Appleton, WI Cap Rate 1.50%
Appleton is the urban anchor of the Fox Cities metro (Appleton-Neenah-Menasha-Oshkosh) — a Northeastern Wisconsin metro built around the paper-manufacturing legacy of the Fox River Valley plus deep healthcare and education bases. The 1.50% cap rate at a $335,000 median price keeps the 0.36% rent-to-price ratio close to functional. Population growth at 0.6%/yr is steady.
Employment is anchored by ThedaCare (the dominant regional medical system serving the Fox Cities — ThedaCare Regional Medical Center plus the broader network is one of the larger Wisconsin private employers), the paper-and-packaging industry (the Fox River Valley was historically the largest US paper-production region — Kimberly-Clark, Georgia-Pacific, plus the broader Fox Valley specialty papermaking; significantly smaller than its 20th-century peak but with persistent specialty operations), the broader Outagamie County government, Lawrence University (private liberal arts college — one of the older Wisconsin colleges), Fox Valley Technical College, Plexus Corporation (electronics-manufacturing services, headquartered in Neenah), the broader insurance and financial-services base, and EAA AirVenture in nearby Oshkosh (the annual aviation airshow drawing ~600K visitors and producing significant seasonal STR demand each July). Submarkets stratify cleanly: the historic Memorial Drive area and the broader downtown are walkable urban-historic with strong appreciation; the broader Grand Chute and Menasha areas are premium suburban-school zones; the Neenah area is a separate higher-end submarket; the broader Outagamie County extends with newer construction.
Wisconsin property tax at 1.85% is on the higher end for the Midwest. Wisconsin state income tax is graduated with a top rate near 7.65%. Insurance is reasonable but verify winter / freeze deductible structure (Fox Cities has heavy snowfall exposure). The structural advantages: ThedaCare + Plexus + paper manufacturing + Lawrence provides a diversified employer mix; EAA AirVenture STR upside is genuinely meaningful (the annual airshow produces extraordinary July rental demand — investors near Wittman Field can effectively monetize the event); cost basis is materially below Madison or Milwaukee. The structural risks: paper-industry employment has been shrinking for decades; WI tax structure is heavier than IL or IA; broader Wisconsin demographic trajectory has been mixed. For investors who want a defensible Wisconsin mid-size market outside Madison/Milwaukee with healthcare-plus-manufacturing anchors and unique aviation-tourism STR upside, Appleton is the most underrated Fox Cities option.
Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026
Market Data
2026 Market Update: Appleton
Appleton's 0.4% rent-to-price ratio is well below the 1% rule. At median prices of $335,000, the $1,220/mo rent produces only $419/mo in NOI. Investors here need to target below-median properties or pursue value-add strategies to make the numbers work.
At current rates, a 20% down conventional loan ($67K at 7%) would result in approximately $-1,363/mo cash flow — negative at median prices. Larger down payments, seller financing, or buying 15–25% below median are strategies to turn the numbers positive.
Property taxes consume 42% of gross rent here — one of the highest ratios in our dataset. This significantly compresses margins and makes Appleton a market where tax-conscious underwriting is essential. Every deal should be stress-tested with potential assessment increases.
Deal Modeling & Scenarios for Appleton
All figures below are computed from Appleton's real market medians. Use them as a baseline; override with property-specific numbers in the calculators.
Property Tax Bill in Real Dollars
At 1.85% effective rate on the $335,000 median price, the annual tax bill is $6,198 — that's very high (top 15% of US markets) (+75% vs the national average of ~1.06%). Verify the actual assessed value before purchase; sale-triggered reassessments can push the bill higher than the seller's current statement.
5-Year Cap Rate Trajectory
If Appleton continues appreciating at 2.4%/yr while rents grow at a conservative 3%/yr, cap rate holds roughly steady as price growth outpaces rent. Year-by-year projection at the median:
| Year | Est. Price | Est. Rent/Mo | Cap Rate |
|---|---|---|---|
| Today | $335K | $1,220 | 1.5% |
| Year 1 | $343K | $1,257 | 1.5% |
| Year 2 | $351K | $1,294 | 1.5% |
| Year 3 | $360K | $1,333 | 1.5% |
| Year 4 | $368K | $1,373 | 1.5% |
| Year 5 | $377K | $1,414 | 1.5% |
Three Financing Scenarios
Same median-priced Appleton property — different capital structures. All-cash maximizes cap rate. Leverage trades cash flow for higher cash-on-cash return when the spread between cap rate and borrowing cost is positive.
| Scenario | Cash Invested | Monthly Cash Flow | Annual CF | Cash-on-Cash |
|---|---|---|---|---|
| All cash | $335K | $419 | $5,030 | 1.5% |
| 20% down conventional @ 7% | $77K | $-1,363 | $-16,356 | -21.2% |
| 25% down DSCR @ 8.5% | $97K | $-1,513 | $-18,155 | -18.7% |
Three Price Tiers: Below, At, and Above the Median
Properties don't always trade at the median. Lower-priced units typically offer higher cap rates but harder operations; higher-priced properties tend to compress cap rates while attracting better tenants. All-cash assumptions below:
| Tier | Price | Rent/Mo | NOI/Yr | Cap Rate | Monthly CF |
|---|---|---|---|---|---|
| Below median (~75% price) | $251K | $1,037 | $4,178 | 1.7% | $348 |
| At median | $335K | $1,220 | $4,028 | 1.2% | $336 |
| Above median (~125% price) | $419K | $1,403 | $3,879 | 0.9% | $323 |
Total Return Over a 5-Year Hold
Cap rate is just one piece. Real estate returns come from four sources: cash flow, appreciation, principal paydown, and tax benefits. Assuming 20% down conventional financing at 7% and a 5-year hold at Appleton's historical appreciation rate of 2.4%:
On a $67K down payment, that's a -29.1% total ROI over 5 years (not annualized). Tax benefits from depreciation are additional and depend on your personal tax bracket.
Risk Flags Specific to Appleton
Automated checks against the underlying data — surface only the risks that actually apply to Appleton, not generic boilerplate:
Cap Rate Calculator — Appleton
Pre-filled with Appleton medians. Adjust to match a specific property.
Cash-on-Cash Return — Appleton
Factor in financing to see your actual return on invested capital in Appleton.
Is Appleton a Good Place to Invest in Rental Property?
Appleton, WI has a population of 75,000 and has been growing at 0.6% annually — roughly in line with national trends, meaning demand is stable but not exceptional. The median home price of $335,000 paired with median rents of $1,220/mo produces an estimated cap rate of 1.50%.
Property taxes at 1.85% 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 5% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 5.8x, homes cost about 5.8 times the local median income of $58,200. This moderate ratio indicates a balanced rent-vs-buy market. Home values have appreciated at roughly 2.4% 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, Appleton 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.