate: 3.69%
Short Term Rental Daily Rate: $316
Short Term Rental Occupancy Rate: 47%
Walk Score: 38

As evident by the data shown above, Nashville rental returns are higher for short term rental properties compared to long term rentals.

If you’re interested in the Nashville real estate market, Airbnb properties in Nashville could be the way to go. The potential for good cash on cash return is definitely there.

Mashvisor’s real estate heatmap showing which parts of Nashville TN has the highest Airbnb cash on cash returns

The Pros and Cons of Investing in Nashville

Nashville, the capital of Tennessee, boasts a strong job market, high quality of life, and a rapidly growing population, all of which are contributing to high rental demand.

That’s enough to attract the attention of investors.

Based on what our cash on cash return calculator showed, Nashville seems a lucrative location for vacation rentals at the moment. In fact, it currently shows a 47% occupancy rate and cash on cash return of 3.64% for short term rentals.

Airbnb properties are definitely something to keep in mind.

Nashville is known for its nightlife and music scene, with numerous bars, performance venues, and clubs—which is bound to attract tourists looking for entertainment. At the same time, it remains a family-friendly tourist destination.

While there are many reasons why you should consider investing in Nashville real estate, it’s important to be aware of some potential drawbacks.

Nashville is a city that offers a lot, ranking as one of the fastest-growing cities in the US—which is great news for real estate investors.

However, it also drove the real estate market prices up significantly. Median property prices are up by as much as 85% from five years ago, according to S-Ehrlich.

The Top 5 Neighborhoods in Nashville for Short Term Rental Investment

Searching for profitable rental properties in Nashville can actually take longer than you might’ve anticipated. The good news is Mashvisor is always one step ahead and ready to help.

Below, from Mashvisor’s February location report, we prepared a list of the best Nashville neighborhoods to invest in 2023 based on the cash on cash return, among other factors. The neighborhoods are ranked from the highest to the lowest CoC return.

1. Elizabeth Park

Median Property Price: $475,701
Average Price per Square Foot: $343
Days on Market: N/A
Number of Short Term Rental Listings: 1,074
Monthly Short Term Rental Income: $4,519
Short Term Rental Cash on Cash Return: 6.02%
Short Term Rental Cap Rate: 6.09%
Short Term Rental Daily Rate: $354
Short Term Rental Occupancy Rate: 46%
Walk Score: 59

Elizabeth Park comes in first with the highest cash on cash return; our calculator reports a 6.02% return for short term rentals. Most residents here own their homes, and the neighborhood is generally known to be a quieter one. You can find a lot of coffee shops, restaurants, and parks in the area, so it is suitable for shorter family vacations.

2. JSH Neighborhood Club

Median Property Price: $520,781
Average Price per Square Foot: $404
Days on Market: 34
Number of Short Term Rental Listings: 862
Monthly Short Term Rental Income: $4,001
Short Term Rental Cash on Cash Return: 5.38%
Short Term Rental Cap Rate: 5.45%
Short Term Rental Daily Rate: $359
Short Term Rental Occupancy Rate: 42%
Walk Score: 48

In second place is JGH Neighborhood Club. It’s an excellent location for investing in short term real estate in Nashville, with our calculator indicating a promising 5.38% cash on cash return. It’s a walkable area with many interesting things to do, and if you’re bringing a pet with you, know that JSH Neighborhood Club is a pet-friendly area, too.

3. Greenwood

Median Property Price: $588,155
Average Price per Square Foot: $541
Days on Market: N/A
Number of Short Term Rental Listings: $926
Monthly Short Term Rental Income: $3,831
Short Term Rental Cash on Cash Return: 4.50%
Short Term Rental Cap Rate: 4.55%
Short Term Rental Daily Rate: $335
Short Term Rental Occupancy Rate: 45%
Walk Score: 59

Greenwood ranks third on our list for investing in Nashville Airbnb properties, with an equally impressive cash on cash return of 4.50%. It’s a walkable neighborhood with several parks and playgrounds—which makes it a great spot for families with kids.

4. Historic Edgefield

Median Property Price: $705,213
Average Price per Square Foot: $493
Days on Market: N/A
Number of Short Term Rental Listings: 967
Monthly Short Term Rental Income: $4,543
Short Term Rental Cash on Cash Return: 3.92%
Short Term Rental Cap Rate: 3.95%
Short Term Rental Daily Rate: $351
Short Term Rental Occupancy Rate: 46%
Walk Score: 81

With our calculator indicating cash on cash return of 3.92%, Historic Edgefield takes fourth place on our list. It is one of the liveliest neighborhoods in Nashville. It seems like there is always something going on in Historic Edgefield. The location is mainly known for exciting festivals, after all.

5. Buena Vista

Median Property Price: $731,326
Average Price per Square Foot: $444
Days on Market: 138
Number of Short Term Rental Listings: 1,092
Monthly Short Term Rental Income: $4,356
Short Term Rental Cash on Cash Return: 3.53%
Short Term Rental Cap Rate: 3.56%
Short Term Rental Daily Rate: $407
Short Term Rental Occupancy Rate: 41%
Walk Score: 82

The fifth place goes to Buena Vista—our cash on cash return calculator indicates a 3.53% return for short term rentals. It’s actually one of the best places to live in Nashville. If you’re a tourist, you’ll get that urban feel if you decide to visit the place. The local neighborhood’s mostly known for its local businesses, landmarks, and fine restaurants.

Looking for houses for sale in Nashville may be a tedious job if you’re not equipped with the right tools. But with Mashvisor’s platform and cash on cash return calculator, the process of searching for profitable investment property becomes easier.

Make sure to use Mashvisor’s investment tools help you find the best short term rentals in Nashville.

The Importance of the Cash on Cash Return Calculator

The cash on cash return calculator is key to predicting how profitable a property can be and whether investing in it makes financial sense or not. A higher cash on cash return indicates a more profitable investment property; it’s as simple as that.

Here’s a summary of the importance of cash on cash return for real estate investors and the benefits of using a cash on cash return real estate calculator:

It provides valuable insight into the property’s income potential.
The calculator gives you a quick way to compare different investment opportunities.
It can be used to monitor how the property is performing financially.

Of course, a cash on cash return calculator won’t tell you everything about your rental property. Unlike an ROI (return on investment) calculator, it won’t factor in tax benefits, appreciation, loans, and similar variables.

However, a cash on cash return calculator will still be a valuable asset when it comes to evaluating the profitability of a potential investment.

What’s a Good Cash on Cash Return?

There’s no universal rule or a specific number that would be considered “good” cash on cash return.

Obviously, the higher the cash on cash return indicated by the calculator, the better. The number depends on many different factors, though—including the location, the current state of the real estate market, and the type of property in question.

With that said, most investors would agree that the estimated cash on cash return of 8% and higher indicates a good return on investment. However, depending on the market, even cash on cash return rates of 3% to 7% can still be considered acceptable.

How to Find the Best Investment Properties in Nashville Using Our Cash on Cash Return Calculator

Finding profitable Nashville properties for sale is a process that requires you to do extensive research, know the area you’re investing in, and determine the potential cash on cash return.

In the past, it would’ve probably taken you ages to sort through all the investment properties in Nashville—but Mashvisor was able to break down the process into five simple steps. Plus, you get to use our cash on cash return calculator to speed things up—but more on that later.

Here’s what you need to do:

1. Determine What You’re Looking For

Before you get to use the cash on cash return calculator and start going through the actual numbers, you should know what you’re looking for in terms of potential investments. In other words, you should be confident in your investment strategy.

So, here are some questions you should answer before taking further action:

Are you looking to invest in a long term or short term real estate property?
Do you prefer single family homes, apartments, or studio apartments?
Are you financially stable enough? Do you have extra cash on you?
Are you tied to a specific location?

This step seems obvious enough—and yet, it often gets overlooked because some investors are more focused on the data and numbers. Our advice to you is:

Before taking any of the following steps and using our calculator, it is essential that you take the time to answer these real estate-related questions. It’ll give you a better understanding of what you’re looking for in terms of investments—and what your next step should be.

2. Research the Real Estate Market

The next step is pretty self-explanatory:

Once you’ve prepared your strategy, you will need to research the real estate market. At the moment, the US real estate market offers countless possibilities for real estate investors.

What you need to do is focus on the specific real estate market that’s of interest to you. It can be a market within your state. But if you’re willing to take on a challenge, you can also conduct out-of-state market research.

Either way, the main goal remains the same.

Do your homework on the population, seasonality, local economy, amenities, as well as other factors that can potentially make or break your investment deal. Once you’ve identified the real estate market that fits your requirements investment-wise, you may take a deeper dive.

3. Conduct an Investment Property Search

What makes Mashvisor stand out from the rest of the competition regarding investing opportunities is its investment property search tool. The cutting-edge investment tool allows real estate investors to conduct thorough research on a potentially lucrative property.

It relies on predictive analytics that provide real estate investors with accurate results on how to pin down the most profitable investment properties in the area.

The key to success here is undoubtedly location, and Mashvisor’s tool makes sure to keep tabs on all relevant changes and potential investment windfalls.

4. Perform a Neighborhood Analysis

Location, as you may know, holds a lot of weight when it comes to the potential success and profitability of your investment.

Once you’ve performed an in-depth market analysis and found a city you are interested in—Nashville, for example—you can turn your attention to the specific neighborhoods.

Without a neighborhood analysis, there is no way to ensure that you’re investing in the right neighborhood.

Every property exists in the context of its neighborhood. The report will basically give you an estimate of a property’s “investment potential” based on the neighborhood it’s located in.

On that note, with the help of Mashvisor’s Neighborhood Analysis feature, you can gain insights into what real estate properties are for sale in that particular area.

Plus, you’ll get relevant details about each property, along with neighborhood stats—such as median prices, traditional and Airbnb cash on cash return, cap rate, and occupancy rates.

So, if you’re serious about investing in Nashville, now would be a great time to scroll through potential real estate investment properties.

Rental Comps

Rental comparables, or rental comps, for short, allow you to compare your rental property to other nearby properties with similar qualities.

The “qualities” we’re referring to include property type, square footage, number of bedrooms, number of bathrooms, and available amenities, among other things.

Why is it important to see how your property stacks up against other properties in a particular area?

Well, using rental comps will allow you to set a competitive and reasonable rental rate for your property. Plus, it’ll show you how other properties in that neighborhood are performing and if you can expect a good return on your investment.

Finally, you can proceed to use a cash on cash return calculator:

5. Use a Cash on Cash Return Real Estate Calculator

Cash on cash return makes it possible to determine the return on investment for your rental property relative to the amount of money invested in it. The formula takes into account your pre-tax cash flow and the total amount invested when purchasing the property.

Of course, you can try doing the calculations manually; the formula for cash on cash return is relatively simple:

Cash on Cash Return = (Annual Pre-Tax Cash Flow / Total Cash Invested) x 100

But without an actual CoC return calculator, it will be a time-consuming task and will introduce the risk of errors.

And considering that Mashvisor’s platform already includes a cash on cash return real estate calculator, why waste time on doing things manually?

Mashvisor’s calculator will take estimated property-related expenses, rental income, as well as occupancy rate into account to calculate potential cash flow and expected cash on cash return.

Mashvisor cash on cash calculator is the ultimate helper tool for real estate investors, as it allows them to find and analyze traditional and Airbnb real estate. The calculator covers most of the housing market in the US, and it utilizes interactive investment tools to enable investors to make fast and smart decisions right away.

Going through spreadsheets and various calculators can take days or weeks – but Mashvisor’s cash on cash calculator will provide you with accurate numbers in minutes’ time.

You can start real estate hunting right away—Mashvisor offers a 7-day free trial. Sign up now and see what our platform offers real estate investors looking for a good deal.

Investing in Nashville Houses for Sale: Wrapping Up

We’ve successfully walked you through the topic of finding investment deals in the Nashville real estate market. More importantly, we showed you how to assess their profitability with the cash on cash return real estate calculator.

Now, let’s go through the key takeaways:

Many experts agree that Nashville could rank as the fifth hottest US real estate market in 2023. The rental returns are higher for short term rental properties at the moment, though, so your focus should be on Airbnb properties for sale in Nashville.

Some of the most profitable Nashville neighborhoods for short term rentals include Elizabeth Park, Greenwood, Buena Vista, JSH Neighborhood Club, and Historic Edgefield.

That said, finding a Nashville investment property for sale can prove to be a lengthy process. As long as you research the real estate market, perform the rental analysis, and use cash on cash return calculator, though, you’ll be able to make an informed decision.

You don’t have to go through this process alone.

Schedule a free demo today with one of Mashvisor’s Product Specialists today and we will provide an in-depth introduction to our products and answer any questions.

Start Your Investment Property Search!

Find Great Deals in the Nashville Real Estate Market with Our Cash on Cash Return Calculator