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Rental property ROI calculator for Excel
A rental property ROI calculator for Excel that goes past the deal-analyzer math. One tab sizes up a purchase (cap rate, cash-on-cash, the 1% rule); the other measures what a property you already own actually earned this year, all four ways a rental pays, after tax, ending at return on equity. Every result is a live formula. No email, no signup.
- The owned-property tab: cash flow, principal paydown, appreciation, and the tax effect, from your own books
- Return on equity, the number that starts the keep-or-sell conversation
- The purchase tab: PMT-computed payment, NOI, cap rate, cash-on-cash, 1% rule
Educational template, not tax or investment advice. The seeded numbers are a worked example; type over them.
The four ways a rental pays, and cash flow is the smallest
Most ROI spreadsheets stop at cash-on-cash, and at 2026 rates that number is grim on paper. The worked example seeded in the owned-property tab is a $300,000 purchase three years in, $75,000 of cash invested, renting at $2,300 a month. Its cash flow return is 4.3%. The full picture is a different story:
| Return component | This year | On $75,000 in |
|---|---|---|
| Cash flow (after tax) | $3,200 | 4.3% |
| Principal the tenant paid down | $3,800 | 5.1% |
| Appreciation | $10,000 | 13.3% |
| Tax owed on all of it | $0 | a paper loss sheltered the cash flow |
| Total return on invested cash | $17,000 | 22.7% |
The tax row is why after-tax matters: NOI of $18,200 minus $11,200 of interest and $8,900 of depreciation is a $1,900 paper loss, so the $3,200 of real cash arrives with nothing owed on it. Whether that loss also offsets your W-2 income depends on the passive activity loss rules. What counts as a strong total is covered in what is a good ROI on a rental property.
ROE: the number that answers "should I keep it"
Total return divides by the cash you put in years ago. Return on equity divides the same year by what is trapped in the property today, and that denominator grows every year the loan amortizes and the value climbs. The example earns 22.7% on its original $75,000 but 13.5% on today's $126,000 of equity, and that gap widens with every year of paydown. When ROE sinks under what the freed-up equity could earn elsewhere, run the sell vs hold vs 1031 calculator: it prices the sale taxes that this decision actually hinges on.
Sizing up a purchase, at rates that tell the truth
The second tab is the classic pre-purchase sheet: price, down payment, loan (the payment computes with PMT), rent with a vacancy haircut, and the operating expense lines. The seeded deal is $250,000 at 6.5%, renting at $2,100, and it clears about $35 a month, a 0.6% cash-on-cash. That is not the template being pessimistic; that is what financed deals look like at 2026 rates, and it is why the 1% rule (rent over price, 0.84% here) survives as a first filter. NOI and cap rate are in the same block; if those terms are new, the NOI calculator guide walks the math line by line.
Where the numbers come from
The purchase tab runs on estimates. The owned-property tab deliberately does not: rent actually collected, operating expenses off your P&L, interest off the 1098, principal off the year-end statement, depreciation off your schedule. If those numbers are not sitting somewhere you can copy from, that is the real finding; the P&L template produces the operating lines, and the bookkeeping guide is the system that keeps them current. Prefer the math without the spreadsheet? The in-browser ROI calculator computes cash-on-cash, cap rate, and ROE from the same inputs, no download.
Frequently asked questions
How do I calculate ROI on a rental property in Excel?
Divide what the property paid you this year by the cash you have put in. The paying happens four ways: cash flow (NOI minus the full mortgage payment), principal the tenant paid down, the change in market value, and the tax effect. This workbook computes each as its own formula, then totals them; the seeded example earns $17,000 on $75,000 invested, 22.7%, of which only 4.3 points are spendable cash flow.
What is a good ROI on a rental property?
Most owners hold their total return, all four components, against the 8-10% a boring index fund averages, and want a premium over it for the work a rental adds. Cash-on-cash alone runs much lower on financed properties, low single digits at 2026 rates. The full benchmarks, and why the answer changes with leverage, are in our what-is-a-good-ROI guide linked on this page.
What is the difference between cash-on-cash, cap rate, and ROE?
Three denominators. Cap rate is NOI over price with no loan in the math: use it to compare deals. Cash-on-cash is cash flow over the cash you personally put in: use it to judge the financing. Return on equity is this year's total return over what is trapped in the property today: use it to decide whether to keep the property. The workbook computes all three so they stop being interchangeable.
How does depreciation change my rental's ROI?
It shelters the cash the property produces. Depreciation is a deduction with no cash cost, roughly the building's basis over 27.5 years, so a property can put real money in your pocket while reporting a taxable loss. In the seeded example, $8,900 of depreciation turns $3,200 of collected cash flow into a $1,900 paper loss and a $0 tax bill. The owned-property tab carries this math so your after-tax return is the one you see.
Why measure return on equity on a property I already own?
Because your equity grows every year, and the return on it quietly shrinks. The original cash you invested is a fixed denominator; equity is not, it climbs with every principal payment and every year of appreciation. A property earning 22.7% on the cash you put in years ago may be earning 13.5% on what a sale would free up today. When that second number drops under your alternatives, it is time to price a sale or a 1031.
Does this calculator work in Google Sheets?
Yes. It is a standard XLSX using SUM, MAX, and PMT, all of which Google Sheets and Numbers support natively. Upload it to Google Drive and open as a Sheet; the loan payment, return components, and ROE keep computing. Type over the seeded example numbers; the shaded rows are formulas and fill themselves.