ROI is an acronym for Return on Investment. Essentially, it means how much profit you will receive in return for the cash investment made. ROI is typically expressed as a percentage of the cost of your investment.

For example, if you pay $200k for rental property and the ROI is 5%, you stand to make $10k in profit.

The purpose of the ROI calculation is to give you a clearer picture of whether your investment will be profitable or not. Unfortunately, there is no defined calculation for ROI, and you may find that people include and exclude certain variables to change the result.

Depending on if you’re paying cash or on financing, the ROI calculation will change. We at Maximum Vacation Homes can help you by providing you with a clear ROI report for your specific property.