How the Airbnb ROI calculator works
You enter two revenue figures: a conservative one (for example AirDNA’s 50th percentile for comparable listings) and an expected one (the 75th percentile). Every result is shown for both, because a good deal still works when the market is soft.
Revenue is your average nightly rate times the nights you book in a year (365 × occupancy), plus the cleaning fees guests pay. Expenses come in two kinds. Variable costs rise with bookings: platform fees, management, cleaning per turnover, supplies and a maintenance reserve. Fixed costs you pay either way: property tax, insurance, utilities, HOA and software.
Net operating income (NOI) is revenue minus operating expenses, before the mortgage. Cash flow is NOI minus your principal and interest. Cash-on-cash return divides that annual cash flow by every dollar you put in: down payment, closing costs, inspection, renovation, furnishing, startup costs and a cash reserve. Debt service coverage (DSCR) is NOI divided by your mortgage payments; many STR lenders look for 1.2 or higher.
The Furnishing tab builds your setup budget room by room, with a quick setup for bedrooms, bathrooms and style. The CapEx tab sets aside a yearly reserve for the roof, HVAC, flooring and other items based on their age and lifespan. Both totals flow into the deal analysis automatically, and your numbers are saved in this browser so you can come back to them.
What is a good ROI for an Airbnb?
Most long-term rentals return 5–10% cash-on-cash in a good year. Because a short-term rental takes more work and more risk, James recommends targeting at least 15% cash-on-cash in your expected case, and making sure your worst case still doesn’t lose money each month.
Cap rate shows how a property performs regardless of financing, which makes it useful for comparing deals. Break-even occupancy shows how much room for error you have. If you need 70% occupancy just to cover costs in a market that averages 55%, walk away.
Run a worst case and an expected case
Estimate revenue from comparable listings, or from AirDNA’s 50th percentile for your worst case and the 75th percentile for your expected case. Run the calculator twice. A deal is worth pursuing when the expected case clears your return target and the worst case still breaks even.
Frequently asked questions
How do I calculate ROI on an Airbnb?
Take your annual revenue, subtract operating expenses and mortgage payments to get annual cash flow, then divide by the total cash you invested (down payment, closing costs, furnishing, renovation and startup costs). That is your cash-on-cash return, the most common ROI measure for Airbnb investors.
What is a good cash-on-cash return for a short-term rental?
James recommends targeting 15% or more in your expected case. Traditional long-term rentals typically return 5–10%. Anything below 15% on an STR deserves serious scrutiny, because the extra work and risk of short-term renting should be rewarded.
What occupancy rate should I use?
Use the real occupancy of comparable listings in your market, not the market average for all listings. Data tools like AirDNA show percentiles. Use the 50th percentile for a conservative case and the 75th for a well-run listing.
How much does it cost to furnish an Airbnb?
A budget-conscious, standard-style 3-bedroom, 2-bathroom home runs around $11,000 in furniture, linens, kitchenware and decor, before extras such as a hot tub (about $8,000) or a game room. Premium styling can cost 50% more. Use the Furnishing tab to build your own estimate room by room.
How much should I set aside for CapEx on a short-term rental?
Divide each major item’s replacement cost by its lifespan and add them up. For a typical single-family STR, including a furniture refresh every several years, that often lands between $3,000 and $6,000 a year. The CapEx tab does this from your inspection report.
Does this calculator include Airbnb fees?
Yes. The platform fee field defaults to Airbnb’s 15.5% host-only fee. If you are still on the split-fee model, change it to about 3%.
Is the calculator result a guarantee of income?
No. It is an educational estimate built on the numbers you enter. Verify revenue, taxes, insurance and local regulations for your property before you buy.
Calculator disclaimer
These calculators are free educational tools provided “as is” and “as available,” without warranties of any kind, express or implied, including warranties of accuracy, completeness, reliability or fitness for a particular purpose. Results are estimates based only on the numbers you enter, default example figures and simplified assumptions. They may contain errors, may not reflect your market, financing, taxes, insurance, regulations or actual costs, and the calculators may change without notice.
Nothing on this page is financial, investment, tax, accounting, legal, lending or real estate advice, and nothing here is an offer, recommendation or guarantee to buy, sell, finance or manage any property or to earn any income. Example figures are illustrations, not typical or expected results. Short-term rental income varies, local rules can restrict or prohibit short-term rentals, and you can lose money. Verify every figure independently and consult qualified professionals, such as a licensed accountant, lender, attorney or real estate professional, before making any decision.
To the fullest extent permitted by law, BNB Mastery, James Svetec and their affiliates, employees and partners are not liable for any loss or damage of any kind arising from your use of, or reliance on, these calculators, their results or any errors or omissions in them. You use them at your own risk. By using these calculators you agree to this disclaimer, our Terms of Service and our Earnings Disclaimer.