Rex says
Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.
Try a scenario
Click to load — tweak from there.Inputs
Result
Cap rate
2.10%
Net operating income
$35,200
Cash flow after debt service
$35,200
Total land value
$1,680,000
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How to use this
- 1Enter acres.
- 2Enter cash rent ($/acre).
- 3Enter property tax ($/acre).
- 4Enter other landlord costs (drainage, insurance) ($/acre).
- 5Enter land value ($/acre).
- 6Enter annual debt service (if financed) ($).
- 7Read your cap rate on the right — it updates as you type.
- 8Hit Share to keep the scenario or send it to someone.
About this calculator
Farmland is often bought partly for appreciation and partly for income, and the cap rate — net rental income divided by purchase price or current market value — is the standard way to compare it against other income-producing real estate or investments. This calculator nets cash rent against property taxes and other landlord carrying costs, then divides by the land value to get a cap rate, plus shows the dollar cash flow after any land debt service so a buyer can see whether a parcel actually cash-flows positively or is being bought primarily for appreciation and tax reasons.
Worked example
Using the values the calculator loads with:
Inputs
- Acres: 160
- Cash rent: 250 $/acre
- Property tax: 22 $/acre
- Other landlord costs (drainage, insurance): 8 $/acre
- Land value: 10500 $/acre
- Annual debt service (if financed): 0 $
Results
- Cap rate: 2.10%
- Net operating income: $35,200
- Cash flow after debt service: $35,200
- Total land value: $1,680,000
What each field means
Inputs
- Acres
- The acres used in the calculation. Starts at 160 so you have a working example on load.
- Cash rent ($/acre)
- The cash rent used in the calculation, measured in $/acre. Starts at 250 $/acre so you have a working example on load.
- Property tax ($/acre)
- The property tax used in the calculation, measured in $/acre. Starts at 22 $/acre so you have a working example on load.
- Other landlord costs (drainage, insurance) ($/acre)
- The other landlord costs (drainage, insurance) used in the calculation, measured in $/acre. Starts at 8 $/acre so you have a working example on load.
- Land value ($/acre)
- The land value used in the calculation, measured in $/acre. Starts at 10500 $/acre so you have a working example on load.
- Annual debt service (if financed) ($)
- The annual debt service (if financed) used in the calculation, measured in $. Starts at 0 $ so you have a working example on load.
Results
- Cap rate
- Returned as a percentage and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Net operating income
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Cash flow after debt service
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total land value
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
FAQ
What's a typical farmland cap rate?
Row crop farmland in the Midwest has commonly traded at 2.5-4% cap rates in recent years, which is low compared to most commercial real estate — the difference is made up by expected land appreciation and lower volatility, not current income yield.
Why is farmland cap rate lower than other real estate?
Farmland has historically appreciated steadily with limited supply growth and functions partly as an inflation hedge, so buyers accept a lower current income yield in exchange for capital appreciation and low correlation with stocks and bonds.
Does a negative cash flow after debt mean it's a bad purchase?
Not necessarily if you're underwriting on total return including appreciation, but it does mean the parcel isn't self-funding on its own rental income, and you need outside cash flow or equity to service debt until rents rise or the loan is paid down.
How does this interact with the cash rent vs crop share comparison?
This calculator assumes a cash rent lease structure specifically. If the land is under a crop share arrangement instead, substitute the landlord's expected average net crop share income per acre for the cash rent figure to get a comparable cap rate.
Accuracy and limitations
- Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
- Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
- This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.
Related tools
Cash Rent vs Crop Share Calculator
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Years to break even on planting a new orchard or vineyard block.
Vineyard Establishment Cost Calculator
Per-acre buildout cost for trellis, vines, and irrigation on a new vineyard.
Cite this calculator
Writing about this topic? Grab a citation — every link helps keep these tools free.
RevenueLab. (2026). Farmland Cash Rent Cap Rate Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/farmland-cash-rent-cap-rate
<p>Source: <a href="https://www.revenuelab.fyi/toolbox/farmland-cash-rent-cap-rate" target="_blank" rel="noopener">Farmland Cash Rent Cap Rate Calculator — RevenueLab</a> (2026).</p>
Source: [Farmland Cash Rent Cap Rate Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/farmland-cash-rent-cap-rate) (2026).