Batesville, AR Cap Rate: 5.43% — Rental Property Analysis
Batesville is one of the most affordable markets in the country in the South with a small but investable metro of 50,000. At a 5.43% estimated cap rate, this is a moderate market where rents of $940/mo lag behind home prices. With a median home price of $155,000 and steady population growth supports long-term rental demand, Batesville offers opportunities for investors who source deals carefully.
Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026
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Moderate — source deals carefully
Based on $155,000 median price and $940/mo median rent
Est. Cap Rate
5.43%
1% Rule
0.61%
Fails
GRM
13.7x
Price / Income
3.3x
Market Data
Median Home Price$155,000
Median Monthly Rent$940
Property Tax Rate0.61%
Population50,000
Population Growth0.9% / yr
Median Household Income$46,400
Vacancy Rate6%
Annual Appreciation2.5%
2026 Market Update: Batesville
Batesville's 0.6% rent-to-price ratio is well below the 1% rule. At median prices of $155,000, the $940/mo rent produces only $701/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 ($31K at 7%) would result in approximately $-124/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.
The 13.7x gross rent multiplier and 6% vacancy rate position Batesville as a value-oriented market. With annual appreciation at 2.5%, total returns (cash flow + equity growth) run approximately 7.9% before financing leverage.
Cap Rate Calculator — Batesville
Pre-filled with Batesville medians. Adjust to match a specific property.
Property Details
$
$
3–8% typical
%
Monthly Expenses
0.61% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
4.52%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$7,003
net operating income
Gross Rent Multiplier
13.7x
Good (<15)
1% Rule
0.61%
✗ Fails
Monthly Cash Flow
$584
before debt service
Annual Breakdown
Gross Rental Income$11,280
Less Vacancy−$677
Effective Income$10,603
Less Operating Expenses−$3,600
Net Operating Income$7,003
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Factor in financing to see your actual return on invested capital in Batesville.
$
$38,750
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-5.89%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$43,400
$38,750 down + $4,650 closing
Monthly Mortgage
$758
on $116K loan
Monthly Cash Flow
$-213
after all expenses
Annual Cash Flow
$-2,554
before taxes
Cash Flow Breakdown
Monthly Rent$940
Less Expenses−$395
Less Mortgage−$758
Monthly Cash Flow$-213
Is Batesville a Good Place to Invest in Rental Property?
Batesville, AR has a population of 50,000 and has been growing at 0.9% annually — roughly in line with national trends, meaning demand is stable but not exceptional. The median home price of $155,000 paired with median rents of $940/mo produces an estimated cap rate of 5.43%.
Property taxes at 0.61% are well below the national average of ~1.1%, providing a meaningful cash flow advantage many investors overlook. The vacancy rate of 6% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 3.3x, homes cost about 3.3 times the local median income of $46,400. This relatively affordable ratio suggests a deep pool of renters who find buying out of reach, supporting rental demand. Home values have appreciated at roughly 2.5% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.
Bottom line: Batesville presents moderate opportunities. Cap rates near 5.43% mean deals need careful sourcing — look for value-add rehabs or emerging neighborhoods where rents are climbing.
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