Short answer: It depends on price and rent. For the US median home ($360,600) renting for the median 3-bedroom rent ($1,677/mo) with 20% down, cash flow breaks even at about 1.59% after taxes, insurance, vacancy, maintenance and management (Census ACS 2024). That is below Freddie Mac's record low of 2.65%. Today's average is 7.32%. Only 3 of 98 big US cities break even at today's rate on a median home.
Definition
A rental's break-even mortgage rate is the loan interest rate at which the property's monthly cash flow is exactly $0: rent minus taxes, insurance, HOA and budgets for vacancy, maintenance and management just covers principal and interest. Above it, the property loses money each month.
By the numbers: For the US median home with 20% down it is about 1.59%, below Freddie Mac's record low of 2.65%; only 3 of the 98 big US rental markets FirstDoor compared break even at today's 7.32% (Census ACS 2024; Freddie Mac, October 22, 2026).
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Starts at the US median home ($360,600) and 3-bed rent ($1,677/mo), Census ACS 2024, at Freddie Mac's 7.32% rate. Assumes tax at 0.89% of price (US median), $1,200/yr insurance, 3% closing costs, 5% vacancy, 5% maintenance and 8% management. Adjust all of these in the full calculator.
The short answer
A median-priced US home renting for the median 3-bedroom rent breaks even at a 30-year rate of about 1.59% with 20% down, after taxes, insurance and budgets for vacancy, maintenance and management. That is below the lowest rate Freddie Mac has ever recorded, 2.65% on January 7, 2021. Today's average is 7.32% (October 22, 2026).
Across the 98 big US rental markets FirstDoor compared, the typical city's median home needs about 2.25% to break even. Only 3 (Detroit, MI, Cleveland, OH and Toledo, OH) break even at today's rate, and 39 would at the record low. In 22, even a 0% loan with 20% down would not cover the costs.
Good to know: This is educational, not investment advice. Freddie Mac's survey rate is for owner-occupied homes; investment property loans usually price higher, so a real rental loan needs even more room. Cash flow here is before income tax and ignores appreciation and loan paydown, the same way FirstDoor's score does.
Why the rate matters so much
On a 30-year loan, the interest rate sets most of your biggest monthly cost. On the US median home's $288,480 loan (20% down), each percentage point near today's rate moves principal and interest by about $192 a month. Rent, taxes and insurance don't care what rate you got.
Break-even rate = the rate where rent − operating costs = principal & interestOperating costs are tax, insurance, HOA and FirstDoor's default 5% vacancy, 5% maintenance and 8% management. Whatever net operating income is left is what the mortgage can eat before cash flow goes negative. If NOI is small next to the loan, no realistic rate saves the deal.
Tip: Type a listing into the rental cash flow calculator, then change only the rate to see your own break-even. The DSCR calculator shows how a lender sees the same math.
The same house at every rate since 2019
The US median home ($360,600) renting for the US median 3-bedroom gross rent ($1,677/mo), 20% down, with Freddie Mac's weekly 30-year average at different points in time:
| Rate | P&I / mo | Cash flow / mo | Cash-on-cash | DSCR |
|---|---|---|---|---|
| Record low (January 7, 2021): 2.65% | $1,162 | −$155 | -2.2% | 0.87 |
| 2021 average: 2.96% | $1,210 | −$202 | -2.9% | 0.83 |
| 2019 average: 3.94% | $1,367 | −$360 | -5.2% | 0.74 |
| 2022 average: 5.34% | $1,609 | −$602 | -8.7% | 0.63 |
| 2024 average: 6.72% | $1,865 | −$858 | -12.4% | 0.54 |
| 2025 average: 6.60% | $1,842 | −$835 | -12.1% | 0.55 |
| Today (October 22, 2026): 7.32% | $1,982 | −$974 | -14.1% | 0.51 |
| Recent peak (October 26, 2023): 7.79% | $2,075 | −$1,067 | -15.4% | 0.49 |
Click a row to open it in the calculator. Annual averages are computed from Freddie Mac's weekly survey. Even at the 2021 low, the typical home only got close; buyers then made money mostly on appreciation, not monthly cash flow.
Red flag: "Buy now, refinance later." A refinance is a bet that rates fall and that you still qualify. Underwrite the deal at the rate you can lock today.
Break-even rate in 98 cities
Each city's median-priced home renting for the city's median 3-bedroom gross rent, 20% down on a 30-year loan, the city's median property tax, $1,200 a year insurance (assumed), 5% vacancy, 5% maintenance, 8% management. The break-even rate is where monthly cash flow hits $0; the next column is the rate for $200 a month, FirstDoor's strong mark. Sorted by break-even rate.
| # | City | Median value | 3-bed rent / mo | Break-even rate | Rate for $200/mo | Cash flow at 7.32% |
|---|---|---|---|---|---|---|
| 1 | Detroit, MI | $95,900 | $1,255 | 12.37% | 8.89% | $284 |
| 2 | Cleveland, OH | $109,600 | $1,105 | 8.35% | 4.89% | $63 |
| 3 | Toledo, OH | $122,600 | $1,146 | 7.58% | 4.40% | $17 |
| 4 | Pittsburgh, PA | $220,400 | $1,630 | 6.30% | 4.48% | −$120 |
| 5 | Birmingham, AL | $189,800 | $1,303 | 5.59% | 3.36% | −$173 |
| 6 | Rochester, NY | $164,300 | $1,315 | 5.19% | 2.53% | −$182 |
| 7 | Memphis, TN | $209,800 | $1,418 | 5.00% | 2.92% | −$252 |
| 8 | Gainesville, FL | $270,800 | $1,789 | 4.93% | 3.34% | −$335 |
| 9 | Lubbock, TX | $223,600 | $1,583 | 4.87% | 2.91% | −$283 |
| 10 | Buffalo, NY | $187,000 | $1,217 | 4.64% | 2.23% | −$257 |
| 11 | Corpus Christi, TX | $234,000 | $1,616 | 4.58% | 2.68% | −$328 |
| 12 | Philadelphia, PA | $253,600 | $1,573 | 4.39% | 2.62% | −$379 |
| 13 | Kansas City, MO | $261,600 | $1,641 | 4.11% | 2.37% | −$425 |
| 14 | Tucson, AZ | $299,700 | $1,688 | 3.94% | 2.41% | −$511 |
| 15 | San Antonio, TX | $260,900 | $1,707 | 3.73% | 1.93% | −$470 |
| 16 | St. Petersburg, FL | $436,200 | $2,351 | 3.65% | 2.60% | −$801 |
| 17 | Wichita, KS | $212,900 | $1,310 | 3.63% | 1.37% | −$392 |
| 18 | Tulsa, OK | $234,400 | $1,371 | 3.58% | 1.54% | −$437 |
| 19 | Baltimore, MD | $247,400 | $1,569 | 3.58% | 1.65% | −$462 |
| 20 | Norfolk, VA | $311,200 | $1,805 | 3.51% | 2.00% | −$590 |
| 21 | Hialeah, FL | $446,800 | $2,326 | 3.51% | 2.47% | −$848 |
| 22 | Indianapolis, IN | $241,500 | $1,406 | 3.48% | 1.49% | −$462 |
| 23 | Irving, TX | $349,800 | $2,123 | 3.45% | 2.10% | −$674 |
| 24 | St. Louis, MO | $214,500 | $1,275 | 3.42% | 1.13% | −$416 |
| 25 | Jacksonville, FL | $325,300 | $1,767 | 3.31% | 1.84% | −$647 |
| 26 | Oklahoma City, OK | $259,300 | $1,479 | 3.28% | 1.41% | −$518 |
| 27 | Columbus, OH | $279,900 | $1,672 | 3.25% | 1.52% | −$564 |
| 28 | Orlando, FL | $430,200 | $2,293 | 3.24% | 2.13% | −$869 |
| 29 | Houston, TX | $301,200 | $1,819 | 3.13% | 1.51% | −$623 |
| 30 | Tallahassee, FL | $294,500 | $1,592 | 3.08% | 1.42% | −$615 |
| 31 | Cincinnati, OH | $263,300 | $1,588 | 3.02% | 1.13% | −$557 |
| 32 | Mesa, AZ | $440,800 | $2,076 | 2.93% | 1.83% | −$949 |
| 33 | Aurora, CO | $494,600 | $2,397 | 2.91% | 1.94% | −$1,068 |
| 34 | Phoenix, AZ | $454,900 | $2,142 | 2.85% | 1.78% | −$995 |
| 35 | New Orleans, LA | $305,100 | $1,624 | 2.83% | 1.19% | −$670 |
| 36 | Fort Worth, TX | $330,500 | $1,964 | 2.82% | 1.32% | −$727 |
| 37 | Omaha, NE | $269,500 | $1,658 | 2.81% | 0.94% | −$593 |
| 38 | Louisville, KY | $241,700 | $1,294 | 2.76% | 0.64% | −$537 |
| 39 | Spring Valley, NV | $440,200 | $2,095 | 2.73% | 1.61% | −$985 |
| 40 | Winston-Salem, NC | $281,200 | $1,445 | 2.65% | 0.83% | −$639 |
| 41 | El Paso, TX | $209,600 | $1,319 | 2.64% | 0.13% | −$477 |
| 42 | Arlington, TX | $337,800 | $1,887 | 2.56% | 1.06% | −$780 |
| 43 | Virginia Beach, VA | $403,200 | $2,019 | 2.56% | 1.31% | −$931 |
| 44 | Nashville, TN | $438,800 | $2,064 | 2.50% | 1.35% | −$1,025 |
| 45 | Greensboro, NC | $290,200 | $1,495 | 2.49% | 0.71% | −$679 |
| 46 | Colorado Springs, CO | $479,500 | $2,145 | 2.42% | 1.37% | −$1,135 |
| 47 | Milwaukee, WI | $207,900 | $1,273 | 2.34% | not even at 0% | −$499 |
| 48 | Las Vegas, NV | $458,300 | $2,067 | 2.29% | 1.18% | −$1,109 |
| 49 | Fresno, CA | $396,300 | $1,902 | 2.29% | 0.99% | −$959 |
| 50 | Lexington, KY | $318,400 | $1,570 | 2.20% | 0.55% | −$782 |
| 51 | Knoxville, TN | $294,700 | $1,379 | 2.17% | 0.37% | −$728 |
| 52 | Dallas, TX | $340,400 | $1,856 | 2.03% | 0.46% | −$861 |
| 53 | Bakersfield, CA | $406,500 | $1,986 | 2.02% | 0.73% | −$1,028 |
| 54 | Tempe, AZ | $488,600 | $2,072 | 1.98% | 0.91% | −$1,244 |
| 55 | Henderson, NV | $520,400 | $2,253 | 1.96% | 0.96% | −$1,328 |
| 56 | Charlotte, NC | $431,900 | $1,969 | 1.94% | 0.71% | −$1,107 |
| 57 | Albuquerque, NM | $324,600 | $1,550 | 1.85% | 0.17% | −$844 |
| 58 | Durham, NC | $439,400 | $1,989 | 1.70% | 0.47% | −$1,167 |
| 59 | Denver, CO | $636,400 | $2,570 | 1.48% | 0.63% | −$1,746 |
| 60 | Stockton, CA | $456,800 | $2,000 | 1.47% | 0.26% | −$1,255 |
| 61 | Tampa, FL | $494,400 | $2,176 | 1.41% | 0.30% | −$1,369 |
| 62 | Riverside, CA | $616,400 | $2,507 | 1.32% | 0.42% | −$1,729 |
| 63 | Reno, NV | $567,700 | $2,224 | 1.28% | 0.31% | −$1,599 |
| 64 | Raleigh, NC | $450,300 | $1,909 | 1.22% | not even at 0% | −$1,280 |
| 65 | Sacramento, CA | $515,800 | $2,170 | 1.14% | 0.05% | −$1,480 |
| 66 | Minneapolis, MN | $368,300 | $1,748 | 1.10% | not even at 0% | −$1,063 |
| 67 | Lincoln, NE | $278,200 | $1,403 | 0.99% | not even at 0% | −$814 |
| 68 | Richmond, VA | $377,900 | $1,682 | 0.90% | not even at 0% | −$1,118 |
| 69 | Tacoma, WA | $500,500 | $2,144 | 0.88% | not even at 0% | −$1,484 |
| 70 | St. Paul, MN | $301,800 | $1,475 | 0.87% | not even at 0% | −$896 |
| 71 | Worcester, MA | $411,700 | $1,892 | 0.85% | not even at 0% | −$1,225 |
| 72 | Alexandria, VA | $704,200 | $2,909 | 0.70% | not even at 0% | −$2,135 |
| 73 | Plano, TX | $541,700 | $2,366 | 0.64% | not even at 0% | −$1,653 |
| 74 | Chicago, IL | $341,200 | $1,661 | 0.63% | not even at 0% | −$1,042 |
| 75 | Atlanta, GA | $462,200 | $1,918 | 0.36% | not even at 0% | −$1,456 |
| 76 | Portland, OR | $588,200 | $2,364 | 0.19% | not even at 0% | −$1,888 |
| 77 | Newark, NJ | $396,600 | $1,811 | not even at 0% | not even at 0% | −$1,351 |
| 78 | Madison, WI | $418,400 | $1,876 | not even at 0% | not even at 0% | −$1,409 |
| 79 | Providence, RI | $413,800 | $1,525 | not even at 0% | not even at 0% | −$1,483 |
| 80 | Yonkers, NY | $521,700 | $2,128 | not even at 0% | not even at 0% | −$2,019 |
| 81 | Miami, FL | $598,200 | $2,179 | not even at 0% | not even at 0% | −$2,027 |
| 82 | Austin, TX | $571,000 | $2,217 | not even at 0% | not even at 0% | −$2,042 |
| 83 | Jersey City, NJ | $571,700 | $2,249 | not even at 0% | not even at 0% | −$2,158 |
| 84 | Salt Lake City, UT | $620,100 | $1,747 | not even at 0% | not even at 0% | −$2,312 |
| 85 | Washington, DC | $733,400 | $2,567 | not even at 0% | not even at 0% | −$2,408 |
| 86 | Santa Ana, CA | $772,600 | $2,602 | not even at 0% | not even at 0% | −$2,554 |
| 87 | Boston, MA | $722,800 | $2,153 | not even at 0% | not even at 0% | −$2,677 |
| 88 | Honolulu, HI | $850,100 | $2,425 | not even at 0% | not even at 0% | −$3,006 |
| 89 | Long Beach, CA | $849,500 | $2,676 | not even at 0% | not even at 0% | −$3,051 |
| 90 | New York, NY | $778,600 | $2,094 | not even at 0% | not even at 0% | −$3,217 |
| 91 | Anaheim, CA | $892,200 | $2,718 | not even at 0% | not even at 0% | −$3,233 |
| 92 | Arlington, VA | $945,700 | $3,306 | not even at 0% | not even at 0% | −$3,325 |
| 93 | San Diego, CA | $980,700 | $3,052 | not even at 0% | not even at 0% | −$3,496 |
| 94 | Seattle, WA | $950,800 | $2,951 | not even at 0% | not even at 0% | −$3,530 |
| 95 | Oakland, CA | $884,000 | $2,474 | not even at 0% | not even at 0% | −$3,654 |
| 96 | Los Angeles, CA | $947,900 | $2,564 | not even at 0% | not even at 0% | −$3,719 |
| 97 | Glendale, CA | $1,182,800 | $2,691 | not even at 0% | not even at 0% | −$4,960 |
| 98 | San Jose, CA | $1,271,200 | $3,368 | not even at 0% | not even at 0% | −$5,115 |
| United States | $360,600 | $1,677 | 1.59% | 0.05% | −$974 |
4 of 98 cities break even at 6% or higher and 6 at 5% or higher. "Not even at 0%" means rent minus operating costs can't cover a 0% loan for 80% of the price, so only a bigger down payment or a lower price helps.
Good to know: These are citywide survey medians with margins of error, and the median rental and median owner-occupied home are different houses. ACS gross rent includes utilities the renter pays. ACS reports rents above $3,500 only as "$3,500+", so San Francisco, CA, Irvine, CA are left out, and taxes above $10,000 are capped at $10,000.
If rates won't save the deal, what will
Rates are the one lever you don't control. The ones you do:
- Price. At the US median rent, about $204,000 breaks even at 7.32%. The max offer calculator finds that number for any listing.
- Down payment. About 59% down breaks even on the US median home at 7.32%. More cash buys cash flow but lowers your return on each dollar.
- Rent. About $2,865/mo breaks even on the US median home. Verify it with real comps.
- Market. The cities at the top of the table have more income per dollar of price. See best cities by cap rate.
Beginners also use house hacking, where owner-occupied loan terms apply, or buy below value with BRRRR. For what counts as enough, see what good cash flow is.
Worked example
The US median home ($360,600, Census ACS 2024) renting for the US median 3-bedroom gross rent ($1,677/mo), 20% down at its break-even rate of 1.59% for 30 years, the US median property tax ($3,211/yr), $1,200/yr insurance (assumed), 5% vacancy, 5% maintenance, 8% management, closing costs assumed at 3% ($10,818).
| Rent / mo | $1,677 |
| Operating costs (/mo) | −$669 |
| Mortgage (P&I) at 1.59% | −$1,008 |
| Cash flow / mo | −$1 |
| Cash flow at today's 7.32% | −$974 |
Frequently asked questions
What mortgage rate makes a rental property cash flow?
It depends on price and rent. For the US median home ($360,600) renting for the median 3-bedroom rent ($1,677/mo) with 20% down, cash flow breaks even at about 1.59% after taxes, insurance, vacancy, maintenance and management (Census ACS 2024). That is below Freddie Mac's record low of 2.65%. Today's average is 7.32%. Only 3 of 98 big US cities break even at today's rate on a median home.
How much does a 1% rate change affect a rental?
On a $288,480 30-year loan near today's rates, one percentage point is about $192 a month in principal and interest, which comes straight out of cash flow.
Should I wait for rates to drop to buy a rental?
FirstDoor doesn't predict rates. Underwrite at the rate you can lock today. In 59 of 98 big cities a median home would not break even even at the 2.65% record low, so price and rent matter more than timing.
Are investment property mortgage rates higher?
Usually, yes. Freddie Mac's survey is for owner-occupied loans, and loans on investment properties carry extra pricing adjustments and need more down, so expect a higher rate than the survey average.
Can I buy now and refinance later?
You can, but a refinance is a bet that rates fall and you still qualify, and it has its own closing costs. If the deal only works after a refinance, it doesn't work yet.
Keep learning
Sources
Educational content, not financial advice. Loan programs and requirements change; confirm with a lender.