Cap Rate vs. Cash-on-Cash Return Explained

Podcast: The Commercial Real Estate Investor Podcast · Tyler Cauble

Opublikowano: 2026-09-14

Key Takeaways An 8% cap rate does not equal an 8% return. Cap rate is a property-level metric based on NOI and purchase price—not your actual cash-on-cash return. Financing can dramatically change your returns. Interest rate, amortization, leverage, and loan structure can cause cash-on-cash returns to vary significantly—even on the exact same property. Don’t take the reported NOI at face value. Management fees, reserves, vacancy, credit loss, and other expenses may not be reflected in the seller’s numbers. Your true cash invested matters. Closing costs, capital expenditures, reserves, and other up...