Keep reading as we explain what a rental property calculator is and why Mashvisor’s rental property calculator is the best one in town!
What Is a Rental Property Calculator?
The rental property calculator – also known as the investment property calculator – is an online real estate investing tool in which real estate property investors input some basic information about a real estate investment property (such as the purchase price, the financing method, the cash investment, etc.). The tool then provides them with all the crucial numbers needed to decide whether or not to go for this income property.
To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.
Why Does Every Real Estate Investor Need a Rental Property Calculator?
Before real estate property investors had the rental property calculator, they would spend weeks collecting data on the real estate market and investment properties, calculating all the necessary numbers, and coming up with the expected rental income, expenses, and profit from the targeted rental property. However, Mashvisor’s rental property calculator does this within minutes! Nowadays, a real estate investor who makes use of the rental property calculator saves lots of time and efforts. Thus, this real estate investing tool adds a lot of convenience to the life of a real estate investor.
Accuracy is another reason why every real estate investor needs a rental property calculator. There is always the risk of making a mistake when calculating by hand or when using a spreadsheet. However, Mashvisor’s rental property calculator uses traditional and predictive analytics as well as comparative and historical data and provides real estate property investors with the most accurate results, which eliminates the risk of making a decision based on wrong calculations.
Overall, every real estate investor needs the rental property calculator because it allows him/her to make smart real estate investing decisions. To get immediate access to the best rental property calculator there is, sign up for Mashvisor now.
Mashvisor’s Rental Property Calculator: What Does It Calculate?
Mashvisor’s rental property calculator provides real estate property investors with the numbers they need in order to estimate the expected rental income, expenses, and profit from a certain income property. The three most important numbers (or metrics) are:
Cash Flow: In simple words, cash flow is the difference between the monthly rental income and the monthly expenses of a real estate investment property. This number could be positive or negative. Obviously, as a real estate investor, you always want to invest in positive cash flow investment properties! Negative cash flow means the expenses exceed the profits, meaning you’re actually losing instead of making money from your income property. Mashvisor’s rental property calculator provides property investors with cash flow details after all the numbers have been added.
Capitalization Rate: The cap rate is the ratio of the net operating income (NOI) over the property’s value. For example, if the NOI of an investment property is $10,000, and its value is $100,000, the cap rate would be 10%. Real estate property investors are advised to invest in a property with a cap rate above 10%. Mashvisor’s rental property calculator provides readily calculated cap rate ratios for thousands of investment properties across the US housing market!
Cash on Cash Return: The cash on cash return is the NOI over the total cash investment. Calculating CoC return means real estate property investors can determine the expected profits they’d make whether they pay for the income property all in cash or with a mortgage loan. In real estate investing, investment properties with cash on cash return of at least 8% are good investments. Similar to the cap rate, Mashvisor’s rental property calculator also provides real estate property investors with the cash on cash return for investment properties.
Related: Cap Rate vs. Cash on Cash Return
Mashvisor’s Rental Property Calculator: Special Features
Neighborhood Analysis
What makes Mashvisor’s rental property calculator different from the rest is that it provides real estate property investors with all crucial real estate investing numbers (like the median property price, average square foot price, average rental income, occupancy rate, the average cash on cash return, cash flow, and average cap rate) at the neighborhood level! As a result, the real estate investor can use this data to compare different neighborhoods in hundreds of US cities and towns and decide how profitable a certain neighborhood is and whether or not it’s good for real estate investing.
Related: Top 10 Real Estate Markets for Buying Rental Property in 2018
Rental Property Analysis
After selecting the neighborhood, Mashvisor’s rental property calculator will give real estate property investors even more insight on the best investment property type (house, townhouse, single-family home, multi-family home, condo, etc.) in the area. Once again, Mashvisor will provide the basics numbers (rental income, expenses, cash flow, cash on cash return, cap rate, and occupancy rate) of each income property in that area in order for the real estate investor to decide which one is most profitable.
Mashvisor’s rental property calculator also gives estimates of both one-time costs and recurring expenses associated with buying, managing, and renting out an investment property. Not only that, but the real estate investor can play around and change these numbers and determine the best financing strategy based on the results. For example, you can change the amount of the down payment, and the rental property calculator will, in turn, recalculate all numbers related to the investment.
Optimal Rental Strategy
In real estate investing, one factor that determines how profitable an income property will be is the rental strategy. Property investors could rent out their investment properties either as traditional rentals or Airbnb rentals. Each rental strategy has different rental income, expenses, occupancy rate, cash on cash return, and cap rate. To decide which rental strategy is optimal, a rental property calculator is needed!
Mashvisor’s rental property calculator also helps real estate property investors choose the optimal rental strategy for the income property. How? Easy! All data provided by Mashvisor’s rental property calculator is disaggregated into two categories based on the rental strategy: traditional and Airbnb data. Based on the real estate investor’s input in addition to the neighborhood and property analysis, Mashvisor will tell you which rental strategy is most profitable.
Related: Real Estate Investing: Traditional vs. Airbnb Investments
Other Features Provided by Mashvisor’s Rental Property Calculator
Mashmeter
Another special feature that is only provided by Mashvisor’s rental property calculator is the Mashmeter. This tool simply tells property investors how good or bad a neighborhood is for real estate investing, presented as a percentage. This allows a real estate investor to easily compare between neighborhoods. The score is highly reliable as it’s based on actual quantitative and qualitative data and Mashvisor’s analysis.
Optimal Number of Bedrooms
The final feature of Mashvisor’s rental property calculator is the possibility to give the real estate investor an indication of the number of bedrooms that an investment property should have to achieve the best profits in a certain neighborhood.
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Mashvisor’s Rental Property Calculator – Conclusion
So, whether you’re a beginner real estate investor looking to buy your first investment property, or an experienced real estate investor searching for your next income property, be smart and make use of Mashvisor’s rental property calculator! This real estate investing tool will guarantee that you make the best investment decisions and find profitable investment properties in any state, city, and neighborhood in the US housing market!
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