Understanding Annual Cash Flow
How we calculate. BTCF ≈ NOI − annual mortgage debt service. The form uses the same arithmetic as the worked examples on this page. See our methodology and accuracy policy.
Real-world scenario: A typical Annual Cash Flow case uses annual noi 75000 and annual debt service 55000. Enter the same figures below to reproduce the worked path.
What is Annual Cash Flow?
The numerator for cash-on-cash return. Positive cash flow means NOI covers the loan payments with surplus.
- Debt service = annual P&I (and required debt payments)
- Before income tax
- Pair with CoC
The Formula
Worked Example
Common Use Cases
- Deal underwriting: levered surplus
- Hold/sell decisions: cash yield
- CoC inputs: annual cash flow
Pro Tips
- Stress vacancy and rates
- Include HOA if applicable in OpEx/NOI first
- Reserves are separate
Limitations: Annual Cash Flow results are educational real-estate planning aids—not appraisals, loan offers, or investment advice. Confirm figures with qualified professionals.
FAQ
Is this the same as NOI?
No. NOI is before debt service; cash flow subtracts the loan payments.
Can cash flow be negative?
Yes—if debt service exceeds NOI, the result is negative.
Authoritative References
For real estate investing concepts, consult:
- National Association of Realtors — market context
- Investopedia — NOI — net operating income basics
- CFPB — homebuying education