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Net Operating Income (NOI) Calculator
Subtract vacancy and itemized operating expenses from gross income to get the net operating income that drives cap rate, value, and DSCR.
Income
Operating expenses (annual)
Net operating income (annual)$31,940Effective gross income − operating expenses
NOI (monthly)$2,662
Effective gross income$46,740
Expense ratio31.7%
How to use this calculator
Enter gross annual income, any other income, and an expected vacancy rate, then itemize your operating expenses — tax, insurance, maintenance, management, utilities, and other. The calculator returns effective gross income, total expenses, your expense ratio, and net operating income.
What the metrics mean
- Net operating income (NOI) — effective gross income minus operating expenses.
- Effective gross income — gross rent and other income minus vacancy.
- Operating expenses — taxes, insurance, maintenance, management, utilities, and other recurring costs.
- Expense ratio — operating expenses as a percent of effective gross income.
Frequently asked questions
- How do you calculate net operating income?
- NOI = effective gross income − operating expenses. Effective gross income is your gross rent and other income minus vacancy; operating expenses include taxes, insurance, maintenance, management, and utilities.
- What is not included in NOI?
- NOI excludes the mortgage payment (debt service), capital expenditures, depreciation, and income tax. That is what makes it comparable across differently financed properties.
- Why does NOI matter?
- NOI drives the two figures investors and lenders care about most: cap rate (NOI ÷ price) and the value an income property commands. A small NOI change moves value a lot.
- What is a typical expense ratio?
- Operating expenses often run 35–50% of effective gross income for residential rentals, depending on age, management, and who pays utilities. The calculator shows your ratio so you can sanity-check it.
Want the operating statement built for you? dre1mery.com assembles income, expenses, and NOI on every property automatically.