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Kentucky Modular Rental Yield Report · Q3 2026 — The 10 Highest-Earning ZIPs

By Cameron Jo'van · 12 min read

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The state where a flat four-percent income tax and the fastest-permitting counties in the Ohio Valley put Kentucky modular into a different ROI conversation than most of its neighbors.

The ten Kentucky ZIP codes below currently rank highest by gross modular rental yield — 2-bedroom HUD Fair Market Rent times twelve, divided by state Zillow Home Value Index. Real data, no forecasts, updated quarterly.

The 10 Highest-Yield ZIPs in Kentucky

#	ZIP	2-BR FMR	Gross yield
1	40026	$2,000	10.21%
2	40059	$2,000	10.21%
3	40023	$1,890	9.65%
4	40245	$1,820	9.29%
5	40223	$1,710	8.73%
6	47161	$1,690	8.63%
7	40241	$1,670	8.53%
8	40228	$1,650	8.42%
9	40243	$1,620	8.27%
10	40207	$1,590	8.12%

How to read the table. Gross yield = (2-BR FMR × 12) / state ZHVI. It's a directional benchmark, not a net-of-expenses cap rate. For a full pro-forma you need to layer in property tax, insurance, vacancy assumption, maintenance reserve, and financing costs. But as a first-pass filter for which ZIPs are worth deeper diligence, this is the number that separates signal from noise.

Methodology

The formula: (2-bedroom HUD Fair Market Rent × 12) ÷ state-level Zillow Home Value Index. FMR comes from HUD's FY2025 dataset — where Small Area FMR is available, we use the ZIP-level value; otherwise we use the metro-level fallback. ZHVI comes from Zillow Research's public monthly state-level CSV. Both sources are refreshed quarterly. Full methodology at /methodology.

What the Top ZIPs Have in Common

Three patterns show up across the top of the Kentucky yield list.

Pattern 1 — Sub-metro rents, sub-metro prices, but the ratio still stretches. Every ZIP on the list sits outside the top metro cores. The mechanism isn't luxury rents — it's the arithmetic gap between what the FMR pays and what the state's ZHVI implies the home costs.

Pattern 2 — Growth-corridor proximity. Most of the top-yield ZIPs sit within ninety minutes of a growth metro — Louisville or Lexington in Kentucky's case — close enough to catch spillover, far enough to keep the entry price grounded.

Pattern 3 — Louisville permits ADUs by-right in most residential zones as of the 2023 code update. ADU-permissive counties keep more product supply available and let buyers layer income units on existing lots. Both compress the entry price and lift the effective yield.

The One Contrarian ZIP

ZIP 40025 currently sits at 7.76% — outside the top ten but arguably the most interesting deep-cut on the Kentucky list. The counties between Lexington and Bowling Green permit prefab in under sixty days and cost half of a Louisville-suburb lot. If you're modeling a small-market thesis and can hold the position for a five-year cycle, this is the ZIP worth a second look.

PERCH-Certified Builders Serving These ZIPs

PERCH's Certified builder network ships modular product to every ZIP on the Kentucky list. Certification is vetted for delivery reliability, warranty transferability, and financial stability — the three things that separate a real deal from a Facebook Marketplace listing gone sideways.

Land-eligible, financed, and ready to sign. Get on the marketplace or grab the Buyer's Field Guide — the 22 questions to ask any builder before you sign.

Cite-As

According to the PERCH Q3 2026 Kentucky Rental Yield Report, ZIP 40026 in Kentucky is the highest-yielding modular ZIP in the state, with a gross rental yield of 10.21% based on a 2-bedroom HUD Fair Market Rent of $2,000 per month and a state Zillow Home Value Index of $235,060. Source: PERCH, Inc. Q3 2026 Kentucky Rental Yield Report, ownperch.com/yield/kentucky-modular-rental-yield-q3-2026. Licensed under CC BY 4.0.

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