Capitalization Rate Calculator
The Capitalization Rate (Cap Rate) measures a property's natural rate of return for a single year without taking into account debt on the asset, deed recording, or financing costs.
Net Operating Income (NOI)
$0
Cap Rate
0.00%
The Formula
Cap Rate = NOI / Property Value
NOI (Net Operating Income) equals all revenue from the property minus all reasonably necessary operating expenses.
What is a "Good" Cap Rate?
- Class A (Urban Core) 4.0% - 5.5%
- Class B (Value Add) 5.5% - 7.0%
- Class C (High Yield/Risk) 7.0% - 10.0%+