Cap rate, real cash flow, and return on the cash you put in — including the expenses most analyses leave out. Estimate only, not investment advice.
Estimates only — not investment, tax, or legal advice. How we calculate every figure
Estimated all-in monthly payment for a home price you have in mind.
What homeowners insurance costs in your state, and whether what you pay is out of line.
Income, savings, and debts in — max home price and qualification signal out.
A rental bought for $300,000 and sold seven years later for $394,780 nets $158,925 at closing — and owes about $24,753 of federal tax, $15,273 of it on depreciation you were required to take. Here is the math, why a sale with zero appreciation still owes tax, and the three clocks a fourth-quarter sale starts.
A leveraged rental makes money three ways and cash flow is only one of them. Here is what the other two are worth — and why the structure that maximises them is a bet, not a plan.
How to verify one specific rental deal: audit the seller's pro-forma line by line, comp a real rent, reassess the tax, age the systems, and price the offer the numbers actually support.
Set up basis correctly, claim the depreciation you are owed, survive the passive-loss rules, and know what the sale will cost — with every figure tied to the statute.
Kentucky guide
Kentucky is not a hurricane state, and it is correctly absent from the list of 19 states plus DC that use hurricane deductibles. It has no coast, no wind pool, and no named-storm mechanics.
What it does have is severe convective storm exposure — hail, straight-line wind and tornado, including the December 2021 western Kentucky outbreak — and in response, the major carriers writing here have largely replaced the traditional flat $1,000 wind deductible with a separate percentage of the Coverage A dwelling limit.
Be precise about what that is, because the distinction matters for how you shop:
This is carrier underwriting practice, not Kentucky law. There is no mandatory-offer statute here of the kind Florida and Louisiana have. No regulation prescribes a menu of allowable percentages, no statute caps how often the deductible applies, and no disclosure form is required to be signed. It varies by carrier and by county, and a Kentucky homeowner has to read the declarations page to find out what they bought. Nobody is obliged to walk you through it.
The practical consequence for a landlord is a number, not a principle. At 1% on a $300,000 dwelling limit that is $3,000 on a hail claim while the flat deductible — still governing fire, theft and water — remains $1,000. At 2% it is $6,000. In the highest-risk western Kentucky counties some carriers write 3% or even 5%. Section 3 works out that this article's example property produces $9,238.75 of net operating income a year, so a 5% deductible is 1.62 years of everything the property earns, due while the rent has stopped.
A note before you start: this is general educational information about how rental property arithmetic works in Kentucky. It is not investment, tax, insurance, or legal advice, and it is not a recommendation about any property. Kentucky insurance is priced per structure and per county, and property tax is administered county by county — both counties in this data carry rates above the statewide figure. Talk to a Kentucky CPA about tax treatment, a licensed Kentucky insurance agent about a real quote, and a Kentucky attorney about anything contractual.
Read the full Kentucky guide →21 min read · Updated 2026-08-28