Interactive tool

Multifamily Cash-on-Cash Calculator

Evaluate annual net cash flow against total equity invested—built for commercial apartment building analysis, not residential flips.

Last updated: 2026-05-24

Cash-on-Cash

Enter your deal

Cash invested

Purchase price

Down payment %

DSCR min: 20–25%

Closing costs $

Typical: 2–3%

Rehab / repairs $

Optional

Income & expenses

Gross annual rent

Vacancy %

Typical: 5–8%

PITIA $/mo

P&I + tax + ins + HOA

Other opex % of EGI

Mgmt, maintenance, capex

Results

Cash-on-Cash Return

9.22%

8–12% — strong

Strong cash-on-cash. Deal beats most passive alternatives. Look to scale.

Cash invested
Down payment: $62,500
Closing costs: $5,000
Total cash in: $67,500
Annual cash flow
Gross rent: $30,000
Less vacancy: ($1,500)
Less other opex: ($4,275)
Less annual PITIA: ($18,000)
Net annual cash flow: $6,225
Monthly cash flow: $519

Cash-on-Cash = Annual Net Cash Flow ÷ Total Cash Invested. Unlike cap rate, CoC accounts for financing. It measures what your actual out-of-pocket dollars earn each year — the investor's return metric.

Cash-on-cash return tiers

CoC range	Rating	Context
< 5%	Weak	Doesn't justify illiquidity; better passive options exist
5–8%	Acceptable	Works in appreciation markets; modest cash flow
8–12%	Strong	Beats most passive alternatives; good DSCR territory
12%+	Excellent	Verify assumptions; achievable in strong cash-flow markets

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How to calculate cash-on-cash return

For multifamily equity investors, the core formula is:

Cash-on-Cash = Annual Cash Flow After Debt Service ÷ Total Cash Invested

Total cash invested includes down payment, closing costs, initial reserves, and value-add capex funded from equity.

Worked example: 24-unit acquisition with 35% equity

Purchase price $3,600,000. Loan $2,340,000 (65% LTV). Equity at closing: down payment plus costs = $1,350,000. After debt service, annual cash flow is $162,000.

Cash-on-cash: $162,000 ÷ $1,350,000 ≈ 12.0%
Unlevered cap rate on $3.6M with $270,000 NOI ≈ 7.5%—lower because leverage amplifies equity yield

Pair with the cap rate calculator and capital stack design guide for full underwriting context.

Frequently asked questions

What is cash-on-cash return in multifamily?

Cash-on-cash measures annual pre-tax cash flow divided by total equity invested. It shows levered yield to the sponsor after debt service—not unlevered cap rate on property value.

How do you calculate cash-on-cash return?

Cash-on-Cash = Annual Cash Flow After Debt Service ÷ Total Cash Invested. Include down payment, closing costs, reserves, and capex equity in the denominator.

What is a good cash-on-cash return for apartment buildings?

Targets vary by market, leverage, and business plan. Stabilized acquisitions might target high single digits to low teens; value-add deals may accept lower early yields for appreciation and refinance upside.

How is cash-on-cash different from cap rate?

Cap rate is unlevered (NOI ÷ value). Cash-on-cash is levered (cash flow ÷ equity). Higher leverage can raise cash-on-cash while cap rate stays constant—along with risk.

Should I include capex in cash invested?

Yes for value-add deals. Sponsors who omit renovation equity overstate returns. Lenders also expect clarity on total equity at risk including reserves.

Can this calculator replace a full investment model?

No. Use it for directional checks. Full models should include disposition, refinance, tax assumptions, and downside scenarios across the hold period.