Ready to invest in Memphis rental properties?

[Terez Jones]

Ready to invest in Memphis rental properties?

Memphis is one of America’s most affordable cities, yet it offers a diverse economy, excellent location, and plenty for residents to do.
This makes it a hidden gem in an environment where finding good deals in more prominent markets is getting harder.

Here are the benefits of owning Memphis rental properties:

💰 1. Steady Income: Most Memphis rents are trending gradually upwards, signaling potential growth in the future.
The right Memphis rental can offer passive income after repairs and upgrades if you hire a good property manager.

💰 2. Diversification: Real estate has a low correlation with stock and bond performance. Therefore, it could be a great way to guard your wealth against declines in the stock and bond markets.

💰 3. Significant Tax Savings: The IRS offers plenty of tax deductions to real estate investors. Speaking with a tax professional to determine what tax breaks you qualify for and how much is a wise choice.

➡️ Mortgage Interest DeductionReal estate investors cannot use the homeowner mortgage interest deduction. However, they can deduct mortgage interest as a business expense.

➡️ Property DepreciationDepreciation lets investors reduce their taxable income to account for property wear and tear. This is one of the largest deductions investors can take.

➡️ Operating ExpensesThe IRS lets you deduct “ordinary and necessary” expenses paid to manage your Memphis rental property and run your business (i.e. advertising, pest control, repairs and improvements, tenant screening, utilities, and more.)

➡️ Property Taxes and InsuranceInvestors have to pay property taxes and insurance regularly. But, fortunately, many can deduct these on their income taxes.

➡️ Travel ExpensesInvestors who must travel to manage their property might be able to write off related travel expenses. 

💰 4. Memphis’s Economy:Memphis has a relatively diverse economy. Major sectors in the area include healthcare, education, government, and trades/transportation/utilities.

💰 5. Geography and Amenities:Memphis is not far from the Midwest nor the Deep South. It sits on Tennessee’s borders with Mississippi and Arkansas, making it the Arkansas-Mississippi-Tennessee tri-state area hub. 

💰 6. Affordable Prices:Memphis real estate is reasonably affordable compared to cities of similar size. The housing market is somewhat competitive, with a $200,000 median listing price. Investors may be able to enter this market fairly easily.

💰 Final Thoughts on Owning Rental Properties in Memphis: Memphis can be a great market for rental investors. It’s one of America’s most affordable cities, yet it boasts a healthy economy, a good location, plenty of history, and a thriving art and cultural scene.

Are you sold on investing in Memphis real estate?