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Cap Rate Analysis: Lancaster, PA

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

Moderate — source deals carefully
Based on $225,000 median price and $1,280/mo median rent
Est. Cap Rate
4.30%
1% Rule
0.57%
Fails
GRM
14.6x
Price / Income
5.1x

Market Data

Median Home Price$225,000
Median Monthly Rent$1,280
Property Tax Rate1.35%
Population64,000
Population Growth0.4% / yr
Median Household Income$44,200
Vacancy Rate5.5%
Annual Appreciation2.6%

Cap Rate Calculator — Lancaster

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

Property Details
$
$
3–8% typical
%
Monthly Expenses
1.35% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
3.48%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$7,819
net operating income
Gross Rent Multiplier
14.6x
Good (<15)
1% Rule
0.57%
✗ Fails
Monthly Cash Flow
$652
before debt service
Annual Breakdown
Gross Rental Income$15,360
Less Vacancy−$845
Effective Income$14,515
Less Operating Expenses−$6,696
Net Operating Income$7,819

Cash-on-Cash Return — Lancaster

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

$
$56,250
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-6.82%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$63,000
$56,250 down + $6,750 closing
Monthly Mortgage
$1,100
on $169K loan
Monthly Cash Flow
$-358
after all expenses
Annual Cash Flow
$-4,297
before taxes
Cash Flow Breakdown
Monthly Rent$1,280
Less Expenses−$538
Less Mortgage−$1,100
Monthly Cash Flow$-358

Is Lancaster a Good Place to Invest in Rental Property?

Lancaster, PA has a population of 64,000 and has been growing at 0.4% annually — roughly in line with national trends, meaning demand is stable but not exceptional. The median home price of $225,000 paired with median rents of $1,280/mo produces an estimated cap rate of 4.30%.

Property taxes at 1.35% fall within the national average range and shouldn't present unusual challenges. The vacancy rate of 5.5% is moderate and within normal parameters for a healthy rental market.

At a price-to-income ratio of 5.1x, homes cost about 5.1 times the local median income of $44,200. This moderate ratio indicates a balanced rent-vs-buy market. Home values have appreciated at roughly 2.6% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.

Bottom line: Lancaster presents moderate opportunities. Cap rates near 4.30% mean deals need careful sourcing — look for value-add rehabs or emerging neighborhoods where rents are climbing.

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