Carter County

Carter County prices a median home at $238,959 against median rent of $1,284.72, producing a rent-to-price ratio of 0.0645, or roughly 77 cents of monthly rent per $1,000 of purchase price. That sits well below the 1% rule threshold most cash-flow investors target, and the model confirms it: at 6.85% financing with 20% down, the estimated monthly mortgage of $1,253 plus $450 in operating expenses produces a projected cash flow of negative $418 per month and a cash-on-cash return of -9.13%. The cap rate of 4.19% tells a similar story on an unlevered basis, meaning the asset itself is generating just over four cents of net income per dollar of value before debt service. Home prices declined 0.35% year-over-year, so the market is not compensating for weak cash flow with appreciation either. Carter sits at the 52nd national percentile across 1,000 counties and ranks 32nd of 95 Tennessee counties, a middle-of-the-pack position that reflects a market neither obviously broken nor obviously compelling.

The numbers suit a narrow profile. A pure cash-flow buyer should look elsewhere: the -9.13% cash-on-cash return under standard financing is not a rounding error, it is a structural problem driven by a rent-to-price ratio that does not support leveraged acquisition at current rates. An appreciation buyer faces a market where prices just posted a slight annual decline and the appreciation score of 48 out of 100 signals below-average growth expectations. The most credible use case is a value-add operator who can acquire below the $238,959 median, force rent above the $1,284.72 median through renovation, or both, compressing the gap enough to reach breakeven or modest positive cash flow. The affordability index of 79 and the affordability score of 79 out of 100 indicate that housing remains accessible relative to local incomes, which limits how aggressively rents can be pushed without tenant turnover pressure but also suggests the buyer pool for eventual disposition is reasonably broad.

No economic anchor data was provided for Carter County, so employer-specific analysis is not possible here. Investors should independently research the county's major employers and sector concentration before committing capital, particularly given the stability score of 50, which places the market at the midpoint of the index and warrants scrutiny of the local employment base.

The combined monthly tax and insurance burden comes to $213, embedded in the $450 estimated expense figure. The state-average effective property tax rate used here is 0.71%, flagged as a normal rate, meaning it is neither a tailwind nor a meaningful drag on underwriting relative to other Tennessee markets. That said, the note accompanying the data is worth taking seriously: this is a state-average estimate from Tax Foundation 2024, and actual Carter County or township-level rates may differ. Before finalizing any underwrite, pull the county assessor's current millage rate on the specific parcel rather than relying on the state average. The insurance component at 0.36% annually, or roughly $72 per month, is modest and reflects Tennessee's generally manageable hazard insurance environment.

The primary risks visible in this data are concentration and demographic scale. With a population of 56,315, Carter is a small market. Small markets tend to have thinner tenant pools, more pronounced local economic sensitivity, and less liquidity at disposition. A single large employer contraction or a demographic shift in net migration can move vacancy in ways that larger metros absorb more easily. The slight year-over-year price decline, while not alarming in isolation, is worth monitoring as a potential early signal of softening demand. No regulatory or vacancy data was provided, so those risk dimensions cannot be assessed from this dataset.

Compared to its neighbors, Carter's rent-to-price ratio of 0.0645 is the weakest in the group. Madison County at 0.0748, Shelby County at 0.0758, and Haywood County at 0.0727 all offer materially better ratio economics. Shelby County in particular, with a median home price of $215,747 and median rent of $1,363, combines a lower entry price than Carter with higher rent and a ratio nearly 18% better. Madison County shows a similar pattern at $222,286 median price and $1,386 rent. Fayette County's ratio of 0.0635 is slightly worse than Carter's and comes at a much higher price point of $366,798, making it the least compelling cash-flow option in the peer set. Wayne County lacks rent data, making direct comparison impossible. An investor choosing Carter over its neighbors needs a specific reason, whether below-median acquisition price, local knowledge of a specific submarket, or a value-add thesis that pencils out in Carter but not elsewhere. On raw ratio and pricing metrics alone, Madison or Shelby County offers a more favorable starting point.