A cash-flow result describes one set of assumptions. Break-even rent and occupancy show how much income the property needs to cover that budget. Use both to ask more specific questions about a listing.
Reviewed October 11, 2026 · Illustrative examples · CAD
Break-even rent includes the costs that rise with rent
Simply adding the mortgage and fixed bills understates the rent you need when management, maintenance and reserves are percentage-based. This calculator allows for vacancy first, charges management on collected rent, and charges maintenance and reserves on scheduled rent.
Break-even scheduled monthly rent = (annual fixed costs + scheduled annual mortgage payments + actual extra principal) ÷ {12 × [(1 − vacancy rate) × (1 − management rate) − maintenance rate − reserve rate]}. Rates in this formula are decimals. It is the combined rent for all enabled units and suites, not the rent for each door.
The result holds the financing and fixed costs constant. It does not mean the property can command that rent. Compare the required amount with leases or supported property-specific rent evidence. If the retained-rent factor is zero or negative, the calculator shows N/A because the formula cannot produce a positive rent margin.
A worked example from the calculator
Illustration only: the default $500,000 property schedules $2,500 monthly rent with 5% vacancy, 8% management, 5% maintenance and 3% reserves. Annual fixed costs are $4,800 and scheduled monthly mortgage payments are $2,326.42. The retained-rent factor is 0.794. Break-even scheduled monthly rent is $3,433.78.
At the entered $2,500 rent, break-even occupancy is 127.24%. A result above 100% means collecting every dollar of the entered rent would still leave a cash shortfall. This explains why reducing vacancy alone cannot solve this particular illustrative budget.
Occupancy here measures income collection
Break-even occupancy = [fixed costs + scheduled debt service + extra principal + scheduled rent × (maintenance rate + reserve rate)] ÷ [scheduled rent × (1 − management rate)]. Multiply by 100 for a percentage. It measures the share of total scheduled annual rent that must be collected; it is not a physical unit count.
A fourplex with one vacant unit does not necessarily lose exactly 25% of rent because units can rent for different amounts. Arrears, concessions and turnover also affect income collection. The model applies a single aggregate vacancy allowance and does not forecast individual tenancy dates.
Use the result to test the budget
Review owner-paid utilities, condo fees, maintenance and the reserve allowance before changing rent assumptions. Run the combined higher-rate, lower-rent comparison, then save both sets of coverage figures in your report.
These are first-year operating cash break-even measures. They do not recover the down payment, closing costs or renovation cash, and they do not include tax or sale proceeds. A positive cash-flow result also does not establish whether an investment is suitable.
Annualized return (IRR)4.50%Uses year-end cash flow & final net sale
Property equity$641,216Final value minus mortgage balance
View cash flow, equity & sale detailsMonthly cash flow over timeAnnual cash flow ÷ 12 · CAD
Reconcile the final sale
Estimated property value
$641,216.00
Outstanding mortgage
-$0.00
Selling costs
-$27,148.64
Net sale proceeds
$614,067.36
Cumulative cash flow
-$160,740.33
Upfront cash invested
-$102,000.00
Total profit if sold
$351,327.03
Mortgage paid off in month 300 (year 25). Reserves are treated as spent or unavailable and are not returned at sale.
End-of-year values · dollars rounded for display
Year
Property value
Mortgage balance
Annual NOI
Capital reserve
Mortgage + extras
Annual cash flow
Property equity
Net sale proceeds
Profit if sold
Cumulative ROI
1
$505,000
$391,691
$19,920
$900
$27,917
-$8,897
$113,309
$91,609
-$19,288
-18.91%
2
$510,050
$382,961
$20,119
$909
$27,917
-$8,707
$127,089
$105,187
-$14,417
-14.13%
3
$515,151
$373,790
$20,320
$918
$27,917
-$8,515
$141,361
$119,255
-$8,864
-8.69%
4
$520,302
$364,154
$20,524
$927
$27,917
-$8,321
$156,148
$133,836
-$2,603
-2.55%
5
$525,505
$354,030
$20,729
$937
$27,917
-$8,125
$171,475
$148,955
$4,391
4.30%
6
$530,760
$343,394
$20,936
$946
$27,917
-$7,927
$187,366
$164,636
$12,145
11.91%
7
$536,068
$332,219
$21,145
$955
$27,917
-$7,727
$203,849
$180,906
$20,688
20.28%
8
$541,428
$320,479
$21,357
$965
$27,917
-$7,525
$220,950
$197,793
$30,050
29.46%
9
$546,843
$308,144
$21,571
$975
$27,917
-$7,321
$238,699
$215,325
$40,261
39.47%
10
$552,311
$295,185
$21,786
$984
$27,917
-$7,115
$257,126
$233,534
$51,355
50.35%
11
$557,834
$281,569
$22,004
$994
$27,917
-$6,907
$276,265
$252,452
$63,365
62.12%
12
$563,413
$267,265
$22,224
$1,004
$27,917
-$6,697
$296,148
$272,111
$76,328
74.83%
13
$569,047
$252,236
$22,446
$1,014
$27,917
-$6,485
$316,811
$292,549
$90,281
88.51%
14
$574,737
$236,446
$22,671
$1,024
$27,917
-$6,271
$338,291
$313,801
$105,263
103.20%
15
$580,484
$219,857
$22,898
$1,035
$27,917
-$6,054
$360,627
$335,908
$121,315
118.94%
16
$586,289
$202,429
$23,127
$1,045
$27,917
-$5,835
$383,861
$358,909
$138,481
135.77%
17
$592,152
$184,118
$23,358
$1,055
$27,917
-$5,615
$408,035
$382,849
$156,806
153.73%
18
$598,074
$164,880
$23,591
$1,066
$27,917
-$5,392
$433,194
$407,771
$176,337
172.88%
19
$604,054
$144,668
$23,827
$1,077
$27,917
-$5,166
$459,387
$433,725
$197,124
193.26%
20
$610,095
$123,432
$24,066
$1,087
$27,917
-$4,939
$486,663
$460,759
$219,220
214.92%
21
$616,196
$101,122
$24,306
$1,098
$27,917
-$4,709
$515,074
$488,926
$242,678
237.92%
22
$622,358
$77,682
$24,549
$1,109
$27,917
-$4,477
$544,676
$518,281
$267,556
262.31%
23
$628,582
$53,056
$24,795
$1,120
$27,917
-$4,243
$575,526
$548,882
$293,914
288.15%
24
$634,867
$27,183
$25,043
$1,131
$27,917
-$4,006
$607,684
$580,790
$321,816
315.51%
25
$641,216
$0
$25,293
$1,143
$27,917
-$3,767
$641,216
$614,067
$351,327
344.44%
Useful estimates start with clear assumptions.
Monthly payments use Canadian fixed-rate, semi-annual compounding. The rate stays constant; actual mortgages renew. Taxes, mortgage insurance, lender eligibility and prepayment penalties are not automatically calculated. Growth rates and presets are assumptions. Read the methodology.
MITEY rental property analysis
All amounts in CAD · illustrative estimates before tax · 25-year holding period
Investment snapshot
Upfront cash required
$102,000.00
Initial mortgage
$400,000.00
Scheduled mortgage payment / month
$2,326.42
First-year monthly cash flow
-$741.42
First-year annual NOI
$19,920.00
Cap rate
3.98%
First-year cash-on-cash return
-8.72%
Final-year property equity
$641,216.00
Net sale proceeds
$614,067.36
Cumulative cash flow
-$160,740.33
Profit if sold (after upfront cash)
$351,327.03
Cumulative ROI
344.44%
Annualized return (annual IRR)
4.50%
First-year coverage and break-even
Break-even scheduled monthly rent
$3,433.78
Break-even occupancy / income collection
127.24%
Debt-service coverage ratio
0.71×
Break-even includes fixed costs, reserves and actual scheduled and extra principal payments. Required rent keeps the entered vacancy and percentage costs; required occupancy holds scheduled rent unchanged. Occupancy above 100% means full collection still leaves a shortfall. DSCR is annual NOI divided by scheduled principal and interest; it excludes reserves and extra principal and is N/A without scheduled debt service. These are cash-budget measures, not lender qualification results. N/A break-even means a non-positive retained-rent margin or an undefined collection denominator.
Combined stress case
Interest rate +2 percentage points from the start; all rents −10%. Other assumptions unchanged. Not a lender qualification test.
Stress mortgage rate
7.00%
Stress first-year monthly cash flow
-$1,415.16
Stress first-year cash-on-cash return
-16.65%
Stress break-even scheduled monthly rent
$4,032.32
Stress break-even occupancy
163.37%
Stress debt-service coverage
0.52×
Inputs
Purchase & financing
Purchase price
$500,000.00
Down payment
20 %
Mortgage interest rate
5 %
Amortization
25 years
Holding period
25 years
Operating costs
Property tax / year
$3,600.00
Insurance / year
$1,200.00
Owner utilities / month
$0.00
Condo fee / month
$0.00
Other operating costs / month
$0.00
Vacancy allowance
5 %
Property management
8 %
Routine maintenance
5 %
Capital reserve
3 %
Closing & upfront costs
Legal fees
$1,500.00
Inspection
$500.00
Buyer agency fees
$0.00
Initial renovations
$0.00
Initial repairs
$0.00
Other closing costs
$0.00
Growth & sale assumptions
Property value growth / year
1 %
Rent growth / year
1 %
Fixed expense growth / year
1 %
Selling costs
4 %
Fixed sale costs
$1,500.00
Extra mortgage payments
Extra principal / month
$0.00
Extra principal / year
$0.00
One-time principal payment
$0.00
One-time payment year
1 years
Monthly rent by unit
Unit 1 main rent
$2,500.00
Unit 1 suite
Not included
Custom end-of-year property values
No overrides. Annual appreciation applies.
Year-by-year projection
Year
Value
Balance
NOI
Reserve
Debt service¹
Cash flow
Equity
Sale proceeds
Profit if sold
ROI
1
$505,000
$391,691
$19,920
$900
$27,917
-$8,897
$113,309
$91,609
-$19,288
-18.91%
2
$510,050
$382,961
$20,119
$909
$27,917
-$8,707
$127,089
$105,187
-$14,417
-14.13%
3
$515,151
$373,790
$20,320
$918
$27,917
-$8,515
$141,361
$119,255
-$8,864
-8.69%
4
$520,302
$364,154
$20,524
$927
$27,917
-$8,321
$156,148
$133,836
-$2,603
-2.55%
5
$525,505
$354,030
$20,729
$937
$27,917
-$8,125
$171,475
$148,955
$4,391
4.30%
6
$530,760
$343,394
$20,936
$946
$27,917
-$7,927
$187,366
$164,636
$12,145
11.91%
7
$536,068
$332,219
$21,145
$955
$27,917
-$7,727
$203,849
$180,906
$20,688
20.28%
8
$541,428
$320,479
$21,357
$965
$27,917
-$7,525
$220,950
$197,793
$30,050
29.46%
9
$546,843
$308,144
$21,571
$975
$27,917
-$7,321
$238,699
$215,325
$40,261
39.47%
10
$552,311
$295,185
$21,786
$984
$27,917
-$7,115
$257,126
$233,534
$51,355
50.35%
11
$557,834
$281,569
$22,004
$994
$27,917
-$6,907
$276,265
$252,452
$63,365
62.12%
12
$563,413
$267,265
$22,224
$1,004
$27,917
-$6,697
$296,148
$272,111
$76,328
74.83%
13
$569,047
$252,236
$22,446
$1,014
$27,917
-$6,485
$316,811
$292,549
$90,281
88.51%
14
$574,737
$236,446
$22,671
$1,024
$27,917
-$6,271
$338,291
$313,801
$105,263
103.20%
15
$580,484
$219,857
$22,898
$1,035
$27,917
-$6,054
$360,627
$335,908
$121,315
118.94%
16
$586,289
$202,429
$23,127
$1,045
$27,917
-$5,835
$383,861
$358,909
$138,481
135.77%
17
$592,152
$184,118
$23,358
$1,055
$27,917
-$5,615
$408,035
$382,849
$156,806
153.73%
18
$598,074
$164,880
$23,591
$1,066
$27,917
-$5,392
$433,194
$407,771
$176,337
172.88%
19
$604,054
$144,668
$23,827
$1,077
$27,917
-$5,166
$459,387
$433,725
$197,124
193.26%
20
$610,095
$123,432
$24,066
$1,087
$27,917
-$4,939
$486,663
$460,759
$219,220
214.92%
21
$616,196
$101,122
$24,306
$1,098
$27,917
-$4,709
$515,074
$488,926
$242,678
237.92%
22
$622,358
$77,682
$24,549
$1,109
$27,917
-$4,477
$544,676
$518,281
$267,556
262.31%
23
$628,582
$53,056
$24,795
$1,120
$27,917
-$4,243
$575,526
$548,882
$293,914
288.15%
24
$634,867
$27,183
$25,043
$1,131
$27,917
-$4,006
$607,684
$580,790
$321,816
315.51%
25
$641,216
$0
$25,293
$1,143
$27,917
-$3,767
$641,216
$614,067
$351,327
344.44%
¹ Includes scheduled payments and extra principal. Table dollars are rounded for display; calculations use full precision.
Assumptions and methodology
Monthly mortgage interest uses r = (1 + j/2)^(1/6) − 1. Payments stop at payoff. The rate is held constant; real mortgages renew. Vacancy reduces rent; management uses collected rent, maintenance and capital reserve use scheduled rent. Fixed costs grow at the expense growth rate; percentage-based costs grow with rent.
NOI excludes financing and capital reserves. Cash flow deducts both, including extra principal. Cash required includes all entered upfront costs. Equity excludes accumulated cash flow. Net sale proceeds deduct mortgage balance and entered selling costs. Profit adds cumulative cash flow and subtracts upfront cash. Cumulative ROI divides profit by upfront cash; annual IRR uses year-end cash flows and final sale proceeds. N/A means an undefined denominator or no unique conventional IRR.
Reserves are cash outflows and are not returned at sale. Custom values override year-end property values; later appreciation starts from the override. Inputs and presets are user assumptions, not market forecasts or offers.
Income and capital gains taxes, CCA, GST/HST, mortgage insurance premiums, loan eligibility, registration and lender charges, prepayment limits/penalties and special assessments are not automatically calculated. Add applicable known costs to the relevant input and seek qualified advice.
Methodology: https://rentalanalysiscalculator.com/calculation-methodology/ Reviewed October 11, 2026 · Part of The MITEY Network · hello@mitey.ca
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