Calculator methodology

Every figure produced by a RealtrAI calculator is arithmetic on assumptions the user supplies (or, in website illustrations, assumptions we disclose). No calculator output is sourced market data, a performance benchmark, a projection of actual property performance, an appraisal, or investment advice. This page publishes the formulas so any figure can be reproduced by hand.

VR Calculator (vacation-rental analysis)

The VR Calculator turns user-supplied assumptions into standard pro-forma metrics using these formulas:

• Gross annual revenue = average daily rate × 365 × occupancy rate, distributed across a stated monthly seasonality profile.
• Net operating income (NOI) = gross annual revenue × (1 − operating-expense ratio). The expense ratio is an input, not a market estimate.
• Cap rate = NOI ÷ purchase price.
• Annual debt service = standard fixed-rate amortization on the financed amount (purchase price × (1 − down-payment percentage)) at the stated rate and term.
• Cash invested = down payment + stated closing costs.
• Cash-on-cash return = (NOI − annual debt service) ÷ cash invested.
• Five-year IRR = the discount rate at which the net present value of this cash-flow series equals zero: the initial cash invested (negative); annual pre-tax cash flow grown at the stated growth rate; and, in year five, net sale proceeds (purchase price grown at the stated appreciation rate, minus stated selling costs and the remaining loan balance).

What the model holds fixed: a fixed-rate, fully amortizing loan; a constant occupancy and expense ratio; user-stated growth, appreciation, and selling-cost rates; and no tax treatment, depreciation, capital reserves, or refinancing. Results change exactly and only when the inputs change.

What does the homepage VR Calculator illustration calculate?

The current homepage example is deliberately narrower than the full product calculator. Its disclosed fields are: Assumed nightly rate: $250; Assumed booked nights: 180 per year; and Scope: Gross revenue before costs and taxes. Its prepared result is $250 × 180 nights = $45,000 per year. It does not calculate or display a property value, occupancy rate, financing terms, net operating income, cap rate, cash-on-cash return, or IRR. The inputs are fictional teaching assumptions, not sourced market data, a booking forecast, or a projection for an actual property.

ROI calculator (hours saved)

The ROI calculator multiplies only the values you enter: hours saved per month = listings per month × hours per listing × your assumed time-reduction percentage, and dollar value = hours saved × your stated hourly value. The time-reduction percentage is your scenario input - RealtrAI does not publish a measured time-savings benchmark, and the calculator does not predict or guarantee time savings, revenue, conversion, or any other business outcome.

How is the public example validated?

The site's release tests compare this methodology summary with the current homepage example's disclosed rate, booked nights, and arithmetic result. The full product calculator remains a separate authenticated workflow using the seven pro-forma formulas above. Users must verify every input and output against their own facts before client use; no output is a substitute for professional judgment, an appraisal, or qualified advice.