Sumter, SC Cap Rate 6.43%
Sumter is a budget-friendly market in the South with a small but investable metro of 50,000. At a 6.43% estimated cap rate, this is a solid market where rents of $1,410/mo lag behind home prices. With a median home price of $205,000 and steady population growth supports long-term rental demand, Sumter 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
Market Data
2026 Market Update: Sumter
Sumter's 0.7% rent-to-price ratio is well below the 1% rule. At median prices of $205,000, the $1,410/mo rent produces only $1,098/mo in NOI. Investors here need to target below-median properties or pursue value-add strategies to make the numbers work.
On a conventional loan with 20% down ($41K) at 7%, estimated monthly cash flow is $7 — a thin 0.2% cash-on-cash return. Investors should negotiate below asking price or target properties with above-median rents to build a meaningful cash flow buffer.
With 1.9% annual population growth paired with 3.4% home appreciation, Sumter offers a rare combination of current cash flow and future equity upside. The 12.1x gross rent multiplier suggests the market hasn't fully priced in this growth trajectory.
Deal Modeling & Scenarios for Sumter
All figures below are computed from Sumter's real market medians. Use them as a baseline; override with property-specific numbers in the calculators.
Property Tax Bill in Real Dollars
At 0.57% effective rate on the $205,000 median price, the annual tax bill is $1,168 — that's very low (bottom 15% of US markets) (-46% 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 Sumter continues appreciating at 3.4%/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 | $205K | $1,410 | 6.4% |
| Year 1 | $212K | $1,452 | 6.4% |
| Year 2 | $219K | $1,496 | 6.4% |
| Year 3 | $227K | $1,541 | 6.4% |
| Year 4 | $234K | $1,587 | 6.3% |
| Year 5 | $242K | $1,635 | 6.3% |
Three Financing Scenarios
Same median-priced Sumter 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 | $205K | $1,098 | $13,181 | 6.4% |
| 20% down conventional @ 7% | $47K | $8 | $94 | 0.2% |
| 25% down DSCR @ 8.5% | $59K | $-84 | $-1,007 | -1.7% |
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) | $154K | $1,199 | $9,803 | 6.4% | $817 |
| At median | $205K | $1,410 | $11,294 | 5.5% | $941 |
| Above median (~125% price) | $256K | $1,621 | $12,784 | 5.0% | $1,065 |
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 Sumter's historical appreciation rate of 3.4%:
On a $41K down payment, that's a 122.1% total ROI over 5 years (not annualized). Tax benefits from depreciation are additional and depend on your personal tax bracket.
Risk Flags Specific to Sumter
Automated checks against the underlying data — surface only the risks that actually apply to Sumter, not generic boilerplate:
Cap Rate Calculator — Sumter
Pre-filled with Sumter medians. Adjust to match a specific property.
Cash-on-Cash Return — Sumter
Factor in financing to see your actual return on invested capital in Sumter.
Is Sumter a Good Place to Invest in Rental Property?
Sumter, SC has a population of 50,000 and has been growing at 1.9% annually — above the national average, suggesting steady demand pressure on housing. The median home price of $205,000 paired with median rents of $1,410/mo produces an estimated cap rate of 6.43%.
Property taxes at 0.57% are well below the national average of ~1.1%, providing a meaningful cash flow advantage many investors overlook. The vacancy rate of 5.5% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 4.1x, homes cost about 4.1 times the local median income of $49,486. 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 3.4% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.
Bottom line: Sumter offers attractive fundamentals for rental investors. Strong population growth, low taxes, and cap rates above 6% put it in the upper tier of investable markets.