Formulas

Definitions from the Property Tracker glossary.

• Rent-to-Value Ratio™ (RV Ratio™) — Monthly Rent ÷ Purchase Price × 100.
• Annual Gross Rent Multiplier — Purchase Price ÷ Gross Annual Rent.
• Debt Coverage Ratio — NOI ÷ Total Mortgage Payment.
• Capitalization Rate — NOI ÷ Purchase Price × 100.
• Cash on Cash Return — Annual Cash Flow ÷ Initial Cash Invested × 100.
• ROI — (Cash Flow + Principal Reduction + Appreciation) ÷ Initial Cash × 100.
• ROI with IIDD — Gross Equity Income ÷ Initial Cash × 100 (GEI includes IIDD).
• Inflation Induced Debt Destruction® (IIDD) — Projected Inflation Rate × Total Loan Amount.
• Gross Equity Income — Cash Flow + Principal Reduction + Appreciation + IIDD.
• First-Year Appreciation — Purchase Price × appreciation %.
• Cash Flow — NOI − Mortgage Payments.
• NOI — Operating Income − Operating Expenses (effective rent × 0.82 − taxes − insurance).
• Principal Reduction — Mortgage Payment − Interest Portion (first 12 months summed).