Rental property returns

What you will pay to buy the property.

The part of the price you pay in cash up front, as a percentage. 20% of a $250,000 home is $50,000. Putting down less than 20% usually adds a monthly mortgage insurance charge.

The yearly cost of the loan, as a percentage of what you owe. Use a current quote from a lender, because rates change often.

How many years you have to pay the loan back. A 30-year loan has smaller monthly payments; a 15-year loan has bigger payments but costs far less interest overall.

Fees paid when the sale closes (lender, title company, recording and similar), as a percentage of the price. Often around 2% to 5%. A lender can give you an estimate.

Money you will spend fixing the property right after you buy it, before renting it out.

What a tenant would pay each month. Check listings for similar rentals nearby.

Extra money the property earns each month besides rent, such as laundry, parking or storage fees. Enter 0 if none.

The percentage of time the property sits empty between tenants, earning no rent. 5% to 8% is a common planning figure; 6% is about three weeks a year.

What you pay the county in property tax each year, in dollars. You can look up a property's tax bill on its county website.

What you pay each year to insure the property, in dollars. Get a quote from an insurance company.

A monthly fee some communities charge for shared upkeep such as landscaping, roofs or amenities. Enter 0 if there is none.

Utilities you pay as the owner each month, such as water, trash or shared electric. Enter 0 if tenants pay all of their own.

Money set aside for routine repairs and upkeep, as a percentage of the rent. 5% to 10% is a common planning range.

Money set aside for big, expensive replacements like a roof, furnace or water heater, as a percentage of the rent, so those bills don't wipe out your cash flow. 5% to 10% is common.

What a property manager charges to find tenants, collect rent and handle problems, as a percentage of the rent. Often 8% to 10%. Enter 0 if you would manage it yourself, though your time has value too.

How much you expect the property's value to rise each year. It varies by place and time, 2% to 4% is a common cautious guess, and values can also fall. It affects the long-term results, not the monthly cash flow.

How much you expect the rent to go up each year. At 3% a year, $2,000 of rent becomes $2,060 next year. This only affects the long-term projection.

How much you expect costs like taxes, insurance and repairs to rise each year. Costs usually creep up, so using a rate close to your rent growth is a cautious choice.

How many years you plan to own the property before selling it. Longer holds give rent increases and loan payoff more time to build wealth.

What it costs to sell, as a percentage of the sale price: agent commission, transfer tax and closing fees. Often around 6% to 8%.