St. George, UT Cap Rate 2.72%
St. George is the largest metro in southern Utah — uniquely anchored by sustained outdoor-lifestyle retiree in-migration from California and the Pacific Northwest, Utah Tech University (formerly Dixie State), and Zion National Park / Bryce Canyon gateway tourism. The 2.72% cap rate at a $525,000 median price reflects sustained post-2020 in-migration. The 0.36% rent-to-price ratio sits below the 1% rule. Population growth at 3.5%/yr is among the strongest in the country.
Employment is anchored by the broader retiree-and-tourism economy (St. George has been one of the fastest-growing US retiree destinations for two decades — sustained in-migration from California and the broader Pacific Northwest produces continuing healthcare, retail, services, and construction employment), Intermountain St. George Regional Hospital, the broader Dixie Regional Medical Center, Utah Tech University (formerly Dixie State University — the recently-renamed public university with ~12K students), the broader Washington County government, the Zion National Park tourism economy (~5M annual visitors to Zion produce extraordinary STR demand in the broader Washington County area; Bryce Canyon nearby), and a meaningful construction-and-supplier base supporting continued in-migration. Submarkets stratify cleanly: the historic downtown St. George area is walkable urban with strong appreciation; the broader Bloomington Hills and Bloomington areas are premium retiree-and-family neighborhoods; the broader Washington and Hurricane areas extend the metro with newer construction; properties near Zion gateway zones have specific STR-tourism dynamics.
Utah property tax at 0.55% is among the lowest in the country. Utah state income tax is a flat ~4.65%. Insurance is reasonable but verify wildfire / wildland-interface exposure for foothill properties. STR regulation has been a recurring political topic in Washington County given Zion gateway proximity; verify ordinance status before underwriting any short-term thesis. The structural advantages: sustained California/PNW retiree in-migration is genuinely durable; Zion gateway tourism is structural; UT broader tax structure is among the most landlord-favorable; cost basis is materially below most western US migration destinations; outdoor-lifestyle appeal continues. The structural risks: migration-narrative sensitivity (similar to Boise/Bozeman/CdA — the pricing thesis depends on continued remote-work and retiree migration); STR regulation continues to evolve; rapid greenfield development brings new supply. For investors who want southwestern Utah outdoor-and-retiree exposure, St. George is the most distinctive Mountain West option.
Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026
Market Data
2026 Market Update: St. George
St. George's 0.4% rent-to-price ratio is well below the 1% rule. At median prices of $525,000, the $1,870/mo rent produces only $1,190/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 ($105K at 7%) would result in approximately $-1,603/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 23.4x gross rent multiplier and 4.8% vacancy rate position St. George as a growth-dependent market. With annual appreciation at 3.2%, total returns (cash flow + equity growth) run approximately 5.9% before financing leverage.
Deal Modeling & Scenarios for St. George
All figures below are computed from St. George's real market medians. Use them as a baseline; override with property-specific numbers in the calculators.
Property Tax Bill in Real Dollars
At 0.55% effective rate on the $525,000 median price, the annual tax bill is $2,888 — that's very low (bottom 15% of US markets) (-48% vs the national average of ~1.06%). Verify the actual assessed value before purchase; sale-triggered reassessments can push the bill higher than the seller's current statement.
5-Year Cap Rate Trajectory
If St. George continues appreciating at 3.2%/yr while rents grow at a conservative 3%/yr, cap rate compresses as price growth outpaces rent. Year-by-year projection at the median:
| Year | Est. Price | Est. Rent/Mo | Cap Rate |
|---|---|---|---|
| Today | $525K | $1,870 | 2.7% |
| Year 1 | $542K | $1,926 | 2.7% |
| Year 2 | $559K | $1,984 | 2.7% |
| Year 3 | $577K | $2,043 | 2.7% |
| Year 4 | $595K | $2,105 | 2.7% |
| Year 5 | $615K | $2,168 | 2.7% |
Three Financing Scenarios
Same median-priced St. George property — different capital structures. All-cash maximizes cap rate. Leverage trades cash flow for higher cash-on-cash return when the spread between cap rate and borrowing cost is positive.
| Scenario | Cash Invested | Monthly Cash Flow | Annual CF | Cash-on-Cash |
|---|---|---|---|---|
| All cash | $525K | $1,190 | $14,275 | 2.7% |
| 20% down conventional @ 7% | $121K | $-1,603 | $-19,241 | -15.9% |
| 25% down DSCR @ 8.5% | $152K | $-1,838 | $-22,060 | -14.5% |
Three Price Tiers: Below, At, and Above the Median
Properties don't always trade at the median. Lower-priced units typically offer higher cap rates but harder operations; higher-priced properties tend to compress cap rates while attracting better tenants. All-cash assumptions below:
| Tier | Price | Rent/Mo | NOI/Yr | Cap Rate | Monthly CF |
|---|---|---|---|---|---|
| Below median (~75% price) | $394K | $1,590 | $11,371 | 2.9% | $948 |
| At median | $525K | $1,870 | $12,785 | 2.4% | $1,065 |
| Above median (~125% price) | $656K | $2,151 | $14,209 | 2.2% | $1,184 |
Total Return Over a 5-Year Hold
Cap rate is just one piece. Real estate returns come from four sources: cash flow, appreciation, principal paydown, and tax benefits. Assuming 20% down conventional financing at 7% and a 5-year hold at St. George's historical appreciation rate of 3.2%:
On a $105K down payment, that's a 23.7% total ROI over 5 years (not annualized). Tax benefits from depreciation are additional and depend on your personal tax bracket.
Risk Flags Specific to St. George
Automated checks against the underlying data — surface only the risks that actually apply to St. George, not generic boilerplate:
Cap Rate Calculator — St. George
Pre-filled with St. George medians. Adjust to match a specific property.
Cash-on-Cash Return — St. George
Factor in financing to see your actual return on invested capital in St. George.
Is St. George a Good Place to Invest in Rental Property?
St. George, UT has a population of 105,000 and has been growing at 3.5% annually — well above the national average, signaling strong housing demand from population inflows. The median home price of $525,000 paired with median rents of $1,870/mo produces an estimated cap rate of 2.72%.
Property taxes at 0.55% are well below the national average of ~1.1%, providing a meaningful cash flow advantage many investors overlook. The vacancy rate of 4.8% is impressively low, indicating tight rental supply and strong tenant demand — favorable for landlords.
At a price-to-income ratio of 9.9x, homes cost about 9.9 times the local median income of $52,800. This elevated ratio means homeownership is stretched, supporting rental demand but limiting buyer pools. Home values have appreciated at roughly 3.2% 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, St. George 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.