Enter the purchase price of a property and the expected monthly rent into the calculator to determine the rent to value ratio.

## Rent To Value Formula

The following formula is used to calculate a rent to value ratio.

RTV = MR / P *100

- Where RTV is the rent to value ratio (%)
- MR is the expected monthly rent
- P is the purchase price of the home or building

## Rent to Value Definition

Rent to value is defined as the percentage of the ratio of monthly rent to the purchase price of a home. This ratio is typically referred to as the opposite of the price to rent ratio.

## Rent To Value Example

How to calculate a rent to value?

**First, determine the monthly rent.**Estimate the expected monthly rent you will charge for the property.

**Next, determine the purchase price.**Determine the final purchase price, including fees, of the home.

**Finally, calculate the RTV.**Calculate the rent to value using the equation above.

## FAQ

**What is a good rent to value ratio?**

Typically anything above 2% is a good ratio. This means the rental earnings will pay for the purchase price after just 50 months or roughly 4 years.

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