What is the cap rate in Dallas, TX?

The median cap rate in Dallas, TX is 4.7%. This is based on HUD Fair Market Rents and current home values.

Is Dallas a good place to buy rental property?

Dallas has a cap rate of 4.7% and estimated cash flow of -$425/month. Returns are moderate — consider the appreciation potential. Median home price is $317,122 with average 3BR rent of $2,035/month.

What is the average rent in Dallas, TX?

The HUD Fair Market Rent for a 3-bedroom in Dallas, TX is $2,035/month. This represents the estimated rent for standard-quality housing in the area.

Dallas, TX — Rental Investment Analysis

🟡MODERATE— average returns

Data: HUD FMR FY2024 + Zillow ZHVI April 2026 + Freddie Mac rates. Last updated June 2026.

Investment Summary

As of 2026, rental properties in Dallas, TX yield a 4.7% cap rate. Median home price is $317,122 with 3-bedroom rents at $2,035/month.

Dallas is a moderate market — workable but not exceptional for cash flow. Median home price sits at $317,122 — moderate by national standards, requiring a solid down payment but not out of reach. With 3-bedroom rents around $2,035/month, the 4.7% cap rate tells the story. Cash flow is deeply negative at -$425/month with standard assumptions. This market requires appreciation to justify the investment.

At 0.65% on the 1% rule, rents are low relative to purchase prices. You'd need a significant discount from asking price to make the numbers work. DSCR of 0.74 is below 1.0, meaning rental income doesn't cover the mortgage. DSCR lenders will likely decline this market at current prices.

Bottom line: Consider Dallas only if you believe in long-term appreciation. The numbers don't support cash flow at today's prices and rates.

Data sources: HUD Fair Market Rents (FY2024), Zillow Home Value Index (April 2026), Freddie Mac Primary Mortgage Market Survey.

Cap Rate

4.7%

Below average

Monthly Cash Flow

-$425

After all expenses

Price-to-Rent

12.7

Investor-friendly

DSCR

0.74

Fails

Key Metrics

Median Home Price: $317,122
Average Rent (3BR): $2,035/mo
Price-to-Rent Ratio: 12.7(good)
1% Rule: 0.65%(fails — need 1%+)
Cash-on-Cash Return: -7.2%
Vacancy Rate: 8.0%

Market Strength

Unemployment Rate: 4.3%(0% vs national)
Rent Growth (YoY): +2.9%(national avg)
Population Growth: +1.5% YoY

Assumptions Used

20% down, 6.52% rate, 30yr, 8% vacancy, 10% maintenance

Customize these numbers →

Property Tax Rate

1.68%

of assessed value (TX avg)

Median Income

$67,321

household (TX avg)

Rent-to-Income

36.3%

Stretched

Section 8 Max Rent

$2,035/mo

3BR voucher payment

TX Investor Climate

Landlord Friendly

9/10

State Income Tax

None

Property Tax

1.68% effective

Population Trend

+1.5% (3yr)

Population Movement (Tax Year 2021→2022)

Net Migration

+4,032 households

GROWING

Total Inflow

31,471

households moved in

Avg Income (New Residents)

$104,192

per household

Where they're coming from:

1.Collin, TX9,587 households · avg $86,610

2.Los Angeles, CA1,250 households · avg $207,741

3.Cook, IL960 households · avg $151,412

4.Bexar, TX883 households · avg $69,304

5.Maricopa, AZ628 households · avg $310,782

Where residents are leaving to:

1.Collin, TX12,403 households

2.Los Angeles, CA780 households

3.Bexar, TX766 households

4.Cook, IL635 households

5.King, WA516 households

Strong net inflow suggests growing rental demand and upward pressure on rents.

Best Zip Codes in Dallas for Investors

75202

Cap Rate: 8.6%Cash Flow: +$506/mo$274,161

75210

Cap Rate: 8.2%Cash Flow: +$223/mo$145,814

75249

Cap Rate: 8.1%Cash Flow: +$408/mo$291,057

All Zip Codes in Dallas

Zip	Cap Rate	Cash Flow	Home Price	Rent (3BR)	DSCR
75202	8.6%	+$506	$274,161	$2,870/mo	1.35
75210	8.2%	+$223	$145,814	$1,470/mo	1.29
75249	8.1%	+$408	$291,057	$2,890/mo	1.26
75215	7.5%	+$162	$177,907	$1,660/mo	1.17
75241	7.0%	+$107	$214,124	$1,890/mo	1.09
75216	6.9%	+$79	$175,625	$1,540/mo	1.08
75088	6.4%	-$4	$361,995	$2,970/mo	1.00
75235	6.4%	-$6	$283,197	$2,320/mo	1.00
75203	6.2%	-$30	$207,709	$1,670/mo	0.97
75217	6.2%	-$29	$200,184	$1,610/mo	0.97
75254	6.2%	-$49	$304,152	$2,440/mo	0.97
75227	6.1%	-$52	$226,680	$1,800/mo	0.96
75232	6.1%	-$56	$240,642	$1,910/mo	0.96
75253	6.0%	-$91	$261,665	$2,040/mo	0.93
75226	5.8%	-$146	$313,739	$2,400/mo	0.91
75223	5.8%	-$130	$251,676	$1,910/mo	0.90
76177	5.6%	-$250	$374,140	$2,770/mo	0.87
75152	5.5%	-$249	$320,506	$2,330/mo	0.85
75212	5.2%	-$254	$247,019	$1,720/mo	0.81
75219	5.1%	-$436	$418,812	$2,910/mo	0.80
75224	5.1%	-$259	$234,365	$1,610/mo	0.79
75474	5.0%	-$281	$243,691	$1,660/mo	0.78
75243	5.0%	-$366	$304,995	$2,060/mo	0.77
75233	4.8%	-$399	$294,104	$1,930/mo	0.74
75236	4.8%	-$380	$280,337	$1,840/mo	0.75
75231	4.7%	-$415	$302,528	$1,980/mo	0.74
75237	4.7%	-$371	$270,453	$1,770/mo	0.74
75204	4.7%	-$724	$502,933	$3,250/mo	0.73
75228	4.5%	-$437	$282,678	$1,790/mo	0.71
75143	4.1%	-$517	$276,286	$1,640/mo	0.65
75173	4.1%	-$643	$342,378	$2,030/mo	0.65
76078	3.8%	-$783	$366,865	$2,060/mo	0.60
75147	3.6%	-$646	$274,789	$1,470/mo	0.56
75287	3.5%	-$1,151	$471,302	$2,470/mo	0.54
75208	3.4%	-$1,031	$419,434	$2,190/mo	0.54
75240	3.2%	-$1,090	$409,965	$2,040/mo	0.50
76084	2.9%	-$1,155	$391,618	$1,810/mo	0.45
75424	2.8%	-$1,344	$446,514	$2,030/mo	0.43
75206	2.7%	-$1,876	$610,627	$2,730/mo	0.42
75218	2.6%	-$1,758	$556,583	$2,430/mo	0.41
75246	2.5%	-$1,244	$384,153	$1,640/mo	0.39
75248	2.3%	-$2,184	$634,376	$2,550/mo	0.35
76272	2.3%	-$1,596	$464,368	$1,870/mo	0.35
75252	2.0%	-$2,288	$621,746	$2,320/mo	0.31
75244	2.0%	-$2,694	$730,744	$2,720/mo	0.31
75220	1.9%	-$1,951	$525,505	$1,940/mo	0.30
75201	1.6%	-$3,910	$984,173	$3,320/mo	0.25
75238	1.3%	-$2,705	$638,734	$1,950/mo	0.20
75214	1.3%	-$3,592	$842,049	$2,540/mo	0.20
75229	1.1%	-$3,292	$748,833	$2,140/mo	0.17
75209	0.7%	-$5,045	$1,067,342	$2,620/mo	0.11
75230	0.3%	-$5,507	$1,076,341	$2,130/mo	0.04