Looking at townhouses as one example of local investment properties, let's see how their property values have changed over the past five years.  

Here's the median sales price of attached homes in Harrisonburg and Rockingham County...

In 2020 = $193,000

In 2025 = $320,000

So, property values have increased (+66%) over the past five years.  And... mortgage interest rates have also increase significantly...

In 2020 = 3.5% to 4%

In 2025 = 6% to 7%

Given these two variables, let's look a rough potential cash flow situation in each year...

In 2020...

Property Value = $193,000

Interest Rate = 4%

Monthly Mortgage Payment = $925 (75% LTV, includes HOA fee)

Monthly Rental Income = $1,200

Cash Flow = + $275 / month

In 2025...

Property Value = $275,000 (rounded down a bit from the median)

Interest Rate = 7%

Monthly Mortgage Payment = $1,700 (75% LTV, includes HOA fee)

Monthly Rental Income = $1,650

Cash Flow = - $50 / month

So, what does all of this mean for investor buyers or investor sellers?

Would-be buyers of investment properties often have difficulty making the cash flow make sense even if they're only financing 75% of the purchase price.  

Even though rental rates have increased significantly over the past five years, property values have increased even more rapidly, and mortgage interest rates make it difficult to achieve positive cash flow.

But...

Would-be sellers of investment properties care considerably less about the cash flow of the properties they are selling.  They are generally delighted by the significantly higher property values they obtain when selling their property.

Of note, many of these investment properties are being purchased by owner occupants.  If an investor buyer can't make the numbers work... there are plenty of people who are looking to buy their first home who are happy to purchase these investment properties that are being sold.

So... if you are looking to buy an investment property... be realistic about the likely cash flow dynamics... and if you are considering selling an investment property... you'll likely be thrilled by the price a buyer will currently pay for your property.