Cash Flow Investing in Phoenix, AZ
Data-driven cash flow analysis for Phoenix, AZ — score breakdown, key investment metrics, and how it compares to other markets.
Last updated: May 2026
Score Breakdown
Key Metrics for Cash Flow
Cap Rate
4.9%
Moderate
Rent-to-Price
0.43%
Below 1% rule
Vacancy Rate
8.3%
Elevated
Property Tax
0.62%
Very low
Cash Flow Investment Thesis
Phoenix is a migration magnet with strong semiconductor and tech job growth (TSMC, Intel). Cap rates have compressed from the 2020-2021 price run-up, but population growth supports long-term rent appreciation.
How Phoenix Compares
| Rank | City | Cash Flow Score | Cap Rate | Median Price |
|---|---|---|---|---|
| #32 | Richmond, VA | 3.8 | 6.2% | $280,000 |
| #33 | Philadelphia, PA | 3.8 | 5.6% | $240,000 |
| #34 | Nashville, TN | 3.8 | 5.2% | $400,000 |
| #35 | Portland, OR | 3.8 | 4.2% | $480,000 |
| #36 | Phoenix, AZ | 3.8 | 4.9% | $385,000 |
| #37 | Houston, TX | 3.7 | 6.3% | $265,000 |
| #38 | Chicago, IL | 3.5 | 6.0% | $275,000 |
Showing markets ranked near Phoenix for this strategy.
Quick Math: Estimated Annual Return
Based on median market data. Your actual returns will vary based on specific property, financing, and management costs. Always run your own analysis before investing.
Frequently Asked Questions
What is the cash flow score for Phoenix, AZ?
Phoenix, AZ scores 3.8 out of 10 on our cash flow score, ranking #36 out of 52 markets we track. Weighted composite: rent-to-price ratio (30%), cap rate (30%), low vacancy (20%), low property taxes (20%). Scale 0–10.
Is Phoenix a good city for cash flow investing?
Phoenix, AZ ranks #36 for cash flow investing with a score of 3.8/10. While not a top-ranked market for this strategy, it may have strengths in other investing approaches.
What is the average cap rate in Phoenix?
The average cap rate in Phoenix, AZ is 4.9%. The median home price is $385,000 with a median monthly rent of $1,650, resulting in a rent-to-price ratio of 0.43%.
What are the property taxes in Phoenix?
The effective property tax rate in Phoenix, AZ is 0.62%. On a $385,000 property, that translates to approximately $2,387 per year in property taxes.
How does Phoenix compare to other cash flow markets?
Among our 52 tracked markets, Phoenix, AZ ranks #36 for cash flow investing. Other markets may be stronger for this particular strategy, though it may excel in different approaches.
Does Phoenix meet the 1% rule?
Phoenix, AZ has a rent-to-price ratio of 0.43%, which falls significantly below the 1% rule. However, the 1% rule is a rough guideline — individual deals can still cash flow well in this market.
Run Your Own Numbers for Phoenix
Use our free calculators pre-filled with Phoenix, AZ market data, or adjust the numbers for your specific deal.
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