The Phoenix market has endured a wave of foreclosures that has driven median property prices down from US$235,000 in 2007 to US$99,100, as of June 2011 according to Zillow.
Today you can buy an almost 1300 square foot Â remodeled home in Goodyear, a suburb of Phoenix, for $86,900! Â These homes are renting for around $1,000 a month. Â Thatâ€™s a 14% ROI (if you pay cash for the house), and you have fully recouped your investment in under 10 years! Â Because of all of the foreclosures demand for rentals is only increasing! Â People who purchased at the height of the market have seen the value of their homes drop by 50% and more. Â They realize that they will not see that equity return for years, so they are walking away. Â The demand for rental property is outstripping the supply as evidenced by the amount of apartment sales over the last 6 months.
This lack of inventory makes the rental home investment market a safe place to diversify your portfolio.