Short answer: In Phoenix, AZ, the median home value is $454,900 and the median 3-bedroom rents for $2,142/mo (Census ACS 2024). That's a rent-to-price ratio of 0.47%, so it misses the 1% rule and ranks #27 of the 50 largest US rental markets. With 20% down at 7.40%, FirstDoor scores a median-priced home Pass (−$1,125/mo cash flow).
Key numbers
The 1% rule in Phoenix
A quick screen many investors start with: is monthly rent at least 1% of the price? In Phoenix, here's the answer on typical numbers.
Across all rentals (not just 3-bedrooms) the ratio is 0.38%. A home renting for the median 3-bedroom rent would need to cost about $214,000 or less to pass.
A typical Phoenix home, scored
We took a home at the median value, gave it the median 3-bedroom rent, and ran it through the same math as the FirstDoor calculator: 20% down, a 30-year loan at 7.40%, the city's median tax rate, and standard expense budgets.
| 3-bedroom rent (median) | $2,142 |
| Property tax ($1,816/yr, local median) | −$151 |
| Insurance ($2,270/yr, assumed) | −$189 |
| Vacancy 6% · Maintenance 5% · Management 8% | −$407 |
| Net operating income | $1,395 |
| Mortgage (P&I on $363,920 at 7.40%) | −$2,520 |
| Monthly cash flow | −$1,125 |
What price works in Phoenix?
Same rent, different prices. Here's the most you could pay in Phoenix for each result, keeping the median 3-bedroom rent and local tax rate.
Takeaways
- Phoenix's 0.47% ratio is well under the 1% rule (#27 of 50). Most investors here are betting on appreciation, not monthly income.
- A median-priced home here would cost you about $1,125/mo out of pocket after the mortgage and every expense. To break even you'd need to pay about $276,000, 39% below the median.
- Rents are outrunning prices: the median 3-bedroom rent rose 7.5% from 2023 to 2024 while values rose 3.1%. That slowly improves the math for buyers.
- Property taxes are light: the median bill is $1,816, about 0.40% of value versus 0.89% nationally.
Frequently asked questions
Does Phoenix pass the 1% rule?
No, on typical numbers. The median 3-bedroom gross rent is $2,142/mo and the median home value is $454,900 (Census ACS 2024 1-year), a ratio of 0.47%. To pass at that rent, a home would need to cost about $214,000 or less.
What is the typical rent for a 3-bedroom in Phoenix?
The median gross rent for a 3-bedroom in Phoenix, AZ is $2,142 a month, and $1,712 across all rentals (Census ACS 2024 1-year). Gross rent includes utilities the renter pays, so the landlord's share can be a bit lower. The 3-bedroom median rose 7.5% from 2023.
Can you cash flow a rental in Phoenix?
At the median price, not easily. With 20% down at 7.40% and realistic expenses, a $454,900 home renting for $2,142 loses about $1,125/mo. It breaks even at roughly $276,000.
How much cash do you need to buy a typical rental in Phoenix?
About $104,580: a 20% down payment of $90,980 plus closing costs we assume at 3% ($13,600). Lenders often also want several months of reserves. Investment loans commonly need 15–25% down.
Is Phoenix a good place to buy a first rental?
FirstDoor scores a median-priced home in Phoenix as Pass (0 of 8 points). That's a starting point, not a verdict on every listing: neighborhoods vary, and buying below the median changes the math. Run any listing through the free calculator.
Compare similar markets
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Sources
Data: U.S. Census Bureau, 2024 American Community Survey 1-year estimates (released September 2025); year-over-year changes compare with 2023. Mortgage rate: Freddie Mac PMMS, week of October 15, 2026. Retrieved October 15, 2026. Insurance ($2,270/yr), closing costs (3%), maintenance (5%) and management (8%) are FirstDoor assumptions, not local data. Investment-property loans often price above the PMMS average. Medians describe the whole city, not any one home. Educational content, not financial advice.