Every successful real estate investment begins with the right LOCATION! Finding the best location that offers a high return on investment is not as difficult as people make it seem. With the right real estate investment tools, you can find just about any type of investment property in any real estate market you choose and according to your preferred rental strategy.
Mashvisor, for example, can help you locate the best performing areas for investment properties (both traditional rentals and Airbnb rentals). It is through the use of our rental property calculator that we came to conclude that you should invest in Airbnb Scottsdale in 2018. So if you are interested in Airbnb real estate investing, then stick around and read about Airbnb Scottsdale.
Why investing in Airbnb is a smart rental strategy
First things first, are Airbnb rentals really worthwhile? When many real estate investors come to choose an investment strategy, they second guess the idea of short-term rentals. They always go for the “less risky” form of investment properties (long-term rentals). But the truth is Airbnb is a quick and easy way to make money in real estate. Here is why you should be investing in Airbnb rentals.
1. Increased rental income
Airbnb rentals that are leased for fewer months can generate increased rental income for property investors. This is due to the fact that the rent you charge is totally under your control. Most short-term rentals command a premium price at certain points of the year giving you a very lucrative rental income. Airbnb property owners can capitalize on market demand especially during the off-season.
2. Tax advantages
Under the new federal tax law that went into effect, owners of rental properties that are operated as businesses will be able to deduct mortgage interest on these properties, along with business expenses related to the rental. So if you operate your rental as a business, you may be able to deduct up to 20 percent of net rental income from your income taxes.
3. A short-term rental property can help diversify your investments
Short-term rentals involve a completely different market than other types of real estate. Investing in Airbnb rental property can help diversify your real estate investment portfolio. Through asset diversification, you help to insulate your investment portfolio from market instability. What’s great with short-term rentals is the revenue that you get from renting out your property may be able to cover the mortgage on your property (if there is one). This can be a very attractive way for beginner real estate investors to get into the business without having to stress so much about financing.
With Airbnb rentals, you will have more flexibility by being a host or homeowner. You get to set the house rules that suit you best. Also, you have full control over the renting dates. You can block certain dates for personal use whenever you want, without disrupting anyone. This is perfect for those who want an opportunity to use their property as a vacation home.
Should you invest in Airbnb Scottsdale?
Scottsdale is a desert city in Arizona made up of about 240,000 inhabitants. Scottsdale is known for its excellent economy and dominant, well-paying employment sectors. The median household average income is about $73,288 which is above the average US level. The city of Scottsdale has a low crime rate and is moderately safe. These are all great qualities that make Scottsdale a very lucrative place to invest in for real estate investors.
Of course, the most important thing to consider when investing in any type of property is profitability. In Scottsdale, you can find Airbnb rental properties that offer a high return on investment. Given below is the return on investment metrics for Scottsdale real estate investment properties (both traditional and Airbnb). These figures are calculated by Mashvisor’s investment property calculator. Our investment property calculator can be used to give real estate investors all the estimated major metrics of profitability in real estate investing, such as rental income, cash on cash return, cap rate, and Airbnb occupancy rate.
Read Also: Best Cities For Airbnb Occupancy Rates
To start searching for the best investment properties in the Scottsdale real estate market, click here.
- Median Property Price: $881,728
- Airbnb Rental Income: $2,025
- Airbnb Cash on Cash Return: 1.2%
- Airbnb Cap Rate: 1.2%
- Traditional Rental Income: $3,370
- Traditional Cash on Cash Return: 2.32%
- Traditional Cap Rate: 2.32%
- Airbnb Occupancy rate: 47.12%
Now I know what you’re thinking: WOW the Scottsdale real estate market is anything but AFFORDABLE! With the median property price being so high, how can any real estate investor even consider Scottsdale? Even though the median property price is great for determining how affordable a certain housing market is, it doesn’t mean that every property in that market is $881,728! In fact, we were able to pull out Airbnb rental properties in Scottsdale that are very affordable and offer a high return on investment. We found these properties using Mashvisor’s property finder tool which helps real estate investors locate the best performing properties in their selected city/cities of choice. You can use the different filters to filter out properties that do not match your preferences.
Do you have a free Mashvisor account? Click here to use our Property Finder and find properties in a matter of minutes!
Scottsdale Airbnb rental property #1:
List price: $119,000
Airbnb COC: 7.66%
Scottsdale Airbnb rental property #2:
List price: $159,000
Airbnb COC: 5.36%
Scottsdale Airbnb rental property #3:
List price: $165,000
Airbnb COC: 4.73%
Scottsdale Airbnb rental property #4:
List price: $154,900
Airbnb COC: 4.65%
NOTE: If you want to take a closer look at these properties and their addresses, click here.
What factors make Scottsdale good for investing in Airbnb?
Tourism not only ranks as Scottsdale’s most important industry, it has become the industry that brings business to Scottsdale. Rich CEOs and people from all over the country come to play tennis, golf, hike, and bike in desert mountains and take in the city’s vibrant arts and culinary scenes. They come to enjoy all the beautiful attractions that Scottsdale has which is why investing in Airbnb Scottsdale is a smart investment strategy.
2. Job growth and employment rate
It’s quite clear that the economy in Scottsdale is performing better than other areas in the US. The job growth over the past year was 3.2%. Moreover, the expected job growth in coming years is 41.9% above the nationwide average. So many people will be migrating to Scottsdale for the growing job opportunities. This is good news for real estate investors thinking about Airbnb Scottsdale because when many people first come to a new city, they prefer to rent out a short-term rental property until they get adjusted. So if you want to buy a Scottsdale investment property or rent out your property through Airbnb Scottsdale, now is the right time.
Airbnb Laws for Scottsdale
Airbnb Scottsdale is completely legal. There were laws signed which prohibited all Arizona municipalities from banning the listing and use of Airbnb and other home rental websites. So there is nothing to worry about. The future for Airbnb Scottsdale is looking good. Plus you never know, trends for Airbnb Scottsdale investment property might exceed traditional rentals in terms of profitability.
The next time you’re searching for short-term rental properties, you should consider Airbnb Scottsdale. This city offers good investment opportunities for every real estate investor.