Top Residential Rental Income Property Markets

Why Residential Income Property

Nearly 4 million families have been pushed into the rental markets since the great recession began and the housing bubble burst. At the same time the supply of habitable rental units has shrunk substantially. The result is that rents are rising and investors are moving in for the returns. The National Association of Realtors projects a 4% average increase in rents nationally this year and 4% in 2013. Goldman Sachs economists estimate that rental properties (acquired at today’s prices) are yielding more than 6% on average nationwide.

The residential income property market is changing as investors, ranging from large private equity funds and REIT’s to ­local rehabbers are moving into residential housing. Even Warren Buffett is bullish on single-family homes as an attractive investment now. The National Association of Realtors estimates investors accounted for 1.23 million home purchases, so investors are purchasing between 1/4 to 1/3 of all the residential properties on the market. Investment property broker, Robert Stec say’s “Today’s investors are really focussed on operating expenses and net yields unlike the mid 2000s speculators we saw in Vegas, Phoenix & Miami buying condos just hoping to flip them for a quick profit”

Last year half of investment purchases were for cash . The median price paid was $100,000, up 6.4% from $94,000 in 2010. If buyers are planning to flip a property these days, it’s usually after fixing it up.  The market today is better served as investors are looking for a long-term, stable income. And with investors getting returns paying more than the 2% current yield on ten-year Treasuries it is not wonder why their is so much demand for investment grade residential properties.

CNN rank’s these 10 cities as some of the best markets in the U.S. to buy rental properties. CNN collected data from Rent Jungle, National Association of Home Builders, HomeVestors and National Association of Home Builders. They then ranked cities by estimated future returns investors can expect when they buy single-family homes with the intent to rent the properties.  A baseline projected national average future return of 5% was used. As an investor however, if you’re going to take on the risk of owning an investment property, you need to have a shot at getting a very nice return.

Investor Tip: The Buyers Utopia network suggests only dealing with investment properties that can produce at least a 10 percent return on your investment.  [iphorm_popup id=3 name=”Residential Cash Flow Positive Income Properties”]Contact Us For Opportunities[/iphorm_popup]

CNN rank’s these 10 cities as some of the best cities in the U.S. to buy rental properties.

Detroit Residential Income Property Top Market

Daytona Residential Income Property Top Market

Reno Residential Income Property Top Market

Tampa Bay Residential Income Property Top Market