Cash-on-Cash Return

Definition

Cash-on-cash return measures the annual pre-tax cash flow a property generates against the total cash the investor has personally committed (down payment + closing + rehab + reserves). Unlike cap rate, it accounts for leverage — making it the most direct measure of return on actual dollars at risk.

Formula

Worked example

An investor commits $120,000 in down payment + rehab and the property generates $14,400/yr in pre-tax cash flow after debt service. Cash-on-cash = 12.0%.

How DealIntel uses it

DealIntel reports cash-on-cash on every BRRRR and Buy-and-Hold scenario alongside IRR and total ROI — and stress-tests it against rate, vacancy, and rehab overrun shocks.

Related terms

• Capitalization Rate · Cap RateThe annual unlevered return of an income property, expressed as a percentage of its value.
• Debt-Service Coverage Ratio Loan · DSCRAn investment property loan qualified on the property's rental income rather than the borrower's W-2 income.
• Buy, Rehab, Rent, Refinance, Repeat · BRRRRA long-hold real estate strategy that recycles capital through a cash-out refinance after stabilization.

Matt Abadi is the founder of DealIntel. He leads the development of the platform's six-strategy underwriting engine, 25-point Kill List, and Monte-Carlo financial model — the institutional analysis stack DealIntel applies to every fix and flip deal. DealIntel was founded in 2025 with the central thesis that knowing when not to invest is the most valuable number on the page.