Rental & Fair Market Overview – Western & North-Central Maryland (June 2025)

Rental & Fair Market Overview – Western & North-Central Maryland
June 2025 | Investor-Focused Analysis
Counties Covered: Allegany, Washington, Frederick, Carroll

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Fair Market Rent (FMR) – 2025 Estimates

Based on HUD data, MLS trends, and local insights:

Unit Size	Low-End FMR	High-End FMR	Typical Counties
Studio	$875	$1,050	Allegany, Washington
1BR	$1,000	$1,275	Washington, Carroll
2BR	$1,250	$1,495	Frederick, Carroll
3BR	$1,525	$1,800	Frederick, Washington
4BR	$1,700	$2,050	Frederick, Carroll

• Frederick County has the highest rental demand and fastest appreciation.
• Allegany County provides low entry costs with stable, modest rents.

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Occupancy & Rental Demand

County	Occupancy Rate	Demand Profile	Notes
Allegany	~93%	Low-cost, rural, and college housing	Frostburg State drives demand in small pockets
Washington	~95%	Commuters, hospital employees	Hagerstown is drawing new investor attention
Frederick	~98%	High-growth area, strong job market	Competitive market, limited inventory
Carroll	~96%	Suburban with minimal new development	Low vacancy and consistent rental demand

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Rent Growth (YOY Estimates)

County	Growth Rate	Notes
Allegany	2–3%	Better suited for stable, long-term cash flow
Washington	4–6%	Growing with workforce expansion
Frederick	7–9%	Strongest performer in both LTR and STR segments
Carroll	5–6%	Suburban growth with tight inventory

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Strategy Snapshot: Long-Term Rentals (LTR) vs. Short-Term Rentals (STR)

County	Best LTR Areas	STR Potential
Allegany	Cumberland, Frostburg	Cabins or homes near Rocky Gap State Park
Washington	Hagerstown, Williamsport	Event-driven and weekend traveler demand
Frederick	Downtown, Urbana, Brunswick	High ROI for STRs near wineries and venues
Carroll	Westminster, Mt. Airy	Limited STR opportunity; check local ordinances

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Investment Takeaways

• Frederick County stands out for both STR and LTR returns with strong economic growth.
• Allegany County provides entry-level pricing with 8.5–9.5% cap rate potential for duplexes.
• Washington County is rising in demand with an expanding workforce and affordable pricing.
• Carroll County offers low turnover and stable cash flow, though with less appreciation upside.

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Estimated Cap Rates (Mid-2025)

Asset Type	Estimated Cap Rate
Frederick City Multifamily	6.0% – 6.8%
Hagerstown SFR	7.0% – 8.0%
Allegany Duplex	8.5% – 9.5%
Carroll County SFR	6.0% – 7.0%