Cashflow is the lifeblood of any real estate investment, revealing whether a property pays for itself each month or requires additional capital from your own pocket. Our cashflow calculator compares monthly rental income against all ongoing expenses and calculates the resulting surplus or shortfall.
How to Use This Calculator
The cashflow calculator gives you a clear overview of your property's monthly liquidity position. Here is how to use it:
- Step 1: Enter the monthly cold rent (Kaltmiete) you receive from your tenant.
- Step 2: Enter the monthly mortgage payment (annuity), consisting of interest and principal repayment.
- Step 3: Enter the monthly Hausgeld paid to the property management association for apartments. For houses, enter estimated monthly operating costs.
- Step 4: Enter any other monthly expenses such as management fees, insurance, or maintenance reserves.
Understanding the Results
The cashflow analysis provides a detailed picture of monthly payment flows:
- Gross Monthly Income: The total monthly cold rent you collect as a landlord.
- Total Monthly Expenses: The sum of all monthly costs, including mortgage payment, Hausgeld, and other expenses.
- Monthly Cashflow: The difference between income and expenses. A positive value means the property is self-sustaining and generating a surplus.
- Annual Cashflow: The monthly cashflow multiplied by 12 for an annualized perspective.
- Cashflow Status: A classification of positive, neutral, or negative that shows at a glance how the property is performing financially.
Why This Matters for Investors
Positive cashflow means the property finances itself without additional capital injections and puts money in your pocket every month. This is particularly crucial for investors building a portfolio, as each additional property should ideally improve the overall cashflow position. Negative cashflow, on the other hand, requires monthly subsidies from your personal income, which limits financial flexibility and can quickly become burdensome with multiple properties. In Germany, cashflow for apartments is heavily influenced by the Hausgeld, which can vary significantly depending on the age and condition of the building complex. Experienced investors pay close attention to the Hausgeld statement (Hausgeldabrechnung) and verify that adequate maintenance reserves are being built up. A seemingly attractive purchase price can quickly turn into a loss-making proposition when combined with high Hausgeld and below-average rent levels.
Tips
- •Always build in a buffer of at least 10-15% of rental income for unforeseen costs such as repairs, rent defaults, or special assessments (Sonderumlagen).
- •The Hausgeld for apartments typically already includes maintenance reserves and management fees. Check carefully which items are recoverable from tenants and which are not.
- •A slightly negative cashflow can be acceptable if you have a high repayment rate, as the principal repayment builds wealth through debt reduction. Focus on the overall picture.