Memphis, TN-MS-AR
The tri-state single-family rental market. Memphis runs 92% single-family permits — the HIGHEST in the queue. Affordable median home at $228,100, cap rate proxy 4.36% workable, and FedEx + logistics anchor the labor market. The catch: net migration −2,410 (-0.18%) and the lowest 5-year HPI in Tennessee (#10 of 10). 8 counties spanning TN, MS, and AR — DeSoto MS is the affluent suburb, Marshall MS is the workforce belt.
The numbers that matter most
What an investor checks first when sizing up a new metro — affordability ratio, rent vs income, cap rate proxy, and where the market is moving. Each metric shown vs. state and national medians for instant context.
moderate
Price to income
3.52×
The single most-cited 'is this market still cheap' check. Below 3× and you're in an affordability tailwind.
- vs Tennessee
- 3.49×
- vs U.S.
- 3.43×
Benchmark
ACS median home value ÷ median HHI
comfortable
Rent to income
23.6%
What share of a typical household's income goes to rent. Below 30% means tenants can absorb modest rent increases.
- vs Tennessee
- 24.3%-0.6
- vs U.S.
- 23.3%
Benchmark
(HUD FMR 2BR × 12) ÷ median HHI
deal-by-deal
Cap rate proxy
4.4%
Rough first-pass yield assuming a 35% expense ratio. Not an underwriting number — a 'is this even worth modeling' filter.
- vs Tennessee
- 4.4%
- vs U.S.
- 4.4%=
Benchmark
(FMR 2BR × 12 × 0.65) ÷ ACS median home value
shrinking
Net migration
-0.18%
Forward-looking demand signal. Positive net migration drives rent growth and absorbs new supply.
- vs Tennessee
- 0.13%
- vs U.S.
- 0.04%
Benchmark
IRS net migration ÷ population
pipeline growing
Permit pipeline
2.48
permits per 1,000 residents
Forward-supply indicator. Above ~5 means the metro is building meaningfully relative to its size; below 2 means supply is tight.
- vs Tennessee
- 4.59
- vs U.S.
- 3.49
Benchmark
Census BPS permits TTM ÷ population × 1,000
softening
Unemployment
4.0%
Tighter unemployment means higher wages, more rental demand, lower vacancy.
- vs Tennessee
- 3.5%
- vs U.S.
- 4.0%=
Benchmark
BLS LAUS, latest month
Section index — click any row to jump
What the data says about Memphis
Memphis is the tri-state single-family rental market. Across 8 counties — Shelby at the core plus Tipton, Fayette in TN, DeSoto, Marshall, Tate, Tunica in MS, and Crittenden in AR — the metro packs 1.34 million residents with a household income of $64,743 (Census ACS) and a median home value of $228,100. The HUD Fair Market Rent for a 2-bedroom is $1,274 — among the cheapest in the queue. The House Price Index ran +41.4% over five years (FHFA HPI) — modest, well below the Sun Belt sprinters.
The interesting fact is that Memphis is the highest single-family share in the queue at 92%. 3,058 of 3,312 permits over the trailing 12 months are single-family. This is a pure SFR market — multifamily barely happens. Inside Tennessee, Memphis ranks #10 of 10 for 5-year HPI — dead last. Nashville, Knoxville, and the smaller TN metros all ran much harder. The cap rate proxy is 4.36% — workable, just below the 4.4% national. P/I 3.52 moderate, R/I 23.6% comfortable.
The 8-county geometry shifts pipeline south into Mississippi:
- Shelby County, TN (926K pop, $229,700 MHV) is the core but only builds 1,257 permits TTM = 1.36 per 1,000 — Memphis proper plus Bartlett, Germantown, Collierville. 38% of the pipeline.
- DeSoto County, MS (186K pop, $248,700 MHV) builds 944 permits = 5.07 per 1,000 — Olive Branch, Southaven, Hernando. The affluent Mississippi suburbs and the metro's growth engine.
- Marshall County, MS (34K pop, $172,200 MHV) is the densest at 364 permits = 10.71 per 1,000 — Holly Springs.
- Fayette County, TN (42K pop, $316,000 MHV) builds 298 permits = 7.06 per 1,000 — Oakland, Rossville. The affluent eastern TN exurb (the most expensive county in the metro).
- Crittenden County, AR (West Memphis) adds 79 permits — small AR side of the metro.
Memphis runs 2.48 permits per 1,000 residents — well below the national 3.49. Permit YoY is +1.6% — basically flat.
What's changing: net IRS migration is −2,410 returns (IRS SOI) — the metro is losing residents on net, −0.18% of population. Unemployment is 4.0%, exactly at the national. Owner-occupancy 60.6%, bachelor's-or-higher 30.7% (low). Memphis is anchored by FedEx, the medical district (St. Jude), and logistics — strong employers but the labor market is more cyclical than a tech hub.
What does an investor do?
- If you're hunting cash flow: Memphis is a known SFR cash-flow market. 4.36% cap proxy on a $228K median works on paper, and the 92% SFR mix means you can find product easily. Look at Shelby County's east side (Hickory Hill, Berclair) for entry-level SFR. DeSoto MS for the affluent SFR tenant.
- If you're playing appreciation: Memphis is the wrong call. Last in TN by 5-year HPI, slowing migration, and no clear catalyst for the next leg. If you want TN appreciation, Nashville or Knoxville.
- If you already own here: Hold the SFR and underwrite carefully on tenant quality. Memphis works as a cash-flow market but has been a known operator-quality risk for years. The metro-wide migration is negative; your tenant base shrinks if you don't manage well.
Where prices are and where they've been
FHFA House Price Index — repeat-sales index across the metro, sized against this metro's median household income and benchmarked against the Indiana metros average and U.S. metros average.
5-year price appreciation
+41.4%
FHFA HPI · Q1 2020 → Q4 2025
+2.2% YoY
$228,100 median home value
Memphis home prices climbed 41.4% over the last 5 years according to the FHFA repeat-sales index — a steady appreciation pace for a Midwest metro of this size. The 1-year change of 2.2% suggests steady appreciation continuing.
See the chart below for how the metro's appreciation curve stacks up against the Indiana metros average and the U.S. metros average. The gap between the metro and the national line is the "catch-up" or "lag" signal — and the slope tells you whether the gap is widening or closing.
How to read it
- 01Memphis ran **+41.4% over five years** — above the U.S. metros average of +34.3% but well below the Sun Belt sprinters. Modest, sustainable growth.
- 02Inside Tennessee, Memphis ranks **#10 of 10** for 5-year HPI — dead last in its own state. Nashville and Knoxville ran much harder.
- 03**Recent YoY is +2.24%** — modest, slowing but still positive.
- 04U.S. metros ran **+34.3%** over the same window. Memphis outperformed by ~7pp — the smallest outperformance of any T4 metro in the queue.
- 05The takeaway: Memphis is **the cash-flow play**, not the appreciation play. The 5-year run was modest, the YoY is positive, the metro provides stable yields without the rocket profile.
Where the value tier sits — top 5 counties by home value
| County | Median home value | Median HHI | Price-to-income | Verdict |
|---|---|---|---|---|
| Fayette County | $316,000 | $84,764 | 3.73× | moderate |
| DeSoto County | $248,700 | $82,980 | 3.00× | affordable |
| Shelby County | $229,700 | $62,337 | 3.68× | moderate |
| Tipton County | $220,100 | $71,736 | 3.07× | moderate |
| Tate County | $173,000 | $63,995 | 2.70× | affordable |
How to read the FHFA House Price Index
FHFA HPI is a repeat-sales index — it tracks the price change of the same properties over time, smoothing out new construction and luxury transactions. It's built from the mortgage data the GSEs (Fannie Mae, Freddie Mac) already see, which makes it free of MLS survey error and immune to listing-feed gaps.
- 01Repeat-sales method. Tracks the same properties over time, so new construction and luxury transactions don't skew the trend.
- 02Federally sourced. Built from GSE mortgage data — no MLS survey error, no commercial license required to publish.
- 03Slope, not level. Watch the slope of the line, not the absolute index value — a steepening curve is a more reliable buy signal than the level.
The rent ladder
HUD Fair Market Rent by bedroom count, sized against this metro's median household income and benchmarked vs Indiana and the U.S.
Typical 2-bedroom rent
$1,274
/ month · HUD FMR FY 2026
23.6% of median HHI
A typical 2-bedroom in costs the median household 23.6% of their income — 0.3 points above the U.S. average (23.3%) 0.6 points below Tennessee (24.3%).
HUD calls anything above 30% "rent-burdened." This metro sits comfortably under that line, which means tenants can absorb modest rent increases — and landlords have headroom on rent hikes before pushing tenants out of the market.
Fair Market Rent — by bedroom count
| Bedroom | Monthly | Annual | % of median HHI | Verdict |
|---|---|---|---|---|
| 1 BR | $1,154 | $13.8K | 21.4% | comfortable |
| 2 BR | $1,274 | $15.3K | 23.6% | comfortable |
| 3 BR | $1,683 | $20.2K | 31.2% | rent-burdened |
Why HUD Fair Market Rent matters
FMR is HUD's 40th-percentile rent estimate by bedroom count — refreshed every fiscal year, sourced from Census surveys (not commercial listing data), and used as the cap for Section 8 voucher payments. Three things investors should know:
- 01Defensible benchmark. Federal source, no commercial license required to publish or compare against.
- 02Section 8 ceiling. A property at or below FMR is voucher-eligible — government-paid rent at the FMR cap.
- 03Conservative estimate. 40th percentile means more than half of actual market rents in the metro come in higher.
Labor market direction
U.S. Bureau of Labor Statistics — LAUS (unemployment) + CES (nonfarm employment), benchmarked against the U.S. average.
Unemployment rate
4.0%
BLS LAUS · latest month
Memphis's labor market is softening, with unemployment running at 4.0% — 0.0 points above the U.S. metros average (4.0%).
For an investor, tighter unemployment means higher wages, more rental demand, and lower vacancy. The trend chart below shows how the metro's unemployment has moved over the last 30 months.
Unemployment rate
4.0%
Nonfarm jobs
—
Median household income
$64,743
ACS 5-year
How to read the labor market
Two BLS series tell you almost everything you need about a metro's labor market: LAUS (unemployment, refreshed monthly) and CES (nonfarm payroll counts, refreshed monthly). LAUS is the tightness signal; CES is the size and direction signal.
- 01Unemployment is rental demand. Tighter labor markets mean higher wages and lower vacancy — landlords have pricing power when employers are competing for workers.
- 02YoY change is the trend signal. A negative pp YoY change means the labor market tightened over the last year — usually a leading indicator for rent growth.
- 03Nonfarm growth is supply absorption. Positive nonfarm payroll growth absorbs new housing supply and supports the rent + price trajectory together.
What's being built
U.S. Census Bureau, Building Permits Survey — trailing 12 months, broken out by structure type, with the YoY change as the directional signal.
Total permits TTM
3,312
Census BPS · trailing 12 months
+1.6% year-over-year
2.48 permits per 1,000 residents
Memphis pulled 3,312 building permits over the trailing 12 months, a modest expansion 1.6% year-over-year. That works out to 2.48 permits per 1,000 residents, vs the U.S. metros average of 3.49.
Single-family vs multifamily mix matters: 5+ unit permits are lumpy (developers file for entire projects at once), while single-family permits are smoother and more reliable as a demand signal. The chart below breaks out the monthly mix.
Single family
3,058
trailing 12 months
2–4 unit
44
trailing 12 months
5+ unit
210
trailing 12 months
How to read the supply pipeline
Census BPS publishes building permit counts every month at the county level, by structure type. Single-family permits are the smooth signal — they reflect ongoing builder demand. 5+ unit permits are lumpy and project-level — one apartment approval can spike a month.
- 01Permits per 1,000 residents. The size-adjusted comparison number. Above ~5 means the metro is building meaningfully relative to its population; below 2 means supply is tight.
- 02YoY change is the direction. Year-over-year change in TTM permits tells you whether builders are leaning in or pulling back. Watch this number for trend reversals.
- 03Mix matters for cap rates. Heavy 5+ unit permitting tends to compress cap rates; single-family-dominated pipelines preserve them.
All 8 counties, ranked by population
Census Bureau (population, ACS demographics) + Census Building Permits Survey.
How to read it
- 01**Shelby County leads with 1,257 permits TTM** — Memphis proper plus Bartlett, Germantown, Collierville. The TN core but only 38% of the metro pipeline (low for a metro core).
- 02**DeSoto County, MS** (Olive Branch, Southaven, Hernando) builds **944 permits = 5.07 per 1,000** — the affluent Mississippi suburbs and the metro's growth engine.
- 03**Marshall County, MS** (Holly Springs) builds **364 permits = 10.71 per 1,000** — the densest builder by rate, small county but high pace.
- 04**Fayette County, TN** (Oakland, Rossville) builds **298 permits = 7.06 per 1,000** — the affluent eastern TN exurb at $316,000 MHV.
- 05Memphis runs **2.48 permits per 1,000 residents** — well below the national 3.49. **92% single-family mix is the HIGHEST in the queue** — Memphis is a pure SFR market. **Permit YoY is +1.6%** — basically flat.
How to read the map
- 01**Marshall County, MS (south) is densest at 10.71 per 1,000** — Holly Springs. Small county but high-velocity exurban growth.
- 02Fayette County, TN (east — Oakland, Rossville) at **7.06 per 1,000** — affluent rural-exurban TN.
- 03DeSoto County, MS (south of Memphis) at **5.07 per 1,000** — Olive Branch, Southaven. The largest builder by absolute volume after Shelby.
- 04Tunica County, MS (southwest) at **8.69 per 1,000** — small but unusually dense.
- 05Shelby County (the core) at only **1.36 per 1,000** — the urban core barely builds. Crittenden County, AR (West Memphis) at 1.65 per 1,000 is even slower.
- 06**The pattern shifts south into Mississippi.** The MS suburbs (DeSoto + Marshall) plus the eastern TN exurbs (Fayette) carry the metro pipeline. The Shelby core is supply-constrained.
| # | County | Population | Median HHI | Home value | Permits TTM | YoY |
|---|---|---|---|---|---|---|
| 1 | Shelby County | 926,440 | $62,337 | $229,700 | 1,257 | |
| 2 | DeSoto County | 186,214 | $82,980 | $248,700 | 944 | |
| 3 | Tipton County | 61,116 | $71,736 | $220,100 | 153 | |
| 4 | Crittenden County | 47,945 | $54,271 | $155,100 | 79 | +25.4% |
| 5 | Fayette County | 42,228 | $84,764 | $316,000 | 298 | +6.8% |
| 6 | Marshall County | 33,980 | $51,875 | $172,200 | 364 | +53.6% |
| 7 | Tate County | 28,094 | $63,995 | $173,000 | 132 | +41.9% |
| 8 | Tunica County | 9,787 | $38,402 | $154,500 | 85 | +16.4% |
Similar metros nationally
5 metros closest to Memphis by population and median household income — head-to-head on the metrics that matter for an investor.
Peer set
5
metros nearest by population + HHI
Memphis is closest in size to New Orleans, Oklahoma City, Louisville/Jefferson County, Buffalo.
The table below ranks every metric — green cells mark the best value in the column, rust cells mark the worst. Memphis is highlighted as the focal row.
| Metro | Pop | Med HHI | Home value | P/I | Cap proxy | HPI 5y | Permits/1k | Migration | Unemp |
|---|---|---|---|---|---|---|---|---|---|
★Memphis | 1.34M | $65K | $228K | 3.52× | 4.4% | +41.4% | 2.48 | -0.18% | 4.0% |
New Orleans-Metairie, LA | 1.26M | $62K | $248K | 3.98× | 4.2% | +20.9% | 2.18 | -0.42% | 4.0% |
Oklahoma City, OK | 1.43M | $70K | $215K | 3.05× | 4.5% | +45.7% | 5.90 | +0.18% | 3.6% |
Louisville/Jefferson County, KY-IN | 1.28M | $72K | $236K | 3.30× | 4.2% | +45.5% | 4.78 | -0.02% | 3.1% |
Buffalo-Cheektowaga, NY | 1.16M | $71K | $210K | 2.97× | 5.0% | +57.7% | 1.06 | -0.18% | 4.0% |
Birmingham-Hoover, AL | 1.11M | $70K | $226K | 3.25× | 4.4% | +44.7% | 3.82 | -0.08% | 2.2% |
How to read this comparison
Peer metros are picked by population + median household income — the closest five matches nationally — so the comparison is apples-to-apples on size and economic class. Sun Belt entrants like Las Vegas and Nashville are included when they fall in range, which is why this peer set spans both the Midwest and the Sun Belt.
- 01Green = best in column. The cell with the most-favorable value for that metric, accounting for whether higher or lower is better.
- 02Rust = worst in column. The cell with the least-favorable value. Combined with the green markers, this is your at-a-glance "where does my metro win and where does it lose."
- 03Cap proxy is the yield lens. Cap rate proxy = (FMR 2BR × 12 × 0.65) ÷ median home value. A first-pass yield filter, not an underwriting number — but it puts the peer set on a single comparable scale.
Where people are moving in from
IRS Statistics of Income — Tax Year 2022. Excludes intra-metro suburban churn.
Net migration
-2,410
tax returns · IRS SOI · TY 2022
-0.18% of metro population
5,138 from top origin
Memphis lost −2,410 net IRS returns — −0.18% of population. The metro is shrinking on a household basis. The biggest origins out are intra-Tennessee plus the Sun Belt. Memphis is the rare Sun Belt-adjacent metro that is losing residents.
The IRS data lags by ~2 years (households file taxes the year after they move), but it's the only nationwide county-to-county migration data sourced from administrative records, not survey estimates. The table below shows the top origin counties — the gravitational sources of new residents.
Top origin counties — where new residents are coming from
| Origin county | Tax returns |
|---|---|
| Shelby County, TN | 5,138 |
| DeSoto County, MS | 2,713 |
| Fayette County, TN | 710 |
| Tipton County, TN | 667 |
| Marshall County, MS | 500 |
| Davidson County, TN | 456 |
Who lives in Memphis
U.S. Census Bureau · American Community Survey 5-Year Estimates · 2019–2023 vintage.
Who lives here
- Median age
- 36.7
- Owner-occupancy
- 60.6%
- Bachelor's+
- 30.7%
Memphis relatively young Midwest metro: Median age 36.7, 60.6% owner-occupancy 30.7% holding a bachelor's degree or higher. Stable, educated, and mostly homeowner-driven.
The catch: 48.2% of renter households are rent-burdened (paying 30%+ of income on rent) — high enough to flag as a constraint on rent growth even though the headline rent-to-income ratio looks comfortable.
- Median household income
- $64,743
- Median age
- 36.7
- Bachelor's+ degree
- 30.7%
- Owner-occupancy rate
- 60.6%
- Vacancy rate
- 10.2%
- Rent burdened (30%+)
- 48.2%
Data sources
| Metric | Source | Type | Vintage |
|---|---|---|---|
| Home prices | FHFA — House Price Index | Index | Q4 2025 |
| Fair market rents | HUD — Fair Market Rents | Administrative | FY 2026 |
| Unemployment rate | BLS — Local Area Unemployment Statistics | Survey | Dec 2025 |
| Nonfarm employment | BLS — Current Employment Statistics | Survey | Dec 2025 |
| Building permits | Census — Building Permits Survey | Survey | Mar 2026 TTM |
| Migration flows | IRS — Statistics of Income, Migration Data | Administrative | Tax Year 2022 |
| Demographics | Census — American Community Survey 5-Year | Survey | 2019–2023 |
| Household income | Census — American Community Survey 5-Year | Survey | 2019–2023 |
Page last refreshed: April 9, 2026