Cash-on-Cash Return Calculator

Measure the annual return on your actual cash investment in a commercial property. Essential for comparing leveraged investments.


Understanding Cash-on-Cash Return

Cash-on-Cash Return (CoC) measures the annual return based on the actual cash you invested in a property, not the total property value. It's one of the most important metrics for evaluating leveraged real estate investments.

  • Accounts for financing costs unlike Cap Rate
  • Shows the real return on your equity investment
  • Useful for comparing properties with different financing structures
  • Higher leverage typically increases CoC return (with added risk)

CoC Return vs. Cap Rate

While Cap Rate measures unlevered return on the property itself, Cash-on-Cash Return shows your actual return as an investor. Key differences:

  • All-cash purchase: CoC Return equals Cap Rate
  • Leveraged purchase: CoC Return typically exceeds Cap Rate (positive leverage)
  • If loan rate exceeds Cap Rate, CoC will be lower (negative leverage)
  • CoC includes debt service; Cap Rate does not