NOI Calculator
Enter annual gross rental income and annual operating expenses below to instantly get net operating income.
Property tax, insurance, maintenance, management, HOA -- not debt service or depreciation.
What Is Net Operating Income?
Net Operating Income (NOI) is a rental property's annual income after real operating expenses, but before debt service. It's the standard starting point for cap rate, DSCR, and most other income-property metrics, because it measures the property's own performance independent of how any particular owner financed it.
NOI = Gross Rental Income − Operating Expenses, where operating expenses means property tax, insurance, maintenance and repairs, property management, and HOA dues. Mortgage payments, depreciation, and capital expenditures are deliberately left out.
Worked example
A fourplex brings in $54,000/year in gross rent. Property tax, insurance, maintenance, management, and HOA together run $19,800/year.
NOI = $54,000 − $19,800 = $34,200
A second example, where NOI comes out negative: a single-family rental brings in $18,000/year but its expenses (an older roof, high property tax, self-managed but with real repair costs) total $21,000/year.
NOI = $18,000 − $21,000 = $-3,000 -- a real, valid result. Negative NOI means the property loses money on operations alone, before any mortgage payment is even considered.
Common mistake
Including the mortgage payment as an "expense" when calculating NOI. This inflates every ratio built on top of it in the wrong direction -- a lower NOI makes cap rate and DSCR look worse than the property's real operating performance actually is, and makes it impossible to compare NOI across properties with different financing.
Keep going
- Once you have NOI, dividing it by property value or price gives the cap rate -- the most common way investors use NOI to compare deals. Cap Rate Calculator
- NOI is income before debt service; the rental cash flow calculator subtracts your actual mortgage payment and a CapEx reserve to get what you really keep. Rental Cash Flow Calculator
Frequently Asked Questions
What counts as an operating expense for NOI?
Property tax, insurance, routine maintenance and repairs, property management fees, and HOA dues. These are the real, recurring costs of operating the property.
What does NOT count as an operating expense?
Mortgage principal and interest (debt service), depreciation, and capital expenditures (a new roof, a major renovation) are all excluded from NOI by definition. Folding any of these in is the single most common real-world NOI mistake, and it silently inflates every ratio -- cap rate, DSCR -- that's built on top of NOI.
Why exclude debt service from NOI?
NOI measures how much income the property itself generates, independent of how any specific owner chose to finance it. Two buyers financing the same property with an all-cash purchase versus a large mortgage should calculate the exact same NOI -- their debt service differs, but the property's own operating performance doesn't.
Is NOI the same as cash flow?
No. NOI is income before debt service; cash flow is what's left after paying the mortgage (and often after a CapEx reserve too). A property can have strong NOI and still have negative cash flow if the debt service is high enough.
What do I do with NOI once I have it?
NOI is the input to most other real estate investing metrics on this site -- divide it by property value for cap rate, divide it by annual debt service for DSCR, or subtract debt service from it to get pre-tax cash flow.
This is a neutral calculation based on the numbers you enter -- not investment advice.
Related Calculators
- Rental Cash Flow Calculator — Income & Cash Flow
- Cap Rate Calculator — Return Metrics
- DSCR Calculator — Financing
- Cash-on-Cash Return Calculator — Return Metrics