Half Moon Bay, CA — Rental Investment Analysis
🔴POOR— negative cash flow likelyData: HUD FMR FY2024 + Zillow ZHVI April 2026 + Freddie Mac rates. Last updated June 2026.
Investment Summary
As of 2026, Half Moon Bay, CA has a 0.9% cap rate, indicating limited cash flow potential at current prices of $1,550,098 median.
Half Moon Bay is very expensive relative to rents — expect negative cash flow. At $1,550,098 median home price, Half Moon Bay requires significant capital. A 20% down payment alone is $310,019. With 3-bedroom rents around $4,030/month, the 0.9% cap rate tells the story. Cash flow is deeply negative at -$7,141/month with standard assumptions. This market requires appreciation to justify the investment.
At 0.26% 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 0.14 is below 1.0, meaning rental income doesn't cover the mortgage. DSCR lenders will likely decline this market at current prices.
Bottom line: At current valuations, Half Moon Bay doesn't make sense for rental investors focused on returns. Look at lower-cost markets unless you have specific local knowledge.
Data sources: HUD Fair Market Rents (FY2024), Zillow Home Value Index (April 2026), Freddie Mac Primary Mortgage Market Survey.
Cap Rate
0.9%
Below average
Monthly Cash Flow
-$7,141
After all expenses
Price-to-Rent
32.4
Overpriced for rent
DSCR
0.14
Fails
Key Metrics
- Median Home Price
- $1,550,098
- Average Rent (3BR)
- $4,030/mo
- Price-to-Rent Ratio
- 32.4(high)
- 1% Rule
- 0.26%(fails — need 1%+)
- Cash-on-Cash Return
- -24.0%
- Vacancy Rate
- 8.0%
Market Strength
- Unemployment Rate
- 5.3%(+1% vs national)
- Rent Growth (YoY)
- +2.9%(national avg)
- Population Growth
- -1.2% YoY
Property Tax Rate
0.71%
of assessed value (CA avg)
Median Income
$84,097
household (CA avg)
Rent-to-Income
57.5%
Stretched
Section 8 Max Rent
$4,030/mo
3BR voucher payment
CA Investor Climate
Landlord Friendly
3/10
State Income Tax
Has state tax
Property Tax
0.71% effective
Population Trend
-1.2% (3yr)