Rental property investment - Arizona

[Balachandar Duraiswamy]

Looking to buy a rental property in and around Phoenix area. Any suggestions or recommendations where to invest? Many companies are moving to Phoenix like TSM etc. I was talking to few of my friends and they suggested to look around North Phoenix, Desert ridge & Chandler. 

Any suggestions would be highly appreciated. 

[Erin Estes]

The West Valley (Goodyear, Buckeye, Avondale, Litchfield Park, Surprise, Waddell) is seeing a lot of growth.  If you’re looking for appreciation and more affordable entry points.  The new 202 south loop has also opened up access to places like Tolleson and Laveen which have relatively quick commutes to the East Side (as opposed to the old alternative - I10/I17 during rush hour) with more bang for your buck housing-wise. Growth has been phenomenal valley-wide over the last decade and projections are saying demand will be up in The Valley for the foreseeable future, barring catastrophe. 

The Phoenix basin is sitting on top of a very large underwater aquifer since it is a low point for the many mountains encircling it.  The confluence of three rivers (Gilda, Salt, and Agua Fria) is near the NASCAR track in Avondale, rivers that pull meltwater down into the valley from the mountains. The rivers are dry in parts most of the time as water is stored behind manmade dams up in the mountains and released when the snow melt gives those reservoirs a surplus. Where the rivers seem to “disappear” or dry up, the river is actually running subterranean until it pops up later downriver, as I was told, and that’s why you see “pockets” of water in the riverbeds. When permits for new subdivisions are applied for, the developer has to prove a 100-year supply of water under the subdivision. Water management is of high priority for the state and local municipalities. I think our overall attitude toward water is to be conservative, trust the authorities who are in charge of managing it, be wary and keep an eye on it, but we seem to be doing alright with regard to water resources.  Here is an interesting article on the topic from 2019.

Speaking of water, there is also a pipeline large enough for a VW Bug to drive down connecting downtown Phoenix with the nuclear power plant out in Tonopah (on the other side of Buckeye) and they reuse the purified waste water to cool the reactors out there. It’s the largest power producer in the nation (according to capacity factor). With a plant that large in our backyard, we’re also set up with one of the most stable grids in the nation, which is good news seeing how fast the auto industry is embracing electric automobiles.  

The valley is attracting employers and industries from a wide array of fields from tech to aero to manufacturing and distribution and a lot of companies are not only expanding here, but are choosing to relocate their headquarters here. Why not?  Phoenix has been a city that’s attracted retirees (Sun City opened in 1960 and is regarded as the first “active adult” community) for decades.  The consistently dry climate and sun are attractive, especially after living a life with drastic weather patterns.  Why not move to a place where people choose to retire to?  “Arizona’s Beach” (Puerto Peñasco, Sonora, Mexico aka Rocky Point) is only about a 3.5 hour drive from Phoenix. You can be snowboarding/skiing with either a 2.5 hour drive to Snowbowl in Flagstaff or a four hour drive to the east at Sunrise Park Resort in the White Mountains. San Diego, LA, Las Vegas, and Albuquerque are all within a comfortable day’s drive.  The region has a lot to offer to those who make it home.