1031 Exchange in Kansas City MSA
The Kansas City MSA offers excellent 1031 exchange opportunities as a top 10 housing hot spot for 2025, with competitive property taxes (0.88-1.38%), strong appreciation (+1.2% to +7.6%), and a diversified $145.95 billion economy anchored by healthcare, logistics, and Fortune 1,000 companies.
Population
2,700,000
Key Industries
Healthcare (82,000+ jobs), Federal Government (20,000+ jobs), Transportation & Logistics
Table of Contents
Information is for educational purposes only. Consult qualified professionals for specific advice.
Local Tax Considerations
Property taxes, transfer taxes, and local incentives
Property Tax Rates
Average Rate
0.90% - 1.40%
Assessment Method
Assessed Value (Missouri/Kansas Property Tax Codes)
MSA rate (0.88-1.38%) vs State average (Missouri: 0.91%; Kansas: 1.34%)
Competitive with state averages
Transfer Taxes & Fees
Transfer Tax Rate
Missouri: $0.50 per $500; Kansas: $0.26 per $500
State transfer taxes plus local recording fees and title insurance
Local Tax Incentives
Missouri/Kansas Enterprise Zones
Tax incentives for business development and job creation
Eligibility: Qualifying commercial and industrial developments
Kansas City Development Incentives
Local incentives for business expansion and retention
Eligibility: Companies creating jobs and investing in the area
Opportunity Zones
Federal tax benefits for long-term investments
Eligibility: Qualifying investments in designated opportunity zones
Opportunity Zones
Number of Zones
15
Key Locations
- Downtown Kansas City
- East Kansas City
- Northeast Kansas City
Opportunity Zones offer significant tax benefits for long-term investments, including deferral and potential elimination of capital gains taxes.
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Market Profile Dashboard
Economic indicators and market trends
Population
2,700,000
Growth: +2.1% annually
Median Income
$79,842
Unemployment
3.8%
Job Growth
+3.2% annually
Economic Drivers
Market Trends
Median Home Price
$233,000 - $300,000
Average Rent
$1,485/mo
Cap Rates
7.5% - 10.0%
Demographics
Median Age
35.2 years
Bachelor's Degree+
40.3%
Owner Occupied
64.8%
Property Type Analysis
Investment opportunities by asset class
Multifamily
Strong demand driven by diverse employment base, young professionals, and growing population with excellent market fundamentals.
Market Metrics
- Cap Rates: 8.5%
- Vacancy Trends: Low vacancy at 6.8% due to strong job growth and population increase
- Demand Forecast: Excellent fundamentals with continued economic growth
Risk Factors
- Market competitiveness
- Rising construction costs
Opportunities
- Strong job growth (+3.2%)
- Population growth (+2.1%)
- Diverse employment base
Single-Family Rental
Popular with professionals, federal employees, and families seeking quality housing in growing metro area.
Market Metrics
- Cap Rates: 9.2%
- Vacancy Trends: Very low vacancy at 4.5% with excellent tenant retention
- Demand Forecast: Strong fundamentals with major employer stability
Risk Factors
- Market competitiveness
- Rising home prices
Opportunities
- Top 10 housing hot spot recognition
- Strong appreciation (+1.2% to +7.6%)
- Diverse economic base
Neighborhood Spotlights
Up-and-coming areas and investment hotspots
Downtown Kansas City
Urban core with major development and opportunity zone designation
Investment Thesis
Opportunity zone benefits, downtown revitalization, and proximity to major employers including federal government and corporate headquarters.
Median Price
$285,000
Price Growth
+5.8% YoY
Rental Yield
8.2%
Days on Market
18 days
Key Highlights
Development Pipeline
Major downtown development and mixed-use projects
Overland Park, KS
Affluent suburb with high home values and corporate presence
Investment Thesis
High-income demographics, corporate employment base, and family rental market appeal.
Median Price
$385,000
Price Growth
+3.2% YoY
Rental Yield
7.8%
Days on Market
15 days
Key Highlights
Development Pipeline
Suburban residential and commercial development
Independence, MO
Historic suburb with affordable housing and growth potential
Investment Thesis
Affordable entry points, historical significance, and proximity to Kansas City employment centers.
Median Price
$245,000
Price Growth
+6.1% YoY
Rental Yield
9.5%
Days on Market
22 days
Key Highlights
Development Pipeline
Residential development and historical preservation projects
Northland (Clay County)
Growing suburban area with new development and family appeal
Investment Thesis
New development, family demographics, and competitive property taxes (1.1% effective rate).
Median Price
$265,000
Price Growth
+4.5% YoY
Rental Yield
8.8%
Days on Market
19 days
Key Highlights
Development Pipeline
Major suburban residential and commercial development
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Compare Markets
See how this MSA stacks up against others
Compare Markets
| Metric | Kansas City (Current) | St. Louis | Omaha Council Bluffs | Oklahoma City |
|---|---|---|---|---|
| Population | 4.0M | 4.0M | 4.0M | 4.0M |
| Median Property Price | $750K | $750K | $750K | $750K |
| Average Cap Rate | 5.2% | 5.2% | 5.2% | 5.2% |
| Job Growth Rate | 2.1% | 2.1% | 2.1% | 2.1% |
| Rental Yield | 4.8% | 4.8% | 4.8% | 4.8% |
| Days on Market | 25 | 25 | 25 | 25 |
Frequently Asked Questions
Common questions about Kansas City 1031 exchanges
Kansas City offers exceptional fundamentals as a top 10 housing hot spot for 2025: competitive property taxes (0.88-1.38%), strong appreciation (+1.2% to +7.6%), $145.95 billion diversified economy, 15 opportunity zones, and major employer stability including federal government (20K+) and healthcare (82K+) jobs.
The diverse employment base provides exceptional stability: federal government (20,000+ employees), healthcare sector (82,000+ jobs), multiple Fortune 1,000 companies, transportation/logistics hub, and growing technology sector. This creates consistent rental demand across income levels and property types.
Yes, 15 opportunity zones exist throughout the metro area including Downtown Kansas City, East Kansas City, and various suburban locations. These offer potential tax benefits for qualifying investments including deferral and possible exclusion of capital gains for long-term investments.
The $145.95 billion economy is anchored by healthcare (82,000+ jobs), federal government (20,000+ jobs), transportation/logistics (central US location), financial services, technology, animal health/biosciences leadership, and manufacturing, providing exceptional economic diversity and stability.
The Missouri-Kansas location offers tax planning flexibility, competitive property tax rates on both sides (0.88-1.38%), diverse regulatory environments, and access to incentives from both states. Investors can choose optimal locations based on specific tax and business considerations.