Income
Memphis metro vacancy runs 7%–10% on average. Cordova and East Memphis track closer to 4%–5%. Whitehaven and Frayser often run 10%–14%.
Operating Expenses
Maintenance reserve: 1% of property value per year for routine repairs. CapEx reserve: 1%–2% per year for major systems (roof, HVAC, water heater). Do not include mortgage payments here.
Financing (optional)
Leave blank or enter 0 to see NOI (pre-financing income). Enter your P&I payment to see cash flow after debt service.
Your Numbers
What this calculator measures
This calculator shows your net operating income (NOI) when the mortgage field is left at zero, and your cash flow after debt service when you enter a mortgage payment. These are different numbers measuring different things.
NOI is the property's performance independent of how you financed it. Two investors can own the same property with the same NOI and have completely different cash flow outcomes depending on their down payments, interest rates, and loan terms. NOI is the number to use when comparing properties. Cash flow after debt service is the number that tells you whether the property puts money in your pocket each month.
The expenses most investors underestimate
Maintenance reserves and CapEx reserves are the two line items that disappear from optimistic projections and show up as surprises at the worst times. The 1% rule for maintenance ($1,500 per year on a $150,000 property) covers routine repairs: HVAC servicing, plumbing leaks, appliance issues, minor electrical. CapEx covers the big-ticket replacements: a new roof costs $8,000 to $12,000, a new HVAC system $5,000 to $8,000, flooring $3,000 to $6,000. Budget separately for both or combine them into a single reserve, but do not omit them.
Vacancy is the other underestimated line. A 7% vacancy rate means one month empty every 14 months on average, or roughly 25 days per year. On a $1,200/month rental, that is $984 per year not collected. Budget it as a monthly reserve rather than hoping each turnover will be fast. Some will be. Some will not.
Memphis-specific defaults
The defaults in this calculator are set to Memphis market averages for a $150,000 single-family rental: $1,200 rent, 7% vacancy, 10% management fee, $175/month property tax (Shelby County average for this price range), $115/month landlord insurance, and standard maintenance and CapEx reserves. Adjust each line to match your specific property and neighborhood. A Cordova property may carry lower vacancy and higher tax. A Whitehaven rental may carry lower tax and higher maintenance.
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