The #1 Real Estate Investment Calculator in 2022

How can you be sure you’re buying a good investment property? The key is to use a real estate investor calculator to determine its ROI.

Table of Contents

1. Mashvisor’s Real Estate Investor Calculator
2. What Is a Fair Percentage for a Real Estate Investor to Make Money?

Investments in rental properties are typically capital-intensive, cash-flow dependent, and come with low liquidity. On the other hand, rental property investments are generally more secure, provide tax advantages, and are more likely to protect against inflation than equities markets. As a result, they can become successful and valuable investments with proper financial research.

Real estate investing, if done correctly, can be very rewarding. It can help broaden an investor’s portfolio and provide an additional source of income at the same time. And so many of the top real estate deals don’t involve attending to every call of a tenant.

Now, the reality is that without a real estate calculator, discovering a real estate property that generates the income you desire might be difficult. On the other hand, you can find numerous calculators today; however, Mashvisor’s real estate investment calculator is considered one of the best on the market.

This article is the perfect place to begin if you are considering investing in real estate in 2022. Continue reading to determine why you should check Mashvisor’s real estate tool before purchasing an investment property in the US in 2022 (with a few tips and tricks).

Mashvisor’s Real Estate Investor Calculator

Different kinds of real estate calculators can assist novice investors just getting started in the industry in making the right decisions. Even if you’re an experienced investor, utilizing a real estate calculator may make purchasing a home in 2022 a lot easier.

For example, using Mashvisor’s tools to calculate your prospective earnings will only take a few minutes—no more than the time it takes to input some basic information into the calculators. Moreover, the real estate investment calculator by Mashvisor is a digital tool that can assist you in locating profitable investment properties for sale throughout the US.

Let’s say you must find the correct location, buy the best real estate investment property, and adopt the best rental strategy to make a lucrative real estate investment—all of them can be accomplished with the help of a real estate investment calculator from Mashvisor.

The calculator manages the entire process by allowing you to search for and evaluate both neighborhoods and investment homes. Everything you need to do is submit some basic data based on your real estate investing criteria, and the calculator will take care of everything else.

Since the calculator employs both traditional and predictive analytics, Mashvisor’s real estate software is fast and precise. As a result, when analyzing potential real estate deals, it will save you a considerable amount of time and work.

Moving on, let’s see in detail how Mashvisor’s real estate rental investment calculator can benefit you in 2022. The tool can help with everything from the neighborhood to return on investment (ROI) and investment property analysis.

Real Estate Return on Investment Calculator: Neighborhood Analysis

Location is the most significant element in real estate investments because it determines your ROI the most. To find the best-performing markets, you’ll need to undertake complete real estate market research.

When it comes to investing in real estate, it’s simple to pick a place to invest in because city data can be gathered online, such as on Mashvisor’s real estate blog. It is only part of your real estate market analysis, though. You must limit your property search to a specific neighborhood in your desired city.

Similar income properties in various parts of town can command significantly different prices and produce widely divergent returns. Mashvisor’s return on investment real estate calculator makes it simple and fast to locate the perfect neighborhood for your wallet and investment plan.

With the real estate investment return calculator, investors can conduct a comprehensive neighborhood analysis with just a few clicks.

Note: The Mashvisor calculator can generate a precise estimate, informing you how much rental income you may expect. It does the computations by utilizing big data and AI capabilities. Furthermore, Mashvisor’s data is sourced from reputable real estate data sources such as MLS, Airbnb, and Zillow.

Real Estate Investor Calculator: Heatmap Feature

Mashvisor’s real estate heatmap is a quick and efficient approach to starting your local study. The tool displays the profitability of neighborhoods in your chosen real estate market using various color codes based on several metrics. The metrics include pricing, rental income (Airbnb and conventional), cash on cash return (Airbnb and traditional), and Airbnb occupancy rate.

Investors may use Mashvisor’s real estate investment return calculator to research top-performing areas that meet your plan after identifying top-performing neighborhoods that meet your needs.

For example, on the Neighborhood Analytics Page, the real estate investment calculator will give the following neighborhood-level real estate data and analytics:

• Number of traditional and Airbnb properties for sale
• The optimal number of bedrooms
• Optimal property type
• Average Airbnb occupancy rate
• Average Airbnb and traditional cash on cash return
• Average Airbnb and traditional rental income
• Average price per square foot
• Median price
• Walk Score
• Real estate comps
• Mashmeter Score
• Optimal rental strategy

Learn More: The 2022 Guide to Using Heatmap Analysis to Identify Areas for Rental Investment

Additional Features Worth Checking Out

The neighborhood insight feature allows you to learn more about the best home type, the number of bedrooms, and the rental strategy to utilize in your area (Airbnb vs. traditional). 

The Mashmeter, which operates in the form of a percentage to deliver each neighborhood a rating that can be compared to other communities in the same or another city, is also available to property investors through Mashvisor.

• Mashmeter: The Mashmeter is a one-of-a-kind tool that can only be found at Mashvisor. It allows the real estate investor to determine whether investing in a specific neighborhood is a good or poor idea. The score will be calculated as a percentage based on the qualitative and quantitative data gathered.
• Optimal Rental Strategy: Mashvisor’s real estate investment return calculator uses the information gathered to provide an estimate of the optimal rental strategy for a real estate investment property in a specific neighborhood. Traditional or Airbnb rentals will be the best options.

Selecting a neighborhood with a high-income potential is a proven method to make money in real estate. Rather than spending weeks or even months visiting areas and conducting market research, you can now determine the best spots to invest in a couple of minutes.

Mashvisor’s return on investment calculator in real estate also lets you obtain a detailed report for the location you’re looking at. The calculator’s report contains all of the neighborhood’s property listings and their statistics in Excel format, so you can simply compare them. 

You can also share the documents with your real estate agent or colleague for feedback before proceeding with your property search.

Real Estate Investor Calculator: Investment Property Analysis

After deciding on a neighborhood for investment, the following step is to locate the most profitable income house for sale you can purchase. It will require a thorough examination of several property listings within your price range and meet your investment criteria to select the ideal one for your situation.

Based on your neighborhood analysis, you should limit your search on these real estate properties because you already have a good knowledge of the best property type, amount of bedrooms, and rental strategy.

As a real estate investor, you should use Mashvisor’s Property Finder. It is a simple and practical approach to searching for investment properties in 2022. The program will search your target market for homes that meet your particular criteria and offer a good return on investment (ROI) potential.

Learn More: How to Conduct Investment Property Analysis in 2022

Now, you must undertake a thorough examination of the properties. Mashvisor’s real estate investment return calculator comes in handy now. You’ll get a range of useful investment property data for each property you evaluate, such as:

Rental Expenses

Mashvisor’s tool calculates the one-time initial expenses and ongoing rental property charges for investors. Monthly expenditures predictions help calculate future cash flow, whereas start-up cost estimates will assist you in understanding your initial investment.

The estimated costs include the following:

One-Time Startup Costs

• Closing expenses
• Inspection of the house
• Equipment and furnishing
• House repairing

Monthly Costs 

• Property insurance 
• Maintenance
• Property tax
• Expenses for property management
• HOA dues
• Advertising
• Tax on rental income
• Utilities

Related: 5 Airbnb Costs to Owner You Should Know Before Buying a Property

Rental Income

Rental income is the cash investors receive from renters who live on the property. It is one of the most important factors for deciding if a property is worth investing in.

Again, if you want to make an educated decision—which you should—the real estate calculator can assist.

Because our calculator estimates rental revenue, the rate of return on the real estate investment calculator can also be used as a rental income estimator.

However, you’ll need to research rental competitors in the region to evaluate the rental revenue on your own, which is a time-consuming task. Mashvisor’s real estate investment calculator saves you time by quickly providing Airbnb and traditional rental income predictions.

Cash Flow

Cash flow is one of the most important measures for investment properties since it represents the difference between an estate’s income and overall costs. It informs investors about the possible returns they might expect from their recently purchased property.

You can evaluate the future cash flow using rental income and cost estimations. You don’t need to, though, because Mashvisor’s cash flow calculator will calculate your cash flow for you. 

The calculator will help you assess whether or not a property is viable. To display the possible cash flow, it covers management and electricity charges, taxes, HOA dues, and even housekeeping fees.

Nevertheless, it is advised that you only invest in properties that provide positive cash flow, mainly if you are a novice.

Return on Investment (ROI)

The primary goal of rental property research for real estate investors is to explore the likelihood of profitability. Return on investment (ROI) is a good indicator of profitability. Cap rate and cash on cash return are the two most crucial ROI measures.

Personally performing the above calculations can be challenging, particularly when examining many rental property holdings. Nevertheless, in 2022, you may use Mashvisor’s real estate investment calculator for cash on cash return and cap rate to get quick approximations.

Our return on investment real estate calculator includes a mortgage calculator for investment properties. Depending on the mortgage data you enter, the calculator’s interactive feature helps to evaluate your projected cash flow and cash on cash return. 

It covers the purchase price of the property, the loan amount, the kind of mortgage, the loan duration, the down payment, and the interest rate.

Cash on Cash Return

In basic terms, the cash on cash return is the rate of return on investment (ROI) that an investor will get on a real estate investment depending on the profit generated by the rental property and the amount of money put in the rental property. 

To put it another way, cash on cash return tells property investors what percentage of profit they can expect based on how much money they put in.

Cap Rate

The capitalization rate, or cap rate, is a real estate investment’s profit metric. Simply stated, it refers to how much of the property’s value an investor receives as income.

Moreover, a cap rate is a metric for determining how risky an investment is. The larger the cap rate, the greater the risk and the potential return. And the lesser the cap rate, the more negligible risk, and the lower the anticipated gain.

While the cap rate equation is easy to understand, manually calculating the cap rate for each possible investment property is impractical. Instead, why not utilize a cap rate calculator? The calculator can assist you in quickly and properly estimating cap rates.

Mashvisor’s real estate calculator is an excellent solution—it calculates cap rate, rental income, cash on cash return, and occupancy rate, helping you determine the best location to invest in real estate and the perfect property.

Occupancy Rate

The Airbnb occupancy rate or traditional occupancy rate is a metric for rental demand that significantly impacts your rental income and ROI. However, predicting occupancy rates is problematic because it depends on numerous factors, such as the location’s appeal, the property type, current market trends, marketing abilities, etc.

Depending on the success of real estate comps in 2022, Mashvisor’s investment property calculator will provide you with precise occupancy rate forecasts.

Optimal Rental Strategy

You should first explore the two basic rental tactics before addressing how to choose the optimal rental property strategy for your property investment. It will help you comprehend the connections and differences between the two and decide which rental method is best for your specific business strategy.

You’ll obtain statistics for both Airbnb and traditional rental techniques for each critical metric provided by the calculator. That will make it easier for you to assess and decide on the best rental strategy for your property.

Real Estate Comps

To prevent overspending, real estate investors should look at previous sales of similar homes in the region (real estate comparisons) to see if the purchase price is appropriate. Also, investors should consider the rates offered by comparable rental listings in the area when estimating rent.

Mashvisor’s real estate investment calculator makes finding real estate rental comps easier. It will provide you with a list of comparables and other information to assist you in conducting your own comparisons.

What Is a Fair Percentage for a Real Estate Investor to Make Money?

In theory, you may expect an annual rate of return on a real estate property of 7% to 13%. Residential real estate investment returns average roughly 11%, compared to 10% for commercial real estate.

Nevertheless, you anticipate earning money when you invest. Rental revenue often accounts for a large portion of the return on investment (ROI) for real estate investors. It might be difficult to tell which property would provide a positive cash flow while searching for a lucrative deal. Fortunately, there is a method you may use to estimate the potential of a house rapidly.

Discover how to use the 1% rule in real estate to select the ideal home. You can also use the rule to establish the right monthly rent if you’re searching for your own profitable investment property.

The 1% Rule

The 1% rule compares the purchase price of an investment property to the gross income it will create. To meet the 1% criteria, a potential investment’s monthly rent must be equivalent to or more than 1% of the purchase cost.

If you intend to purchase an investment property, the 1% rule can help you identify the ideal property to meet your financial goals. You may use it to determine how much money the property will generate rapidly. If the house is currently vacant, you can utilize the rule to assist set the monthly rent.

It’s crucial to remember that the above is only a recommendation. It’s a great place to start, but you should consider additional criteria when choosing how much rent to charge your renters.

How to Use the 1% Rule

The 1% rule is easy to apply. Simply multiply the property’s purchasing price by 1%. Even better, relocate the comma in the purchasing price two spaces towards the left. The end result should be the bare minimum in monthly rent.

If the house needs any repairs, investors should enter the cost into the equation by adding them to the purchase cost and then increasing the total by 1%.

The 50% Rule

Real estate investors use the 50% rule to determine the profitability of a certain rental property. The principle, as the name implies, requires subtracting 50% of a property’s monthly rental revenue when estimating prospective earnings.

According to the criterion, 50% of rental revenue should be labeled as costs. These expenses are then ignored when comparing prospective earnings to monthly mortgage or debt repayments.

Moreover, undervaluing the cost of bills is one of the most common mistakes landowners make when looking for deals. It can result in decreased profit margins or, in rare situations, a deal that fails entirely. To protect against unforeseen expenditures and charges, investors will implement the 50% rule into their first review of a deal.

How Does the 50% Rule Work?

The 50% rule works by splitting the entire monthly rental revenue in half. It would account for any possible expenditures related to the property’s ownership. Repair charges, taxes, property maintenance fees, utilities, and insurance prices all fall under the potential expenses.

The rule does not require investors to know the actual expenditure amount. In reality, investors use the 50% rule to estimate possible opportunities rapidly and accurately based on minimal information.

One thing to keep in mind is that mortgage or loan payments are not considered expenditures under the 50% rule. Because of this, you should make sure that the remaining portion of your rental revenue can cover the monthly mortgage.

The rule can also be applied to a variety of residential property types, including single-family, multifamily, condominiums, duplexes, and so on. Its adaptability makes it extremely useful when you come upon a prospective offer and need to act quickly.

Conclusion

So, let’s sum everything up. First, you must find the perfect property in the appropriate profitable area for an effective real estate investment. It involves a thorough analysis of the real estate sector and investment properties.

What you need is only the correct information, data, and tools. Luckily, Mashvisor is a one-stop real estate investment tool that helps thousands of real estate investors in making good decisions.

This real estate website maintains and frequently updates a vast database that covers the entire US home market. Its real estate investor calculator allows you to handle complex math and select the best property for your needs.

Mashvisor provides an investment property calculator, which allows you to estimate your prospective profits based on several factors. As a result, you can use the calculator to perform your own property search and analysis. With it, you don’t have to spend too much time in one city generating spreadsheets and calling agents. 

Therefore, whether you’re a first-time or seasoned investor, Mashvisor’s estimations are reliable and trustworthy. In addition, the platform’s investment calculator tool assists you in determining your potential return on investment (ROI) and cash flow.

To access our real estate investment tools, click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.