Cap Rate Calculator
Calculate the capitalization rate from net operating income and value.
Best for: Use it to compare income properties, estimate value from NOI, or gauge if a price is reasonable.
Input
Result
EstimateNet operating income
₹2,40,000
What to do next
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- Type
- Industry Standard
- Method
- Industry-standard method
- Confidence
- High
Uses the standard formula and conventions the industry relies on.
Cap rate = NOI ÷ value × 100. A higher cap rate means more income per rupee/dollar of price (often more risk); a lower one means a pricier, often safer asset.
- 1.Net operating incomeHigh impact
The numerator of the cap rate.
- 2.Property valueHigh impact
A lower price raises the cap rate.
- Raise NOI (higher rent, lower costs)
- Buy below market value
- Inflation often matters more than expected over the long run.
- Small rate changes can significantly affect total outcomes.
- Long-term consistency usually beats short-term timing.
A higher cap rate often means higher risk, not a better deal - context matters. — U.S. Federal Reserve
How it's calculated & sources
- NOI is before financing
- Excludes appreciation
Free & no sign-up · runs entirely in your browser. Results are estimates for general information, not professional advice — verify important decisions with a qualified expert. Last reviewed June 2026.
How it works
Cap rate = net operating income (income − expenses) ÷ property value × 100. It measures unleveraged return and helps compare properties.
Frequently asked questions
What is a good cap rate?+
Typically 4–10%, depending on location and risk; higher means more income relative to price (and often more risk).
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