What is cash-on-cash return in homebuilding? | Finance & Deals Glossary

Cash-on-cash return measures annual pre-tax cash flow relative to invested cash, useful for community and portfolio comparisons.

Why It Matters

It helps operators compare deal efficiency when leverage and hold period vary across projects.

How It Works

Teams estimate net operating cash after debt service and divide by total equity deployed.

Pro Tip

Run downside, base, and upside scenarios using slower absorption and higher incentive assumptions.

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What is cash-on-cash return in homebuilding? is part of Finance & Deals in the Real Torch homebuilding glossary.

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Real Torch builds Atlas — an AI platform that helps home builders apply market intelligence, pricing strategy, and sales enablement to specific markets and communities using listing data, economic indicators, and building permits across 3,000+ U.S. counties.