Real Estate Investing Formulas:
Gross Operating Income
GOI = Gross annual rent – annual vacancy loss
Net Operating Income (NOI)
NOI = GOI – operating expenses
Capitalization Rate (Cap Rate)
Cap Rate = NOI / Market value or purchase price
Rent to Cost Ratio (RCR) or Gross Rental Yield
RCR = Monthly Rent Income/Purchase price
Cash on Cash Return (CCR)
CCR = (NOI / down payment or cash invested including rehab) * 100
Return On Investment (ROI)
ROI = NOI / Total Down Payment