RORE Calculator


 Why use the RORE calculator?

The RORE Calculator is a tool designed to help you calculate your real estate investment return. Real estate investing can be a great way to build wealth, but it can also be risky if you don't know what you're doing. That's where the RORE calculator comes in.


How do you calculate RORE?

A Return on Real Estate (RORE) calculator is a tool used to determine the profitability of a real estate investment. The formula for calculating RORE is as follows:

RORE = (Net Operating Income / Total Investment) x 100

Net Operating Income (NOI) is the income generated from the property after operating expenses, such as property management fees and maintenance costs, have been subtracted. Total Investment includes the purchase price of the property, as well as any closing costs, repairs, and improvements.

Example:

A property is purchased for $500,000 and has annual operating expenses of $50,000. The property generates $100,000 in rental income per year.

NOI = $100,000 - $50,000 = $50,000
Total Investment = $500,000

RORE = ($50,000 / $500,000) x 100 = 10%

In this example, the RORE is 10%, indicating that the property generates a 10% return on the total Investment.

Note that this is a simple way to calculate the RORE, and other factors can be considered, such as taxes, depreciation, financing costs, etc.


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