Winston-Salem, NC Cap Rate: 4.50% — Rental Property Analysis
Winston-Salem is a mid-range market in the South with a mid-sized city of 253,540. At a 4.50% estimated cap rate, this is a moderate market where rents of $1,490/mo lag behind home prices. With a median home price of $275,000 and steady population growth supports long-term rental demand, Winston-Salem 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 $275,000 median price and $1,490/mo median rent
Est. Cap Rate
4.50%
1% Rule
0.54%
Fails
GRM
15.4x
Price / Income
6.2x
Market Data
Median Home Price$275,000
Median Monthly Rent$1,490
Property Tax Rate0.81%
Population253,540
Population Growth0.7% / yr
Median Household Income$44,600
Vacancy Rate6%
Annual Appreciation2.8%
2026 Market Update: Winston-Salem
Winston-Salem's 0.5% rent-to-price ratio is well below the 1% rule. At median prices of $275,000, the $1,490/mo rent produces only $1,032/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 ($55K at 7%) would result in approximately $-431/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 15.4x gross rent multiplier and 6% vacancy rate position Winston-Salem as a balanced market. With annual appreciation at 2.8%, total returns (cash flow + equity growth) run approximately 7.3% before financing leverage.
Cap Rate Calculator — Winston-Salem
Pre-filled with Winston-Salem medians. Adjust to match a specific property.
Property Details
$
$
3–8% typical
%
Monthly Expenses
0.81% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
3.73%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$10,255
net operating income
Gross Rent Multiplier
15.4x
High (>15)
1% Rule
0.54%
✗ Fails
Monthly Cash Flow
$855
before debt service
Annual Breakdown
Gross Rental Income$17,880
Less Vacancy−$1,073
Effective Income$16,807
Less Operating Expenses−$6,552
Net Operating Income$10,255
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Factor in financing to see your actual return on invested capital in Winston-Salem.
$
$68,750
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-7.49%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$77,000
$68,750 down + $8,250 closing
Monthly Mortgage
$1,345
on $206K loan
Monthly Cash Flow
$-481
after all expenses
Annual Cash Flow
$-5,767
before taxes
Cash Flow Breakdown
Monthly Rent$1,490
Less Expenses−$626
Less Mortgage−$1,345
Monthly Cash Flow$-481
Is Winston-Salem a Good Place to Invest in Rental Property?
Winston-Salem, NC has a population of 253,540 and has been growing at 0.7% annually — roughly in line with national trends, meaning demand is stable but not exceptional. The median home price of $275,000 paired with median rents of $1,490/mo produces an estimated cap rate of 4.50%.
Property taxes at 0.81% fall within the national average range and shouldn't present unusual challenges. The vacancy rate of 6% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 6.2x, homes cost about 6.2 times the local median income of $44,600. This elevated ratio means homeownership is stretched, supporting rental demand but limiting buyer pools. Home values have appreciated at roughly 2.8% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.
Bottom line: Winston-Salem presents moderate opportunities. Cap rates near 4.50% mean deals need careful sourcing — look for value-add rehabs or emerging neighborhoods where rents are climbing.
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