Top markets for investing in rental properties – Week 2
By.. “Venu Vankadhara, Real Estate Investor”
Buying homes for passive rental income is hot, but new real estate investors often wonder about which are the most profitable areas to buy homes. In order to invest in rental property, one must buy a house where mortgage and HOA expenses are less than their rental income. You can invest in single family, multi-family, condos, townhomes, shopping centers, office buildings etc.,
There are lots of financing options – traditional mortgage, private money, hard money etc. These options mean that anyone can get started with a little bit of wisdom and a lot of out of the box thinking no matter their financial planning.
Below are some of the top markets for renal real estate investment
- Phoenix area, AZ
Why do rental market is hot in Phoenix? "Outstanding job growth is the key factor". With jobs being added at an annual rate above 3%, the demand for rental properties is high.
Best cities for rental market in Arizona
- Sierra Vista
- Catalina Foothills
- Queen Creek
- Tanque Verde
- Tampa/Orlando area, FL
After the Great Recession, homes in the Tampa Bay area bounced back in value. Because of the high foreclosure rate, real estate investors grabbed up great deals. In 2017, the Tampa Bay area remains a great area for real state investing. According to a recent article by the Tampa Bay Times, home flipping is slowing down as prices continue to rise. Experts say Tampa’s home flipping rate ties for the third highest among metro areas in the United States. Some hot places include zip codes in Seminole Heights, St. Petersburg and Pinellas Park. Some of the most popular zip codes include Historic Kentwood (33713), and 33712 and 33705 ZIPS, which are areas in St. Pete south of Central Avenue.
- Philadelphia, PA
Philadelphia's rental market is on fire right now and has no signs of slowing down. That's according to a recently published TD Economics report that found that the city's apartment market is the "epicenter" of real estate activity, "with both absorptions and completions running at twice the pace seen over the past 15 years." Using CoStar data, the report determined that while Philly's homeownership rates declined by 6.1 percentage points between 2007 and 2014, apartment vacancy rates have dropped to historic lows. Dolega says, "The vacancy rates in apartments in Philly area are dropping to a very, very low number. It was basically at 3.7 percent at the end of 2015, which is the lowest vacancy rate since 1988. It's tremendous."
So why is the apartment market so hot? One word: Millennials.
"Millennials want to live, play, and work within walking distance of each together". "They're really driving up demand for apartments, and I don't think developers realized how strong the demand would be."But "as far as stability goes, while the pace of the growth is rapid, the foundations of the commercial real estate market are quite sound and that's very, very solid positive for the city."
- Austin, TX
Austin is in high demand, and that's not going to change anytime soon. A new report from online real estate investment firm HomeUnion has named Austin one of the most desirable rental markets in the U.S. for 2017, making it a sound choice for local and remote real estate investors. In fact, Austin is No. 9 on the report's ranking of highest demand markets, which means it boasts some of the strongest supply and demand fundamentals in the nation.
"An influx of millennial job-seekers drawn to the low cost of living compared to coastal markets, combined with growth in internet and technology sector jobs, make Austin one of the most desirable metros for renters.
- Indianapolis, IN
Each year, thousands flock to Indianapolis to see the Indy 500, one of the country’s premier auto races. In the coming years, there will be a different race in Indianapolis: the race to invest. The central Indiana city has excellent market conditions and could become one of the top targets for single-family rental investors around the country. Here are a few reasons why we see Indianapolis becoming a prime spot for SFR investment:
Indianapolis has a strong private sector, and the city’s unemployment numbers declined 0.4 percent between the months of January and February alone, according to the Bureau of Labor Statistics. While many metropolitan areas are heavily reliant on one industry, Indianapolis thrives thanks to economic variation. Multiple industries contribute to the area’s economic performance, with education, finance and health care representing some of the most important sectors. The city’s population rose steadily between 2010 and 2013, according to the most recent information from the BLS, and continued economic performance should encourage further migration to the area.
- Lima, OH
A new report shows the Lima housing market is the healthiest it’s been in 15 years, and local real estate agents expect this trend to continue through 2017.The report found that Lima has seen the second largest increase in housing market sustainability in the U.S
- Raleigh/Durham/Chapel Hill area, NC
In North Carolina, the Raleigh/Durham/Chapel Hill area remains a lucrative area for investment. The median home purchase price is about $200,000. Investors will likely succeed by choosing the following North Carolina communities: Youngsville (27596), Clayton (27520), Knightdale (27545), Holly Springs (27540) and Garner (27529).
Next Week Topic: Calculating Net Operating Income (NOI)
"Venu Vankadhara, Real Estate Investor"
Disclaimer – This article is for information purpose only. All information presented here is accurate to the best of author’s knowledge. Vastavam.net and its undersigned are not liable for any misrepresentation on this web site or in any additional information given verbally or in writing relating to Vastavam.net. and its’ investments. It is the readers’ responsibility to verify all information given. Readers should consult their own legal, real estate and tax advisors about the suitability of real estate investment for their particular needs and situations.