Rent prices are soaring throughout the state of California. According to new data out of RealFacts, an apartment tracking firm, rents in Orange County are increasing at the fastest pace they have in eight years. The current average asking price for an apartment in Orange County is $1,848. That marks an all-time high for the county and a 6.9% increase from the same period one year ago.
For people interested in buy and hold real estate investing, this means that the time to invest is now. Rent prices are going up throughout the state, and home prices are ticking upward as well. Real estate experts agree that the current housing market is extremely strong and only getting stronger. They also agree that this increase in rents is unlikely to slow down in the next few years. That means that investors can buy a California home today, earn monthly income from renters for the next year few years, and resell the property for a substantial profit down the line.
Part of the reason why rent is going up so quickly is that vacancy rates are incredibly low. The national average is currently 4.2% according to Reis Inc., a commercial data provider. In Orange County, the vacancy rate is just 2.4%. In Sacramento and San Diego, vacancy rates are even lower.
Rents are also being pushed up in part by Millennials who are unwilling or unable to purchase homes. Millennials tend to prefer the flexibility that renting provides, and they also tend to migrate towards cultural and work hubs like Los Angeles and San Francisco. Indeed, some of the best places for rental real estate investing are up-and-coming neighborhoods in urban areas like San Diego, Los Angeles, and San Jose.
If you’re considering a rental real estate investment, your first move should be to research the market and find the areas where both rents and home prices are increasing at a steady rate. Look beyond neighborhoods in your immediate vicinity in order to find ideal investment properties that you can either manage from afar or entrust to a property management firm.
Finally, secure rental real estate financing from a private money lender who will help you leverage your capital into the most profitable investments. The right lender should be able to provide you with funding in a matter of days, not months, and be genuinely invested in your success.
To learn more about our rental real estate financing options, call ZINC Financial today at 559.326.2509.