Real Estate Investment Opportunities In Arizona
Arizona’s strong economy, consistently sunny weather, and relative affordability makes it an attractive option for real estate investors.
Arizona’s population increased by about 750,000 residents between 2010 and 2020. It remains one of the fastest growing states, with approximately 17% of newcomers moving in from California. High tech employers including the semiconductor industry and major companies like Tesla and Oracle have also contributed to the state’s growth by relocating their headquarters to Arizona.
According to the 2020 Census, Arizona’s average price-to-rent ratio is around 19. This means that many residents find it more advantageous to rent than own a home for most residents. This is great news for investors, whether they’re looking to invest in a traditional home to rent out or an entire apartment building.
Another growing opportunity for investors lies in the Short Term Rental Market. AZ has a long history of being a desirable destination for travelers, and the STR market is no exception.
Although the demand for housing is high, median home prices are relatively affordable compared to other states, making for many investment opportunities throughout the state.
Identifying your investment goals and opportunities
Ultimately, the best investment for you depends on your personal goals. If you want to flip a home, you probably won’t be looking for the same criteria as a vacation property investor.
Some investors focus on property appreciation, whereas others like the steady stream of income that comes from long-term rentals. Vacation Rentals are also very popular in our state, and our agents have had personal experience with the Scottsdale, Southeast Valley and 55+ Short-Term Rental (STR) market.
We can help you find investment opportunities throughout the state, depending on your desired budget and goals.
In recent years, Phoenix property values have increased by an average of 17.43% year-over-year, and the city boasts the highest rent-to-mortgage ratio in the state — 75.8%. It has the fastest-growing population in Arizona, and the city also attracts thousands of tourists every year, making it a viable option for all kinds of investors.
While we always insist that any investor do their own research into the current market, and an individual property expected return, many market experts predict that property values will at least hold their own or continue to increase over the next few years, making the Phoenix real estate market highly desirable for most investors, while the market is still relatively affordable.
Phoenix Rental Property investments
Arizona’s high Real Estate appreciation rates have impacted every aspect of the local marketplace. In particular, the rental market is just as hot as the buyers’ market. Higher home prices and a historically low number of listings has prevented many prospective buyers from purchasing a home of their own, and are now looking to rent instead of buy. As a result, landlords have found themselves in a position of power in Arizona and increased their asking rates.
Despite historical appreciation, there are still plenty of opportunities to capitalize on today’s market. Flipping homes remains popular in the Phoenix area, however increased interest rates and building supplies have whittled down the profit margins for house flips. Short term rentals are popular in Arizona, particulary in the many communities without Home Owner Associations, and their accompanying rules and restrictions. Our agents can search potential neighborhoods and areas which allow unrestricted STRs. And perhaps the most appealing real estate investment opportunities in AZ lies with long-term rental properties.
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