Best Locations To Buy Rental Property
This collection of factors can help real estate investors home in on the best locations to make an investment. Markets that have a low gross rent multiplier, low property taxes, and a positive outlook for future property value growth offer the best mix of conditions for a potential investor. In the U.S., most of those locations are found in the South. Southern states tend to have some of the lowest housing prices and lowest property taxes of any region, but the region is also seeing some of the fastest growth in the country, which will boost property values as more people seek housing.
best locations to buy rental property
To identify the best locations for buying a rental property, our researchers created a composite index based on five key factors real estate investors consider when evaluating a market. These factors include the gross rent multiplier, recent and forecasted home price growth, effective property tax rates, and population growth.
Security deposits are not treated as rental income if they are meant to be refunded to the tenant. Instead, a rental security deposit is recorded as a liability on the property balance sheet. For more help with rental income and expenses, check out our rental income and expense worksheet guide.
The good news is that with long-distance real estate investing, you can find plenty of places to buy rental property where prices are low and cash flow is strong. Most of these places have the same things in common, including good job markets, rising rents, and increasing property values.
Based on those criteria, here are some attractive places to consider when you are thinking about buying rental property. The home value data comes from Zillow as of November 2021, rent statistics for a 3-bedroom home come from Zumper as of January 2022, the job and population growth statistics from DataUSA.io compare 2018 to 2019, and population and 10-year population growth (2010 vs 2020) is from the U.S. Census Bureau:
Other metrics to use when deciding which rental property markets to invest in include neighborhood ratings, school rankings, crime rates, vacancy rates, business-friendly government, and if landlord-tenant laws favor you or the renter.
Looking to invest in New York rental property? Our friends at Clever Real Estate make it easy to connect with the best local real estate agents. Clever is a free service that will personally match you with agents from Keller Williams, RE/MAX, and other leading brokerages.
The median home price in Brookhaven is nearly $550,000. Since prices have been steadily climbing over the last several years and it can be challenging to find a place to rent, Brookhaven can be one of the best places to buy a rental property in New York.
To get started, we recommend shopping around for a local real estate agent. A great agent can help you jump on promising rental property opportunities, compete against other buyers, and even stay one step ahead of MLS listings. Our friends at Clever can introduce you to the best New York real estate agents today, including agents who specialize in 1031 exchanges and investment opportunities.
.col-1-center td:nth-child(1), .col-1-center th:nth-child(1)text-align:center; Recommended Reading Looking for a Home Buyer Rebate? Read This First Want to learn how to get a home buyer rebate? This guide will tell you everything you need to know to save on your home purchase. How to Make an Offer on a House (10 Steps!) Before you buy your dream home, you need to know how to make an offer on a house. Learn how to submit an offer and what happens next! Clever Real Estate Reviews: Is It Legit? (2023 Update) Clever matches you with experienced agents and helps you save on realtor fees. Read these Clever Real Estate reviews to learn more! FAQsWhat is the best place to buy rental property in New York?
While California remains one of the most prominent states in the US, not every rental property investment may be right for you. Depending on your budget, return goals, and maintenance capabilities, one location in California may be better suited for you than another.
California is a diverse state with a booming economy and a wide range of industries. It has everything from movie sets to fintech startups, bringing both local and international visitors to every corner. Now, the question is: how do you determine the best place to buy rental property here? Just exactly where are the best places to invest in California in 2023?
California should continue seeing a high demand for rental properties going into the 2023 US housing market. The continued strength in rental demand should make the state the best place to buy rental property.
Each year, properties in all the best places to invest in California see a significant increase in market value. Median home prices across the state were expected to rise 5.2% in 2022. It means that if and when investors want to sell their property, they are almost always sure to see a significant return from their original purchase cost.
Given the potential for lucrative returns, many investors are trying to determine where is the best place to invest in real estate property in the Golden State. The best places to invest in California in 2023 may differ from investor to investor, depending on different factors.
While both have their merits, choosing one or the other can make or break your investment returns. Here are some things to consider before buying an investment property for long term and short term rentals in the California housing market:
When you own a rental property, whether it is a long term or a vacation rental property, the main goal is to get someone to constantly rent it so you can generate income. In a long term rental setup, investors will normally see constant occupancy as leases are signed for at least a year.
Short term rental properties, on the other hand, are seasonal. It means there may be times when no one is renting the property, whereas other times might benefit from a strong short term rental demand.
With short term properties listed on Airbnb, it is important to remember that you will need to deal with a third-party company handling your property and also adhere to the local short term rental regulations. Though it may pride itself as the best place to invest in real estate, California is not the most Airbnb-friendly state in the US housing market.
In particular, for Airbnb Los Angeles and Airbnb San Diego, you need to run an owner-occupied rental to be legally listed. If you are looking to buy an investment property to list on Airbnb without needing to live in it, you should avoid these places when buying a property.
While a short term rental property may be a slightly more hands-on investment, it does have the potential to generate more income than a long term rental property. A long term rental property will have a fixed price every month throughout the entire year.
Within the same city and even neighborhood, long term and short term rental properties generate very different returns on investment. Thus, you should conduct neighborhood analysis and investment property analysis before deciding which rental strategy to go with to ensure maximum return.
Want to find the best short term rental properties in California and any location in the US? Click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.
As of 2022, Mashvisor concludes that the above locations are the best places to invest in real estate in California. Going into 2023, the California housing market shows great promise in yielding the highest rate of return on long term and short term rental properties.
As an investor, your quest for the best place to buy rental property might just end with California. But then again, it will still depend on the place of the investment. Location plays a very crucial role in determining the success of an investment. For this reason, you need to make sure you do your research.
Elk Grove has a cost-of-living index of 134.9. The average Airbnb price in Elk Grove differs greatly from the typical rental prices; renting a one-room Airbnb costs $2,146. With a cash-on-cash return of 3.04 percent and an 82 percent occupancy rate, Elk Grove is undoubtedly one of the best places to buy vacation rental property in the Golden State.
If investing in rental property in Palm Springs, Los Angeles, and San Diego is too expensive for your taste, Winchester is the ideal middle ground. Situated in Riverside County, Winchester is one of the best places to buy a rental property in Southern California. Renting out your Airbnb here means a 17.58 percent cash-on-cash return and an 87 percent occupancy rate. A four-room Airbnb can rent for up to $12,045 in Winchester.
Increasing home prices and low housing inventory indicate a competitive market for homebuyers in 2022. But with rent prices and the demand for rental housing on the rise, one group of buyers may still be highly motivated and in a good position to purchase property: real estate investors.
Florida has lower-than-average property taxes and no personal income tax, and the Greater Orlando area ranked No. 2 on our list for best investment appreciation and No. 7 for best rental income growth.
With lower-than-average state property taxes and no personal income tax, the Tampa-St. Petersburg-Clearwater metro area ranked No. 1 for best investment appreciation and No. 5 for best rental income growth.
Even as the pandemic drove renters out of major cities (Boston included), data shows many renters are returning to tech-based cities and rents are increasing once again. Boston rents are up 12.9% year-over-year, according to Realtor.com November rental data, and the Greater Boston area ranked No. 4 for best rental income and No. 2 for best rental income growth.
While you have the option to list your investment property as a traditional rental, statistics have shown that Airbnb rentals generate higher monthly rental income. Data from Awning shows investors typically make $2,720 per month off of investment properties in Clearwater. Rental growth has also increased by over 20% in the past quarter. 041b061a72