Cash on Cash Return by Purchase Price
The same rent-to-price ratio produces roughly the same cash on cash return at any price, which is why the table below is flat and why the rent column is the one that matters. Assumptions: 25% down, 3% closing, 7.25% over 30 years, rent at 0.9% of price, 5% vacancy, taxes 1.2% and insurance 0.5% of price.
| Price | Cash invested | Typical rent | Cash flow | Return | Rent for 8% |
|---|---|---|---|---|---|
| $100k | $28,000 | $900 | $574 | 2.0% | $1,080 |
| $150k | $42,000 | $1,350 | $860 | 2.0% | $1,615 |
| $200k | $56,000 | $1,800 | $1,147 | 2.0% | $2,155 |
| $250k | $70,000 | $2,250 | $1,434 | 2.0% | $2,695 |
| $300k | $84,000 | $2,700 | $1,721 | 2.0% | $3,235 |
| $350k | $98,000 | $3,150 | $2,008 | 2.0% | $3,775 |
| $400k | $112,000 | $3,600 | $2,294 | 2.0% | $4,315 |
| $450k | $126,000 | $4,050 | $2,581 | 2.0% | $4,850 |
| $500k | $140,000 | $4,500 | $2,868 | 2.0% | $5,390 |
| $600k | $168,000 | $5,400 | $3,442 | 2.0% | $6,470 |
| $700k | $196,000 | $6,300 | $4,015 | 2.0% | $7,550 |
| $800k | $224,000 | $7,200 | $4,589 | 2.0% | $8,625 |
| $1m | $280,000 | $9,000 | $5,736 | 2.0% | $10,785 |
| $1.5m | $420,000 | $13,500 | $8,604 | 2.0% | $16,175 |
Each price has its own page with rent, rate and down payment sensitivity tables. Or run your exact deal in the cash on cash return calculator.