Wilmington is the largest coastal North Carolina metro, anchored by a deep port economy, a meaningful film and television production industry, and the University of North Carolina Wilmington. The 2.87% cap rate at a $435,000 median price reflects sustained coastal-NC in-migration and the post-2020 remote-worker premium. The 0.39% rent-to-price ratio sits below the 1% rule. Population growth at 1.8%/yr is among the strongest in the Carolinas.
Employment is anchored by the Port of Wilmington (the major NC container port), the broader maritime and logistics economy, the North Carolina film industry (Wilmington has historically been one of the largest non-LA film production hubs in the country — NC's film tax credit drives this, though the credit has been periodically reduced and reinstated; verify current incentive status before underwriting any film-economy thesis), New Hanover Regional Medical Center / Novant Health, the University of North Carolina Wilmington (~17K students), Live Oak Bank (a major small-business lender headquartered here), nCino (banking software), Corning's optical fiber operations, and the broader tourism and beach economy along the Wrightsville-Carolina-Kure beach chain. Submarkets stratify dramatically by water and beach access: downtown / historic district has walkable urban-character premium pricing; Wrightsville Beach, Carolina Beach, and Kure Beach are STR-leaning with significant insurance and regulatory exposure; the Mayfaire / Landfall / Porters Neck areas are premium suburban-school; Castle Hayne and Leland (across the Cape Fear) extend the metro with cheaper basis.
North Carolina property tax at 0.76% is moderate, and New Hanover County's reassessment cycle is multi-year (newer buyers can pay materially more than seller's old bill — model accordingly). NC state income tax is a flat ~4.5%. Insurance is the dominant operational variable — Wilmington sits on the Atlantic coast with significant hurricane exposure (Hurricane Florence in 2018 caused catastrophic damage; Helene in 2024 caused widespread inland flooding through the Carolinas — both events repriced insurance). Beach properties pay materially higher premiums than mainland Wilmington. Flood zone designations matter sharply. Get a binder quote per address. STR regulation varies between Wilmington proper (more restrictive) and the beach municipalities (mixed). The structural advantages: durable port + healthcare + education employment; growth thesis remains intact. The structural risks: hurricane exposure and insurance trajectory are real and need honest underwriting.
Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026
Wilmington's 0.4% rent-to-price ratio is well below the 1% rule. At median prices of $435,000, the $1,690/mo rent produces only $1,040/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 ($87K at 7%) would result in approximately $-1,274/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 21.4x gross rent multiplier and 5% vacancy rate position Wilmington as a growth-dependent market. With annual appreciation at 3.7%, total returns (cash flow + equity growth) run approximately 6.6% before financing leverage.
All figures below are computed from Wilmington's real market medians. Use them as a baseline; override with property-specific numbers in the calculators.
At 0.76% effective rate on the $435,000 median price, the annual tax bill is $3,306 — that's below national average (-28% 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.
If Wilmington continues appreciating at 3.7%/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 | $435K | $1,690 | 2.9% |
| Year 1 | $451K | $1,741 | 2.9% |
| Year 2 | $468K | $1,793 | 2.8% |
| Year 3 | $485K | $1,847 | 2.8% |
| Year 4 | $503K | $1,902 | 2.8% |
| Year 5 | $522K | $1,959 | 2.8% |
Same median-priced Wilmington 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 | $435K | $1,040 | $12,480 | 2.9% |
| 20% down conventional @ 7% | $100K | $-1,274 | $-15,290 | -15.3% |
| 25% down DSCR @ 8.5% | $126K | $-1,469 | $-17,626 | -14.0% |
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) | $326K | $1,437 | $9,838 | 3.0% | $820 |
| At median | $435K | $1,690 | $10,975 | 2.5% | $915 |
| Above median (~125% price) | $544K | $1,943 | $12,112 | 2.2% | $1,009 |
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 Wilmington's historical appreciation rate of 3.7%:
On a $87K down payment, that's a 41.7% total ROI over 5 years (not annualized). Tax benefits from depreciation are additional and depend on your personal tax bracket.
Automated checks against the underlying data — surface only the risks that actually apply to Wilmington, not generic boilerplate:
Pre-filled with Wilmington medians. Adjust to match a specific property.
Factor in financing to see your actual return on invested capital in Wilmington.
Wilmington, NC has a population of 125,948 and has been growing at 1.8% annually — above the national average, suggesting steady demand pressure on housing. The median home price of $435,000 paired with median rents of $1,690/mo produces an estimated cap rate of 2.87%.
Property taxes at 0.76% are well below the national average of ~1.1%, providing a meaningful cash flow advantage many investors overlook. The vacancy rate of 5% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 8.2x, homes cost about 8.2 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 3.7% annually. Above-average appreciation adds an equity component to total returns, though deals should still pencil on cash flow alone.
Bottom line: At current median prices, Wilmington 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.