Cash-on-Cash Return Calculator India

Why the calculator's cash-invested figure runs ahead of your down payment

RBI's Master Circular – Housing Finance (February 2022) sets loan-to-value ceilings of up to 90% for a property costing up to ₹30 lakh, up to 80% between ₹30 lakh and ₹75 lakh, and up to 75% above ₹75 lakh. Those percentages apply only to the property's own cost — the circular instructs banks to "not include stamp duty, registration and other documentation charges in the cost of the housing property they finance", with a carve-out only for homes costing ₹10 lakh or less. Above that line, every rupee of stamp duty and registration is cash you fund yourself, and this calculator's Closing Costs field is exactly where it belongs — alongside the down payment, not folded into the mortgaged purchase price.

Why the annual cash flow in the numerator can shift mid-hold

Since 1 October 2019, RBI has required "all new floating rate personal or retail loans...to an external benchmark" — typically repo — with the lender free to set its own spread, adjustable only when the benchmark moves or the borrower's own creditworthiness genuinely changes. If the loan you're modelling is floating-rate, the interest-rate field driving this calculator's annual debt service is not a constant for the whole hold: it resets on your lender's schedule (commonly quarterly) whenever the Monetary Policy Committee moves the repo rate. RBI held the repo rate at 5.25% across every 2026 meeting this registry could directly confirm through June 2026 — that is a snapshot, not a permanent figure, and a materially different repo rate a year or two into your hold will move the annual debt service this calculator subtracts from NOI, and with it the cash-on-cash number.

The same rate regime works in the investor's favour on the exit side of that logic: RBI's Pre-payment Charges on Loans Directions, 2025 bar foreclosure or pre-payment charges on floating-rate loans to individuals taken for non-business purposes, for loans sanctioned or renewed on or after 1 January 2026. If a strong year of rent lets you pay down principal ahead of schedule to lift a future year's cash-on-cash figure, a qualifying floating-rate loan carries no penalty for doing it — confirm your own sanction date against that 1 January 2026 cutoff before assuming it applies to your specific loan.

Buying under construction adds a third line to cash invested

If the property you're modelling is under construction rather than ready-to-move, GST is a further upfront cash outlay this calculator's Closing Costs field should also capture — it is paid alongside each construction-linked instalment, not financed as part of the home loan's property value. CBIC's own rate notification sets construction of an affordable residential apartment at an effective 1% GST, paid in cash only with no input tax credit available to the buyer, and a non-affordable residential apartment at 5% on the same cash-only, no-ITC basis. A buyer funding a ₹45,00,000 non-affordable under-construction flat therefore needs roughly a further ₹2,25,000 in cash across the construction period, on top of down payment, stamp duty and registration — all of it belongs in cash invested, none of it in the financed loan amount.

What belongs in the calculator's operating-expense field

Annual operating expenses feed directly into this calculator's NOI, and one recurring line is municipal property tax — which is not a flat percentage anywhere in India. Bengaluru's BBMP taxes under a Unit Area Value Self-Assessment Scheme where depreciation is available on a calendar-year basis, claimable once per block period, and a 5% discount applies for paying by the prescribed early date. Mumbai's MCGM instead taxes on a Capital Value computed as Base Value (from the Stamp Duty Ready Reckoner) × User Category × Nature/Type of Building × Age Factor × Floor Factor × Carpet Area — an older, lower-floor unit is assessed lower than an identical new high-floor one even at the same address. Neither city publishes a single percentage a reader can apply blind; pull the actual figure from your own municipal notice rather than estimating it as a round percentage of rent.

There is no published benchmark to check your result against

No official source — RBI, the National Housing Bank's RESIDEX index, CREDAI, or the Ministry of Statistics — publishes a residential rental-yield or cash-on-cash benchmark by Indian city. Whatever number this calculator returns is only as reliable as the rent, price, financing terms and closing costs you enter; there is no authoritative citywide average to compare it against, so treat any such figure you see elsewhere as an unsourced estimate rather than an official statistic.