How the Model Computes

This page explains the math the model shows you. Everything here is an estimate built to help you see where a property stands. It is not financial, tax, or legal advice. Where a number can move a real decision, the model labels it and tells you to confirm it with a professional. That honesty is the point of the tool.

Cash on cash on the total cash in the deal

For a purchase, the model measures cash on cash return against every dollar you actually put in: the down payment plus closing costs plus any rehab, less any credits you receive. Many calculators divide by the down payment alone, which quietly inflates the return. We count the whole deal so the number reflects reality.

CapEx reserved as a line above NOI

Big ticket items like a roof, a water heater, or a furnace do not show up every month, but they are real. The model sets aside a capital reserve as a separate, non optional line above net operating income. Older buildings carry a higher floor on that reserve, because deferred replacements tend to arrive sooner.

Property tax from the price under Proposition 13

For a purchase, the model estimates California property tax from the price you pay, because a sale usually resets the assessed value under Proposition 13, then grows it by about 2 percent a year. For a property you already own, the model uses your actual tax bill instead. Either way the figure is labeled as an estimate to confirm with the County Assessor.

Rent growth clamped to the legal cap

When the model projects rent forward, it never assumes a raise the law would not allow. It clamps the growth to the cap that applies to your address, whether that is California AB 1482, the Los Angeles Rent Stabilization Ordinance, or Santa Monica rules. If a tenant is already in place below market, the model also shows how many years it would take to reach market rent under that cap.

Vacancy on scheduled rent

The model applies vacancy to the rent you could schedule, not to the rent you already collected. Taking the loss off the full asking rent is the honest way to show it, so an empty month lands where it really would.

Depreciation recapture on allowed or allowable

When you sell, the model estimates the tax on the sale. Residential depreciation runs on a 27.5 year straight line, and it lowers your basis whether or not you ever claimed it. That allowed or allowable rule matters: an owner who inherited a rental and never took depreciation still owes recapture on the amount that was allowable. The model surfaces this so the sale math is not a rosy surprise, and it treats the recaptured portion at a labeled flat rate.

The Section 121 primary residence exclusion

If the property was once your primary home, the Section 121 exclusion can shield a large slice of the gain, up to 250000 dollars for a single filer or 500000 dollars for a married couple. It applies only when you meet the 2 of 5 year rule, it excludes only the appreciation portion, and it never covers depreciation recapture. The model shows how much time you have left in that window when it applies.

Proposition 19 on an inherited rental

For property you inherited, the model flags Proposition 19. Since February 2021 the old parent to child exclusion no longer shields a home that is not owner occupied. Kept as a rental, it reassesses to current market value and the tax bill can jump sharply. This is one of the numbers people most often do not see coming, so the model puts it in front of you and tells you to confirm it with the County Assessor and a CPA.

Estimates labeled with their sources

Every estimated figure is a labeled, editable value, never a silent guess dressed up as fact. Where a real source exists we name it: county records for parcel and assessment facts, RentCast for market value and rent estimates, and HUD fair market rents as a second rent sanity check. You can edit any assumption and watch the model update.

Open the model and run your own property, or book a call to walk through the numbers with us.

Frequently asked questions

Is the model free?

Yes. The rental model is free and there is no login to start. You can run the numbers on your property, see the verdict, and read the math behind it without paying anything.

Do you sell my data?

No. We never sell, trade, or rent your information. A model you do not save is deleted automatically after 90 days, and a saved model is visible to nobody unless you choose to send it to us or share a link you control.

Is this financial advice?

No. The model shows estimates so you can see where a property stands. It is not financial, tax, or legal advice. Confirm anything that matters with a CPA, an attorney, or the County Assessor before you act on it.

Does the model work outside Los Angeles?

It works anywhere, and it is deepest in Los Angeles County, where we pull parcel facts, an automated value estimate, and the local rent cap rules for your address. Outside that coverage the model falls back to values you enter by hand, so you can still run a full analysis.

Why does my property tax number differ from my real bill?

For a purchase we estimate the tax from the price under Proposition 13, because a sale usually resets the assessed value. Your current bill reflects an older assessed value, so the two can differ a lot. We label the estimate and its source, and we tell you to confirm the real number with the County Assessor.