Cap Rate Calculator
Enter any two of: Net Operating Income, Property Value, or Cap Rate — and instantly solve for the third.
Cap rate = net operating income ÷ property value × 100.
Use the Cap Rate Calculator
Cap Rate Calculator
Fill in two values and click Calculate to see results.
Cap Rate
—
NOI
—
per year
Property Value
—
market value
Cap Rate
—
annualized
Formula Breakdown
Market Benchmark
Quick answer
Cap rate = net operating income ÷ property value × 100. A property with $60,000 a year in NOI and a value of $1,000,000 has a 6% cap rate. Turn it around to value a property: at a 5% cap rate, $60,000 ÷ 0.05 = $1,200,000.
Examples
| NOI per year | Property value | Cap rate |
|---|---|---|
| $24,000 | $400,000 | 6.00% |
| $18,000 | $250,000 | 7.20% |
| $60,000 | $1,000,000 | 6.00% |
| $100,000 | $1,250,000 | 8.00% |
Enter NOI and property value.
Summary
The cap rate (capitalization rate) is the most widely used metric for evaluating income-producing real estate. It is calculated by dividing a property's Net Operating Income (NOI) by its current market value. This calculator lets you solve for any one of the three variables — cap rate, NOI, or property value — given the other two, making it useful for both buyers assessing yield and sellers estimating fair market value.
How it works
- Select which value you want to solve for: Cap Rate, Property Value, or NOI.
- Enter the two known values in the input fields.
- The calculator instantly computes the missing value using the cap rate formula.
- Review the formula breakdown to understand exactly how the result was derived.
- Adjust your inputs to model different scenarios and compare returns.
- Use the result alongside other metrics such as cash-on-cash return and GRM for a full investment picture.
Use cases
- Evaluate whether a listed property price is justified by its income.
- Compare cap rates across multiple investment properties in different markets.
- Back-calculate the maximum price you can pay to hit a target cap rate.
- Estimate what NOI a property must generate to justify its asking price.
- Present cap rate analysis to lenders, partners, or co-investors.
- Quickly screen off-market deals during initial due diligence.
- Model the impact of rent increases or expense reductions on cap rate.
- Benchmark against typical market cap rates for a given asset class.