Calulating ROI

[Gerald W mcgee]

Does anybody know a simple formula to calculate ROI and the estimated ROI in the future of the property?

[Andrew Syrios]

We usually call in Cash on Cash. But just take you're Cash Flow (which you get from taking your net operating income and subtracting your debt service) and then divide that by your overall cash investment. So if you made (or think you'll make) $10,000 a year and you have $50,000 of your own cash into the deal, then it's $10,000 / $50,000 or a 20% cash on cash return (or ROI).