Cap Rate in Philadelphia, PA

2026 Market Overview for Real Estate Investors

Avg Cap Rate

5.6%

#33 of 50 markets

Median Home Price

$240,000

Purchase price

Median Monthly Rent

$1,500

$18,000/yr gross

Rent-to-Price Ratio

0.63%

Moderate

Cap Rate Rating

Moderate

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

Market Snapshot

Population1,550,542
5-Year Population Growth-0.8%
Median Household Income$49,000
Vacancy Rate8.0%
Property Tax Rate1.36%($3,264/yr)

Investor Takeaway

Philadelphia offers good rent-to-price ratios for a major East Coast city. The university corridor (UPenn, Drexel, Temple) provides reliable tenant demand. Watch for the city wage tax impact on tenant affordability.

Quick Math

Estimated annual numbers for a median-priced property in Philadelphia, PA before financing:

Annual Gross Rent$18,000
Less Vacancy (8.0%)($1,440)
Less Property Tax (1.36%)($3,264)
Less Est. Insurance + Maintenance($4,800)
Estimated NOI$8,496
Implied Cap Rate3.5%

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

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Compare Other Markets

Baltimore, MD

$180,000 median

6.5%

Pittsburgh, PA

$180,000 median

7.2%

Richmond, VA

$280,000 median

6.2%

Chicago, IL

$275,000 median

6.0%

Charlotte, NC

$340,000 median

5.6%
View All 50 Markets →

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