Real estate trends play a major role in the search for real estate investment properties. Depending on the time period, there are different types of properties that generate a more positive cash flow than others. In big cities, nowadays condominiums or apartments are prime real estate investment choices. In the suburbs, there are more options. While condos and apartments both remain trendy choices, single family homes for rent won’t be a trend or concept that goes out of style anytime soon.
Single Family Homes for Rent Are a Popular Choice among Tenants
According to the National Rental Home Council, the single family homes market comprises 13 % of all occupied housing and 37% of the total rental market. Single family homes for rent remain a popular choice, particularly after the housing crisis. According to the Marketplace, more Americans are choosing the option of renting, and this isn’t limited to apartments. Karan Kaul, of the Urban Institute says that in 2005 “there were about 10.5 million single-family rental properties. Today that number is north of 17 million. That’s almost a 70 percent increase.”
Related: Why Is a Single Family House the Best Investment Property?
According to Zillow, millennials seem to gravitate towards single family homes for rent for different reasons. College students find single family homes that are located near major universities very cost efficient and convenient, especially if they can find several roommates to share the rental expenses. Although people usually think of apartments or condos when renting, single family homes for rent have become very popular as well. These homes are especially convenient for families, or even single tenants who desire more dwelling space.
Single Family Homes for Rent Have More to Offer to Tenants
Single family homes for rent are a renter’s dream. Think about it. Instead of being confined to the walls of an apartment or a small condo, a single family home allows you a certain kind of freedom that multi family properties do not. You won’t have to worry about that person above you with the noisy parties, and you won’t have to worry about your children running around and disturbing your downstairs neighbor. Single family homes for rent provide you with privacy and flexibility. Depending on the area of the single family homes for rent, outdoor space is also a big plus. With families, apartment or condo space can be very limited. Single family properties, on the other hand, give you the option of having outdoor space. Imagine all the pool parties and barbecues you can have in that new backyard of yours.
In recent years, new companies such as Airbnb allow you to rent out a single family home as a rental property for days, weeks, or even months at a time. This has given tenants more options, and has also given them the freedom of knowing they have the choice of stepping into a short-term rental contract, rather than committing to a long-term rental.
Single Family Homes for Rent Generate Positive Cash Flow for Investors
If done successfully, almost any real estate investment has the potential to be very profitable, and present a positive cash flow for investors. With single family homes for rent, there are lower turnover rates. This means you won’t have as many tenants as you would in a multi family property. Not as many tenants also means less maintenance, and less fixing for the landlord. At the end, single family homes for rent will appreciate regardless of the housing market. While the housing market changes continuously, single family homes remain a top choice for real estate investors. This is a concept that won’t change anytime soon.
Several years ago, there weren’t many options for single family homes for rent. The options given to tenants were mostly long term rentals, as they were expected to stay in a single family property for a long period of time. Today, real estate investors have the option to rent out single family properties through different websites such as an Airbnb, allowing them to be able to control the occupancy rate, as well as giving them the opportunity to rent out a single family home temporarily. These short-term rentals also provide tenants with better options while traveling. Many tenants prefer to rent out single family homes through Airbnb because they remain more cost efficient, and a better choice than other vacation rentals.
Related: What Is the Investment Opportunity of Buying a Rental Property for the Sole Purpose of Renting Out an Airbnb?
In addition, single family homes for rent are more financially attainable for investors than multi family properties. An apartment building as well as duplexes and triplexes are definitely expensive, and depending on the down payment, some properties may be unattainable for some investors, particularly first time real estate investors. Investing in multi family homes may be worth in the long run, but investing in a single family home is almost guaranteed to make money in real estate. For example, let’s say a real estate investor decides to invest in a single family home, with plans to rent it out. The investor finds a single family property for about $90,000. The investor then decides to rent out the property, which will provide him/her with a nice rental income of about $900 a month. This will allow the investor to comfortably make his/her mortgage payments. Depending on the down payment, the property can yield an excellent cash on cash return rate, making the investment the best decision there is for the investor.
Related: What Makes for the Best Single Family Homes for Rent?
Real estate trends are concepts that are always changing. However, single family homes for rent are not going anywhere anytime soon. Single family homes for rent have been around for years, and are considered the traditional property investment. However, with all of the new ways you can profit from single family homes, renting them has given both tenants and investors significantly more flexibility. With exciting new concepts such as Airbnb, the market for single family homes for rent is always changing. Single family homes have always been in demand, and thanks to new investment ideas, they won’t become an outdated concept in the near future either.