The Top Rental Markets for 2024

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Good morning, good afternoon and good evening everybody. Hey. Welcome this episode of the Note Closure Show. As always, Scott Carson. Excited to be here Today, Today's episode is about an article that came about about two weeks ago from Adam Attom which is a newsletter, it kind of does a lot in the real estate investing community and what they did is they released their top counties for single family rentals here in the United States. And they go through a variety information and that thought based on the numbers and what they were talking about, I thought it valuable for you guys to know what 10 cities or 10 counties you should be looking to buy rental property or buying notes that maybe you want potentially want to turn into long term rentals for you. And I was actually kind of surprised at what they listed at. So let me share with you guys. If you look want to read the whole article, go in the description, click on the link below there and you'll be able to read the article for yourself and see kind of where you're counting at and how you're doing stuff and maybe areas to avoid and areas to go from there. But let's start with this. You know, basically the article really shared some great information. I was really kind of surprised by it. But anyway so let me share my screen here. So for those that are watching can kind of follow along there you want to. So this article came out here and you know it's kind of a hot button across the country for the most part. Basically they, they pulled information for Q1 on the single family rental market for 2024 and compared it to 2023 and it ranks the best US market for buying single family rental properties this year. Now the report analyzed homes across 341 US counties with a population at least a hundred thousand. And so there's gonna be some counties that don't have that population that just weren't even ranked. Doesn't mean they're not bad. But average. The numbers came kind of surprisingly these 340 county. Okay, the average annual three bedroom gross rental yield, which is your annualized gross rent divided by median purchase price among the 340 counties is projected to be somewhere around 7.55%. Okay. That's up slightly from 7.39 in the same markets a year ago, marking the second year of rising projections after three years of decline. Okay now obviously we know that return changes for on a gross, I mean on a net level depending on the own landlords, what they're doing and some of the things that they do. But what's great is when you get to the top 10. Well, let me just read this quote here. The US home sales market cooled off a good bit last year with some of the weakest gains over the past decade. But that wasn't enough to make home prices affordable for most workers, which likely fed enough demand to push up rents and yields for investors whose lease out single family properties. Said Rob Barber, the CEO at him, the fact that so few homes are available for sale in many markets clearly further helped increase rental demands for landlords and boost their bottom lines. You know, you also look at interest rates going up, people can't afford as much to buy and people can't sell as much. So they're what are they doing? They're turning to rentals. Let's rent it out and go that route. So the top 10 rental markets, okay, this is kind of some of these were kind of surprising. So we started first was the counties with the highest potential annual gross rental yields on three bedroom properties for 2024 are Indian River County, Florida. That's around the Vero Beach Sebastian area. That was that came at 14.6%. Number two, St. Louis City, Missouri 14.6% Cameron County, Texas. This surprised me in the Brownsville Harlingen Metro areas at 13.2%. Monroe County, New York which is where Rochester is 12.8% and Richmond County, Georgia is where August Augusta is at 12.7. Okay. The highest potential annual three bedroom gross rental yields in 24 Monk counties with a popular of at least 1 million are Wayne County, Detroit, Michigan basically 12%. Allegheny county which is Pittsburgh at 11.2. Cuyahoga County, Cleveland at 10.2 and then my least favorite crook Cook county at 10.1 and then Riverside County, California 9.7. Okay, now rental returns increase across majority of the nation. Okay, they increased basically compared to last year's numbers in 216 of the 341 counties I'd say 63%. They're led by Taylor county which is Abilene, Texas surprised me Yield up from 7.6% to 11.3. So if you're out in west Texas and Abilene where you may out there Abilene Christian and not oil fields and stuff like that. Jefferson county, which is around Birmingham, Alabama is up from 8.5 to 12.1. Richmond county which is Augusta is from up from 9.6 to 12.7. Midland County, Texas is up from 8.7. 11.7 in Aiken County, South Carolina which is outside of Augusta, Georgia is up from 8.4 to 11%. Okay. Biggest increases in potential annual gross rental yields among counties of the population million are Riverside County, Louisiana County, Fulton county, that's Atlanta Georgia, Montgomery county outside of Washington D.C. that's Montgomery County, Maryland, outside of Washington D.C. and Dallas County, Texas. Okay, Metro areas with a population William or more showing decreases in potential gross on three bedroom rentals. This is maybe stuff to look to get rid of. It's. There's no surprise here. Kings County, Brooklyn, a lot of people leaving there. Cook County, Chicago, not surprised there. Wayne County, Detroit, Michigan, not surprised there. Miami Dade, floor was kind of surprised, that's down. And Nassau County, New York, which is just outside of New York City, down from there. All right, now the lowest rental returns are in these areas. Basically San Francisco, San Jose, Nashville, which is a surprise. In Washington D.C. among other Western markets. Okay. And then here's the thing that's not surprising. Rents rising faster than wages. The majority of the counties measured, you know, our rents are rising faster on a three bedroom than average wages in a basic 197 of the 341 counties, which is 58%. Now obviously it's higher in areas like LA, Harris County, Houston, Texas, which does not surprise me because that's also one of the top three distressed markets out there. We talk a Maricopa county, which is Phoenix, Arizona, not surprised there. San Diego county and Orange County. So that's. Those don't really surprise me. Harris did a little bit, but the rest did not. Average wages are increasing faster than median three bedroom rents in 144 to 340 counties and that's basically 42%. Cook County, Miami Dade, Kings County, Queens County, New York and San Bernardino, California. Rent rising faster than home prices in two thirds of the nation. Once again, very similar there. Like we just said, L A Harris County, Maricopa County, San Diego, Orange county, all rents rising faster than home prices. So there's a lot of great stuff to go back and watch or not watch, but go back and read this full article. Like I said, put it in the chat. Roll the top 10 though. Let me bring that back up for it. Let me. I've got that in a spreadsheet. I want you guys to. We'll talk about this here really fast. So the number one area. Actually let's stop with 10 and work our way down, shall we say? Okay, so once again if you're looking, number 10 is one of the. The 10 best county to buy rental. Buying the whole rental property right now, Detroit, Michigan. All right, that's Wayne county and not necessarily just Detroit by itself, but Wayne county came at number 10. Number nine, Jefferson, Alabama which is around the Birmingham area. Now Birmingham city itself Sits in both Jefferson and Shelby counties, but the Birmingham side or the Jefferson county side did really well. It came at number nine, Montgomery County, Alabama, which is basically almost smack dab in the middle of the state. The nearest major city was Columbus, Georgia. That came at number eight for rentals. Number seven. This kind of surprised me. This really, really surprised me. But you know, Naples, Florida, Collier county, now Naples is a expensive part of Florida. And then you've also got Marco island, that's a part of Collier county as well there. So people are paying more to live down. And maybe what we've seen from actually living down that area for a while is it's a lot of people coming into from New York, New Jersey. So when you look at the numbers and it talks about how Kings county and the air people in Brooklyn, New York are leaving, I'd be willing to bet they're moving down there for the sunshine. Happens every winter and they're probably deciding to stay down there. Not a surprise for down in Naples. Number six, this did not surprise me. When you think about everything, this is Hidalgo county, and this is down by McAllen and Hidalgo, Texas, down by the border. So a lot of people coming in need a place to rent. Rents are going up in that part of the state. Number five, Richmond County, Georgia. That's where Augusta, the Masters is at. So as we getting close here to the Masters actually being next month, maybe that's got something to do with it. People are back out to it. Number four, Monroe county, which is Rochester, New York. Rochester has always been a very affordable area. The thing I liked about it is it is very. It's kind of lower value. But rents really do outperform what it costs to buy a rental property there. I would necessarily want to buy an own debt because it takes forever to foreclose New York State. But if you do take some back, take not a bad rental market. Number three, another part of the border, Cameron County, Texas, that's down by Brownsville and Harlingen, right on the border there. Once again, increasing rents because there's all this people coming to the area. Not only people coming across the border, but also people, you know from all across the country coming there. You know, National Guard, other people going down there for work as well. Number two, this is St. Louis county, which is the surrounding area around St. Louis, Missouri. And number one, Indian River, Florida, which we talked about, is the Sebastian. Sebastian is the largest city in Indian River County, Florida. It's about two, three miles inland. But Vero beach, many are familiar with that area out there on the water there so Vero beach for a while I mean we saw quite a bit of stuff there on the non performing side but it was always kind of rough in some cases you always have to be kind of careful of where you're buying it so you know none of those really surprised me in a lot more if you can see notes I mean distress stuff down in those neck of the woods might be looking at as a possible exit strategy might be targeting those for subject to deals determine the potential rentals and stuff like that as well for you so check it out we'll have like the like I said the full link to the article you go back and watch it dive into your county all that good stuff based on the atom article and love to get your feedback any questions comments any surprises from these top 10 or what you found from the article so go out hopefully everybody take some action and we'll see at the top bye.

Sam sat.