Cap Rate for $20,000 NOI on $250,000 Property
A $250,000 property with $20,000 in net operating income has an 8% cap rate.
How to use this tool
- Enter net operating income (noi) and current property value in the fields above.
- Results update instantly as you type — or click Calculate.
- Read your cap rate and the full breakdown beneath it.
See the capitalization rate for a $250,000 investment property with $20,000 annual NOI — a common rental scenario.
Frequently asked questions
- What is a good cap rate?
- Cap rate standards vary by market and property type. In primary markets (NYC, SF), cap rates of 3–5% are common. Secondary markets may see 6–8%. Higher cap rates signal higher return — but also higher risk.
- Does cap rate include the mortgage?
- No. Cap rate is a financing-independent metric. It uses Net Operating Income (NOI), which excludes debt service. This lets you compare properties regardless of how they are financed.
- What is the difference between cap rate and cash-on-cash return?
- Cap rate ignores financing; cash-on-cash return accounts for your actual mortgage payments. A property can have a low cap rate but high cash-on-cash return if financed favorably, and vice versa.