Salt Lake City, UT · Member since 2013 · 164 posts · 73 votes
Does anyone have suggestions on how to determine if an area is a good rental neighborhood?
The questions comes from a house I recently looked at. Great condition, nice inside, recently remodeled kitchen. Neighborhood is great as well. It's a FSBO.
The thing I'm looking at is other homes to determine rent rates as well as competition.
Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
12y
Here's my recommendations for what they're worth:
First, drive the neighborhood. Look for pride of ownership, dilapidated or boarded up buildings, lots of 'for sale' signs, people hanging out in the middle of the day doing nothing, trash, etc. This can help you get a good feel for the neighborhood. Also, call on the 'for rent' signs and ask around to get an idea about rents.
Second, research the area. You can find crime stats along with a lot of others by zip code on sites like homefair.com and clrsearch.com. You can also find income data by subdivision with the map feature on city-data.com. You can get comps from zillow.com (be wary of the zestimate though) and rent comps on rentometer.com, hotpads.com or craigslist (use the map feature). Loopnet.com has commercial sales data and there are many others like that.
Third, ask around. Your local REIA group can probably give you some good tips. But you can just ask people you meet in the neighborhood how things are around there.
Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
12y
Here's my recommendations for what they're worth:
First, drive the neighborhood. Look for pride of ownership, dilapidated or boarded up buildings, lots of 'for sale' signs, people hanging out in the middle of the day doing nothing, trash, etc. This can help you get a good feel for the neighborhood. Also, call on the 'for rent' signs and ask around to get an idea about rents.
Second, research the area. You can find crime stats along with a lot of others by zip code on sites like homefair.com and clrsearch.com. You can also find income data by subdivision with the map feature on city-data.com. You can get comps from zillow.com (be wary of the zestimate though) and rent comps on rentometer.com, hotpads.com or craigslist (use the map feature). Loopnet.com has commercial sales data and there are many others like that.
Third, ask around. Your local REIA group can probably give you some good tips. But you can just ask people you meet in the neighborhood how things are around there.
Manasquan, NJ · Member since 2014 · 88 posts · 23 votes
12y
I sometimes put an add on craigslist or other websites and actually advertise the anticipated finished project to see if there is interest. I also can adjust price to see where my price point is with ease. I do not give the address but only the area. This works really well to help me determine the rent-ability number to throw in my equation on ROI. About 5 months ago I did this and we got so many hits and I was surprised by the quality of tenants I purchased another property in the same neighborhood and rented it with ease at a very fair price that provides me with the same cash flow as the first. I found out during the the first evaluation the largest Health Care employer was expanding by a prospective tenant so I made moves to increase my holdings in that area. i wish there were more available as these are really quality tenants to which most stay for 3 years at minimum (per their contract with the Health Care facility)
-Location. Based on location, neighborhood condition, community features, type of properties, etc., is it a place where I would want to live and spend time?
-Long-term view. Can I see myself holding the property for 5-10 years?
-Market. What's my rental competition, what do similar properties rent for, what's the school district like, how's housing demand/supply, how's the job market, etc? (use online sources - craigslist, hotpads, zillow, etc - and talk to people)
-Evaluation. What's my potential cash flow and return?
-Second opinions. What do local realtors and property managers say?
My personal focus is on finding quality and taking a long term view. When I look at new markets, I do a lot of research online and talk to people with local knowledge. Real estate agents are a great source of information, even if you don't ultimately close with them.
Like @Andrew Syrios said, I also talk to the neighbors. Most people readily share their opinions when asked. The more you know up front, the more likely you'll be to find an investment that works for you.
Gunpowder, MD · Member since 2015 · 10 posts · 0 votes
9y
I have something to add to this post and hopefully someone can answer my question. I found a nice home in a decent, quiet, suburban neighborhood. There is not much around, military base 15 min away,1 grocery store 10 min away. Everything else is a 25 min drive. I looked at Zillow to see what the properties are rented for in this neighborhood, but there are barely any listed! Does it mean people mostly buy there or there are just not many vacancies? What are your thoughts? Another more desirable area next to shops 20 min away has sooo many properties for rent which I feel may not be a good sign because of great competition. I'm hesitating to make a decision.