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Cap Rate Analysis: McKinney, TX

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

Challenging for pure cash flow
Based on $410,000 median price and $1,850/mo median rent
Est. Cap Rate
2.57%
1% Rule
0.45%
Fails
GRM
18.5x
Price / Income
4.4x

Market Data

Median Home Price$410,000
Median Monthly Rent$1,850
Property Tax Rate1.78%
Population210,000
Population Growth3.5% / yr
Median Household Income$92,400
Vacancy Rate4.8%
Annual Appreciation3.2%

Cap Rate Calculator — McKinney

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

Property Details
$
$
3–8% typical
%
Monthly Expenses
1.78% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
2.00%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$8,198
net operating income
Gross Rent Multiplier
18.5x
High (>15)
1% Rule
0.45%
✗ Fails
Monthly Cash Flow
$683
before debt service
Annual Breakdown
Gross Rental Income$22,200
Less Vacancy−$1,066
Effective Income$21,134
Less Operating Expenses−$12,936
Net Operating Income$8,198

Cash-on-Cash Return — McKinney

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

$
$102,500
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-9.74%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$114,800
$102,500 down + $12,300 closing
Monthly Mortgage
$2,005
on $308K loan
Monthly Cash Flow
$-932
after all expenses
Annual Cash Flow
$-11,180
before taxes
Cash Flow Breakdown
Monthly Rent$1,850
Less Expenses−$777
Less Mortgage−$2,005
Monthly Cash Flow$-932

Is McKinney a Good Place to Invest in Rental Property?

McKinney, TX has a population of 210,000 and has been growing at 3.5% annually — well above the national average, signaling strong housing demand from population inflows. The median home price of $410,000 paired with median rents of $1,850/mo produces an estimated cap rate of 2.57%.

Property taxes at 1.78% 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 4.8% is impressively low, indicating tight rental supply and strong tenant demand — favorable for landlords.

At a price-to-income ratio of 4.4x, homes cost about 4.4 times the local median income of $92,400. This relatively affordable ratio suggests a deep pool of renters who find buying out of reach, supporting rental demand. Home values have appreciated at roughly 3.2% 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, McKinney 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.

Run a BRRRR analysis for McKinney
Model a buy-rehab-refinance deal with McKinney data pre-loaded.
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