Exploring what works in rental housing in the Phoenix area
This web site can be read as a primer in the basics of landlording in the Metropolitan Phoenix market. Despite all the admonitions you may have seen in real estate books, the essence of being a successful - profitable - landlord is to buy and maintain properties that are appealing to tenants. You want to buy for as low a price as you can, of course, and sell for as much as you can squeeze out of your buyer. But if you buy the wrong home in the wrong location, and if you maintain your property as a dump, you will suffer long vacancies between tenants, and you will end up renting to the least-qualified people in the tenant pool. Why? Because the premium tenants will be going to the premium properties.
This video discusses these issues in some detail:
The home discussed in the video is a real rental property, purchased by a real investor. The refurbishing was done by Mark Deermer, Handyman of Phoenix, 602-321-9083. The links in the sidebar illustrate the condition of the property at the time we put it under contract and then again after Close of Escrow - after Mark had whipped the home into shape.
The purchase price of the property was $65,000, and the landlord put another $9,000 into it to refurbish it to turn-key condition. Total acquisition cost was $74,000 - for a property than can rent for $800 - $850 a month, maybe more. Moreover, it's the right house in the right location with the right features and amenities nearby. And, most importantly, it has been refurbished to pristine condition. When tenants go looking for rental homes in that part of Avondale, Arizona, this home should come up first on their list of candidate houses. The landlord will have a selection of premium tenants to chose from. The home should suffer little vacancy over the years - provided the landlord continues to maintain the property in turn-key condition. And it should sell easily - and at a premium price - to owner-occupants on the way out.
Owning rental homes is a business. The objective is profit. This web site illustrates an investment strategy that works in the Phoenix real estate market. If you want to discuss this in detail, you can phone me - Greg Swann - at 602-740-7531 or shoot me an email.