Cap rate, real cash flow, and return on the cash you put in — including the expenses most analyses leave out. Estimate only, not investment advice.
Estimates only — not investment, tax, or legal advice. How we calculate every figure
Estimated all-in monthly payment for a home price you have in mind.
What homeowners insurance costs in your state, and whether what you pay is out of line.
Income, savings, and debts in — max home price and qualification signal out.
A rental bought for $300,000 and sold seven years later for $394,780 nets $158,925 at closing — and owes about $24,753 of federal tax, $15,273 of it on depreciation you were required to take. Here is the math, why a sale with zero appreciation still owes tax, and the three clocks a fourth-quarter sale starts.
A leveraged rental makes money three ways and cash flow is only one of them. Here is what the other two are worth — and why the structure that maximises them is a bet, not a plan.
How to verify one specific rental deal: audit the seller's pro-forma line by line, comp a real rent, reassess the tax, age the systems, and price the offer the numbers actually support.
Set up basis correctly, claim the depreciation you are owed, survive the passive-loss rules, and know what the sale will cost — with every figure tied to the statute.
Maryland guide
Maryland is the state in this series where no single expense dominates. The effective property tax rate is 0.92% — the second-lowest here. Insurance is $2,051 a year at $300,000 of dwelling coverage — mid-range. On the $463,449 statewide median that is $4,263.73 of tax against $2,051 of insurance, a ratio of just 2.08 to 1, the closest to parity anywhere in this seven-state set. Neither line decides the deal.
Two things do decide it, and they are both easy to miss.
The first is the hurricane deductible trigger, which is the broadest in this series. In Maryland an insurer may apply the percentage deductible to a covered loss sustained while a hurricane warning is in effect for any part of the State, or within 24 hours after the last such warning is terminated. Not near the property. Not in the same county. Anywhere in Maryland. A warning that covers Ocean City can put a percentage deductible in play on a house in Montgomery County, more than 100 miles inland.
The second is price growth, or the absence of it. Maryland's recorded annual home appreciation rate is 0.60% — the lowest in this seven-state set, against Connecticut's 4.7% and New Jersey's 4.48%. Every property in this series loses money from operations. In most of these states the argument for buying anyway is appreciation. In Maryland that argument is running on 0.60%.
If you take one thing from this article: a property that does not cash flow and does not appreciate is not a strategy. It is a subscription.
A note before you start: this is general educational information about how rental property arithmetic works in Maryland. It is not investment, tax, insurance, or legal advice, and it is not a recommendation about any property. Maryland's recordation tax is set county by county with no statewide rate, and assessments run on a three-year cycle administered by the state. Talk to a Maryland CPA about tax treatment, a licensed Maryland insurance agent about a real quote, and a Maryland real estate attorney about anything contractual.
Read the full Maryland guide →21 min read · Updated 2026-08-28