Net Operating Income (NOI) Calculator

Net Operating Income (NOI) calculator for rental property analysis

Net Operating Income (NOI) is the most common “clean” income figure used to evaluate a rental property. It answers a simple question: after normal operating costs, how much income does the property produce before financing and taxes? If you are comparing two properties, discussing performance with an agent, or sanity-checking a deal, NOI is one of the first numbers you want because it strips out your personal financing choices and focuses on the property itself.

This NOI calculator is designed for one primary use case: estimating a rental property’s NOI from monthly rent and operating expenses, with an optional vacancy allowance. That means it is not a mortgage calculator and it is not a full investment return model. It will not tell you your cash-on-cash return, your cap rate, or your after-tax profit. Those are separate decisions that sit on top of NOI. Here, the decision is narrower: “Is the property producing enough operating income to be worth analyzing further?”

To use the calculator quickly, enter your gross rent per month, add any other recurring income (like parking or laundry), set a vacancy percentage (or keep the default), and enter your monthly operating expenses. The result shows annual NOI and monthly NOI first, then a compact breakdown of effective gross income, vacancy loss, and operating expenses. If you want a more structured expense estimate, open the Advanced section and enter whichever expense items you actually know. The calculator will build an annual operating expense figure from those items, including optional management and maintenance reserve percentages.

Assumptions and how to use this calculator

• NOI excludes debt service: mortgage payments, interest, and loan fees are not operating expenses and should not be entered here.
• Vacancy is applied as a percentage of gross scheduled income (rent plus other income). If you prefer a different method, adjust the vacancy rate to match your reality.
• Operating expenses should reflect the owner’s costs to keep the property operating (rates/taxes, insurance, HOA/body corporate, utilities paid by owner, routine maintenance, management, and similar costs).
• If you enter any Advanced expense items, the calculator assumes you want to build operating expenses from those items and ignores the “total operating expenses (monthly)” field to avoid double counting.
• Management and repairs reserve (if used) are calculated as a percentage of effective gross income (after vacancy), which is a common practical approach for quick underwriting.

Common questions

What is NOI, in plain language?

NOI is the property’s income after paying the bills required to run it, before paying the mortgage and before personal income taxes. It is meant to reflect how the property performs as an asset, not how you personally choose to finance it.

Should I include my mortgage payment in operating expenses?

No. Mortgage payments (principal and interest) are financing costs, not operating costs. If you include them, you are no longer calculating NOI. If you want to see what cash you keep after the mortgage, you are looking for cash flow after debt service, which is a different metric.

What counts as operating expenses for NOI?

Typical operating expenses include property taxes or rates, insurance, HOA/body corporate fees, utilities paid by the owner, routine repairs and maintenance, landscaping, advertising/tenant placement, and property management. Large one-off capital improvements are usually treated separately as capex rather than routine operating expense.

What if I do not know my exact expenses yet?

Use the quick method with a rough monthly expense estimate, then refine it. A practical approach is to start with known fixed items (rates, insurance, HOA) and add a conservative allowance for maintenance and management. The Advanced section helps you do this without forcing you to list everything.

Why can NOI be negative, and what does that mean?

If your effective gross income is lower than your operating expenses, NOI becomes negative. That means the property does not even cover basic operating costs before considering the mortgage. It does not automatically mean “never buy,” but it is a major red flag unless there is a specific, realistic reason income will increase or expenses will drop.