Definitions • Assumptions • Tips

Turnkey: What the calculator means

This page explains the terms used in the Turnkey analyzer and the assumptions behind the math. It’s intentionally simple so you can compare deals quickly.

Turnkey Strategy

A turnkey rental is typically “rent-ready” with minimal work needed. The Turnkey analyzer focuses on:

Purchase + financing
Stabilized monthly rent
Operating expenses (either % or itemized)
Taxes, insurance, and (if applicable) PMI
Year-1 cash flow and cash-on-cash return

What it does not model: rent growth, appreciation, tax benefits, or refinancing.

Key Outputs

Output	Meaning
Monthly Cash Flow	Rent minus operating expenses, mortgage P&I, taxes, insurance, and PMI (if any).
Cash to Close	Down payment + purchase closing costs + initial repairs/make-ready.
Cash-on-Cash (Year 1)	(Monthly cash flow × 12) ÷ cash to close.

Cash-on-cash is a simple “year 1 efficiency” metric. It’s useful for comparing rentals, but it is not the full story.

Expense Modeling

% of Rent Mode

Operating expenses are estimated as a single percent of gross rent. This is fast and good for quick filters.

Typical ranges vary widely by property/market. If unsure, start conservative.

Itemized Mode

Vacancy, management, repairs, and capex are entered as percentages of gross rent, plus “Other Monthly.”

Itemizing can reduce surprises — but only if your inputs are realistic.

What counts as Operating Expenses?

In this calculator, operating expenses generally include vacancy, property management, repairs/maintenance, capital expenditures (CapEx reserves), and any owner-paid utilities/HOA/yard/snow.

Property taxes and insurance are handled separately in the calculator (they are not included in the OpEx %).

PMI (Conventional Loans)

PMI is estimated if your down payment is less than 20% and the loan type is “Conventional.” PMI rates vary based on credit score, DTI, and lender.

The calculator uses a simple estimate (directional). If PMI meaningfully impacts the deal, confirm the real PMI quote with your lender.

Taxes & Insurance

Property tax is modeled as a yearly percent applied to the purchase price, then divided monthly. Insurance is entered as a monthly estimate.

These can be the biggest “gotchas.” Always validate with county records and insurance quotes.

Initial Repairs / Make-Ready

Turnkey deals often still need small costs before renting: paint touch-ups, minor plumbing/electrical, locks, smoke detectors, landscaping cleanup, etc.

This is treated as part of your “cash to close” because it’s real cash out of pocket near purchase.

Practical Use

Quick screening

Start with conservative rent and a conservative OpEx %. If it still cash flows, it’s worth deeper review.

Deeper underwriting

Switch to itemized mode and validate taxes/insurance. Add HOA/utilities to “Other Monthly.”

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