Real Estate ROI Calculator
Calculate rental yield, cash flow, and investment payback period
Purchase Costs
Rental Income
Operating Expenses
Loan Information
Rental Income Tax (Taiwan estimate)
Note: These tax figures follow Taiwan tax law (income tax on rental income) and are a Taiwan-specific estimate, not a US or other-country tax calculation.
Property Appreciation Estimate
Investment Analysis
Investment Advice
Medium rental yield, need to evaluate capital gain potential.
Cumulative Cash Flow Trend
About Real Estate ROI Calculator
What is Real Estate ROI?
Real Estate Return on Investment (ROI) is a key metric for measuring real estate investment performance and evaluating property profitability. This calculator provides three important yield calculations: Gross Rental Yield, Net Rental Yield, and Cash-on-Cash Return, helping you fully understand your investment property returns.
What are the differences between the three yields?
1. Gross Rental Yield = (Annual Rental Income ÷ Property Price) × 100%
The simplest calculation method, considering only the ratio of rental income to property price without any expenses. Taiwan residential gross yield typically ranges between 2-4%.
2. Net Rental Yield = [(Annual Rental Income - Annual Expenses) ÷ Property Price] × 100%
The actual return after deducting operating expenses such as management fees, maintenance, taxes, and insurance, providing a more realistic picture of returns.
3. Cash-on-Cash Return = [(Annual Rental Income - Annual Expenses - Annual Loan Payment) ÷ Down Payment] × 100%
Considers the loan factor and calculates the return on actual invested capital. This is the most important metric for evaluating rental property investments.
How to use this calculator?
- Enter Purchase Costs: Fill in property price, renovation costs, and other fees (agent fees, taxes, etc.)
- Enter Rental Income: Fill in expected monthly rent and consider vacancy rate (recommended 5-10%)
- Enter Operating Expenses: Include management fees, maintenance costs, property tax, land value tax, and insurance
- Enter Loan Information: Loan amount, interest rate, and loan term
- Review Results: The system displays various yields, cash flow, payback period, and detailed analysis in real-time
What is a reasonable ROI?
Taiwan Residential Investment Yield Benchmarks:
- Gross Rental Yield: Taipei ~1.5-2.5%, New Taipei ~2-3%, Central/Southern Taiwan ~3-5%
- Net Rental Yield: After expenses, typically 0.5-1.5% lower than gross yield
- Cash-on-Cash Return: Positive means cash inflow, negative means additional subsidy needed
- Payback Period: Generally recommended within 20-30 years, shorter is better
Frequently Asked Questions
Q: Why is my cash flow negative?
Negative cash flow means that after deducting all expenses (including loan payments) from annual rental income, additional subsidy is still needed. This is common in Taiwan real estate investment, as many investors value capital gains (property appreciation) over rental income. If cash flow is negative, assess whether your financial capacity can sustain long-term subsidies and whether property appreciation potential can offset the cash flow gap.
Q: How to estimate vacancy rate?
Vacancy rate refers to the proportion of months in a year when the property cannot be rented. General recommendations:
• Prime locations, quality properties: 5% (~0.6 months vacant)
• General residential areas: 8-10% (~1-1.2 months vacant)
• Remote areas, older properties: 15% or more
Conservative estimates with safety margins are recommended.
Q: How much should I budget for maintenance?
Maintenance costs are recommended at 0.5-1% of property price per year, or 10-15% of monthly rent. New properties may require less in the first 5 years, but after 10 years, equipment aging (air conditioning, water heaters, appliances) requires replacement, increasing expenses. Annual budget allocation is recommended to avoid sudden large expenses affecting cash flow.
Q: What hidden costs should I watch for in real estate investment?
Besides items listed in this calculator, also consider:
• Rental costs: Agent fees (0.5-1 month rent), advertising fees
• Renovation depreciation: Renovation needed every 5-10 years
• Rental income tax (Taiwan): Rental income must be declared, choose 43% necessary expense or actual expense deduction
• Capital gains tax (Taiwan): Tax on capital gains when selling (45% rate if held less than 2 years)
• Time costs: Finding tenants, management, handling tenant issues, etc.
Investment Advice & Risk Disclaimer
⚠️ Risk Warning
- Real estate investment involves large amounts and low liquidity, requiring careful evaluation
- Rising interest rates increase loan burden and affect cash flow
- Falling property prices may cause capital losses
- Rental income is unstable, affected by economy, location, and tenant quality
- Tax policy changes (such as capital gains tax) may affect investment returns
This calculator is for reference only. Please consult professional financial advisors or real estate experts for actual investment decisions.
