Metrics
IRR (Internal Rate of Return)
Annualized return over the full hold period, including cash flow, principal paydown, appreciation, and exit proceeds.
How it's calculated
IRR solves for the rate where the sum of discounted cash flows (including exit) equals zero.Example
Invest $80k. Collect $7k/yr cash flow for 10 years. Sell for $480k (paying off $260k mortgage = $220k proceeds). IRR ≈ 14.5%.
Why IRR (Internal Rate of Return) matters
IRR captures the FULL return story: monthly cash flow + principal paydown + appreciation + exit value, all rolled into one annualized number. It's the right metric for wealth-builders.
Related terms
Cash-on-Cash Return
Annual cash flow ÷ total cash invested (down payment + closing + rehab). Tells you how hard your mon…
Monthly Cash Flow
Rent minus operating expenses minus mortgage payment. The cash that lands in your account each month…
Appreciation Rate
Your editable assumption for annual property-value change.
Ready to run the IRR (Internal Rate of Return) math on a real deal?
Free 60-second analysis with labeled starting assumptions and no signup. Pro calculates your Offer Ceiling: the highest price that still meets your targets under the assumptions shown.
Where IRR (Internal Rate of Return) shows up in TrueCap
The analyzer computes this metric on every run from the assumptions you see and can edit, shows it in the results view beside cash flow after reserves and DSCR, and uses your targets for it in Buy Box fit and in the Offer Ceiling — the highest price that still meets those targets. It appears in the written decision memo and the PDF with the same value and the same inputs.