Cap Rate in Knoxville, TN

2026 Market Overview for Real Estate Investors

Avg Cap Rate

5.8%

#30 of 50 markets

Median Home Price

$270,000

Purchase price

Median Monthly Rent

$1,400

$16,800/yr gross

Rent-to-Price Ratio

0.52%

Moderate

Cap Rate Rating

Moderate

Typical for stable markets with moderate growth potential. Balanced risk-return profile.

Market Snapshot

Population	192,648
5-Year Population Growth	+5.5%
Median Household Income	$44,000
Vacancy Rate	5.8%
Property Tax Rate	0.68%($1,836/yr)

Investor Takeaway

Knoxville offers Tennessee tax advantages with strong University of Tennessee-driven rental demand. Low property taxes boost effective returns compared to similar-sized markets.

Quick Math

Estimated annual numbers for a median-priced property in Knoxville, TN before financing:

Annual Gross Rent$16,800

Less Vacancy (5.8%)($974)

Less Property Tax (0.68%)($1,836)

Less Est. Insurance + Maintenance($5,400)

Estimated NOI$8,590

Implied Cap Rate3.2%

Estimates based on median values. Insurance + maintenance estimated at 2% of home value. Actual results vary by property condition, neighborhood, and management.