What is cash-on-cash return?
The annual rental cashflow as a percentage of the actual cash you put in (deposit plus buying costs), not the full property price. It shows how hard your real money works.
// real-estate › Advanced
Property ROI Calculator (Advanced)
Advanced property ROI on the cash you actually put in — cash-on-cash return from rental cashflow, plus total return once capital growth is included.
cash-on-cash = annual cashflow / cash invested ; total ROI adds capital growth
Frequently asked questions
Why measure against cash invested rather than price?
Because you borrow most of the price. Your return should reflect the cash you actually committed, which is why leverage can make a modest property a strong investment.
How does capital growth change the picture?
A lot. Total ROI adds the property's value increase to the cashflow, and because growth is on the whole property but measured against your small deposit, leverage magnifies it.
Is high leverage always good?
No. It amplifies gains but also losses, and bigger loans mean bigger repayments and more risk if rates rise or the market falls. The stress-test calculator helps check that.
What costs count as 'purchase costs'?
Stamp duty or transfer tax, legal fees, inspection and loan setup costs, anything you spend to acquire the property beyond the deposit.