Project monthly and annual cash flows for investment properties with waterfall charts, DSCR, and break-even occupancy.
Rent minus mortgage is not cash flow, and this tool exists to show the gap. You enter rent, vacancy, operating expenses, loan terms, and a capital reserve, and it projects monthly and annual cash flow with a waterfall chart that walks from gross rent down to cash in hand, plus debt service coverage ratio (DSCR) and break-even occupancy. The surprise most buyers hit: the mortgage payment is not an operating expense. It is subtracted after net operating income, so a property that 'pays for itself' on paper can still project negative cash flow once vacancy and reserves are taken out.
A concrete input and expected output from the current implementation.
Input
Price $400,000, 25% down, 2-unit property, gross rent $3,600/month, vacancy 5%, operating expenses $1,100/month, loan $300,000 at 6.5% fixed for 30 years
Expected output
Monthly cash flow: +$423.79. Annual cash flow: +$5,085.48. DSCR: 1.22. Break-even occupancy: 83.2%. Waterfall: $3,600 gross rent - $180 vacancy - $1,100 operating expenses = $2,320 NOI - $1,896.21 debt service = $423.79 cash flow.
At 6.5% for 30 years the payment on $300,000 is $1,896.21, so NOI of $2,320 ($3,600 - 5% vacancy - $1,100) leaves $423.79. DSCR is annual NOI ($27,840) over annual debt service ($22,754.52) = 1.22, and break-even occupancy is ($1,100 + $1,896.21) / $3,600 = 83.2%.
Gross potential rent is reduced step by step: vacancy and collection loss, then operating expenses (taxes, insurance, utilities, management, maintenance), giving net operating income (NOI). Debt service and any capital reserve you enter are subtracted after NOI, and what remains is the monthly cash flow, scaled to an annual figure. Principal and interest never appear inside operating expenses, which is why the ordering matters.
Debt service coverage ratio is annual NOI divided by annual principal and interest payments; 1.22 means NOI covers the payment 1.22 times over, and anything below 1.0 means the property cannot pay the loan from its income. Break-even occupancy is operating expenses plus debt service divided by gross potential rent, converted to a percentage: the occupancy level at which the monthly projection hits exactly zero.
Because vacancy, operating expenses, and any capital reserve are all subtracted before the mortgage payment is reached. A full unit today does not mean full income over a year, and lenders, appraisers, and this tool assume a vacancy allowance. Check the waterfall: the gap usually appears at the vacancy and reserve steps, not at the loan.
For a rental-property loan, 1.25 is a common underwriting floor and 1.20 is frequently acceptable; below 1.0, NOI cannot cover the payments at all. But a DSCR above the floor is not approval - the lender recalculates income from its own appraisal, so bring a cushion: the break-even occupancy figure shows how much vacancy slack you actually have.
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