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MarketsAlabamaTroy

Cap Rate Analysis: Troy, AL

Investment metrics, interactive calculators, and data-driven analysis for Troy 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 $160,000 median price and $1,160/mo median rent
Est. Cap Rate
6.92%
1% Rule
0.73%
Fails
GRM
11.5x
Price / Income
3.2x

Market Data

Median Home Price$160,000
Median Monthly Rent$1,160
Property Tax Rate0.42%
Population50,000
Population Growth0.8% / yr
Median Household Income$49,614
Vacancy Rate6.4%
Annual Appreciation2.3%

Cap Rate Calculator — Troy

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

Property Details
$
$
3–8% typical
%
Monthly Expenses
0.42% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
5.76%Moderate
Net Operating Income ÷ Purchase Price
NOI / Year
$9,213
net operating income
Gross Rent Multiplier
11.5x
Good (<15)
1% Rule
0.73%
✗ Fails
Monthly Cash Flow
$768
before debt service
Annual Breakdown
Gross Rental Income$13,920
Less Vacancy−$891
Effective Income$13,029
Less Operating Expenses−$3,816
Net Operating Income$9,213
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Cash-on-Cash Return — Troy

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

$
$40,000
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-2.93%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$44,800
$40,000 down + $4,800 closing
Monthly Mortgage
$782
on $120K loan
Monthly Cash Flow
$-109
after all expenses
Annual Cash Flow
$-1,312
before taxes
Cash Flow Breakdown
Monthly Rent$1,160
Less Expenses−$487
Less Mortgage−$782
Monthly Cash Flow$-109

Is Troy a Good Place to Invest in Rental Property?

Troy, AL 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 $160,000 paired with median rents of $1,160/mo produces an estimated cap rate of 6.92%.

Property taxes at 0.42% 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 3.2x, homes cost about 3.2 times the local median income of $49,614. 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 2.3% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.

Bottom line: Troy 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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