Metrics
Cash-on-Cash Return
Annual cash flow ÷ total cash invested (down payment + closing + rehab). Tells you how hard your money is working.
Most buy-and-hold investors target 8–12%.
How it's calculated
CoC = Annual Cash Flow ÷ Total Cash InvestedExample
If you put $80,000 down on a $400,000 property and collect $8,800/yr in cash flow, your CoC is $8,800 ÷ $80,000 = 11.0%.
Why Cash-on-Cash Return matters
Cash-on-cash is the metric leveraged investors should optimize for. It captures the actual return on YOUR money — cap rate doesn't, because it ignores financing.
Run the math on a real deal
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Try the free Cash-on-Cash Return calculatorRelated terms
Cap Rate
Net Operating Income ÷ property value. The unleveraged return a property generates, independent of f…
Monthly Cash Flow
Rent minus operating expenses minus mortgage payment. The cash that lands in your account each month…
IRR (Internal Rate of Return)
Annualized return over the full hold period, including cash flow, principal paydown, appreciation, a…
DSCR (Debt Service Coverage Ratio)
Net Operating Income ÷ mortgage payment. Measures whether the property's income comfortably covers d…