Rent out rooms in the home you live in, the whole home, or nights to guests. See what it brings in each month after every cost and the loan, with the cap rate, the cash-on-cash return and the rent you need to break even.
Net operating income for a year divided by the price. It shows what the home earns for its price, no matter how it is paid for.
?What is cash-on-cash?
Your cash flow for a year divided by the cash you put in. It shows what your own money earns each year.
?What is break-even rent?
The rent that makes the cash flow zero. Below it, you add money each month.
Good to know
Where the money goes, each year
Rent for the year
Empty months
Property tax
Insurance
Repairs and upkeep
Management
Booking site fees
Other costs
Net operating income
Loan payments
Cash flow
?What is net operating income?
The rent you collect minus the costs of running the home. It leaves the loan out.
Cash you put in
Down payment
Price, paid in cash
Closing costs, estimated
Repairs before renting
Total cash in
Also in year one
Loan paid down
Debt coverage
?Why is this not in the cash flow?
Part of each loan payment pays down what you owe. You keep it as equity in the home, but it is not cash in your pocket until you sell or refinance.
?What is debt coverage?
Net operating income divided by the loan payments. Above 1 means the home's income covers the loan. Some rental loans look at this number.
Estimates only, not a quote, offer, pre-approval, or commitment to lend. Talk to Scott for your actual terms.
Change one thing Your cash flow each month if one number moves
If
Cash flow each month
Change
Cash-on-cash
How we got your number
The math, step by step
Rent in, costs out, then the loan. Here is each step with your own numbers. Change anything above and this changes with it.
1
The rent you collect
2
The running costs
3
What the home earns
4
The loan
5
What is left
6
What your cash earns
7
The rent to break even
New to this? Start here
Rental math, in plain words
Eight short parts, from renting rooms to the loan that fits. Then try the calculator above with your own numbers.
1
Renting rooms in the home you live in
You live in one bedroom and rent the others. People call it house hacking. The rent pays part of your loan, and because you live there, the loan is on your own home. Cities limit how many people who are not related may share one home, so check the rule in your city before you count on every room. House hacking in Utah.
2
Cash flow is what is left
Rent comes in. The running costs and the loan payment go out. What is left each month is your cash flow. It can be less than zero. When you rent rooms in your own home, a number below zero is simply what it costs you to live there after the renters pay their share.
3
Plan for empty months and repairs
Even a good rental sits empty between renters, so the page takes a small share off the rent for the year. Roofs, water heaters and air conditioners wear out too, so it sets aside a share of the price each year to pay for them. Both are starting points. An older home, a pool or a big yard can need more.
4
Cap rate compares homes
First take the running costs off the rent you collect. What is left is the net operating income: what the home earns before the loan. Divide it by the price and you get the cap rate. It leaves the loan out, so you can line up two homes side by side, even if one is bought with cash and one with a loan.
5
Cash-on-cash shows what your money earns
Take your cash flow for a year. Divide it by the cash you put in: the down payment, closing costs and any repairs before the first renter. It leaves out the loan you pay down and any change in the home's value.
6
Know your break-even rent
This is the rent where the home pays for itself, with nothing left over. Look up what similar homes nearby rent for. If they rent for less than your break-even, you will add money every month.
7
Property tax on a rental
Utah taxes only 55% of the value of a home that someone lives in full time. That covers a home you live in, even with rooms rented out, and a long term rental that is a tenant's full time home. A nightly rental, a second home or a cabin is taxed on its full value. See the Tax Commission's page.
8
The loan depends on where you live
If you live in the home, you can use a loan for your own home: conventional, FHA, or VA for those who qualify. That works for a house where you rent rooms, and for a home with two to four units where you live in one. Two to four units, explained. If you will not live there, you need an investment loan. It asks for more money down, a higher rate and savings left after closing. A DSCR loan is one kind: the lender looks mostly at the rent against the payment, not your paycheck. DSCR loans in Utah.
Thinking nightly?
Nightly rentals in Southern Utah
A nightly rental can bring in more rent than a monthly one, and it costs more to run. Check these four things before you buy.
1
Each city sets its own rules
Utah law lets each city and county decide where nightly rentals may run. Many allow them only in certain zones. A state law also limits how a city can use an online listing as proof. Read the state law.
2
St. George allows them in some places
St. George allows nightly rentals of homes mainly in approved resort area developments, and each one needs a city business license. Most of the city's neighborhoods do not allow them. Other Southern Utah towns have their own rules.
3
Guests pay lodging taxes
Stays shorter than 30 days owe sales tax and transient room tax. You send them to the Utah State Tax Commission, though some booking sites collect part of it for you. See the Tax Commission's guide.
4
No primary home tax break
A nightly rental is taxed on its full value, so it pays more property tax than the same home rented by the month. Switch the calculator to nightly and the tax line changes to show it.
The details, town by town: vacation rental rules in Utah. Rules change, so the city or county has the final word on any address.
I am licensed in both real estate and mortgage lending, and I take only one role on any single transaction, never both on the same home. You are always free to choose your own agent and lender. See how I work.
This content is for general information only. It is not legal, tax, investment, or financial advice. Consult a qualified professional for guidance specific to your situation.
I update these from one file, so every calculator on the site uses the same numbers.
Estimates only. This is not a quote, offer, pre-approval, or commitment to lend. Figures are illustrative and depend on the assumptions you choose.
This tool is for general information only. It is not legal, tax, investment, or financial advice. Consult a qualified professional for guidance specific to your situation.
What is house hacking?
You buy a home, live in it, and rent out the other bedrooms. The rent from those rooms pays part or all of the home's cost. Because you live there, it is a loan on your own home, so the rate and the money down are usually lower than on a rental you do not live in.
Can I rent out rooms in my home in Utah?
Usually, yes, but cities limit how many people who are not related may live in one home, and some ask for a permit or a business license. Check the rule in your city before you count on every bedroom.
How do you figure cash flow on a rental property?
Start with the rent you expect to collect in a year, minus the months it may sit empty. Take off the running costs: property tax, insurance, upkeep, management and anything else you pay. What is left is the net operating income. Take off the loan payments, and what is left is your cash flow.
What is a cap rate?
The cap rate is the net operating income for one year divided by the price. It leaves the loan out, so you can compare two homes the same way no matter how each one is paid for. A higher cap rate means the home earns more for its price.
What is cash-on-cash return?
It is your cash flow for one year divided by the cash you put in: the down payment, the closing costs and any repairs before the first renter moves in. It shows what your own money earns each year. It leaves out the loan you pay down and any change in the home's value.
What is the break-even rent?
It is the monthly rent that makes the cash flow zero, after empty months, every running cost and the loan payment. Rent above it puts money in your pocket. Rent below it means you add money each month.
How much should I set aside for empty months and repairs?
The page opens with a share of the rent for empty months and a share of the home's value each year for repairs. Both are starting points. An older home, a pool or a big yard can need more. Change them to fit the home.
Does a Utah rental get the primary home property tax break?
A home you live in keeps it, even if you rent out rooms. A long term rental can too: Utah taxes only 55% of the value of a home that is a tenant's full time home, and the owner signs a rental declaration with the county. A nightly rental, a second home or a cabin gets no break, so it is taxed on the full value.
Can I run a nightly rental in St. George?
Only in some places. St. George allows nightly rentals of homes mainly in approved resort area developments, and each one needs a city business license. Most of the city's neighborhoods do not allow them. Every Utah city sets its own rules, so check with the city before you buy.
What taxes apply to a nightly rental in Utah?
Stays shorter than 30 days owe Utah sales tax and transient room tax, paid by the guest and sent to the Utah State Tax Commission. Some booking sites collect part of it for you. You also need any license the city or county asks for.
How is a loan on a rental different from a loan on my home?
A loan on a home you do not live in usually asks for more money down, a higher rate and money left in the bank after closing. If you live in the home and rent rooms, it is a loan on your own home. The page sets the rate and down payment for each. Ask a lender for the real numbers on your loan.
Can I use an FHA or VA loan to buy a rental?
Only if you live there. FHA and VA loans are for a home you live in. It can be a house where you rent out the other bedrooms. It can also be a home with two, three or four units: you live in one and rent the rest. A home you will only rent out needs a different loan.
What is a DSCR loan?
DSCR stands for debt service coverage ratio. It is a loan for a home you rent out. The lender looks mostly at the home's rent compared with its loan payment, instead of your paycheck. The debt coverage line on this page is that same idea. It usually asks for more money down and a higher rate than a loan on a home you live in.
Does this include income tax or depreciation?
No. Rental income and the costs you can write off follow tax rules that depend on you. Ask a tax pro how a rental would change your taxes.
Why does the page show a negative cash flow?
Because the numbers do not cover the costs yet. A home priced high for its rent, or a high rate, can cost more each month than it brings in. Try more money down, a lower price or a higher rent to see what it takes. When you rent rooms in a home you live in, a negative number is what living there costs you after the renters pay their share.
Is this the return I will get?
No. It is an estimate from the numbers you enter. Real rent, empty months, repairs and costs will be different, and no return is promised.
Talk to a real agent
Looking at a home to rent out?
This page makes a good guess. Send me an address, and I will run the real numbers with you: what the home could rent for, what it costs to own, and the rules in that town. It is free, and you are under no obligation.
