Cities where rent is lowest relative to home value — appreciation-bet markets, not cash-flow markets.
Sub-3% gross yield means the home value vastly exceeds the rent it produces. Owner-occupiers pay for that with mortgage, but investors who try to rent out lose money on monthly cash flow.
These markets are usually California, NYC, parts of Florida. The thesis is appreciation; rent doesn't pay the bills.
1Beverly Hills, CALos Angeles-Long Beach-Anaheim · pop 31,02751Stable$3,672,505median home1.32%gross yield
3Newport Beach, CALos Angeles-Long Beach-Anaheim · pop 82,97078Hot$3,709,420median home1.35%gross yield
4Palo Alto, CASan Jose-Sunnyvale-Santa Clara · pop 67,65862Rising$3,683,761median home1.36%gross yield
5Burlingame, CASan Francisco-Oakland-Berkeley · pop 30,88564Rising$2,797,065median home1.50%gross yield
6Cupertino, CASan Jose-Sunnyvale-Santa Clara · pop 58,71065Rising$3,183,398median home1.54%gross yield
7Belmont, CASan Francisco-Oakland-Berkeley · pop 27,13262Rising$2,359,209median home1.57%gross yield
8Los Gatos, CASan Jose-Sunnyvale-Santa Clara · pop 32,95263Rising$2,705,565median home1.68%gross yield
9Menlo Park, CASan Francisco-Oakland-Berkeley · pop 33,04066Rising$2,867,595median home1.72%gross yield
10Los Altos, CASan Jose-Sunnyvale-Santa Clara · pop 30,86467Rising$4,681,519median home1.81%gross yield
11Saratoga, CASan Jose-Sunnyvale-Santa Clara · pop 30,48664Rising$4,209,301median home1.81%gross yield
12South Pasadena, CALos Angeles-Long Beach-Anaheim · pop 25,65665Rising$1,713,186median home1.88%gross yield
13Brentwood, TNNashville-Davidson–Murfreesboro–Franklin · pop 45,52569Rising$1,398,755median home1.94%gross yield
14Campbell, CASan Jose-Sunnyvale-Santa Clara · pop 42,89565Rising$1,977,750median home1.95%gross yield
15Sunnyvale, CASan Jose-Sunnyvale-Santa Clara · pop 156,79262Rising$2,144,024median home2.03%gross yield
16Manhattan Beach, CALos Angeles-Long Beach-Anaheim · pop 33,45363Rising$3,260,960median home2.04%gross yield
17San Carlos, CASan Francisco-Oakland-Berkeley · pop 29,40362Rising$2,476,617median home2.04%gross yield
20Lafayette, CASan Francisco-Oakland-Berkeley · pop 25,37149Stable$1,956,403median home2.17%gross yield
21University Park, TXDallas-Fort Worth-Arlington · pop 25,26878Hot$2,461,469median home2.28%gross yield
22Pleasanton, CASan Francisco-Oakland-Berkeley · pop 75,66440Cooling$1,595,629median home2.29%gross yield
23San Ramon, CASan Francisco-Oakland-Berkeley · pop 85,92447Cooling$1,537,480median home2.30%gross yield
24San Clemente, CALos Angeles-Long Beach-Anaheim · pop 62,62769Rising$1,744,315median home2.32%gross yield
25Redwood City, CASan Francisco-Oakland-Berkeley · pop 82,98256Stable$1,894,827median home2.41%gross yield
26Mountain View, CASan Jose-Sunnyvale-Santa Clara · pop 87,31662Rising$2,029,113median home2.41%gross yield
30Fountain Valley, CALos Angeles-Long Beach-Anaheim · pop 56,03672Rising$1,387,373median home2.44%gross yield
31Milton, GAAtlanta-Sandy Springs-Alpharetta · pop 41,49069Rising$951,308median home2.44%gross yield
32Fremont, CASan Francisco-Oakland-Berkeley · pop 228,19253Stable$1,538,830median home2.45%gross yield
33Foster City, CASan Francisco-Oakland-Berkeley · pop 32,65754Stable$1,908,757median home2.47%gross yield
34San Mateo, CASan Francisco-Oakland-Berkeley · pop 103,00654Stable$1,692,590median home2.52%gross yield
35Santa Monica, CALos Angeles-Long Beach-Anaheim · pop 90,72945Cooling$1,711,898median home2.53%gross yield
36Irvine, CALos Angeles-Long Beach-Anaheim · pop 318,68369Rising$1,566,872median home2.53%gross yield
37Santa Clara, CASan Jose-Sunnyvale-Santa Clara · pop 133,13265Rising$1,766,558median home2.53%gross yield
39Westfield, NJNew York-Newark-Jersey City · pop 32,05076Rising$1,291,636median home2.56%gross yield
40Costa Mesa, CALos Angeles-Long Beach-Anaheim · pop 109,13170Rising$1,416,645median home2.58%gross yield
41Union City, CASan Francisco-Oakland-Berkeley · pop 66,19646Cooling$1,265,098median home2.58%gross yield
42Laguna Niguel, CALos Angeles-Long Beach-Anaheim · pop 64,18573Rising$1,500,721median home2.59%gross yield
43Berkeley, CASan Francisco-Oakland-Berkeley · pop 121,74941Cooling$1,451,222median home2.59%gross yield
44Encinitas, CASan Diego-Chula Vista-Carlsbad · pop 61,13769Rising$1,931,548median home2.62%gross yield
45Santa Barbara, CASanta Maria-Santa Barbara · pop 87,29166Rising$1,854,699median home2.63%gross yield
46Huntington Beach, CALos Angeles-Long Beach-Anaheim · pop 193,15168Rising$1,364,265median home2.64%gross yield
47Danville, CASan Francisco-Oakland-Berkeley · pop 43,41047Cooling$1,915,125median home2.69%gross yield
48Franklin, TNNashville-Davidson–Murfreesboro–Franklin · pop 89,14273Rising$916,079median home2.69%gross yield
49San Rafael, CASan Francisco-Oakland-Berkeley · pop 59,96151Stable$1,337,270median home2.70%gross yield
Gross yield = annual rent ÷ home value. Doesn’t account for vacancy, management, maintenance, taxes, insurance, or financing. Use /tools/roi/ for full net analysis.