Market Conditions in Phoenix>Question Details

Nlbuyrent, Home Buyer in Woodbury Heights, NJ

Strongest rental markets in the greater phoenix area? Looking to buy single family home as a investment and rent it out.

Asked by Nlbuyrent, Woodbury Heights, NJ Sun Oct 16, 2011

Best rental markets in the greater phoenix area? Looking to buy single family home as a investment and rent it out. Where are the strongest rental markets? Surprise? Glendale? Cave Creek, Scottsdale, Chandler? etc..I appreciate any responses.

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Investor X’s answer
This question depends on how much money you plan on investing. You can purchase a built 1970’s Scottsdale home for $180K and rent it for $1,350 a month. Or West side built 2006 by stadium for $70K rental income $950 a month. Do the math. Buying a home in a really nice area like Scottsdale would be like buying low risk bonds making 2% interest. No risk involved. If you want to maximize your income risking it all but making the highest income would be west side near stadium. In April I purchased a 2008 3/2 1,400 sq ft house. Beautiful community by Cricket Pavilion. Purchased $40,600 bucks. Rents for $950 a month. I’d rather buy 4 more of these properties and make $3,800 rental income than a Scottsdale home renting for $1,350 a month. Think like an investor not a home buyer.



Here are just a few examples:
Homes based on 3 bedroom 2 bath home 1.500 sq ft. Nothing fancy or expensive subdivision. These are average prices and rental income. Not bargains. Just average homes for sale.

1970’s Scottsdale home with ugly dated kitchen sells for $180K and up. Rental income $1,350. Anything over $1,350 rental income you’re pushing it. People can afford to buy why rent. Don’t go over $1,350. That’s the magical number.

Gilbert/Chandler/N PHX: 95K-$125K. Rental income $1,000-$1,150 a month.

Mesa: 75K-100K. Rental income $900-$1,100

Glendale: ½ of Glendale is nice. The other ½ is bad news. The middle near 101 Cardinal Stadium would be considered average area. Let’s go with this. $80K-110K rental income $950-$1,000

South Phoenix: Really bad dangerous. There are beautiful communities built here in the middle of ghettos. $60K-$80K. Rent income $700-$875.

There are other areas but just put a few examples.
1 vote Thank Flag Link Tue Oct 18, 2011
Hi NLBuyRent,

All of these areas have good locations to buy/hold/rent. It depends on the sections of these City that you buy in. You will want to purchase a home where you can received the highest yield rate (highest rent and lowest purchase price in a good location). I don't know if you are a cash buyer but did you know that you can purchase real estate with your 401K or IRA? It's possible with a self directed IRA offered by a local company in Arizona. If you are interested, then please feel free to contact me.

P.S. Follow me on Facebook.com at: http://www.facebook.com/scottsdaleproperties

Sean Heideman, Realtor
E-Certified, SFR Certified
Zip Realty
2929 North 44th Street, Suite 320
Phoenix, AZ 85018

Office: 800-225-5947
Cell: 480-213-5251
Fax: 602-288-5533
E-mail: sean.heideman@ziprealty.com

My Profile: http://www.ziprealty.com/agent/sheideman
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0 votes Thank Flag Link Mon Oct 17, 2011
What amount of capital are you looking to invest? How many units do you want to purchase?

Is this one you want to someday consider living in or is it pure investment?

I always think this is somewhat personal, some investors are fine being slum lords and others want something nice, newer and sharp.

What is your flavor?

If you want slum lord I'm probably not your guy. If you want newer, nicer areas of suburbia living then lets talk.

Phoenix is very affordable and positive cash flow is being experienced.
Web Reference: http://www.McVinua.com
0 votes Thank Flag Link Mon Oct 17, 2011
You are currently located in NJ but want to buy in Phoenix.....or surrounding areas in Arizona.....

I suggest strongly to connect with a local Phoenix Realtor who is not only familiar with the purchase prices
in the area but also with the rental market... and besides figuring out for how much you intend to purchase,
cash or with a loan..... have your realtor assist you in calculating if you come out even or with a profit at the
end of the year.....

Your reason for buying is also very important, may be you are thinking that you may want to retire in that area, but not NOW, and that you would like to purchase while the market is down and prices and interest rates are
low, and that makes of course a lot of sense, but you want to make sure you buy a property in an area that
is very much in demand for renting, you would like to live in later on or then sell for profit down the road,
so how many years down the road? So there are so many considerations before making this decision,
get the experienced help of a local Realtor, out of Phoenix is fine, they do know the surrounding cities as
well and can of course explore statistics on your behalf.

Good luck to you!
Edith YourRealtor4Life And Chicago&NorthernIllinois and North Shore Expert
Working always in the very BEST interest of her clients.....
0 votes Thank Flag Link Mon Oct 17, 2011
There are so many investors buying rental properties that it's best to determine what your long term plan is. Some are looking for a strong return on their investment and not counting on appreciation. Others we work with would prefer better areas that will attract a better tenant and most probably come back faster in price than some of the cheaper areas like out in the west valley. In another few years those that are renting will start to qualify again for mortgages and be able to buy a home. For that reason I recommend buying homes that are located in good school districts and not too far out. I like North Phoenix and Scottsdale, Cave Creek, chandler and Gilbert.
Good luck with your search and let me know if you would need more specifics.
Lorrie Feld
Keller Williams Integrity First
0 votes Thank Flag Link Sun Oct 16, 2011
Dear NI:

Depends what you mean my strong? Strong rents, strong renter base, strong longevity of renters?

ASU and Tempe is a very strong rental area in terms of demand, but short term renters as students move on. Less mature renter base. Sun City has retired base and longer term renters that take good care of the property. North Central Phoenix is close to freeway access.Dense population and families. Central Phoenix corridor along I17 has high rental demand because rents are low. People move on.

Rental demand overall is good thoughout the metro area. Rents are on the increase. The possible exceptions are the perimeter cities, although even thiese get there fair share of winter visitor renters.

Scottsdale and PV are always popular and the rents are higher than in west Phoenix.

To see all rental properties currently active on the MLS to see what rents are charges throughout the Phoenix metro: http://link.flexmls.com/ub8m3gk7wx9,12

Jeff Masich, Realtor
Arizona Homes and Land
HomeSmart
Scottsdsale
Web Reference: http://ArizonaHomesLand.com
0 votes Thank Flag Link Sun Oct 16, 2011
The previous answers have summed things up well. I have investors buying in downtown Phoenix, Scottsdale, even Paradise Valley.

The key to their success is they wrote a business plan and built a team to enact the plan. Location is important and only one part of the formula.
0 votes Thank Flag Link Sun Oct 16, 2011
To answer your question...well, yes. All of the areas you mentioned are good. The Greater Phoenix area covers over 7,000 sq miles. The rental market is strong in many areas throughout.

How much capital are you looking to invest? How much income are you hoping to realize? Are you looking for a property to improve or one with the improvement already in place?

The rental properties I have had listed in recent months have leased in 30 days or less. In fact, one had received an offer the day it hit the market. Investors have returned to the Phoenix area. They see value in the home prices and the potential to profit in the rental market.
0 votes Thank Flag Link Sun Oct 16, 2011
Much of the Phoenix rental market is strong because of the high percentage of people losing their homes either to foreclosure or having to short-sale. Some of these areas have a stronger more reliable renter pool than than others. What price point are you looking to purchase in? This will dictate the best areas to buy.

Feel free to contact me with further details,
Jennifer
Homesmart
602-363-0266
jennco88@gmail.com
0 votes Thank Flag Link Sun Oct 16, 2011
We have several zip codes which are red hot at the time. Investors both in the US and abroad are buying these homes due to the high return on investment.

Feel free to contact me if you would like additional information.

Milly Casas
Milly Sells AZ

e-mail: milly@millycasas.com
0 votes Thank Flag Link Sun Oct 16, 2011
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