Buying investment property is an increasingly popular way of developing a passive income through rentals.
And we’ve just come across a recent report by the Pew Research Center that strongly suggests, by implication, this could be one of the best times ever to start a rental portfolio.
The Center recently analyzed Census Bureau housing data and concluded that more households are rented than at any time since 1965! That’s over 50 years ago!
The report states that, although the number of US households expanded by 7.6 million in the decade between 2006 and 2016, households headed by owners remained rather static.
Of course perhaps the key reason for the growth in rentals in those 10 years can be attributed to the dreadful recession that occurred during that period, creating a housing crisis.
The Pew Center also notes that the number of households renting increased from just over 31% in 2006 to 36.6% by the end of last year. This exceed the levels of 36.% seen in 1986 and 1988 and is now very close to the 37% seen in 1965.
Crucially, however, the report stresses that these high figures do not signify a diminution in interest in buying a home. Indeed, according to other Pew Center research last year, 72% of renters said they wanted to buy their own place at some point.
Clearly, most people rent because their circumstances dictate that it must be so, despite constant rises in rentals that have been tracked across recent years and which are widely expected to continue into the foreseeable future.
Looking more locally, we were suddenly reminded of another article we’d recently seen referring to statistics produced by the National Low Income Housing Coalition, demonstrating that New Mexico is one of the cheaper states to rent, requiring an hourly wage of $15.78 in order to afford a two bedroom rental home. Compare that with most of our neighboring states (Utah at $17.02, Arizona at $17.56, Texas at $18.38 and Colorado at $21.97). This should be helping to make our area an even more desirable location for living and renting.
It all sets up an incredibly vibrant market for rental property in the Albuquerque area and should give confidence to anyone considering embarking on this kind of business model.
If you’ve been thinking about property investment, why not contact us today for a very informal discussion exploring the many options that are open to you.
You might also care to read our recent blog on key considerations when choosing a rental investment property.
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The Romero Team is a group of top New Mexico REALTORS that works together to provide only the best service to each and every client whether it be buying or selling Real Estate in New Mexico. Find FREE Home Valuations, Market Data, and all Information about Buying or Selling a Home in Albuquerque, Santa Fe, Rio Rancho, Corrales, Placitas and Valencia County. The Team provides expert representation in many areas including home sales and marketing, serving as Buyers Agent, luxury homes, and vacant land.
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