NOI calculator
Net operating income in one step — enter rent and operating expenses, skip the purchase price and mortgage entirely. Want cap rate, cash-on-cash, and DSCR too? Use the full deal analyzer.
Net operating income
- Gross scheduled rent
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- Vacancy loss
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- Effective gross income
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- Total operating expenses
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Estimates for education only — not investment, tax, or financial advice.
How NOI is calculated
Net operating income starts with gross scheduled rent — the full market rent a property would collect in a year if every unit were occupied — plus any other income like parking, laundry, or storage fees. A vacancy and credit-loss allowance, typically around 5%, is subtracted as a reduction of income to produce effective gross income (EGI). From EGI, operating expenses come out: property tax, insurance, a management fee (charged even if you self-manage, because $0 management overstates a deal), maintenance, owner-paid utilities, HOA dues, and similar recurring costs. What remains is NOI.
NOI is deliberately unlevered and pre-tax. It never subtracts mortgage principal, mortgage interest, depreciation, or income tax — those are the most common NOI mistakes, and letting any of them in corrupts every ratio built on top of NOI, especially cap rate. Capital-expenditure reserves are also kept out, sitting below the NOI line so the figure stays comparable to market comps and to other properties' quoted NOI.
What NOI is used for
NOI is the foundation almost every other rental-property metric is built from. Divide it by a property's price and you get cap rate — the unleveraged yield investors use to compare deals independent of financing. Divide it by annual debt service and you get DSCR — the ratio lenders check before approving a loan. Subtract debt service and a capital reserve from NOI and you get cash flow — what actually lands in your pocket each month.
Because this calculator asks only for rent and operating expenses, it's built for the moment you want NOI on its own — screening a listing, sanity-checking a seller's numbers, or comparing two properties before you've settled on a purchase price or financing plan. When you're ready to see the whole picture — cap rate, cash-on-cash return, DSCR, and a multi-year projection — the full deal analyzer uses the exact same NOI calculation and adds price and financing on top.
NOI calculator FAQ
Common questions about net operating income, answered from the same tested formula module used above.
What is net operating income (NOI)?
NOI is the income a property produces after operating expenses but before financing and taxes. It equals effective gross income (gross rent minus a vacancy allowance, plus any other income) minus operating expenses such as property tax, insurance, management, maintenance, owner-paid utilities, and HOA dues.
How do you calculate NOI?
Start with gross scheduled rent, subtract a vacancy and credit-loss allowance (commonly around 5%) to get effective gross income, add any other income such as parking or laundry, then subtract operating expenses — property tax, insurance, management, maintenance, owner-paid utilities, and HOA dues. What's left is NOI.
Which expenses are included in NOI — and which are not?
Included: property tax, insurance, property management, repairs and maintenance, owner-paid utilities, HOA dues, and similar recurring operating costs. Excluded: mortgage principal and interest, depreciation, income taxes, and capital expenditures. Capital reserves are kept below the NOI line so cap rate stays comparable to market comps.
Does NOI include the mortgage or depreciation?
No. NOI is unlevered and pre-tax — it never subtracts mortgage principal, mortgage interest, depreciation, or income tax. Subtracting the loan is the single most common NOI/cap-rate error. Depreciation is a non-cash tax deduction, not an operating cost.
Is NOI the same as profit or cash flow?
Not quite. NOI is property-level operating profit before debt service, capital expenditures, depreciation, and income tax — similar in spirit to EBITDA for a single property. Your actual take-home cash flow subtracts the mortgage and a capital-expense reserve from NOI.
What's a good NOI?
There's no universal target — NOI is a dollar figure that scales with the property's rent roll and market, so it's only meaningful relative to price (as cap rate) or relative to debt service (as DSCR). Use this calculator's cap rate and DSCR tools alongside NOI to judge whether a number is actually good for a given deal.