NOI (Net Operating Income) Calculator
Calculate Net Operating Income and Operating Expense Ratio for rental properties. Essential metric for real estate investment analysis.
How it works
NOI = Effective Gross Income - Operating Expenses. EGI = (Gross Rent + Other Income) × (1 - Vacancy Rate).
Example
$60,000 gross rent - 5% vacancy - $21,000 expenses = $36,000 NOI (63% OER).
FAQ
What is NOI in real estate?
Net Operating Income is the total income from a property minus all operating expenses, but before debt service and taxes. It's used to calculate cap rates and property value.
What expenses are included in NOI calculation?
Operating expenses include property taxes, insurance, maintenance, management fees, utilities, and repairs. Mortgage payments and capital improvements are NOT included.
What is a good Operating Expense Ratio?
Typically 35-50% for well-managed properties. Lower is better, but varies by property type, age, and management intensity.
How do you account for vacancy in NOI?
Apply vacancy rate to gross rent to calculate Effective Gross Income, then subtract operating expenses to get NOI.