With foreclosures still flooding the market and home prices determined to remain at record lows in most cities, now might be a good time to purchase some rental properties. If you have the capital, or credit good enough to take advantage of low mortgage rates, buying houses in strategic locations and renting them out until the real estate market rebounds can be a great investment. Make sure you buy rental properties in an area where people rent. Usually, this means college towns or communities where young professionals gather. However, with the unpredictability of the housing market, criteria has changed. Here are some of the best cities for purchasing rental properties.
Orlando. The Mickey Mouse enterprise long dominated this area of central Florida, and until the economy took a nosedive, the Orlando area began to boom in terms of industry, commercial growth and housing. However, things have stalled and the average home price is around $165,000. Rent to people who spend a year or two working as entertainers at one of the theme parks, and you’ll have a valuable piece of property whose value is positioned to go up once Orlando starts taking off again.
Las Vegas. Get a great return on your investment in the city that never sleeps. Homeownership hovers around only 55 percent in Vegas, and rental prices are on the upswing. Gamble on scooping up a house or two that you can rent to casino workers.
Phoenix. The rental market in Phoenix is hot. Of course, it’s a dry heat. Anyway, the foreclosure crisis hit this southwestern city hard and many people who lost their homes are now renting. You can garner great rental income inside the city or in the more suburban outskirts.
Fort Lauderdale. Retirees who are grateful to have unloaded their northern or Midwestern homes before losing them to foreclosure or short sales are choosing to spend their golden years renting. This is especially true in southern Florida, where a once robust housing market is suffering. There is a lot of inventory because this warm, coastal area outside of Miami was overdeveloped during happier times. Rentals average at over $1,000 per month.