Investing in Rural and Small Town Properties
Have you ever given any thought to rural or small town investing? Investing in rural properties is definitely a tempting proposition. Imagine the idyllic and picturesque rolling fields, breathtaking sunsets, quaint historic towns, and charming places where everybody knows everyone else’s name. Could it possibly become a viable investment option? Maybe even offers strong returns?
Venturing away from cities has a large number of lesser known benefits for real estate investors.
Stable Markets
Smaller real estate markets, like those in rural areas, also tend to be noticeably more stable. They may not spike up through gentrification, like a suddenly-trendy urban neighborhood that the artists and coffee shops sometimes seem to move into overnight. That said, these markets are not as likely to collapse with an inbound crime wave or suffer urban decay either.
Less Turnover than in Big Cities
Residents in rural areas and small towns have a habit of moving less frequently than the residents in larger urban communities. That can be a major benefit and wonderful news for landlords in rural areas, who might rent to the same family for decades.
Establishing Your Brand
One of the more well-known and beloved aspects of living in small towns and rural communities is that it comes with a sense of belonging and home. Often, in neighborhoods such as these, everybody knows everybody else. Which makes it much easier to build a brand and a reputation in your investing niche.
Although there are definite benefits to investing in small towns and rural communities – as with any investment there are some risks that go hand-in-hand with them as well.
Less Demand for Housing
Having a lower turnover can be a huge benefit to real estate investors and is easily one of the biggest draws for investors in these communities. However, a lower turnover also means that there is often less demand for housing in the area.Unfortunately, this can spell trouble for vacant rentals or properties listed for sale.
Any experienced real estate agent can tell you with about a minute worth research what the average days-on-market numbers are for home sales and rentals. That’s a good starting place, however, if you take a look through recent listings to get a sense for what’s moving quickly, what’s not, and why. Talk to local landlords if you can find any, and get their take on housing demand. Provide yourself with the confidence that you will not have a property sitting vacant for months on end – that would be a bad investment.
As a real estate investor, your goal, no matter where you decide to invest, is to make profitable decisions and investments. As with any investment market, there are serious risks associated with rural and smaller communities, as well as definite benefits. If you are new to the real estate investment game it is absolutely necessary that you take your time to research these markets before investing so much money. This will provide you with not only the knowledge you need but also peace of mind.