Virginia Beach, VA Cap Rate: 4.02% — Rental Property Analysis
Virginia Beach is a higher-priced market in the South with a mid-sized city of 460,490. At a 4.02% estimated cap rate, this is a moderate market where rents of $1,790/mo lag behind home prices. With a median home price of $365,000 and steady population growth supports long-term rental demand, Virginia Beach offers opportunities for investors who source deals carefully.
Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026
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Moderate — source deals carefully
Based on $365,000 median price and $1,790/mo median rent
Est. Cap Rate
4.02%
1% Rule
0.49%
Fails
GRM
17.0x
Price / Income
4.8x
Market Data
Median Home Price$365,000
Median Monthly Rent$1,790
Property Tax Rate0.79%
Population460,490
Population Growth0.8% / yr
Median Household Income$76,400
Vacancy Rate4.6%
Annual Appreciation3.2%
2026 Market Update: Virginia Beach
Virginia Beach's 0.5% rent-to-price ratio is well below the 1% rule. At median prices of $365,000, the $1,790/mo rent produces only $1,224/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 ($73K at 7%) would result in approximately $-718/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 17.0x gross rent multiplier and 4.6% vacancy rate position Virginia Beach as a balanced market. With annual appreciation at 3.2%, total returns (cash flow + equity growth) run approximately 7.2% before financing leverage.
Cap Rate Calculator — Virginia Beach
Pre-filled with Virginia Beach medians. Adjust to match a specific property.
Property Details
$
$
3–8% typical
%
Monthly Expenses
0.79% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
3.37%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$12,284
net operating income
Gross Rent Multiplier
17.0x
High (>15)
1% Rule
0.49%
✗ Fails
Monthly Cash Flow
$1,024
before debt service
Annual Breakdown
Gross Rental Income$21,480
Less Vacancy−$988
Effective Income$20,492
Less Operating Expenses−$8,208
Net Operating Income$12,284
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Factor in financing to see your actual return on invested capital in Virginia Beach.
$
$91,250
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-8.77%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$102,200
$91,250 down + $10,950 closing
Monthly Mortgage
$1,785
on $274K loan
Monthly Cash Flow
$-747
after all expenses
Annual Cash Flow
$-8,960
before taxes
Cash Flow Breakdown
Monthly Rent$1,790
Less Expenses−$752
Less Mortgage−$1,785
Monthly Cash Flow$-747
Is Virginia Beach a Good Place to Invest in Rental Property?
Virginia Beach, VA has a population of 460,490 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 $365,000 paired with median rents of $1,790/mo produces an estimated cap rate of 4.02%.
Property taxes at 0.79% are well below the national average of ~1.1%, providing a meaningful cash flow advantage many investors overlook. The vacancy rate of 4.6% is impressively low, indicating tight rental supply and strong tenant demand — favorable for landlords.
At a price-to-income ratio of 4.8x, homes cost about 4.8 times the local median income of $76,400. This moderate ratio indicates a balanced rent-vs-buy market. 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: Virginia Beach presents moderate opportunities. Cap rates near 4.02% mean deals need careful sourcing — look for value-add rehabs or emerging neighborhoods where rents are climbing.
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