Deal Analyzer
One property, every number: cash flow, cap rate, DSCR, a multi-year projection, IRR and a sensitivity grid.
- Total cash invested
- $86,400
- Equity multiple
- 1.62
- Net operating income
- $24,532
- Annual debt service
- $19,647
- Stress DSCR
- 1.14
- Final-year cash flow
- +$5,967
- Net sale proceeds at exit
- $118,491
- Ending equity
- $144,459
- Break-even occupancy
- 81.87%
- Gross potential rent $37,200
- Vacancy loss −$1,860
- Effective gross income $35,340
- Operating expenses −$10,808
- Net operating income $24,532
- Debt service −$19,647
- Capex reserves −$2,232
- Cash flow $2,653
| Year | Rent | Expenses | NOI | Debt service | Cash flow | Cumulative | Value | Equity |
|---|---|---|---|---|---|---|---|---|
| 1 | $37,200 | $10,808 | $24,532 | $19,647 | +$2,653 | +$2,653 | $329,600 | $91,923 |
| 2 | $38,316 | $11,078 | $25,322 | $19,647 | +$3,443 | +$6,097 | $339,488 | $104,308 |
| 3 | $39,465 | $11,355 | $26,137 | $19,647 | +$4,258 | +$10,355 | $349,673 | $117,177 |
| 4 | $40,649 | $11,639 | $26,978 | $19,647 | +$5,099 | +$15,454 | $360,163 | $130,552 |
| 5 | $41,869 | $11,930 | $27,845 | $19,647 | +$5,967 | +$21,421 | $370,968 | $144,459 |
| Price \ Rent | 0.90× | 0.95× | 1.00× | 1.05× | 1.10× |
|---|---|---|---|---|---|
| 0.90× | +$152 | +$269 | +$385 | +$501 | +$617 |
| 0.95× | +$70.47 | +$187 | +$303 | +$419 | +$535 |
| 1.00× | −$11.39 | +$105 | +$221 | +$337 | +$454 |
| 1.05× | −$93.25 | +$23.00 | +$139 | +$255 | +$372 |
| 1.10× | −$175 | −$58.86 | +$57.39 | +$174 | +$290 |
- Every figure on this page is arithmetic on the assumptions above. Changing an assumption changes the result; nothing here is a forecast.
- The IRR shown is the discount rate that makes the projected cash flows net to zero at the purchase price. It depends entirely on the growth and exit assumptions entered.
All projections on this page are arithmetic results of the assumptions you entered. They are not forecasts or guarantees of future performance. Changing the assumptions changes the results.
How to read this page
The analyzer answers five questions about the same property at once. The overview cards are year-one measures: monthly cash flow, cap rate, cash-on-cash return, DSCR and IRR. The waterfall shows how gross rent becomes that monthly cash flow. The projection table extends the same arithmetic across a holding period. The sensitivity grid re-prices the deal at nearby assumptions.
Nothing on the page is independent of anything else. Every panel calls the same property model, so the cash flow in the waterfall and the cash flow in year one of the projection are the same number. On the default example — a $320,000 property with 25% down at 7.25%, renting for $3,100 — monthly cash flow is +$221.
Five metrics, one deal
| Metric | Value | What it answers |
|---|---|---|
| Monthly cash flow | +$221 | What reaches the owner after debt service and reserves? |
| Cap rate | 7.67% | What does the property yield before financing? |
| Cash-on-cash | 3.07% | What does the $86,400 of invested cash return in cash? |
| DSCR | 1.25 | How many times does NOI cover the mortgage? |
| IRR over five years | 10.76% | What annual return do the cash flows plus the exit imply? |
The five numbers tell a consistent story, and that is the value of putting them side by side. A 7.67% cap rate and a 3.07% cash-on-cash return describe a property whose financing consumes most of the yield. A 10.76% IRR says the exit assumptions make up for the thin cash flow — a statement that depends entirely on selling at a 3% annual appreciation.
The waterfall, line by line
Year-one gross potential rent is $37,200. A 5% vacancy allowance removes $1,860, leaving $35,340 of effective gross income. Operating expenses of $10,808 — management, maintenance, insurance and tax — leave net operating income of $24,532. The loan costs $19,647 a year, and a 6% capex reserve takes $2,232, leaving $2,653 of cash flow, or $221 a month.
The bar chart shows the same sequence. Read it as a bridge: rent at the top, deductions in the middle, cash flow at the bottom. The distance between the NOI bar and the cash flow bar is the cost of financing plus reserves, which on this deal is more than 90% of NOI.
From year one to year five
The projection table grows rent by 3% and expenses by 2.5% a year, holds debt service constant, and compounds the property value at 3%. Cash flow rises from $2,653 in year one to $5,967 in year five; cumulative cash flow over the hold is $21,421.
Equity tells a different story. It starts at $91,923 — the purchase price less the loan, plus the first year of appreciation — and reaches $144,459 by the end of year five. That growth comes from two places: the property value rising and the loan balance falling as principal is paid down. Neither appears in the cash flow column, which is why a deal with modest cash flow can still produce a respectable total return.
IRR and equity multiple
IRR is the annual discount rate at which the projected cash flows, including the net sale proceeds, are worth exactly the original investment. On the default assumptions it is 10.76%. The equity multiple — total distributions divided by total cash invested — is 1.62.
Both figures depend on the exit. The sale price in the final year is the purchase price grown at the appreciation rate, less selling costs and the loan payoff. If the cash flows never change sign, IRR has no solution and the card shows a dash; the projection and the other metrics still stand.
The assumptions are the analysis
Appreciation and holding period move the IRR more than any other input. The table below holds the property and the rent growth fixed and changes only those two:
| Appreciation | Hold | IRR | Equity multiple |
|---|---|---|---|
| 0% | 5 years | 1.49% | 1.07 |
| 0% | 10 years | 7.29% | 1.80 |
| 3% | 5 years | 10.76% | 1.62 |
| 3% | 10 years | 13.16% | 2.99 |
| 5% | 5 years | 15.95% | 2.02 |
| 5% | 10 years | 16.46% | 3.97 |
With no appreciation at all, a five-year hold produces a 1.49% IRR; the same deal held ten years produces 7.29%, because the exit happens after more principal has been paid down and more cash has been collected. The equity multiple rises even more, because it counts every dollar returned rather than discounting when it arrived. That is why the two measures should be read together.
Reading the sensitivity grid
The grid re-runs the deal at five purchase prices and five rent levels. The centre cell is the deal as entered: +$221 a month. The corners show how much the answer depends on two inputs that are estimates before closing: at a 10% higher price and 10% lower rent, cash flow is −$175 a month; at a 10% lower price and 10% higher rent, it is +$617.
The diagonal pattern matters more than any single cell. Cells to the right of centre improve because rent is higher; cells below centre worsen because the price is higher. A deal whose centre cell is barely positive will have a large negative region, which is the visual version of “thin margin”.
Where the numbers disagree — and why
The five metrics on this page are not supposed to agree, and the gaps between them are the analysis. Three of them are worth reconciling explicitly.
Cap rate 7.67% against cash-on-cash 3.07%. The cap rate divides NOI by price; cash-on-cash divides post-debt cash flow by the $86,400 of invested cash. The gap is the cost of financing plus the capex reserve, measured against a denominator that includes closing costs. A cap rate well above cash-on-cash is the signature of debt that consumes most of the yield.
Cash-on-cash 3.07% against IRR 10.76%. Cash-on-cash is one year of cash. IRR includes every year of cash, the principal paid down over the hold, and the sale proceeds at the end. A deal can return 3% on cash in year one and 10.76% a year over five years if the exit assumptions hold — and can return 3% and 1.49% if appreciation is zero, as the scenario table shows.
DSCR 1.25 against the sensitivity corners. The DSCR says the property covers its mortgage 1.25 times as entered. The grid says a 10% higher price with 10% lower rent turns monthly cash flow negative. Both are true: coverage is comfortable at the entered price and fragile if the two inputs move against each other. Reading the card without the grid is how a thin deal starts to look safe.
What the analyzer does not do
The model is deliberately narrow. It does not handle income tax, depreciation, 1031 exchanges, partnership splits, rent control, phased renovations, or a sale that takes longer than the hold period. It does not forecast rents or values; it compounds the rates you enter. It also does not adjust the loan for a refinance during the hold.
Those omissions keep the arithmetic transparent. Every number on the page can be traced to an input, which is the property an analyzer should have. The methodology page documents every definition used here, and the page prints cleanly if the analysis needs to be shared offline.
Frequently asked questions
Is the deal analyzer a forecast?
No. Every projection, IRR and sensitivity figure is arithmetic on the assumptions you enter. It shows what the deal looks like if rent grows at 3% and the value appreciates at 3% — not what will happen. Changing an assumption changes the result; that is the point of the tool.
Why is the IRR undefined sometimes?
IRR is the discount rate that makes the present value of the cash flows equal zero. When every cash flow has the same sign — all negative, for example — no such rate exists, and the tool reports a dash rather than an arbitrary number. The other metrics remain valid.
Which number should I look at first?
Start with monthly cash flow and DSCR, because they describe the property as it operates today. Then read the projection and IRR as the consequences of the growth assumptions. The overview cards are deliberately shown together so a good IRR cannot hide a deal that loses cash every month.
Does the projection include rent increases in the lease?
Only through the annual rent growth assumption you enter. The model grows gross potential rent by that percentage each year; it does not know your lease terms, local rent control rules or the market’s actual trajectory.
What does the sensitivity table actually change?
Each cell recomputes monthly cash flow for a different purchase price and gross rent, using the same loan terms and expense percentages. The highlighted centre cell is the deal exactly as entered. It answers “what if I paid 5% more and rents came in 5% lower?” without retyping anything.
Is the sale value in the final year realistic?
It is the purchase price compounded at the appreciation rate you enter, less the selling cost percentage and the remaining loan balance. It is a mechanical exit assumption, not an appraisal. A lower appreciation assumption changes both the equity multiple and the IRR substantially, as the scenarios above show.
Does the deal analyzer include taxes?
No. Income tax, depreciation, capital gains and depreciation recapture are outside the model. So are 1031 exchanges, partnership structures and state transfer taxes. Those are tax and legal questions rather than arithmetic, and this site does not model them.
Can I print or share the analysis?
Yes. The page prints with the input form, advertisements and navigation hidden, leaving the metrics, waterfall, projection and sensitivity tables. The URL carries every input, so a shared link reproduces the same analysis on the recipient’s screen.
Last updated November 13, 2026. Formulas and accounting conventions are documented on the methodology page.