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Cap Rate Calculator
Free Cap Rate Calculator with instant browser-based results and a clear calculation breakdown.
Cap Rate Calculator
Calculate the Capitalization Rate (Cap Rate) for a real estate investment. Enter the annual net operating income and the property value or purchase price to determine the rate of return.
Capitalization Rate
0.00%
Formula & Explanation
Cap Rate = (NOI ÷ Property Value) × 100
What is Cap Rate? The Capitalization Rate is a metric used to estimate the potential return on a real estate investment. It represents the ratio of a property's net operating income to its current market value or purchase price.
Interpretation: A higher cap rate typically indicates a potentially higher return but may also suggest higher risk. Cap rates vary by property type, location, and market conditions. This calculator provides an estimate and should not be considered guaranteed financial advice.
Want to understand the calculation?
Read the guideSee examples, formula notes and limitations.