Best Location For Single Family Rental Property
I would like to do a search in the sun belt for areas with newer homes, that are growing, with rents at a high enough level to support postive cash flows with little down. San Antonio looks good but is there a reference some where that compares a lot of the sunbelt cities..or is this a do it yourself job?
Thanks
I am gathering the same notes and data for these areas. Please let me know what you learn..
I am specifically looking at florida and texas.
I want to buy either a single resident property and take a room mate or buy up to a 6 unit apartment and occupy one suite.. Maybe even a B&B
texas over florida,
florida over texas...
anythoughts.
There are two many variables..I think there are spots in both areas that are probably pretty good..but how to easily compare a lot of them? Texas, florida, arizona, etc. are all big states, lots of different communities, so how to compare them to look for the best..that is the question.
Texas, depending on the city will probably show a decent cash flow with low probability of super appreciation. Many areas in Texas are in a buyers or neutral market. There are more absorption issues of new building in Texas. My opinion of Florida, especially along the coast, offer better appreciation potential, many have already experienced tremendous gains & may not cash flow as well. So I really depends on how much risk you want to take.
Texas A&M has a website for their school of real estate that offers in-depth data to various Texas markets .
Also, I know a gentleman by the name of Ingo Winzer who is quoted in many financial magazines. He publishes a National analysis of major US cities. Do a google search on him & you will find his info.
I have spent many hours researching this very topic. All of this information is available on-line, though you really need to be creative with your keywords to locate the good stuff.
Compare vacancy rates, appreciation specs, mean and median home prices, determine the greatest percentage of buyers price ranges, population trends, local universities, industry, proximity to water, unemployment rates, new home vs. resales, tax rates, cash flow potential, age of homes, DOM, etc.
Once you have narrowed your search you need to pick up the phone and speak with re attorney, CPA, area specific realtors, property management companies, all of whom specialize in investment real estate.
I hope that this helps, it may seem like a lot of work but you will not PROFIT if you do not work!
Take care,
Andy Gibbs
It really varies from state to state. California is extremely tenant friendly. When I was poor and renting in Hollywood (1988-1993) I had several problems with manangement. Mostly not returning my deposit. We have very srtict renters rights in Ca, all it took was a copy of the specific law sent to the property management office (14 days maximum to return depost, normal cleaning cannot be charged to tenant). I am sure it became tenant friendly because of unfair and greedy slumlords of years past. Great when you are a tenant, but can be expensive when you are an investor.
To answer your question, any competent landlord, management company, or investor calculates vacancy at the local rate (normally 5%-10%) in the overall assesment of the property to determine cash flow.
Like any business, one must weigh the financial ramifications (wow, that was a big word!). You must determine if it is worth your time and money chasing an evicted tenant to court for a few hundred dollars.
Are you looking to begin investing or are you doing a college statistical assignment? Just curious.
Have a great week,
Andy
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