Cap rate · cash flow · cash-on-cash return · free
Rental Property Calculator Canada
Most Canadian rental properties are negative cash flow — investors rely on appreciation. But knowing your exact monthly deficit, cap rate, and cash-on-cash return before you buy is essential. Run the numbers with realistic vacancy rates, Canadian investor mortgage rates (20%+ down), and actual expense ratios.
Educational calculators — always consult a licensed professional before making financial decisions.
Investment properties require a minimum 20% down payment — CMHC insurance does not apply.
Minimum 20% for investment properties in Canada. 25% or more typically gets better rates.
Research comparable units in the neighbourhood. Lenders use 50–80% of rental income when qualifying.
Canadian average vacancy rates vary by city. Toronto and Vancouver are ~1–2%; other cities are higher.
Investment properties are taxed at the same residential rate. Use our Property Tax Calculator for an estimate.
Monthly cash flow
-$1,607
Negative — top-up required
Annual Income & Expenses
5-Year Wealth Building
Assumes 6.09% rate, 25-yr amortization, no property management. Add appreciation and tax deductions to your total return picture.
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What you'll need
- ·Purchase price and down payment (min 20%)
- ·Expected monthly rent
- ·Annual property tax estimate
- ·Vacancy rate for the area
What you'll get
- ✓Cap rate — Net operating income vs purchase price
- ✓Monthly cash flow — What's left after all expenses
- ✓Cash-on-cash return — Return on your actual cash invested
How it works
Enter purchase price and down payment (min 20%)
Investment properties in Canada require at least 20% down — no CMHC insurance available. We calculate your mortgage at investor rates.
Enter expected rent and property tax
We apply a standard 30% expense ratio (insurance, maintenance, management) plus your specific property tax and vacancy rate.
See cap rate, cash flow, and cash-on-cash return
Three metrics every Canadian investor needs: gross yield, net operating income (cap rate), and actual after-mortgage cash-on-cash return.
Rental Property Analysis: $750,000 Property, $150K Down, $3,000/mo Rent
| Metric | Value |
|---|---|
| Gross annual rent | $36,000 |
| Net operating income | $22,680 |
| Cap rate | 3.02% |
| Monthly mortgage payment | $3,282 |
| Monthly cash flow | −$394 |
| Cash-on-cash return | −3.14% |
Negative cash flow is common in Toronto and Vancouver. Investors rely on appreciation. Calgary and Edmonton often show positive cash flow.
About this calculator
What is a good cap rate for a rental property in Canada?+
In high-priced markets like Toronto and Vancouver, cap rates are often 2–4% due to elevated purchase prices. In Calgary, Edmonton, and smaller cities, cap rates of 4–6% are achievable. A cap rate below the mortgage rate means negative leverage — you're relying on appreciation, not cash flow.
What is the minimum down payment for an investment property in Canada?+
Investment (non-owner-occupied) properties require a minimum 20% down payment in Canada. CMHC mortgage insurance is not available for investment properties. Some lenders prefer 25%+ for better rates on investment mortgages.
Is rental income taxable in Canada?+
Yes. Net rental income (rent minus allowable expenses) is taxed as ordinary income at your marginal rate. Allowable expenses include mortgage interest (not principal), property tax, insurance, repairs, property management, and depreciation (CCA). Keep detailed records.
What expenses can I deduct from rental income in Canada?+
Deductible rental expenses in Canada include: mortgage interest (not principal), property taxes, insurance, maintenance and repairs, property management fees, advertising, legal and accounting fees, and capital cost allowance (CCA/depreciation). You cannot deduct the capital portion of mortgage payments.
Know your numbers before you make an offer.
Back to the calculator ↑Rental Property Calculator Canada is built and maintained by the RealCostIQ editorial team. Cost ranges and rates are checked against published industry data and contractor quotes, and revised when the underlying figures move. Read our data methodology or more about who builds this. Every calculation runs in your browser — no account, and none of your inputs are stored.
Cost ranges and rates here are checked against contractor quotes and published industry data. If a number still looks off, email Support@RealCostIQ.com and we'll review and fix it.