Finance category
Mortgage, loan, investing, tax, and money calculators.
Break-Even Rent Calculator
Solve for the gross monthly rent that produces zero cash flow at your assumed vacancy and operating expenses. Then see the rent that hits a target monthly cash flow.
Break-even rent
$2,898
$0 cash flow at the assumed vacancy
Target rent
$3,111
includes target cash flow
Monthly debt service
$1,944
Required effective rent
$2,724
opex + debt service
Reading the number
The break-even rent is the gross rent that produces zero cash flow after assumed vacancy and operating expenses are subtracted from effective gross income. Below this, the deal loses money even at full collection.
If market rent is below your break-even, the deal isn't viable at the current loan structure. Either reduce loan amount (more cash down), find a lower rate, or reduce opex. The target rent shows what you'd need to also clear your minimum cash flow goal.
How to Use
- Enter monthly operating expenses (taxes, insurance, management, maintenance, capex reserves).
- Enter expected vacancy — the calculator grosses up rent to compensate.
- Enter loan amount, rate, and term to size the monthly debt service.
- Enter the target monthly cash flow you want to clear.
- Compare break-even rent to market rent — if break-even exceeds market, the deal doesn't pencil.
Frequently Asked Questions
What's the difference between break-even rent and break-even occupancy?
Break-even rent solves for the rent floor at a fixed occupancy. Break-even occupancy solves for the occupancy floor at a fixed rent. They answer the same question from different angles depending on which lever is fixed.
Should I use this for new acquisitions?
Yes — it's a fast affordability check. Plug in the offer price and projected loan, estimate opex from comps, and see if break-even rent is below market rent. If it isn't, walk away or restructure the offer.
How accurate are operating expense estimates?
Aim within $50–$100 per month per unit on stabilized properties. Include capex reserves (often $50–$150/door/month) so you're not surprised by a roof or HVAC replacement that erases a year of cash flow.
Does this account for property management fees?
Include them in your monthly opex input — typically 8–12% of collected rent for residential property management. Self-managers can leave it at zero but should still credit themselves for time spent.
Related Calculators
Break-Even Occupancy Calculator
Same break-even idea, but solving for occupancy at fixed rent.
Minimum Rent Calculator
Standalone minimum-rent solve for landlords setting initial pricing.
Rental Cash Flow Calculator
Run full cash flow for any rent above break-even.
Rental Yield Calculator
Convert market rent into a yield to compare to other rentals.
Cap Rate Calculator
Cap rate doesn't include debt — break-even rent does.
DSCR Calculator
Make sure your break-even rent still produces a passing DSCR.
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