Buying Rental Properties
There are great benefits of owning rental property. But it’s not just about having available rental property, it’s about having rental space in the best possible location.
Ron Johnsey, who tracks relocation trends with Axiometrics recently blogged that when it comes to determining the best place to buy and/or own an apartment property, it is important to examine the area’s economic and demographic variables such as job growth, net domestic migration and population trends, education, income levels and apartment market fundamentals.
Overall homeownership rate is declining from 69 percent to 66 percent today. There is less interest in owning homes because the buyer sentiment is just not there. The renters that would move out to buy homes see the home prices declining, have higher down payments, require better FICO scores, and so on, and all of this is working to create more renter demand for conventional market-rate apartments.
Axiometrics Inc., recently reported year-to-date effective rent growth in the U.S. apartment market is the best since the nation’s economy started to recover from the Great Recession.
Top- and Bottom-Performing MSAs
As has been the trend, California, Florida and Texas placed among the best-performing metro areas for annualized effective rent and revenue growth.
In its recent research, Johnsey says Apartment Guide provided a comprehensive list of top-searched sister metros - where people most often move from and where they move to - as well as the top-searched Metropolitan Statistical Areas (MSAs).
The top searched markets in order were Los Angeles; Washington D.C.; Dallas; Houston; Atlanta; New York City; Miami; Chicago; Phoenix; and Philadelphia.
Reasons for relocation included:
- 6.3% move due to change in marital status
- 10.7% move to establish own household
- 12.3% move due to other family reasons
- 9.5% move due to new job or job transfer
- 1.8% move to look for work or lost their job
- 5.5% move to be closer to work/easier commute
- 2.1% move for another job-related reason