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Cap Rate Analysis: Des Moines, IA

Investment metrics, interactive calculators, and data-driven analysis for Des Moines rental properties.

Challenging for pure cash flow
Based on $215,000 median price and $1,180/mo median rent
Est. Cap Rate
3.88%
1% Rule
0.55%
Fails
GRM
15.2x
Price / Income
3.8x

Market Data

Median Home Price$215,000
Median Monthly Rent$1,180
Property Tax Rate1.52%
Population214,133
Population Growth0.7% / yr
Median Household Income$56,200
Vacancy Rate5.8%
Annual Appreciation2.7%

Cap Rate Calculator — Des Moines

Pre-filled with Des Moines medians. Adjust to match a specific property.

Property Details
$
$
3–8% typical
%
Monthly Expenses
1.52% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
3.10%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$6,667
net operating income
Gross Rent Multiplier
15.2x
High (>15)
1% Rule
0.55%
✗ Fails
Monthly Cash Flow
$556
before debt service
Annual Breakdown
Gross Rental Income$14,160
Less Vacancy−$821
Effective Income$13,339
Less Operating Expenses−$6,672
Net Operating Income$6,667

Cash-on-Cash Return — Des Moines

Factor in financing to see your actual return on invested capital in Des Moines.

$
$53,750
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-7.32%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$60,200
$53,750 down + $6,450 closing
Monthly Mortgage
$1,051
on $161K loan
Monthly Cash Flow
$-367
after all expenses
Annual Cash Flow
$-4,407
before taxes
Cash Flow Breakdown
Monthly Rent$1,180
Less Expenses−$496
Less Mortgage−$1,051
Monthly Cash Flow$-367

Is Des Moines a Good Place to Invest in Rental Property?

Des Moines, IA has a population of 214,133 and has been growing at 0.7% annually — roughly in line with national trends, meaning demand is stable but not exceptional. The median home price of $215,000 paired with median rents of $1,180/mo produces an estimated cap rate of 3.88%.

Property taxes at 1.52% 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 5.8% is moderate and within normal parameters for a healthy rental market.

At a price-to-income ratio of 3.8x, homes cost about 3.8 times the local median income of $56,200. 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 2.7% 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, Des Moines 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.

Run a BRRRR analysis for Des Moines
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