High Home Prices Allow Investors the Opportunity to Generate Higher Rental Income.
By Noah Brocious – President/RI/Mortgage Loan Originator – A strong seller’s market in Phoenix creates a unique opportunity for landlords and Real Estate Developers to grow their investments with a Hard Money Loan. With strong demand and anemic inventory, prices are growing at the highest rates across the Country in the Valley.
Year over Year growth puts valley home prices growing at 5.2%, earning the “very hot” Zillow market temperature label (https://www.zillow.com/phoenix-az/home-values/). This is in line with YoY monthly rent growing in the high single digits across the entire Valley.
Why Do We See Strong Growth in Real Estate?
Multiple factors: National Corporations like Microsoft, Nike, and Intel are investing billions in the Phoenix-metro area bringing higher than average median wages. Arizona’s comparably low cost of living is attracting out-priced “people” form neighboring states to flock to Maricopa County at an average rate of 200 people a day. A business-minded regulatory environment focused on sustainable economic growth is continually bringing out-of-state investments and inspiring small business growth.
How Can Investors Take Advantage of the Market?
An Investor finds an undervalued property and wants to close quickly with an all-cash offer to secure the deal. Utilizing a competitive rate Hard Money Loan from Capital Fund 1, the investor can get approved in as little as 24hrs to secure the property. After adding value through cosmetic changes, the investor sells the home and reinvests the difference.
Instead of selling the home, the investor refinances the home after the increase in value to either –
- A) get a lower rate
- B) cash out and use the funds for the next project, and then chooses to rent the home out. Here the home is kept as an asset in their portfolio while also generating a steady stream of income.
Are There Opportunities for Investors?
There are a lot of opportunities for experienced and new investors in the market. The market is also signaling to investors they will win despite their exit strategy. Whether to hold, flip, or rent out a property, the market is rewarding investors across the board.