Net operating income (NOI)
A property’s gross operating income minus its operating expenses, before debt service and income tax.
In plain terms
NOI is the central figure behind cap rate, cash-on-cash and DSCR. It excludes the mortgage (that is debt service, not an operating expense), depreciation, and capital expenditures. Operating expenses typically include property tax, insurance, HOA, repairs and maintenance, management, and a vacancy allowance.