If you’ve been thinking about getting into real estate investing in 2025, one of the smartest moves you can make is targeting markets with strong rental ROI. We’re not talking about vague appreciation projections or overpriced coastal metros. We’re talking about real numbers: gross rental yield, rent-to-value ratios, and cash-on-cash returns that can actually generate income today. Whether you’re a seasoned investor looking to diversify or just starting out with a few thousand dollars, this list of 25 cities offers some of the best opportunities across the U.S. right now.
Let’s break down the top markets, why they’re winning, and what kind of returns you can realistically expect—based not just on rental yields, but also on affordability, tenant demand, and economic stability. And if you’re not ready to buy a full property yourself? Don’t worry—we’ll also show you how you can start investing fractionally with as little as $100.
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1. Detroit, Michigan
No surprise here—Detroit is leading the pack in 2025 with a staggering 21.95% gross rental yield. For cash flow-focused investors, this city remains the benchmark. The ongoing revitalization of neighborhoods like Midtown and Corktown continues to draw renters, and property prices are still far below national averages. Add in steadily rising home values and you’ve got the perfect mix of low buy-in and high monthly income. You can still buy homes in Detroit for under $100,000 and command rents north of $1,500 in the right areas. Beyond the numbers, Detroit has something else going for it: momentum. The city’s economy is diversifying, major employers are returning, and developers are finally reinvesting in both residential and commercial spaces. With plenty of room to scale and low initial costs, Detroit is arguably the best value proposition in the country right now for real estate investors.
2. Houma, Louisiana
Tucked away just over an hour from New Orleans, Houma is the definition of a sleeper hit. Monthly rent equals nearly 1% of property value here, which translates to a break-even payback period of under two years for many investors. Median home prices hover under $150,000, while average rents are above $1,400. That level of ROI is rare anywhere in the U.S.—and Houma is delivering it with stability. It benefits from its proximity to larger metros while maintaining its own economic identity rooted in energy, healthcare, and regional logistics. Investors are often surprised by how quickly properties rent and how low the competition is, particularly for renovated single-family homes.
3. Birmingham, Alabama
Birmingham has long been a favorite among investors for good reason: high yields, low prices, and consistent demand. In 2025, it’s back on top, delivering a projected 13.6% return on 3-bedroom rental homes in Jefferson County. You’ll find an investor-friendly environment here, where properties cost a fraction of what they would in Atlanta but with just as much rental demand. The city is also undergoing a steady transformation, which bodes well for appreciation down the line. New development in areas like Avondale and Woodlawn are creating walkable communities with rising rents, and Birmingham’s healthcare sector provides a deep tenant pool year-round.
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4. Cleveland, Ohio
Cleveland continues to outperform, offering a reliable 9.8% rental yield backed by a resilient economy. Anchored by the Cleveland Clinic, major universities, and a solid industrial base, the tenant pool here is steady and diverse. Median home prices in many neighborhoods remain affordable—often under $150,000—while rents are rising faster than national averages. If you’re after low entry costs and long-term rental income, Cleveland is a consistent performer. The city’s revitalization projects have expanded into previously overlooked neighborhoods, creating opportunities for value-add plays. Local incentives and infrastructure upgrades have also made it easier to renovate and lease quickly.
5. Toledo, Ohio
Toledo might not be on every investor’s radar, but that’s part of its charm. With yields over 10% and median home prices around $120,000, it’s a cash flow goldmine. A revitalized downtown, low vacancy rates, and a manufacturing-driven economy mean steady returns without heavy competition. Plus, rent growth continues to outpace inflation, which is a win for long-term investors looking to protect their margins. Toledo is also one of the most landlord-friendly cities in Ohio, making tenant management smoother than in some neighboring metros. It’s an easy city to navigate as a remote investor, with reliable property managers and stable rental demand.
6. Rochester, New York
Rochester is one of the most overlooked but promising cities in the Northeast for rental property investors. With a gross rental yield of 9.1% and a deep pool of stable tenants, the market here balances affordability with strong fundamentals. Rochester is anchored by multiple universities—including the University of Rochester and Rochester Institute of Technology—as well as a growing healthcare and biotech presence that provides long-term employment and rental stability. The average home price remains well below the national median, often around $175,000, while average rent for single-family homes hovers near $1,350. Neighborhoods like South Wedge, Park Avenue, and the East End have seen rising demand due to revitalization efforts and a younger demographic moving in. These areas blend historic charm with walkable amenities, which helps drive higher rents and lower vacancy. Rochester also boasts a highly livable lifestyle, with access to green space, culture, and Lake Ontario—making it a city where people want to stay, not just rent temporarily.
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7. Memphis, Tennessee
Memphis offers a compelling case for both cash flow and long-term appreciation, with a gross rental yield around 7.2% and steady rent growth between 6–8% annually. The city is a logistics powerhouse, home to FedEx’s global hub and a thriving transportation and warehousing sector. This creates consistent demand for rental housing among working-class tenants and young professionals alike. Properties in core neighborhoods such as Midtown, Cooper-Young, and Cordova typically rent quickly and experience low vacancy. Despite its growth, Memphis remains relatively affordable, with median home prices under $225,000 in many areas. The city has also invested heavily in redevelopment, improving infrastructure and increasing the appeal of once-neglected areas. Additionally, the landlord-tenant laws in Tennessee tend to favor property owners, making Memphis particularly attractive for out-of-state investors who want fewer legal headaches while earning strong monthly returns.
8. Youngstown, Ohio
Youngstown may not have the name recognition of larger Ohio metros, but it packs a punch for investors seeking a combination of cash flow and value appreciation. The city has seen nearly 69% appreciation in property values over recent years, and gross rental yields remain comfortably in the 8–10% range for many single-family properties. Average apartment rents stand around $925, and inventory remains accessible, with homes regularly priced below $120,000. The presence of Youngstown State University helps create a reliable source of renters, including students and university employees. But the story doesn’t stop there—Youngstown is undergoing a slow but steady economic comeback, thanks to investment in healthcare, logistics, and downtown redevelopment. Neighborhoods close to the university and the revitalized downtown core offer some of the best returns, especially for investors willing to upgrade properties and provide quality housing in a competitive market.
9. Columbus, Ohio
Columbus stands out as one of the most balanced and resilient markets in the Midwest. With a gross rental yield of 7.9% and a median home price that still hovers under $275,000 in many neighborhoods, the city offers both healthy cash flow and long-term value. Home to Ohio State University, a thriving tech sector, and several Fortune 500 employers, Columbus continues to attract young professionals, students, and families alike. Neighborhoods like Clintonville, Short North, and Olde Towne East offer diverse housing stock and rising rent potential. Columbus also benefits from a relatively low vacancy rate and strong population growth, making it an ideal city for investors who want predictable performance. With ongoing infrastructure improvements and a walkable urban core that’s become more desirable in recent years, this capital city checks nearly every box for real estate investors looking for stable ROI.
10. Milwaukee, Wisconsin
Milwaukee delivers solid rental yields around 7.7%, backed by an economy that includes healthcare, advanced manufacturing, and financial services. With a median home price around $225,000 and average rents over $1,400, investors can generate dependable cash flow while benefiting from the city’s affordability. Milwaukee’s rental market has matured in recent years, with tenants looking for more than just basic housing—they want access to walkable neighborhoods, proximity to the lakefront, and renovated properties. Areas like Bay View, Riverwest, and Walker’s Point are seeing increased interest, especially from young professionals and creatives who are priced out of nearby Chicago. The city is also expanding efforts to modernize its infrastructure and attract remote workers, which could fuel future rent growth. For those targeting long-term tenants and properties with appreciation upside, Milwaukee is a well-rounded option in the heart of the Midwest.
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11. Indianapolis, Indiana
Indianapolis continues to quietly outperform as a rental investment market, offering the kind of steady, predictable returns that attract both first-timers and seasoned buyers. The average rental yield here is just over 7%, supported by a median home price under $240,000 and monthly rents around $1,500. The city is anchored by a balanced economy that includes life sciences, logistics, insurance, and education, which collectively provide a deep and stable tenant base. Neighborhoods like Fountain Square, Broad Ripple, and Irvington offer both appreciation potential and attractive rent-to-value ratios, particularly for investors willing to take on cosmetic renovations. Indianapolis also benefits from a relatively low property tax rate, strong job growth, and a growing population of remote workers and millennials looking for more space without leaving city life behind. With a revitalized downtown and increasing demand for quality rentals, Indy is one of the Midwest’s most reliable bets.
12. Huntsville, Alabama
Huntsville is no longer just a hidden gem—it’s become a magnet for tech professionals, defense contractors, and real estate investors looking for long-term upside. As one of the fastest-growing cities in Alabama, Huntsville is supported by major employers like NASA, the U.S. Army, and a cluster of aerospace and engineering firms. With average home prices near $270,000 and rents exceeding $1,500, investors are seeing yields over 7% in many neighborhoods. The population boom in recent years has created a housing crunch, which is driving both rental and home prices higher. Huntsville’s appeal also lies in its quality of life: excellent schools, low crime rates, and relatively low cost of living. Submarkets like Madison and Hampton Cove are especially attractive for buy-and-hold investors who want appreciation without sacrificing immediate cash flow. Whether you’re targeting single-family homes or small multifamily units, Huntsville offers a strong blend of demand and affordability.
13. Dayton, Ohio
Dayton remains one of the Midwest’s most underrated rental markets, offering investors a unique opportunity to capitalize on high returns with very low entry costs. With home prices averaging around $165,000 and rents approaching $1,300 for renovated properties, gross yields regularly fall in the 8–10% range. The city’s economy is heavily influenced by healthcare, higher education, and aerospace, with Wright-Patterson Air Force Base playing a key role in employment stability. Dayton is also investing in its downtown area, converting old commercial buildings into apartments and adding new retail and restaurant infrastructure. Neighborhoods like South Park and Oregon District have become hotspots for young professionals and renters seeking walkability. Unlike faster-growing metros where prices are already inflated, Dayton still offers plenty of room for value appreciation—making it an attractive option for investors who prioritize both cash flow and long-term growth.
14. Kansas City, Missouri
Kansas City has emerged as one of the most balanced investment markets in the Midwest, thanks to its strong economy, growing population, and relatively affordable housing stock. Rental yields in the 7.5% range are achievable in core neighborhoods like Waldo, Midtown, and the Crossroads Arts District, where renter demand continues to outpace new supply. With a median home price around $240,000 and average rent at $1,500, the math here works well for investors seeking dependable income. What sets Kansas City apart is its infrastructure investment: the expansion of the streetcar line, airport renovations, and city-backed development initiatives are all enhancing property values. The local government has also made zoning easier for small multifamily and accessory dwelling units, creating more options for creative investors. The combination of cultural vibrancy, economic stability, and landlord-friendly policies make KC a city to watch—and act on.
15. Little Rock, Arkansas
Little Rock is a quietly powerful rental market that combines high gross yields with affordable acquisition costs. The average home price remains under $200,000, and typical rents hover near $1,200—yielding returns between 8% and 12% depending on the neighborhood. Nearly half the city’s residents rent, which creates strong ongoing demand for affordable single-family and small multifamily properties. Job growth is anchored by healthcare, government, and education, with multiple universities and hospitals contributing to tenant stability. Areas like Hillcrest and Midtown are seeing increased interest from both local and out-of-state investors, especially those targeting tenants with longer lease durations. With low taxes, landlord-friendly legislation, and steady population growth, Little Rock offers one of the best combinations of income and ease of management in the South.
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16. Tampa, Florida
Tampa continues to rise as one of Florida’s premier rental markets, particularly for investors focused on long-term growth combined with solid short-term cash flow. With a median home price of approximately $380,000 and average rents around $2,000, Tampa yields are hovering above 6%, which is especially impressive in a state known more for appreciation than cash flow. What makes Tampa stand out is its strong population growth—fueled by inbound migration from higher-cost states—as well as its robust job market across healthcare, tech, education, and tourism. The absence of a state income tax only sweetens the deal for both investors and renters. Popular rental neighborhoods like Seminole Heights, Carrollwood, and Westshore are seeing continuous demand, particularly among remote workers and young families. Tampa’s appeal as a year-round destination also makes it attractive for investors exploring mid- and short-term rental strategies. Factor in rising home values and continued infrastructure investment, and Tampa presents a compelling case for long-term portfolio growth.
17. Tulsa, Oklahoma
Tulsa has emerged as a dynamic blend of low-barrier entry and increasing rent growth, attracting investors who want both affordability and returns. With a median home price well under $200,000 and average rent hovering around $1,005, the city offers a gross rental yield of approximately 5.6%. While that yield may appear modest on paper, the real draw is in Tulsa’s upward trajectory. The city is seeing consistent population growth, thanks in part to targeted remote worker relocation programs, a vibrant arts scene, and a more livable cost of living than larger metros. Tulsa’s economy is bolstered by energy, aerospace, and finance, and the market is particularly favorable to small landlords and short-term rental operators. Neighborhoods like Brookside and Cherry Street are appealing to young professionals, while suburban areas like Broken Arrow offer value and long-term tenant stability. It’s a market with momentum—and room to move before values catch up to national averages.
18. Charlotte, North Carolina
Charlotte is a powerhouse rental market in the Southeast that balances economic strength, demographic growth, and investment potential. With median home prices just above $350,000 and two-bedroom rentals now averaging over $2,100, investors can secure yields around 6.8%—especially in up-and-coming areas outside the city center. The city is widely known as the second-largest banking hub in the U.S., which helps drive a strong employment base. But Charlotte is more than finance—it’s growing in tech, healthcare, and higher education, attracting both young professionals and families. Investors looking at neighborhoods like NoDa, Plaza Midwood, and South End will find strong appreciation potential and low vacancy. The city’s growing infrastructure and expanding public transit systems add to its long-term desirability. Whether you’re buying turnkey or value-add properties, Charlotte’s mix of consistent returns and urban expansion makes it one of the most balanced investment choices in the country.
19. Nashville, Tennessee
Nashville remains one of the most talked-about cities in the U.S., and for good reason. With a booming job market, cultural appeal, and vibrant tourism industry, the city offers investors a solid foundation for both long-term appreciation and strong rental income. The average home price is around $390,000, while rental rates—especially for well-located properties—have climbed to $2,400 or more, delivering yields near 6.5%. Nashville’s economy has expanded well beyond music, with healthcare, tech, and education sectors growing quickly. Short-term rentals have exploded in popularity here, particularly in tourist-heavy zones like Downtown, East Nashville, and The Gulch. That said, there are still opportunities for long-term investors, especially in neighborhoods just outside the urban core where price pressure hasn’t peaked. A growing population and consistent inbound migration ensure that demand for housing isn’t slowing anytime soon, which helps to maintain high occupancy and rising rents year after year.
20. Buffalo, New York
Buffalo continues to fly under the radar while delivering impressive rental returns in a state that’s often overlooked by cash flow investors. Properties here are still incredibly affordable—with many available under $150,000—and rental demand remains strong across working-class and student populations alike. Gross rental yields often surpass 10%, making it one of the few cities in New York State where income-focused investors can still thrive. Buffalo benefits from a diversified economy that includes healthcare, higher education, logistics, and growing investments in green energy. The presence of the University at Buffalo and other colleges provides a consistent stream of student renters. Neighborhoods like Elmwood Village and North Buffalo are particularly attractive due to their charm, walkability, and cultural vibrancy. As Upstate New York receives more attention from remote workers looking to escape the high prices of NYC and Boston, Buffalo is uniquely positioned to capture that wave—and reward those who got in early.
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21. Fort Wayne, Indiana
Fort Wayne is gaining traction as a top-tier rental market, especially for investors targeting strong returns in secondary cities. With average home prices under $200,000 and robust performance in the short-term rental space, Fort Wayne offers both affordability and revenue potential. The city’s Airbnb metrics are especially impressive: average occupancy rates exceed 50%, while daily rates in some neighborhoods approach $240, translating to monthly revenues near $8,700 for high-performing properties. Fort Wayne also shines in the long-term rental space, with stable demand driven by healthcare, education, and manufacturing. The city is home to multiple universities and medical centers, including the Parkview Health system and Indiana Tech, ensuring a steady tenant pipeline. Neighborhoods like West Central, Lakeside, and Downtown Fort Wayne are particularly attractive for investors seeking character properties in walkable, urban settings. As the city continues to invest in revitalization and infrastructure, early investors are well-positioned to benefit from both rental income and value appreciation.
22. Springfield, Missouri
Springfield stands out in Missouri for its versatility as a rental market, accommodating both short- and long-term investment strategies. Median home prices remain affordable, often below $180,000, while monthly rents continue to trend upward thanks to steady demand from students, healthcare workers, and local professionals. Short-term rental performance is especially notable, with Airbnb units averaging over $3,700 per month in revenue for top-tier listings. Occupancy rates remain strong, peaking during seasonal events and college semesters due to the presence of Missouri State University and other institutions. Long-term investors benefit from stable rental yields of 7–9%, while those with a hands-on approach can unlock higher margins through short-term rentals in well-located neighborhoods like Rountree, Phelps Grove, and University Heights. With low taxes, a pro-landlord legal environment, and minimal competition from institutional investors, Springfield offers a compelling mix of cash flow and operational flexibility.
23. Omaha, Nebraska
Omaha continues to punch above its weight in terms of rental investment potential. It’s a market known for stability rather than volatility, but that reliability is exactly what many investors are looking for in 2025. With median home prices around $250,000 and rent averages climbing toward $1,800 for well-located properties, gross yields of 6–10% are achievable depending on location and strategy. What makes Omaha particularly appealing is its diverse economy—anchored by insurance, transportation, technology, and finance—with major employers like Union Pacific, Mutual of Omaha, and PayPal keeping the job market resilient. The city also benefits from a healthy supply-demand balance in housing, meaning low vacancy rates and consistent appreciation. Neighborhoods such as Dundee, Benson, and Aksarben Village are popular among renters for their walkability and lifestyle appeal, offering investors a competitive edge in tenant retention. Omaha may not be flashy, but its dependable returns make it a rock-solid addition to any portfolio.
24. Dallas–Fort Worth, Texas
The Dallas–Fort Worth metroplex remains one of the most dynamic rental markets in the U.S., offering investors a rare combination of population growth, economic diversity, and scalable investment opportunities. Home prices have climbed in recent years, with median values now around $375,000, but rents have kept pace—especially for three-bedroom homes, which now average $2,450 across many suburbs. That puts gross rental yields around 7.2%, a strong figure for a metro area with this level of development and infrastructure. DFW benefits from a broad employment base, with Fortune 500 headquarters, healthcare systems, logistics hubs, and a booming tech scene all contributing to demand. The sheer size of the market means investors can tailor strategies to fit almost any niche—whether it’s long-term rentals in Plano, student housing near Denton, or short-term rentals in trendy neighborhoods like Deep Ellum or Bishop Arts. With business-friendly policies, no state income tax, and constant inward migration, DFW is a prime candidate for long-term portfolio growth.
25. Fresno, California
Fresno rounds out the list as one of the few California cities still offering respectable rental yields amid the state’s notoriously high housing costs. While not as affordable as many Rust Belt cities, Fresno remains a value play for West Coast investors, with average home prices around $350,000 and rents steadily rising—up 32.6% in 2024 alone. The current average rent sits around $1,650, producing yields that can cross 5% in the right neighborhoods. What makes Fresno particularly interesting is its relative affordability compared to coastal California metros, making it attractive to renters who are priced out of the Bay Area and Los Angeles. Its central location also provides access to both Northern and Southern California job markets. The local economy is supported by agriculture, education, and healthcare, and recent investment in downtown redevelopment has increased Fresno’s appeal to young renters and remote workers. For investors willing to navigate California’s regulatory environment, Fresno offers a rare opportunity to achieve cash flow in the Golden State.
How to Start Investing in Real Estate with Just $100
If reading through this list has you inspired but you’re not quite ready to buy a whole property, there’s good news: you can start investing in many of these same cities for as little as $100 through Arrived Homes. Arrived is a fractional real estate investing platform that lets you buy shares of income-producing rental properties. You collect rental income in the form of quarterly dividends, and your investment also grows with property appreciation—without having to deal with tenants, maintenance, or property management.
Here’s how it works: Arrived does all the work of finding, purchasing, and managing high-performing rental homes in markets like Charlotte, Tampa, Huntsville, and beyond. You browse available properties on their platform, choose the ones that align with your goals, and invest directly online. From there, you’ll receive a share of the rental income based on your ownership percentage. Whether you want to diversify across multiple markets or build long-term wealth one house at a time, Arrived makes it possible to get started quickly, easily, and without needing to be a landlord.
This model is ideal for first-time investors, those looking to diversify outside the stock market, or anyone who wants passive income from real estate without the usual headaches. It’s real ownership—just without the heavy lifting. And it lets you tap into the rental yields and growth potential of the cities listed above, even if you’re not ready to put down a full down payment yourself.
