Roane County

Roane County's numbers place it squarely in the appreciation-over-cash-flow category, and the math is blunt about it. At a median home price of $296,784 and median rent of $1,233, the gross rent-to-price ratio comes in at 0.50%, which annualizes to roughly 6.0% gross yield before any expenses. The cap rate calculates to 3.24%, and with a 6.85% financing rate on a 20% down loan, the leveraged cash-on-cash return is negative 13.26%, with estimated monthly cash flow at negative $754. That is not a rounding error; it is a structural gap between what the market rents for and what it costs to own with debt. Home price appreciation of 4.5% year-over-year provides some offset, and the appreciation score of 85 out of 100 reflects that Roane has been a genuine price-growth market. But appreciation does not pay the mortgage servicer each month, and any investor underwriting this county needs to be clear-eyed that they are buying a price-growth bet, not a yield play.

The investor profile this market suits is narrowly defined. An all-cash or low-leverage buyer can partially neutralize the carry problem since eliminating the $1,556 monthly mortgage removes the primary source of negative cash flow, but even then the 3.24% cap rate is thin relative to the risk-free rate environment. A long-term appreciation buyer with a 7-to-10-year hold thesis and tolerance for monthly subsidization finds the most logical use case here, particularly if they believe the 4.5% annual price growth rate persists or accelerates. A pure cash-flow operator should look elsewhere. A value-add operator could pencil a deal if they can acquire meaningfully below the $296,784 median and push rents above the $1,233 median, but the spread between the current rent level and a breakeven rent at this price point is wide enough that the execution margin for error is thin.

The combined monthly tax and insurance cost using Tennessee's state-average effective property tax rate of 0.71% and an insurance rate of 0.36% produces $265 per month, or $3,175 annually. The propertyTaxFlag for Roane is "normal," meaning the rate is neither a headwind nor a meaningful tailwind relative to other Tennessee markets. It is worth noting that the 0.71% figure is a state-average estimate from Tax Foundation 2024 data, and actual county or township assessments in Roane may differ, so verify the specific parcel rate before finalizing your underwrite. The $265 monthly tax-and-insurance load is already embedded in the $432 estimated monthly expenses figure cited above, and while it is not extraordinary, it is not trivial on a $1,233 rent either, representing roughly 21% of gross rent.

The affordability index of 66 and the county's national rank of 375 out of 1,000 (52nd percentile) indicate a market that is middle-of-the-road nationally but faces some affordability pressure relative to local incomes. A population of 53,777 makes this a small county, and that size creates concentration risk: the rental demand pool is limited, any major employer disruption or demographic shift hits a smaller base, and liquidity on exit is thinner than in larger metro markets. The stability score of 50 out of 100 reinforces that the market is not particularly recession-insulated. Investors who need to sell in a downturn may find buyer depth limited at the $296,784 price point relative to what they would encounter in a larger Tennessee city.

Comparing Roane to its neighbors sharpens the decision. Madison County prices at $222,286 with median rent of $1,386 and a rent-to-price ratio of 0.748%, more than 50% higher than Roane's 0.499%, while carrying an identical overall score of 60. Shelby County comes in at $215,746 with rent of $1,364 and a ratio of 0.758%, also scoring 61 overall. Haywood County's ratio of 0.727% on a $167,218 median adds another cash-flow-oriented option at a lower price point. Fayette County at $366,798 with a 0.635% ratio and a score of 58 is more expensive than Roane and still generates more relative rent, though neither market is a cash-flow standout. Every neighbor with available rent data outpaces Roane on rent-to-price. The case for choosing Roane over Madison or Shelby rests entirely on its superior appreciation score of 85 versus the 60 and 61 posted by those counties, and on an investor's specific conviction that East Tennessee's price trajectory justifies the monthly carry cost. If cash flow is the primary underwriting objective, Madison County or Shelby County are the more logical destinations. If the thesis is capital appreciation in a smaller Tennessee market, and the investor can absorb roughly $750 per month in negative carry, Roane earns consideration on that basis alone.