News reports and real estate publications have announced that home prices have continued to decline 4.6 percent in the first quarter of 2012. While this is not good news for homeowners, the opposite is true for investment property owners. As more homeowners go through foreclosure or seek alternative living arrangements, the rental property market has seen a spike in monthly rent in 2012 compared to 2011. This upward trend is set to continue as more investment property rent prices rise in 2012. Buying investment properties in Florida cities like Jacksonville are helping more investors rake in higher earnings.
The Measurement of Investment Property Rent Prices
Zillow is the most trusted real estate research film in the United States. Most of the data that is used by realtors and investment property owners around the country comes directly from Zillow. The newest report has put a spotlight on the average monthly rental price of an investment property. The new Zillow data has reported that rental prices have risen by 3 percent compared to the same period from 2010 to 2011. This is excellent news for investment property owners in Florida cities that are able to benefit from this rise in price.
The demand in rental property continues to rise. Families that are getting out of a mortgage are exploring the cost effective solutions provided by renting instead of buying. For homeowners that have gone through foreclosure, renting a property is likely the best solution due to the effects that foreclosure has on credit. The credit and borrowing slowdown caused by foreclosure could keep a person in the rental market for a decade or longer. This change in the markets is allowing more investors to prosper in high foreclosure states like Florida. The ROI on distressed properties and foreclosures that have been remodeled is much higher compared with a preexisting home that might need additional repairs to make it ready to rent.
Why Single Family Homes are More Popular
Unique locations, school districts, longer tenant leases and nearby attractions all contribute to the success of a single family home. As more individuals and families transition out of town homes and apartments, the allure of single family homes is much greater than in any other time in history. The opportunity to have a private lawn, garden and other home amenities not available with other housing is very attractive to modern renters. Investment property owners that own single family homes are reporting increases in long-term leases compared with a vacation home that is typically rented seasonally.
Part of what attracts renters to single family homes is the local surroundings. Communities that are close to Jacksonville Beach attract the family crowd due to the oceanfront activities and shops that cater to tourists. Apart from families, college students and retirees also rent single family homes in favor of duplexes or other types of properties. As rent prices continue to rise, investment property owners can expand their monthly cash flow and put these funds into other investments to grow their wealth faster.