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Cap Rate Analysis: Miami, FL

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

Challenging for pure cash flow
Based on $520,000 median price and $2,100/mo median rent
Est. Cap Rate
2.91%
1% Rule
0.40%
Fails
GRM
20.6x
Price / Income
11.8x

Market Data

Median Home Price$520,000
Median Monthly Rent$2,100
Property Tax Rate0.89%
Population467,963
Population Growth1.2% / yr
Median Household Income$44,200
Vacancy Rate5%
Annual Appreciation4.5%

Cap Rate Calculator — Miami

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

Property Details
$
$
3–8% typical
%
Monthly Expenses
0.89% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
2.44%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$12,696
net operating income
Gross Rent Multiplier
20.6x
High (>15)
1% Rule
0.40%
✗ Fails
Monthly Cash Flow
$1,058
before debt service
Annual Breakdown
Gross Rental Income$25,200
Less Vacancy−$1,260
Effective Income$23,940
Less Operating Expenses−$11,244
Net Operating Income$12,696

Cash-on-Cash Return — Miami

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

$
$130,000
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-10.92%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$145,600
$130,000 down + $15,600 closing
Monthly Mortgage
$2,543
on $390K loan
Monthly Cash Flow
$-1,325
after all expenses
Annual Cash Flow
$-15,894
before taxes
Cash Flow Breakdown
Monthly Rent$2,100
Less Expenses−$882
Less Mortgage−$2,543
Monthly Cash Flow$-1,325

Is Miami a Good Place to Invest in Rental Property?

Miami, FL has a population of 467,963 and has been growing at 1.2% annually — above the national average, suggesting steady demand pressure on housing. The median home price of $520,000 paired with median rents of $2,100/mo produces an estimated cap rate of 2.91%.

Property taxes at 0.89% fall within the national average range and shouldn't present unusual challenges. The vacancy rate of 5% is moderate and within normal parameters for a healthy rental market.

At a price-to-income ratio of 11.8x, homes cost about 11.8 times the local median income of $44,200. This elevated ratio means homeownership is stretched, supporting rental demand but limiting buyer pools. Home values have appreciated at roughly 4.5% annually. Above-average appreciation adds an equity component to total returns, though deals should still pencil on cash flow alone.

Bottom line: At current median prices, Miami 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 Miami
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