Washington Rental Portfolio Guide
What you need to know before building or growing a rental portfolio in Washington — property tax burden, state income tax, security-deposit rule, source-of-income law, and the metros that actually cash-flow after accounting for local taxes.
Tax burden on Washington rentals
Property tax
0.87%
effective rate on median home value
At 0.87% effective, the property tax burden sits in the lower half nationally (rank 24 of 51). Modest annual carrying cost keeps cash flow projections realistic on median-priced homes.
State income tax
None
top marginal rate
No state income tax means rental income and gains from sales flow through your federal return without a state surcharge. This is a structural tailwind for long-term portfolio compounding, especially if you plan to sell into gains later.
Security deposit rule
No statutory cap on security deposits. Landlords set the deposit at whatever the market accepts — typically one to two months' rent, sometimes more for higher-risk applicants or pets. Local ordinances may still apply.
Note: no state income tax; capital gains tax over $250K applies
Deposit rules change; verify current statute before drafting a lease.
Best cash-flow markets in Washington
Modeled monthly cash flow on a median-priced single-family purchase at 20% down, 30-year fixed, using Washington’s 0.87% effective property tax rate plus 25% of rent for insurance, maintenance, vacancy and management.
| Market | Median price | Median rent | Annual property tax | CF / month |
|---|---|---|---|---|
| Aberdeen, WA | $325,833 | $1,449 | $2,835 | $-857 |
| Pullman, WA | $331,097 | $1,320 | $2,881 | $-986 |
| Moses Lake, WA | $363,584 | $1,456 | $3,163 | $-1,077 |
| Yakima, WA | $355,256 | $1,371 | $3,091 | $-1,092 |
| Kennewick, WA | $441,524 | $1,713 | $3,841 | $-1,350 |
| Shelton, WA | $456,188 | $1,826 | $3,969 | $-1,353 |
State median across the metros: $456,188 home, $1,721 rent, $-1,483/mo modeled cash flow.
Track your Washington rental portfolio
The Pro Portfolio Tracker rolls up every property in your portfolio, auto-revalues them monthly against local price data, and flags DSCR risk and equity milestones. Each Washington property carries the state-specific tax burden shown above through to the cash flow calculation.
Property tax rate: Tax Foundation. Security deposit rule: state statute. Verify current law before making decisions — statutes change and this page is a planning reference, not legal or tax advice.