Purchasing rental property in this down economy, as the housing prices continue to drop, is a good business strategy, especially since interest rates are low and rent demands are high.
But not all markets are created equal and there are some cities in the U.S. where you’ll get better ROI than others. A recent survey by Local Market Monitor, a North Carolina-based firm that specializes in forecasting real estate prices, ranks the top 5 cities for reaping the most rental profits.
Las Vegas is listed as the best city for rental investment, primarily due to having the highest foreclosure rate in the country. Former homeowners who fell into foreclosure now rent and the large casino workforce consists of mostly renters.
Detroit is listed as #2 but enter into this market carefully. Although home prices are low, some experts predict even further price reductions over the next 3 years. Also be aware that the state’s unemployment rate is still high and the metro population has decreased since the recession began, thus reducing demand for both sales and rentals.
Warren, Michigan comes in at #3. This suburb of Detroit was also very reliant on the auto industry but the homes are nicely kept, schools are better, there is less crime, and the population is more stable than metro Detroit.
Next on the list is Orlando, Florida. Housing prices have dropped a whopping 43% since 2006 but the area is still a tourist hub with the local amusement parks. Similar to the Las Vegas casino workers, the large majority of amusement park workers are renters and when the economy finally picks up, the number of workers and tourists could increase dramatically.
Rounding out the list at #5 is Bakersfield, California. Housing prices have dropped 50% since 2006 and there’s a high rate of delinquencies and foreclosures. The unemployment rate also hit an all time high of 15% but has slowly improved over the last year, so rents are expected to increase.
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When I initially commented I seem to have clicked the -Notify me when new comments are added- checkbox and now each
time a comment is added I receive 4 emails with the same comment.
Perhaps there is a means you can remove me from that service?
Cheers!