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Cap Rate Analysis: Dallas, TX

Investment metrics, interactive calculators, and data-driven analysis for Dallas rental properties.

Challenging for pure cash flow
Based on $355,000 median price and $1,620/mo median rent
Est. Cap Rate
2.57%
1% Rule
0.46%
Fails
GRM
18.3x
Price / Income
5.9x

Market Data

Median Home Price$355,000
Median Monthly Rent$1,620
Property Tax Rate1.8%
Population1,318,715
Population Growth1.8% / yr
Median Household Income$60,400
Vacancy Rate5.6%
Annual Appreciation3%

Cap Rate Calculator — Dallas

Pre-filled with Dallas medians. Adjust to match a specific property.

Property Details
$
$
3–8% typical
%
Monthly Expenses
1.8% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
1.98%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$7,035
net operating income
Gross Rent Multiplier
18.3x
High (>15)
1% Rule
0.46%
✗ Fails
Monthly Cash Flow
$586
before debt service
Annual Breakdown
Gross Rental Income$19,440
Less Vacancy−$1,089
Effective Income$18,351
Less Operating Expenses−$11,316
Net Operating Income$7,035

Cash-on-Cash Return — Dallas

Factor in financing to see your actual return on invested capital in Dallas.

$
$88,750
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-9.61%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$99,400
$88,750 down + $10,650 closing
Monthly Mortgage
$1,736
on $266K loan
Monthly Cash Flow
$-796
after all expenses
Annual Cash Flow
$-9,549
before taxes
Cash Flow Breakdown
Monthly Rent$1,620
Less Expenses−$680
Less Mortgage−$1,736
Monthly Cash Flow$-796

Is Dallas a Good Place to Invest in Rental Property?

Dallas, TX has a population of 1,318,715 and has been growing at 1.8% annually — above the national average, suggesting steady demand pressure on housing. The median home price of $355,000 paired with median rents of $1,620/mo produces an estimated cap rate of 2.57%.

Property taxes at 1.8% are notably high and represent a significant drag on cash flow — model this expense carefully, as it can make or break a deal. The vacancy rate of 5.6% is moderate and within normal parameters for a healthy rental market.

At a price-to-income ratio of 5.9x, homes cost about 5.9 times the local median income of $60,400. This moderate ratio indicates a balanced rent-vs-buy market. Home values have appreciated at roughly 3% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.

Bottom line: At current median prices, Dallas is challenging for pure cash flow investing. Consider BRRRR strategies with below-market purchases, or look at neighboring metros with stronger price-to-rent ratios.

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