Enter the properties net operating income ($) and the property value ($) into the Cap Rate Calculator. The calculator will evaluate the Cap Rate. 

Cap Rate Formula

The following two example problems outline the steps and information needed to calculate the Cap Rate.

CR = NOI / MV

  • Where CR is the Cap Rate ( )
  • NOI is the properties net operating income ($) 
  • MV is the property value ($) 

How to Calculate Cap Rate?

The following example problems outline how to calculate Cap Rate.

Example Problem #1:

  1. First, determine the properties net operating income ($). 
    • The properties net operating income ($) is given as: 5,000.
  2. Next, determine the property value ($). 
    • The property value ($) is provided as: 30,000.
  3. Finally, calculate the Cap Rate using the equation above: 

CR = NOI / MV

The values provided above are inserted into the equation below and computed.

CR = 5,000 / 30,000 = .1667

Example Problem #2: 

For this problem, the variables required are provided below:

properties net operating income ($) = 6,000

property value ($) = 20,000

Test your knowledge using the equation and check your answer with the calculator.

CR = NOI / MV = ?