Kankakee, IL Cap Rate: 4.49% — Rental Property Analysis
Kankakee is a budget-friendly market in the Midwest with a small but investable metro of 50,000. At a 4.49% estimated cap rate, this is a moderate market where rents of $1,400/mo lag behind home prices. With a median home price of $215,000 and population is roughly stable, Kankakee 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
◈
Moderate — source deals carefully
Based on $215,000 median price and $1,400/mo median rent
Est. Cap Rate
4.49%
1% Rule
0.65%
Fails
GRM
12.8x
Price / Income
3.4x
Market Data
Median Home Price$215,000
Median Monthly Rent$1,400
Property Tax Rate2.06%
Population50,000
Population Growth0.2% / yr
Median Household Income$62,333
Vacancy Rate5.9%
Annual Appreciation2.1%
2026 Market Update: Kankakee
Kankakee's 0.7% rent-to-price ratio is well below the 1% rule. At median prices of $215,000, the $1,400/mo rent produces only $805/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 ($43K at 7%) would result in approximately $-339/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 26% of gross rent here — one of the highest ratios in our dataset. This significantly compresses margins and makes Kankakee a market where tax-conscious underwriting is essential. Every deal should be stress-tested with potential assessment increases.
Cap Rate Calculator — Kankakee
Pre-filled with Kankakee medians. Adjust to match a specific property.
Property Details
$
$
3–8% typical
%
Monthly Expenses
2.06% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
3.49%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$7,493
net operating income
Gross Rent Multiplier
12.8x
Good (<15)
1% Rule
0.65%
✗ Fails
Monthly Cash Flow
$624
before debt service
Annual Breakdown
Gross Rental Income$16,800
Less Vacancy−$991
Effective Income$15,809
Less Operating Expenses−$8,316
Net Operating Income$7,493
Sponsored
Analyze Deals Faster with DealCheck
Import any property, get instant investment analysis — cap rates, cash flow, rehab estimates, and offer calculations. Used by 350,000+ investors.
Factor in financing to see your actual return on invested capital in Kankakee.
$
$53,750
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-4.77%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
$-239
after all expenses
Annual Cash Flow
$-2,871
before taxes
Cash Flow Breakdown
Monthly Rent$1,400
Less Expenses−$588
Less Mortgage−$1,051
Monthly Cash Flow$-239
Is Kankakee a Good Place to Invest in Rental Property?
Kankakee, IL has a population of 50,000 and has been growing at 0.2% 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 $1,400/mo produces an estimated cap rate of 4.49%.
Property taxes at 2.06% 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 5.9% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 3.4x, homes cost about 3.4 times the local median income of $62,333. 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 2.1% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.
Bottom line: Kankakee presents moderate opportunities. Cap rates near 4.49% mean deals need careful sourcing — look for value-add rehabs or emerging neighborhoods where rents are climbing.
Sponsored
Get AI-Powered Property Insights
Homesage.ai analyzes 140 million properties with AI — spot hidden deals, assess property condition, and find investment opportunities. Free to try.