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.
Minnesota guide
Minnesota breaks the Midwest pattern twice.
First, it has the lowest effective property tax rate of the seven states in this set — 1.00% — which on the $375,000 statewide median produces a $3,750 bill. Second, it has an insurance market that behaves like a catastrophe state: $3,333 a year at $300,000 of dwelling coverage, and a single-year premium jump in 2025 that Insurify's series records as 34%, the largest of any state in the country.
Put those together on the median house and the two bills land within $417 of each other. Neither dominates. What they do jointly is push a $375,000 house — the most expensive median in this Midwest set — into a 3.70% cap rate and a -$714.21 monthly cash flow at 25% down.
There is also a Minnesota-specific line at closing that catches out-of-state investors: a Mortgage Registry Tax of 0.23% of the debt secured, paid by the borrower when the mortgage is recorded. Section 1 puts a dollar figure on it.
A note before you start: this is general educational information about how rental property arithmetic works in Minnesota. It is not investment, tax, insurance, or legal advice, and it is not a recommendation about any property. Minnesota property tax runs through a class-rate system administered by county assessors, and insurance is priced per structure. Talk to a Minnesota CPA about tax treatment, a licensed Minnesota insurance agent about a real quote, and a Minnesota real estate attorney about anything contractual.
The statewide median sale price is $375,000 (Minnesota Realtors' MLS-based statewide report, July 2026, up 2.7% year over year; the Twin Cities metro median was separately $408,000, up 3.3%). Redfin's statewide figure for May 2026 was $361,715 — about 3.6% lower, consistent with normal methodology variance between an association MLS report and an algorithmic aggregation.
Read the full Minnesota guide →21 min read · Updated 2026-08-28