Rising Rents Highlight Value of Property Investments

Real Estate

Rising Rents Highlight Value of Property Investments

Recent research from Real Estate Witch, a specialist advisory company, has highlighted once again that property is a timeless quality investment. Their recent report says rent is currently outpacing wages in 46 of America’s 50 largest cities, and this isn’t just a post-COVID trend either. 

Since 1985, inflation and income growth have both lagged rent rises, and while the post-pandemic rent spike appears to be slowing, Real Estate Witch says rents have risen 208% since ‘85, outpacing inflation by 40% and income by 7%.

The steepest long-term rental increases have occurred in Denver, Las Vegas, Charlotte, Seattle, Atlanta, Portland, and Nashville. However, since 2009, rent in San Jose and San Francisco has risen 85% and 71%, respectively, says Real Estate Witch.

Here are some property investment tips to get you inspired:

  • Strategy – What are your goals? Do you want long-term rental income or short-term capital gains? Both options have risks and rewards, so make sure you know your risk profile and what success will look like for you.
  • Homework – Target favorite areas and analyze property values, rental demand, vacancy rates, and market-influencing economic factors. Working with an experienced Brightwork agent can be essential for this task!
  • Location – Strong rental markets need economic growth, job opportunities, and good schools and amenities. In these areas, you'll usually find excellent tenants.
  • Advice – Always work with a professional financial advisor or accountant to ensure affordability and the ability to take advantage of tax benefits.
  • Finance – Work with your adviser to determine the most appropriate financing arrangements. Investigate traditional mortgages and private lenders. Compare rates, terms, and fees as part of your decision-making process.
  • Risk – Limit risk by doubling down on property inspections, title searches, zoning regulations, and potential legal or environmental issues.
  • Diversify –  Don't put your eggs in one basket. Protect your portfolio by buying different styles of property in separate cities. That way, you won't be exposed to a localized economic downturn.

At Brightwork, we have experience working with investors looking for properties that attract strong rental returns and offer excellent capital gains potential. Click here or give us a call today at 925-200-6000 if we can assist you as an investor or landlord.

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