Cash-On-Cash Return

What Does Cash-On-Cash Return Mean?
A rate of return often used in real estate transactions. The calculation determines the cash income on the cash invested. Calculated as:

Investopedia explains Cash-On-Cash Return
For example when you purchase a rental property, you might put down only 10% for a cash down payment. Cash-on-cash return would measure the annual return you made on the property in relation to the down payment.

Filed Under: Financial Theory, Real Estate

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