Best States for Rental Property Investing
States ranked by cap rates, appreciation, landlord laws, and overall investment potential.
West Virginia
Mississippi
Kentucky
Oklahoma
Louisiana
Illinois
Kansas
Arkansas
Alabama
Ohio
Florida
South Carolina
Georgia
Texas
Michigan
Indiana
Pennsylvania
Missouri
Iowa
Nebraska
Connecticut
Tennessee
Virginia
New Mexico
Arizona
Nevada
North Carolina
North Dakota
Wisconsin
Montana
Maine
Colorado
Alaska
South Dakota
Maryland
Wyoming
New Hampshire
Rhode Island
Idaho
Utah
Delaware
Oregon
Hawaii
Minnesota
Vermont
New York
New Jersey
District of Columbia
Massachusetts
California
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📊 How We Ranked These
Our state investment rankings combine landlord-friendliness scores, average cap rates across the state, historical appreciation rates, and economic indicators like job growth and population trends. States that balance strong cash flow potential with legal protections rank highest.
Frequently Asked Questions
Should I invest in my home state or out-of-state?
It depends on your local market conditions. Many coastal investors find better cash flow in Midwest and Southern states. Out-of-state investing requires good property management but can significantly improve returns.
What cap rate should I target?
Most investors target 6-10% cap rates for rental properties. Higher cap rates (8%+) typically come with more risk or management intensity. Markets under 5% are often appreciation plays rather than cash flow investments.