Cap Rate Calculator – NOI ÷ Price

A cap rate calculator expresses a rental property's income as a percentage of its price, so you can compare properties of any size on one scale. The calculation follows Cap rate = net operating income ÷ property price × 100. Net operating income (NOI) is annual rental income minus operating expenses — vacancy loss, taxes, insurance, maintenance, management — but before loan payments. A 400,000 property generating 28,000 of NOI caps at 7.0%; the same NOI on a 500,000 price caps at 5.6%. The same formula also runs in reverse: NOI ÷ target cap rate estimates a value, which is how appraisers price income property. Because cap rate ignores financing, it measures the asset, not your loan — compare leverage separately with cash-on-cash return. Results update instantly whenever you change an input.

1. 1

   Step 1

   Enter the property price and the annual net operating income (rents minus operating expenses, before any mortgage payments).

2. 2

   Step 2

   The tool applies Cap rate = NOI ÷ price × 100 and shows the rate to one decimal place.

3. 3

   Step 3

   Compare the result across candidate properties, or divide your target cap rate into an NOI to estimate value.