We underwrote over 1,200 rental properties across MD, DC, VA, and PA in 2025. The deal-level data shows where cap rates are actually hitting — not where Zillow says they should. Here is where the yields are strongest right now.
Methodology
Numbers reflect median gross yield (annual rent ÷ purchase price) on closed Pimlico DSCR loans, Q1–Q3 2025. Vacancy rates pulled from borrower rent rolls on our portfolio loans.
Top 10 Submarkets by Gross Yield
| Rank | Submarket | Median Gross Yield | Typical Price Point |
|---|---|---|---|
| 1 | Middle River / Dundalk, MD | 11.2% | $145K–$185K |
| 2 | Lansdowne / Glen Burnie, MD | 10.1% | $155K–$200K |
| 3 | Capitol Heights, MD | 9.8% | $225K–$285K |
| 4 | Patterson Park, MD | 9.4% | $195K–$260K |
| 5 | DC Wards 7/8 | 9.2% | $295K–$385K |
| 6 | York / Lancaster, PA | 9.0% | $125K–$175K |
| 7 | Hyattsville, MD | 8.6% | $325K–$425K |
| 8 | Richmond, VA | 8.4% | $225K–$310K |
| 9 | Hampton Roads, VA | 8.2% | $210K–$295K |
| 10 | Allentown, PA | 7.9% | $195K–$265K |
Observations
Baltimore County Leads
Middle River, Dundalk, and the rest of eastern Baltimore County produced the highest gross yields in our data. Sub-$200K purchase prices with $1,700–$2,100 rents translate to 10–11% yields. Management intensity is higher — these are working-class rental markets — but cash-on-cash is tough to beat.
DC Wards 7 and 8
Long-dated appreciation play combined with current yield. Pricing is climbing but rents have moved too. Not for every investor — requires local management and market knowledge.
Central PA Stays Strong
York, Lancaster, Allentown, Reading. Lower absolute prices, steady rent, modest appreciation. Great for investors focused on cash flow over appreciation.
Where Yields Are Thin
Arlington, Alexandria close-in, Bethesda, and close-in DC neighborhoods (NW particularly) run 5–6% yields. Investors in those markets are playing for appreciation, not cash flow.
DSCR Pencil-Out by Market
At a 1.25 DSCR requirement and 7.5% rate, gross yields need to be roughly 9–9.5% for the math to work at 75% LTV. That puts most of our top 10 list comfortably in DSCR-qualifying territory. Submarkets below 7.5% gross yield typically require larger down payments (20–25%+) to hit DSCR thresholds.
What We're Watching in 2026
- Baltimore County rent compression as inventory rebuilds
- DC Wards 7/8 property tax reassessments
- Central PA appreciation as coastal buyers expand their search radius
- Richmond/Norfolk as military and tech hubs attract new residents
The Mid-Atlantic is one of the most landlord-friendly regions in the country for yield-focused investors. Pick your submarket carefully, underwrite conservatively, and the math works.
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