What is the cap rate in Kansas City, MO?

The median cap rate in Kansas City, MO is 4%. This is based on HUD Fair Market Rents and current home values.

Is Kansas City a good place to buy rental property?

Kansas City has a cap rate of 4% and estimated cash flow of -$515/month. Returns are moderate — consider the appreciation potential. Median home price is $289,544 with average 3BR rent of $1,655/month.

What is the average rent in Kansas City, MO?

The HUD Fair Market Rent for a 3-bedroom in Kansas City, MO is $1,655/month. This represents the estimated rent for standard-quality housing in the area.

Kansas City, MO — 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 Kansas City, MO yield a 4.0% cap rate. Median home price is $289,544 with 3-bedroom rents at $1,655/month.

Kansas City is a moderate market — workable but not exceptional for cash flow. Median home price sits at $289,544 — moderate by national standards, requiring a solid down payment but not out of reach. With 3-bedroom rents around $1,655/month, the 4.0% cap rate tells the story. Cash flow is deeply negative at -$515/month with standard assumptions. This market requires appreciation to justify the investment.

At 0.58% 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 0.63 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 Kansas City 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

4.0%

Below average

Monthly Cash Flow

-$515

After all expenses

Price-to-Rent

14.3

Investor-friendly

DSCR

0.63

Fails

Key Metrics

Median Home Price: $289,544
Average Rent (3BR): $1,655/mo
Price-to-Rent Ratio: 14.3(good)
1% Rule: 0.58%(fails — need 1%+)
Cash-on-Cash Return: -10.2%
Vacancy Rate: 8.0%

Market Strength

Unemployment Rate: 3.8%(-0.5% vs national)
Rent Growth (YoY): +2.9%(national avg)
Population Growth: +1.2% YoY

Assumptions Used

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

Customize these numbers →

Property Tax Rate

0.93%

of assessed value (MO avg)

Median Income

$61,043

household (MO avg)

Rent-to-Income

32.5%

Moderate

Section 8 Max Rent

$1,655/mo

3BR voucher payment

MO Investor Climate

Landlord Friendly

7/10

State Income Tax

Has state tax

Property Tax

0.93% effective

Population Trend

+1.2% (3yr)

Population Movement (Tax Year 2021→2022)

Net Migration

-939 households

SHRINKING

Total Inflow

273,543

households moved in

Avg Income (New Residents)

$79,135

per household

Where they're coming from:

1.Jackson Non-migrants, MO263,166 households · avg $79,164

2.Johnson, KS3,385 households · avg $119,226

3.Clay, MO2,042 households · avg $49,839

4.Cass, MO1,223 households · avg $69,106

5.Douglas, KS289 households · avg $47,007

Where residents are leaving to:

1.Jackson Non-migrants, MO263,166 households

2.Johnson, KS3,539 households

3.Clay, MO2,423 households

4.Cass, MO1,561 households

5.Cook, IL265 households

Net outflow may indicate weakening demand — but can mean lower prices and higher cap rates.

Best Zip Codes in Kansas City for Investors

64120

Cap Rate: 14.7%Cash Flow: +$574/mo$82,737

64125

Cap Rate: 13.7%Cash Flow: +$537/mo$88,258

64127

Cap Rate: 13.5%Cash Flow: +$528/mo$89,517

All Zip Codes in Kansas City

Zip	Cap Rate	Cash Flow	Home Price	Rent (3BR)	DSCR
64120	14.7%	+$574	$82,737	$1,380/mo	2.30
64125	13.7%	+$537	$88,258	$1,380/mo	2.14
64127	13.5%	+$528	$89,517	$1,380/mo	2.11
64126	12.8%	+$503	$93,331	$1,380/mo	2.01
64128	12.4%	+$483	$96,288	$1,380/mo	1.94
64130	11.8%	+$479	$105,301	$1,450/mo	1.86
64132	10.2%	+$365	$116,175	$1,400/mo	1.59
64105	9.6%	+$521	$196,505	$2,250/mo	1.50
64124	9.4%	+$307	$122,334	$1,380/mo	1.47
64123	9.2%	+$290	$124,826	$1,380/mo	1.44
64134	8.3%	+$280	$173,787	$1,770/mo	1.30
64129	7.5%	+$137	$153,605	$1,430/mo	1.17
64108	5.9%	-$125	$295,988	$2,280/mo	0.92
64106	5.9%	-$96	$221,075	$1,700/mo	0.92
64109	5.6%	-$121	$185,903	$1,380/mo	0.88
64137	5.6%	-$151	$225,571	$1,670/mo	0.87
64117	5.3%	-$196	$215,222	$1,530/mo	0.83
64111	5.1%	-$303	$273,696	$1,880/mo	0.79
64119	4.8%	-$338	$260,640	$1,730/mo	0.76
64136	4.8%	-$356	$270,677	$1,790/mo	0.75
64131	4.6%	-$374	$256,313	$1,650/mo	0.73
64114	4.6%	-$460	$301,946	$1,920/mo	0.71
64110	4.4%	-$422	$253,673	$1,570/mo	0.69
64077	4.3%	-$413	$232,807	$1,410/mo	0.67
64484	4.2%	-$416	$229,593	$1,380/mo	0.66
64020	4.0%	-$463	$236,580	$1,380/mo	0.63
64157	4.0%	-$839	$425,025	$2,470/mo	0.63
64116	3.9%	-$568	$269,274	$1,520/mo	0.60
64155	3.4%	-$888	$353,249	$1,820/mo	0.53
64151	3.3%	-$888	$349,509	$1,790/mo	0.52
64158	3.1%	-$1,040	$385,549	$1,900/mo	0.49
64153	3.1%	-$1,014	$374,281	$1,840/mo	0.49
64146	3.1%	-$791	$291,365	$1,430/mo	0.49
64040	3.0%	-$799	$287,723	$1,390/mo	0.48
64112	2.9%	-$1,191	$415,256	$1,960/mo	0.46
64747	2.9%	-$881	$298,634	$1,380/mo	0.45
64163	2.8%	-$896	$300,942	$1,380/mo	0.44
64088	2.7%	-$1,029	$338,787	$1,530/mo	0.43
64154	2.7%	-$1,310	$427,942	$1,920/mo	0.43
64139	2.6%	-$1,408	$452,215	$2,000/mo	0.42
64156	2.6%	-$1,445	$461,455	$2,030/mo	0.41
64145	2.6%	-$1,334	$419,444	$1,820/mo	0.40
64746	2.5%	-$1,086	$332,715	$1,410/mo	0.39
64739	2.2%	-$1,197	$345,548	$1,380/mo	0.35
64444	2.2%	-$1,201	$346,067	$1,380/mo	0.35
64734	2.2%	-$1,495	$429,897	$1,710/mo	0.35
64152	2.2%	-$1,505	$430,198	$1,700/mo	0.34
64149	2.0%	-$1,845	$511,106	$1,950/mo	0.32
64166	1.9%	-$1,795	$476,819	$1,730/mo	0.29
64165	1.9%	-$1,731	$458,819	$1,660/mo	0.29
64113	1.8%	-$2,228	$582,435	$2,070/mo	0.28
64167	1.4%	-$2,523	$608,044	$1,920/mo	0.22