Net Operating Income, Cash Flow and Taxable Income Calculations

Just posting a quick refresher for new and occasional investors:

Net Operating Income (NOI): Rental Income (less vacancy) – Insurance, Taxes and Maintenance

Cash Flow:  NOI – Debt Service (Mortgage payments including Interest) and Rental Commissions

Taxable Income: NOI – Interest – Depreciation (Cost Recovery) – Amortized Points and Cap Expenses – Rental Commissions

Please note that your cost to invest and equity do not impact your NOI calculations and your Cap Rate. Your cost to invest will impact your cash flow and your taxable income.

These are general guidelines. For more details and analysis, call Patricia Rattray at 203-570-2096.


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