Lafayette, LA Cap Rate: 6.34% — Rental Property Analysis
Lafayette is a budget-friendly market in the South with a smaller market with 126,000 residents. At a 6.34% estimated cap rate, this is a solid market where rents of $1,330/mo lag behind home prices. With a median home price of $195,000 and steady population growth supports long-term rental demand, Lafayette stands out as a market worth serious analysis for rental investors.
Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026
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Strong investment fundamentals
Based on $195,000 median price and $1,330/mo median rent
Est. Cap Rate
6.34%
1% Rule
0.68%
Fails
GRM
12.2x
Price / Income
3.9x
Market Data
Median Home Price$195,000
Median Monthly Rent$1,330
Property Tax Rate0.52%
Population126,000
Population Growth0.6% / yr
Median Household Income$50,200
Vacancy Rate6.4%
Annual Appreciation2.2%
2026 Market Update: Lafayette
Lafayette's 0.7% rent-to-price ratio is well below the 1% rule. At median prices of $195,000, the $1,330/mo rent produces only $1,030/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 ($39K at 7%) would result in approximately $-7/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 12.2x gross rent multiplier and 6.4% vacancy rate position Lafayette as a value-oriented market. With annual appreciation at 2.2%, total returns (cash flow + equity growth) run approximately 8.5% before financing leverage.
Cap Rate Calculator — Lafayette
Pre-filled with Lafayette medians. Adjust to match a specific property.
Property Details
$
$
3–8% typical
%
Monthly Expenses
0.52% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
5.27%Moderate
Net Operating Income ÷ Purchase Price
NOI / Year
$10,271
net operating income
Gross Rent Multiplier
12.2x
Good (<15)
1% Rule
0.68%
✗ Fails
Monthly Cash Flow
$856
before debt service
Annual Breakdown
Gross Rental Income$15,960
Less Vacancy−$1,021
Effective Income$14,939
Less Operating Expenses−$4,668
Net Operating Income$10,271
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Factor in financing to see your actual return on invested capital in Lafayette.
$
$48,750
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-4.01%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$54,600
$48,750 down + $5,850 closing
Monthly Mortgage
$953
on $146K loan
Monthly Cash Flow
$-182
after all expenses
Annual Cash Flow
$-2,189
before taxes
Cash Flow Breakdown
Monthly Rent$1,330
Less Expenses−$559
Less Mortgage−$953
Monthly Cash Flow$-182
Is Lafayette a Good Place to Invest in Rental Property?
Lafayette, LA has a population of 126,000 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 $195,000 paired with median rents of $1,330/mo produces an estimated cap rate of 6.34%.
Property taxes at 0.52% are well below the national average of ~1.1%, providing a meaningful cash flow advantage many investors overlook. The vacancy rate of 6.4% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 3.9x, homes cost about 3.9 times the local median income of $50,200. 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 2.2% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.
Bottom line: Lafayette offers attractive fundamentals for rental investors. low taxes, and cap rates above 6% put it in the upper tier of investable markets.
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