Cumberland, MD Cap Rate: 5.37% — Rental Property Analysis
Cumberland is one of the most affordable markets in the country in the South with a small but investable metro of 50,000. At a 5.37% estimated cap rate, this is a moderate market where rents of $1,020/mo lag behind home prices. With a median home price of $160,000 and population is roughly stable, Cumberland 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 $160,000 median price and $1,020/mo median rent
Est. Cap Rate
5.37%
1% Rule
0.64%
Fails
GRM
13.1x
Price / Income
2.6x
Market Data
Median Home Price$160,000
Median Monthly Rent$1,020
Property Tax Rate1.04%
Population50,000
Population Growth0.5% / yr
Median Household Income$60,467
Vacancy Rate5.8%
Annual Appreciation2.6%
2026 Market Update: Cumberland
Cumberland's 0.6% rent-to-price ratio is well below the 1% rule. At median prices of $160,000, the $1,020/mo rent produces only $716/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 ($32K at 7%) would result in approximately $-135/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 13.1x gross rent multiplier and 5.8% vacancy rate position Cumberland as a value-oriented market. With annual appreciation at 2.6%, total returns (cash flow + equity growth) run approximately 8.0% before financing leverage.
Cap Rate Calculator — Cumberland
Pre-filled with Cumberland medians. Adjust to match a specific property.
Property Details
$
$
3–8% typical
%
Monthly Expenses
1.04% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
4.39%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$7,018
net operating income
Gross Rent Multiplier
13.1x
Good (<15)
1% Rule
0.64%
✗ Fails
Monthly Cash Flow
$585
before debt service
Annual Breakdown
Gross Rental Income$12,240
Less Vacancy−$710
Effective Income$11,530
Less Operating Expenses−$4,512
Net Operating Income$7,018
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Factor in financing to see your actual return on invested capital in Cumberland.
$
$40,000
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-5.10%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$44,800
$40,000 down + $4,800 closing
Monthly Mortgage
$782
on $120K loan
Monthly Cash Flow
$-190
after all expenses
Annual Cash Flow
$-2,284
before taxes
Cash Flow Breakdown
Monthly Rent$1,020
Less Expenses−$428
Less Mortgage−$782
Monthly Cash Flow$-190
Is Cumberland a Good Place to Invest in Rental Property?
Cumberland, MD has a population of 50,000 and has been growing at 0.5% annually — roughly in line with national trends, meaning demand is stable but not exceptional. The median home price of $160,000 paired with median rents of $1,020/mo produces an estimated cap rate of 5.37%.
Property taxes at 1.04% fall within the national average range and shouldn't present unusual challenges. The vacancy rate of 5.8% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 2.6x, homes cost about 2.6 times the local median income of $60,467. 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 2.6% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.
Bottom line: Cumberland presents moderate opportunities. Cap rates near 5.37% mean deals need careful sourcing — look for value-add rehabs or emerging neighborhoods where rents are climbing.
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