Free calculator
Cap rate calculator.
Capitalization rate is net operating income divided by value. Enter the NOI and price to get the cap rate instantly.
The capitalization rate is a property's net operating income divided by its value or price, expressed as a percentage: Cap rate = NOI ÷ Value × 100. It measures unlevered yield and lets you compare deals. Enter NOI and price above to calculate a cap rate instantly.
Inputs
Cap rate = NOI ÷ Value × 100
Result
Capitalization rate
- Net operating income
- $850,000
- Value
- $13,600,000
- Cap rate
- 6.25%
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Cap rate calculator, explained
What is a cap rate?
The capitalization rate is a property's net operating income divided by its value or price, expressed as a percentage. It's a quick measure of unlevered yield and a common way to compare deals.
What's a good cap rate?
It depends on asset class, market, and risk. Lower cap rates imply higher prices relative to income (often prime, lower-risk assets); higher cap rates imply the opposite. Compare against recent comparable sales in the same market.
How do I get an accurate NOI to use here?
NOI comes from a normalized trailing-twelve operating statement. Framecast's free T-12 tool turns your operating statement into a source-traced NOI you can drop straight in.
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