Cap rate calculator — Florida

Frequently asked questions

How do you calculate cap rate on a rental property?

Cap rate is annual NOI divided by purchase price. NOI is effective gross income after vacancy minus operating expenses like taxes, insurance, and recurring costs.

What is a good cap rate?

A good cap rate depends on market risk, asset quality, and growth expectations. Many investors compare cap rate against local comps, financing terms, and target return hurdles.

Can I save cap rate calculator results?

This calculator does not save your session. Use a free Veld account to save deals in the deal analyzer and track portfolio assumptions over time.

Does this include hurricane or flood insurance?

No. Add expected insurance and reserves in your expense inputs. The calculator does not model hazard zones or carrier requirements for you.

What is a good cap rate in Florida?

Residential cap rates in Florida markets like Tampa, Orlando, and Jacksonville typically run 5–7% as of 2024–2025. South Florida and beach markets compress toward 4–5% due to appreciation expectations and higher prices. Wind and flood insurance costs reduce effective NOI—use your actual carrier quotes in the expenses line.

What DSCR do Florida lenders typically require?

Most DSCR lenders in Florida require a minimum of 1.0, with many preferring 1.20–1.25 for lower rates and better terms. Given Florida's higher insurance costs—especially in coastal counties—underwriting at 1.25 or above leaves room for insurance premium increases without failing coverage thresholds. Confirm requirements with your specific lender.

What cap rate benchmark should I use in Florida?

Recent residential cap rates in Florida are often near 5.7%, but deal quality and neighborhood risk can move that range. Underwrite with your actual 0.76% effective property tax and insurance quotes to avoid overstating NOI.