Underwrite the income, not just the price.
A step-by-step Net Operating Income calculator for residential and commercial properties. Know your margins before you make an offer.
Why do real estate investors care about Net Operating Income (NOI)?
Because it is the most reliable measure of a property’s true profitability.
By stripping away financing costs and income tax, the Net Operating Income reveals the property’s actual operational performance. It confirms that the property generates sufficient income from day-to-day operations to cover its bills, ensuring the investment is fundamentally sound before debt is considered.
Calculator · NOI Analysis
Net operating income
Select property type, enter your numbers, and get a full NOI breakdown instantly.
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The total annual income generated from all leases combined.
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Results · Live
Results Dashboard
Real-time NOI analysis and margin breakdown.
Awaiting your figures
Enter property details and required fields to see your NOI analysis.
Net Operating Income
$0
Margin 0.00%
Residential
Gross Operating Income
$0
Operating Expenses
$0
Net Operating Income
$0
NOI Margin
0.00%
NOI Margin
0.00%
1Potential Rent Income$0
2Vacancy & Credit Loss−$0
3Effective Gross Income$0
4Other Income+$0
5Gross Operating Income$0
6Operating Expenses−$0
7Net Operating Income$0
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Net Operating Income (NOI)
Why do real estate investors care about Net Operating Income (NOI)?
Because it is the most reliable measure of a property’s true profitability.
By stripping away financing costs and income tax, the Net Operating Income reveals the property’s actual operational performance. It confirms that the property generates sufficient income from day-to-day operations to cover its bills, ensuring the investment is fundamentally sound before debt is considered.
Formula
Net Operating Income
(Potential Rent Income−Vacancy and Credit Losses+Other Income)
− Operating Expenses
Step-by-Step Example
Commercial property using sample annual figures.
Step 1
Potential Rent Income
$300,000
Step 2
Less Vacancy
($15,000)
5% of $300,000
Step 3
Effective Gross Income
$285,000
Step 4
Plus Other Income
$15,000
- Annual Parking Revenue$5,000
- Annual Common Area Utility Reimbursements$5,000
- Annual Billboard and Signage Lease$2,000
- Annual Antenna and Cell Tower Lease$2,000
- Annual Late Fees and Penalties$1,000
Step 5
Gross Operating Income
$300,000
Step 6
Less Operating Expenses
($120,000)
- Annual Property Taxes$40,000
- Annual Insurance Premiums$15,000
- Annual Property Management Fees$12,000
- Annual Maintenance and Repairs$18,000
- Annual Common Area Maintenance$15,000
- Annual Payroll Expenses$5,000
- Annual Administrative Expenses$5,000
- Annual Replacement Reserves$10,000
Final Result
NOI = ($300,000 − $15,000 + $15,000) − $120,000
= $180,000
© Annie Scott Realty Group LLC
Estimates only · not financial advice
