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MarketsKentuckyLondon

Cap Rate Analysis: London, KY

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

Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026

Strong investment fundamentals
Based on $155,000 median price and $1,130/mo median rent
Est. Cap Rate
6.65%
1% Rule
0.73%
Fails
GRM
11.4x
Price / Income
3.0x

Market Data

Median Home Price$155,000
Median Monthly Rent$1,130
Property Tax Rate0.81%
Population50,000
Population Growth0.8% / yr
Median Household Income$51,300
Vacancy Rate5.6%
Annual Appreciation2.8%

Cap Rate Calculator — London

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

Property Details
$
$
3–8% typical
%
Monthly Expenses
0.81% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
5.47%Moderate
Net Operating Income ÷ Purchase Price
NOI / Year
$8,481
net operating income
Gross Rent Multiplier
11.4x
Good (<15)
1% Rule
0.73%
✗ Fails
Monthly Cash Flow
$707
before debt service
Annual Breakdown
Gross Rental Income$13,560
Less Vacancy−$759
Effective Income$12,801
Less Operating Expenses−$4,320
Net Operating Income$8,481
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Cash-on-Cash Return — London

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

$
$38,750
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-2.84%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
$-103
after all expenses
Annual Cash Flow
$-1,234
before taxes
Cash Flow Breakdown
Monthly Rent$1,130
Less Expenses−$475
Less Mortgage−$758
Monthly Cash Flow$-103

Is London a Good Place to Invest in Rental Property?

London, KY has a population of 50,000 and has been growing at 0.8% 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 $1,130/mo produces an estimated cap rate of 6.65%.

Property taxes at 0.81% fall within the national average range and shouldn't present unusual challenges. The vacancy rate of 5.6% is moderate and within normal parameters for a healthy rental market.

At a price-to-income ratio of 3.0x, homes cost about 3.0 times the local median income of $51,300. 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 2.8% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.

Bottom line: London 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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