Multifamily Calculator

How to use the multifamily calculator

Start with the asking price, the building's total monthly rent and a loan quote. Use Quick Analysis for a first pass, then Full Underwriting to review the rent roll, itemized costs and financing. Keep current operations separate from hoped-for rent increases.

• Set the unit count. Model a duplex, triplex, quadplex or a 5–20 unit apartment building. In Simple income mode, enter rent for the whole building, not per unit.
• Check occupied and vacant units. Rent Roll mode sums current rents for occupied and notice units; vacant units contribute $0. Vacancy and credit loss percentages then reduce that rent further. Treat the vacancy percentage as an additional allowance in this mode, so you do not count the same vacancy twice.
• Choose an expense method. Quick Estimate applies one percentage to effective gross income after vacancy and credit loss, including other income. Its expense categories are estimates. Itemized mode uses your annual taxes, insurance, utilities and other costs; percentage management, repairs and CapEx also use effective gross income.
• Enter cash and debt costs. Include down payment, closing costs, loan points and initial rehab. Basic financing uses a fully amortizing loan. The examples below do not include mortgage insurance, interest-only periods, balloon payments or renovation financing.

If you will live in a unit, use the house hacking calculator to separate your housing cost from tenant income. For residential loan options on a 1–4 unit investment, see the rental property calculator.

Duplex and eight-unit apartment examples

These fixed examples use the same calculations as the tool. Both assume all units are rented, 5% vacancy, no credit loss or other income, 25% down, 3% closing costs, and a 7% loan amortized over 30 years. Loan points and initial rehab are $0; advanced financing and value-add are off. These are illustrations, not loan offers or market benchmarks. Editing your deal above does not change them.

Dollars are rounded for display; ratios use unrounded values. The examples have different prices, rents and expenses, so their returns do not isolate the effect of unit count.

Try your own price, rents and financing in the calculator.

How much will a lender lend on a multifamily building?

Short answer: the smallest of the lender's limits. A multifamily lender works out the loan allowed by its maximum loan-to-value, the loan whose payment still leaves its minimum debt service coverage ratio, and, for some lenders, the loan that meets a minimum debt yield. Whichever is lowest is the loan. The calculator's Summary tab now runs this test on your own NOI and rate.

• LTV limit = value × maximum LTV. Fannie Mae's Small Mortgage Loans for 5+ unit properties allow up to 80% LTV on loans up to $9 million (Fannie Mae program page).
• DSCR limit = the loan whose annual payment equals NOI ÷ minimum DSCR. The same program's minimum is 1.25×, with amortization up to 30 years.
• Debt yield limit = NOI ÷ minimum debt yield. A rate-independent test some balance-sheet and CMBS lenders add; agency small-loan term sheets usually do not state one.

Worked example: the eight-unit building above

Hypothetical inputs: the eight-unit example's NOI of $76,608, a $1,000,000 price, a 7% rate with 30-year amortization, 80% maximum LTV, 1.25× minimum DSCR and, for illustration, an 8% debt yield floor. The rate and debt yield are assumptions, not a quote.

Price that still earns your target return

The same example earns 5.98% cash-on-cash at $1,000,000. Holding rents, expenses and 25% down at 7% fixed, the highest price that still earns 8% is about $931,096. The Sensitivity tab's “Max Purchase Price” gauge shows this figure for your deal. An earlier version of that gauge scaled the asking price up when a deal missed the target; it was corrected on October 20, 2026 and now solves for the price directly.

Underwritten NOI is usually lower than the seller's

• Vacancy: lenders typically apply at least 5% economic vacancy even when a building is full. Enter that in the calculator rather than 0%.
• Management: a market management fee is charged even if the owner self-manages.
• Reserves: a per-unit replacement reserve is deducted. This tool already counts its CapEx reserve inside NOI.
• Taxes and insurance: taxes are re-estimated at the purchase price and insurance at a current quote, not the seller's history.

Rates and terms in October 2026

Freddie Mac's weekly survey put the average 30-year fixed home-loan rate at 7.40% for the week of October 15, 2026 (PMMS via FRED), and the 10-year Treasury yield was 5.15% on October 19 (FRED DGS10). Loans on 5+ unit buildings are priced as a spread over Treasury yields rather than at the home-loan average, usually carry 5-, 7- or 10-year terms with 25- or 30-year amortization and a balloon, and often have prepayment terms. Use the rate from a dated lender quote. Freddie Mac replaced its Small Balance Loan program with a Conventional Small product for $2 million to $10 million loans on April 15, 2026 (Freddie Mac announcement); its leverage and coverage terms are set in its guide and by each lender.

Read NOI, cap rate, DSCR and cash-on-cash together

NOI in this tool is effective gross income minus modeled operating expenses, including the CapEx reserve. Debt payments and income tax are excluded. Some lender and appraisal statements deduct reserves after NOI instead, so reconcile the reserve treatment before comparing their NOI or cap rate with these results.

• Cap rate = NOI ÷ purchase price. It measures modeled income yield before financing, using this tool's after-reserve NOI.
• Cash flow before tax = NOI − annual debt service. Divide by 12 for the monthly result. A positive NOI can still leave negative cash flow after debt.
• DSCR = NOI ÷ annual debt service. A ratio of 1.00× means modeled income exactly covers debt service. Below 1.00×, it does not. With no debt service, the ratio is not applicable.
• Cash-on-cash = annual cash flow ÷ cash required. In basic financing, cash required includes down payment, closing costs, loan points and initial rehab. It excludes appreciation, principal paydown and tax benefits from the return.

The result cards' targets are screening references, not loan approval rules. A lender may adjust income, reserves and debt service for its own test; see Fannie Mae's underwritten DSCR definition. Open Operating Statement to trace your income through expenses and debt payments.

How to calculate the value of a multifamily property

An income-based value estimate divides annual NOI by a comparable market cap rate expressed as a decimal. For illustration, $96,000 ÷ 0.065 is about $1,477,000. At 7%, the same income implies about $1,371,000. Use income and cap rates with the same reserve treatment, period and occupancy assumptions; do not mix an after-reserve figure with a before-reserve cap rate.

The main Cap Rate card works the other way: it divides your calculated NOI by the purchase price you enter. It is not an appraisal or an automatically selected market cap rate. Exit & Returns lets you explore sale assumptions separately. Gross rent multiplier (price ÷ annual gross rent) is another screening measure, but it ignores expenses and debt.