{"id":3253,"date":"2008-06-21T07:56:22","date_gmt":"2008-06-21T14:56:22","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=3253"},"modified":"2008-06-21T07:56:30","modified_gmt":"2008-06-21T14:56:30","slug":"investors-are-coming-back-to-the-phoenix-rental-home-market-and-with-the-right-business-plan-theyll-make-money","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/3253\/investors-are-coming-back-to-the-phoenix-rental-home-market-and-with-the-right-business-plan-theyll-make-money\/","title":{"rendered":"Investors are coming back to the Phoenix rental home market — and with the right business plan they’ll make money"},"content":{"rendered":"

This is my column for this week from the Arizona Republic<\/i> (permanent link<\/a>).<\/p>\n

 
Investors are coming back to the Phoenix rental home market — and with the right business plan they’ll make money<\/strong><\/p>\n

Rental home investors are coming back into the Phoenix real estate market, and this is a good thing.<\/p>\n

The last time we had a substantial run on rental housing, results were not so sweet. Investors came to Phoenix with the idea that price appreciation would make up for any monthly losses they might take on their rental homes. It’s plausible they were right — in the long run. In the short run, negative cash flow and declining values, coupled with adjustable-rate or negative-amortization loans, drove many of these homes into foreclosure.<\/p>\n

And this accounts for much of the inventory the new wave of investors is drawing upon. The difference is, the prices for these homes have declined enough that they can be — at least potentially — cash-flow positive.<\/p>\n

Why only potentially<\/i> cash-flow positive?<\/p>\n

Because too many investors adopt the worst of the cartoonish characterizations of capitalism when they resolve to become landlords. They pick the cheapest properties in the worst locations and rent to the least-qualified tenants, living through one eviction and repair nightmare after another.<\/p>\n

Here’s a strategy for making more money from a rental home — much more peacefully.<\/p>\n

There are dozens of costs associated with rental housing, and your business plan should take account of all of them. But your biggest potential losses are always going to be vacancy, tenant acquisition, repairs and resale value.<\/p>\n

It makes much more sense to me to buy a property that can command premium rents and will sell at a premium price when you’re ready to move on. Location matters, as do the livability and lifestyle factors of the specific home. You want to pick a home that will stay rented.<\/p>\n

I think it’s a good idea to charge something less than the market rent. This will give you a broader array of tenants to choose from, which will enable you to select tenants with good credit who will treat your property like their own.<\/p>\n

With the right house Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

This is my column for this week from the Arizona Republic (permanent link).  Investors are coming back to the Phoenix rental home market — and with the right business plan they’ll make money Rental home investors are coming back into the Phoenix real estate market, and this is a good thing. The last time we […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,6,5],"tags":[],"class_list":{"0":"post-3253","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-investment","7":"category-marketing","8":"category-real-estate","10":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":15768,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/15768\/dont-you-love-reading-all-that-good-news-about-the-the-phoenix-real-estate-markets-recovery-guess-what-youre-being-lied-to-as-always\/","url_meta":{"origin":3253,"position":0},"title":"Don’t you love reading all that good news about the the Phoenix real estate market’s recovery? Guess what? You’re being lied to — as always.","author":"Greg Swann","date":"March 21, 2012","format":false,"excerpt":"This is what's really happening: FannieMae and FreddieMac are holding foreclosed houses off the market, in anticipation of \"selling\" them to campaign donors. Meanwhile, the town is being picked clean, with prices being bid up by buyers convinced that houses are going out of style -- a story we've heard\u2026","rel":"","context":"In "Group Therapy"","block_context":{"text":"Group Therapy","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/group-therapy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":17666,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/17666\/bloodhounds-end-of-year-letter-to-our-rental-property-investors-thriving-by-surprise\/","url_meta":{"origin":3253,"position":1},"title":"Bloodhound\u2019s end-of-year letter to our rental-property investors: Thriving by\u00a0surprise.","author":"Greg Swann","date":"December 31, 2020","format":false,"excerpt":"I have four listings in the hopper, and the whole first quarter looks strong. So far, I am unable to rid myself of the NAR, but I'll be working on the problem as I go. I don't need ARMLS for rentals \u2013 Zillow alone is better for us \u2013 and\u2026","rel":"","context":"In "Group Therapy"","block_context":{"text":"Group Therapy","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/group-therapy\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-content\/uploads\/2020\/12\/jeff-w-8jWqx3fS0oI-unsplash-1-480x308.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":110,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/110\/when-is-the-best-time-to-buy-when-everyone-else-is-selling\/","url_meta":{"origin":3253,"position":2},"title":"When is the best time to buy? When everyone else is selling…","author":"Greg Swann","date":"July 20, 2006","format":false,"excerpt":"I think this is exceptionally good advice from Craig King at RealBlogging.com:No matter what you're selling, conventional wisdom is that the FUD Factor (fear, uncertainty and doubt) tends to freeze buyers in their tracks. Purchases get delayed. Decisions take longer. Buyers follow the maxim, \"When in doubt, don't.\" At the\u2026","rel":"","context":"In "Marketing"","block_context":{"text":"Marketing","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/marketing\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3107,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/3107\/are-you-an-investor-looking-for-a-rental-home-that-will-stay-rented-buy-a-home-thats-worth-living-in\/","url_meta":{"origin":3253,"position":3},"title":"Are you an investor looking for a rental home that will stay rented? Buy a home that’s worth living in","author":"Greg Swann","date":"May 12, 2008","format":false,"excerpt":"This is my column for this week from the Arizona Republic (permanent link). I wrote this last Tuesday, but it coincides nicely with Barry's post this morning. \u00a0Are you an investor looking for a rental home that will stay rented? Buy a home that's worth living in I represented tenants\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":17003,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/17003\/a-note-to-our-rental-home-investors-influx-just-lacks-majesty-but-its-the-upside-of-an-exodus\/","url_meta":{"origin":3253,"position":4},"title":"A note to our rental-home investors: Influx just lacks majesty, but it\u2019s the upside of an exodus.","author":"Greg Swann","date":"September 13, 2020","format":false,"excerpt":"Me today to our buy-and-hold rental property investors: It's not well-reported, except in the form of secondary evidence like U-Haul rates and MLS listings and closings, but very-vertical cities are emptying themselves to the benefit of very-horizontal communities. Congratulate yourself again for investing in Phoenix, the world's largest suburb. At\u2026","rel":"","context":"In "Flourishing"","block_context":{"text":"Flourishing","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/flourishing\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-content\/uploads\/2020\/09\/erda-estremera-sxNt9g77PE0-unsplash-480x319.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":10766,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/10766\/are-the-uninformed-chatterboxes-in-your-area-insisting-that-the-real-estate-market-has-recovered-you-may-want-to-defer-the-celebration-even-so-this-could-be-the-golden-moment-for-investors-in-phoen\/","url_meta":{"origin":3253,"position":5},"title":"Are the uninformed chatterboxes in your area insisting that the real estate market has recovered? You may want to defer the celebration. Even so, this could be the golden moment for investors in Phoenix.","author":"Greg Swann","date":"January 5, 2010","format":false,"excerpt":"I've known for six months or more that there was a sweet spot on the horizon for investors and other highly-solvent buyers. That event was delayed by the first-time home-buyer's tax credit. Today's news about declines in the number of pending purchase contracts is a symptom of the market returning\u2026","rel":"","context":"In "Flourishing"","block_context":{"text":"Flourishing","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/flourishing\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/3253","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=3253"}],"version-history":[{"count":0,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/3253\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=3253"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=3253"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=3253"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}