Calculators › Rental Property Value Calculator
Deal analysisBy Cedrick Reese, Property Rental Calculator
Free calculator that estimates what a rental property is worth from its income, using the same method professional appraisers use.
Income & target return
Taxes, insurance, maintenance, management. Do not include the mortgage.
The return this type of property should earn in this market. See what is a good cap rate for typical ranges.
Enter a target cap rate above zero to see an estimated value.
One appraisal method among several, useful for a quick income-based estimate. It's not a substitute for a licensed appraisal, a local agent's comps, or a full inspection. Not financial advice. Last reviewed September 2026.
Direct capitalization values a property as Value = Net Operating Income ÷ Cap Rate. It's the standard income-approach method appraisers use for stabilized, income-producing real estate, where there's enough market data to trust the cap rate assumption. It works best for a property with steady, predictable rent, and less well for one mid-renovation or with an unusual income history. Think of it as a reverse cap rate calculator: instead of solving for the cap rate like our Cap Rate Calculator, you set a target cap rate and this solves for value.
On $2,000 monthly rent with 5% vacancy and $8,000 of annual operating expenses, NOI comes to $14,800. Divided by a 6.0% target cap rate, that's an estimated value of about $246,667, an implied gross rent multiplier of roughly 10.3.
It depends heavily on the market, property type, and risk you're comfortable with. See what is a good cap rate for typical ranges by property type and market.
This income approach is one of three standard appraisal methods (the others being sales comparison and cost approach). For a rental, income is usually the most relevant driver of value, but cross-checking against local comps or a full appraisal is still worth doing.
No. The Rent Estimator starts from a property's value and estimates what rent it could charge. This tool runs the opposite direction: it starts from rental income and estimates the property's value.
No, same as the Cap Rate Calculator, NOI and this value estimate are both unlevered, before any mortgage.
This calculator was built by Cedrick Reese, a web developer, using the direct capitalization method that commercial appraisers use to value income-producing real estate. The formula and its assumptions are checked against the reference cited below, and the math stays consistent with our Cap Rate Calculator's math, since this tool simply solves the same equation in the other direction.