@Alex Jaime, I designed my own "SuperRentals" system. I look for SFR & multi-family rentals in Salt Lake and Provo counties as well as Tooele, Davis, and Weber counties. I look at all the new homes each day (as well as 30, 60, 90, 120, 150, 180 day-old active snapshot) and compare them with the average neighborhood rents by bedroom count using about 1600 data points I regularly gather from Rentometer (yes, it is a tedious task!). While their are always deals that pop up anywhere you look, your good question centers around averages: "On average, where should I look?" This presupposes that you are limited to just one county for the simplicity of working with property managers and contractors/handymen, but with this in mind, I am going to share my real data with you.
While the numbers don't lie, there are many other factors that should go into your decision like proximity to mountain recreation, as mentioned by @Stefan Coles. Here are other things to consider: (1) This is just a moment in time in an ever-changing market. (2) This is the raw data. Some house prices are most certainly artificially low because of the agents trying to elicit multiple offers or the short sale agents. (3) Deferred maintenance over whole neighborhoods can hide the true costs of ownership. Downtown Ogden, in Weber County, for example, has great rent numbers but many homes will need $10k-15k to get them rent-ready. (4) Higher rental areas may allow you to hold onto fewer properties to get the same benefit. Would you rather have one higher priced property giving $300/mo cash flow, or two lower priced homes giving $150 each (factoring in all costs)? Especially since the amount of work may be even more at the low end? (5) There are needles in every haystack, and this is where your own competitive advantage must come into play. Market forces tend to equalize the opportunity, so the bottom line is to find something that already works and make it even better. There are very happy landlords in all 5 counties, and the numbers below are simply different hues of winning deals.
Recognizing that entire markets shift between cheering and groaning, and my answer here may not be valid in 12 to 24 months, here is my data from the past 10 days comparing the average Gross Yield (est rents x 12 / asking price) for all 5 counties using only properties with a Gross Yield of 8% or more:
(click to enlarge)
Summary:
Utah county seems to give the best return. The homes are bigger and newer. But there are fewer decent deals to choose from, and homes sit on the market the longest.
Salt Lake county has the second best gross yield and it has 3x as many homes that seem to be good and the homes seem more affordable, but they are 11 years older on average.
Weber County has the lowest average home price and PPSF, but the homes are 27 years older than Utah county, which explains the increase in deferred maintenance I was discussing. The homes are also smaller which gives less rent.
Davis and Tooele both have some great rentals that come up, but on average they do not appear to be good hunting grounds - if you are forced to choose.
Where would I choose? As mentioned above, there are great deals in all 5 counties if you look hard, but Salt Lake County may be the best hunting ground because of a reasonably high Gross Yield and 3x the number of possible deals. But there are also more hunters in Salt Lake, as evidenced by the lower DOM.
The best advice I can give you is to do your own marketing and try to find your own non-MLS deals, but get on wholesalers' lists and work closely with with agents like me who specialize in working with investors. There are several on BP. Don't sign an exclusive agreement with anyone but create an army that is out there hunting deals for you.
Success to you in your search.
