Someone asked which of two properties in the same neighborhood in Fort Myers is better. One has a lower purchase price and lower rent, while the other has a higher purchase price and higher rent. Just comparing the visible rent doesn't provide an answer, so we needed to break down the numbers one by one.

First, according to data from mid-2026, the median rent in Fort Myers is $1,725 per month, and property prices range between $325,000 and $360,000. If we take the median price of $340,000, the annual rental income of $20,700 divided by the purchase price gives a total return rate of about 6.1 percent. Looking at just this number, it stands out as significantly higher than other cities we've discussed.

However, to make a true comparison, we also need to calculate the cap rate. The cap rate is the net operating income (NOI), which is the total income minus operating expenses such as property taxes, insurance, management fees, maintenance costs, and vacancy losses, divided by the purchase price. In Lee County, where Fort Myers is located, the effective property tax rate is 1.07 percent based on Ownwell data, which is slightly lower than the Florida state average of 1.10 percent but higher than the national average of 1.02 percent. When you add Florida's unique hurricane insurance costs, the proportion of operating expenses is often higher than in other states.

If we apply the 50% rule and assume total operating expenses are half of the total rental income, the NOI is $10,350 per year, and the cap rate is around 3 percent. Compared to the initial total return rate of 6 percent, this drops below half, highlighting the difference in whether property taxes, insurance, and management fees are accounted for. Even when comparing two properties in the same neighborhood, this step of calculation is necessary to reveal the true profitability relative to the purchase price.

Considering a situation with a mortgage can change the rankings again. Assuming a 30-year fixed rate of 6.67 percent as of August 13, 2026, from Freddie Mac, with a 20 percent down payment and financing the rest, the principal and interest alone would be close to $21,000 per year. It would be tight to fully cover this amount with the NOI. While the property with the lower purchase price may seem advantageous in terms of cap rate, it's worth noting that if management fees or vacancy losses increase slightly at the cash-on-cash stage, the rankings could flip.

Revisiting the two properties with the 1% rule can help in making a decision. The property with the lower purchase price often has a rent-to-price ratio close to 1 percent, while the property with the higher purchase price tends to have a lower ratio. Based on $340,000 and $1,725 per month, the ratio comes out to 0.51 percent, which falls short of the 1 percent benchmark but is relatively favorable compared to other cities we've discussed.

From a total return perspective, even if cash-on-cash is tight right now, the principal of the loan builds equity, and Fort Myers also has seasonal demand and potential for price appreciation due to its location along the Gulf Coast. However, given the hurricane risk in the area, it's prudent to factor in the potential for rising insurance costs in long-term calculations.

If you're considering moving from another state, keep in mind that while Florida has no state income tax, property taxes and hurricane insurance may be higher than in your previous residence. It's premature to conclude that overall living costs will be lower just because there is no income tax.

Fort Myers is a region where the influx of retirees coincides with seasonal rental demand, making the rental prices themselves appear attractive. However, you must also consider the fluctuations in insurance costs due to hurricane season and the risk of vacancies. When comparing two properties, it's safer to look at not just the total return rate but also the cap rate and cash-on-cash calculations side by side.

Property tax rates and insurance premiums can vary based on the exact address and insurance company, so be sure to get direct quotes before making any agreements. This article is not investment advice, and it's advisable to verify specific numbers with a real estate professional before making any purchasing decisions.