Real Estate Investing in Memphis, Tennessee (38120)
Everything the listing leaves out — vacancy, rent trend, cap rate, landlord climate. All free.
Should you buy in 38120 (Memphis, TN)? Our answer, based on the numbers below.
Mixed signals — some positives, some negatives. Worth considering but not a slam-dunk.
A middle-of-the-road market. Workable, but the best opportunities may be nearby ZIPs rather than this one.
- Elevated vacancy: 8.2% vacancy may signal weakening demand.
- High price-to-rent: Price-to-rent ratio 25.1 — hard to cash-flow at these prices.
What’s happening in Memphis, TN (38120)?
Click any question — our AI will research it live from the web and show you sources.
Market Analysis: 38120 Memphis
This part of Shelby County is not an easy win. The 38120 ZIP records softness in key indicators, and the playbook that works in cleaner markets often stalls here.
The investment case in 38120 is solid only for operators who understand what they are buying. A $428K median suggests accessibility, but management intensity, vacancy drift, and capex surprises are real.
On balance, 38120 offers a low basis, the region around Memphis has moved on in ways that the ZIP itself has not fully absorbed. The result is a discount with genuine reasons.
Employment concentration in 38120 leans toward sectors with higher volatility. The demographic consequence is income fluctuation that investors need to factor into their pro forma.
New investors are better served looking at Memphis's stable or hybrid ZIPs before stepping into 38120. The learning curve here is expensive when the lesson is wrong.
Here's what matters if you're considering buying a home in Memphis:
Property Strategy for 38120
Which property type performs best in this market?
📊 Compare All Property Types →
| Type | Median Value | Est. Rent | Cap Rate | 5yr CAGR | $/Bedroom |
|---|---|---|---|---|---|
| 1BR | $89,129 | $1,450 | 11.7% | +6.3% | $89,129 |
| 2BR | $181,694 | $1,600 | 6.3% | +4.3% | $90,847 |
| 3BR | $309,147 | $2,110 | 4.9% | +4.1% | $103,049 |
| 4BR | $497,109 | $2,460 | 3.6% | +4.7% | $124,277 |
| 5BR | $745,217 | — | — | +4.7% | $149,043 |
Market Trends
Home Value History (with trend line)
Rent History (with trend line)
📊 How Does 38120 Compare?
| Metric | 38120 | Memphis | Memphis, TN-MS-AR | Tennessee |
|---|---|---|---|---|
| Home Value | $428,170 | $150,680 | N/A | $327,001 |
| 5-Year CAGR | 2.5% | 2.6% | N/A | 7.7% |
| Avg Rent | $1,425 | $1,243 | N/A | - |
| Cap Rate | 2.6% | 6.8% | - | - |
Similar ZIPs Within 25 Miles
Compare other nearby markets to see if a neighbor offers a better fit.
Landlord Ground Truth
Real numbers from people who own or manage rentals in ZIP 38120 (Memphis, TN). Anonymous, moderated, never written by AI.
Do you own or manage rentals in ZIP 38120 (Memphis, TN)?
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Property managers serving Shelby County
Manage rentals here? List your business →Advantage Property Management offers property management services in Memphis, TN, and surrounding areas, including Section 8 property management, maintenance, and renovations. summary from their website
Enterprise Property Management offers property management services in Memphis. summary from their website
Foundation Property Management offers property management services in Memphis, TN. summary from their website
Listings are shown for convenience — Repit doesn’t endorse or vet these companies. Ratings shown come only from email-verified visitors.
📊 Market Snapshot
| Home Value | $428,170 |
| Monthly Rent | $1,425 |
| Price-to-Rent | 25.1:1 |
| 1% Rule | ✗ Fails |
💰 Return Metrics
| Gross Yield | 4.0% |
| Cap Rate | 2.6% |
| 5-Year IRR | 5.1% |
📈 Home Appreciation
| 1-Year | +2.2% ▲ |
| 3-Year CAGR | +0.7% ▲ |
| 5-Year CAGR | +2.5% ▲ |
| 10-Year CAGR | +4.9% ▲ |
🏠 Rent Trends
| 1-Year | -8.0% ▼ |
| 3-Year CAGR | N/A |
| 5-Year CAGR | N/A |
The current 30-yr mortgage rate (6.8%) exceeds the estimated cap rate (2.6%). Financing reduces your cash-on-cash return below the cap rate. Markets like this may still make sense as IRR plays — factoring in appreciation, depreciation, and a future refinance when rates drop.
Run an IRR Analysis →⚠️ Risk Signals
Composite view of factors that can impact a ZIP's stability and your downside risk.
Demographics in 38120
Population: 13,249
Crime & Safety
Crime & Safety Data Coming Soon
We're integrating comprehensive crime statistics including violent crime rates, property crime, and safety scores to help you make informed investment decisions.
Expected: Q1 2025
🎓 Schools in 38120
Schools in This ZIP Code
About Repit School Scores
Traditional school ratings rely heavily on standardized test scores, which often reflect family income more than school quality. Repit takes a different approach.
We evaluate schools based on factors that research shows actually impact educational outcomes:
- Class Size — Smaller classes mean more individual attention
- School Funding — Resources available for programs, staff, and facilities
- Community Factors — Neighborhood characteristics that influence student success
- School Environment — Size, type, and structure
Scores are updated annually using federal education data.
🎓 Nearby Colleges & Universities
Investor Insight: With 5,147 students living off-campus nearby, this area has strong rental demand from the college population.
Frequently Asked Questions
Where do home prices stand in Memphis, TN?
Memphis, TN home values average about $428K. That price point suits investors targeting rentals with $1,425/mo in monthly income.
Is Memphis, TN good for house hacking?
House hacking in Memphis, TN is a challenging. With home values around $428K and rents at $1,425/mo, owner-occupants can offset a meaningful share of PITI.
Is the tenant base reliable in Memphis, TN?
Tenant demand in Memphis, TN is solid. The local workforce $1,425/mo rents across most rental classes.
Which investment style suits Memphis, TN?
Investors usually favor careful cash-flow rentals with hands-on management in Memphis, TN. With home values at $428K and rents near $1,425/mo, other strategies can work but produce predictable rather than outsized returns.
What is it like being a landlord in Memphis, TN?
TN ranks as a landlord-friendly state for landlord-tenant law. Memphis generally follows the statewide framework, so landlords face reasonable operating rules.
You know 38120 now. You don’t know where it ranks.
This page stays free — all of it. What one page can’t tell you is how 38120 compares to every other market. Investor ($19/mo) screens every U.S. ZIP by cap rate, the 1% rule, vacancy and landlord climate, and exports your shortlist.
How 38120 ranks in Memphis, TN-MS-AR
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