HomeUnion Ranks the Best Seasonal Bargains for Investment Housing
The top three metros to find bargains based on seasonality are Pittsburgh, San Francisco and Milwaukee.
IRVINE, Calif., Nov. 16, 2016 /PRNewswire/ -- HomeUnion, a leading online real estate investment and management firm, has released a list of the biggest seasonal bargains for investment housing, and found that the winter off-peak period can be the best time of the year to acquire single-family rentals (SFRs). Nationally, the average cap rate for SFRs during the winter months was 6 percent last year, compared to 5.3 percent in the summer. The new Seasonal Single-Family Rental Investment Advantage Report also found that investors pay 7.2 percent less per square foot for the same property during the winter as they do during the spring and summer buying season.
"Based on seasonal cap rate fluctuations, our study conclusively found that early winter is the best time to acquire SFRs," explains Steve Hovland, director of research for HomeUnion. "In many metros, median home prices drop substantially during the colder months, while rent losses were marginal for investors. Winter is the perfect time to acquire solidly performing SFR assets in cold-weather metros such as Pittsburgh and Chicago, as well as in the Sun Belt markets of Jacksonville, Tampa and Greenville, S.C. These markets all ranked among our top 20 metros." For properties that need a little TLC, a winter purchase can give contractors ample time to bring the property up to a level that maximizes rents as the spring renting season commences.
"We also discovered that school quality isn't as important to investors in the winter: Buyers interested in neighborhoods with high-ranked schools make up a greater proportion of sales during the summer compared to the winter," Hovland adds.
Here's a complete list of the markets offering the biggest discounts during the winter months:
| Metro Area |
Cap Rate |
Temperature |
2016 |
2016 |
2016 |
2016 |
| Pittsburgh |
31.4% |
47 |
$69,000 |
$87,000 |
$1,000 |
$1,180 |
| San Francisco |
21.8% |
17 |
$920,000 |
$1,200,000 |
$3,900 |
$4,360 |
| Milwaukee |
19.3% |
54 |
$70,000 |
$92,000 |
$1,100 |
$1,190 |
| Philadelphia |
18.8% |
46 |
$127,000 |
$161,300 |
$1,420 |
$1,520 |
| Chicago |
18.3% |
52 |
$128,000 |
$225,000 |
$1,460 |
$1,560 |
| Columbus |
18.2% |
48 |
$110,000 |
$149,800 |
$1,200 |
$1,350 |
| Boston |
18.1% |
46 |
$247,000 |
$300,000 |
$2,020 |
$2,130 |
| Cincinnati |
16.3% |
47 |
$74,900 |
$115,000 |
$1,090 |
$1,200 |
| Cleveland |
16.0% |
47 |
$62,000 |
$80,100 |
$1,100 |
$1,150 |
| Greenville, S.C. |
15.9% |
38 |
$86,250 |
$140,000 |
$1,130 |
$1,220 |
| Detroit |
15.9% |
51 |
$120,000 |
$163,000 |
$1,210 |
$1,390 |
| Oklahoma City |
15.2% |
44 |
$85,000 |
$100,000 |
$1,060 |
$1,130 |
| Palm Beach, Fla. |
15.2% |
15 |
$235,500 |
$275,000 |
$2,130 |
$2,280 |
| Seattle |
12.8% |
27 |
$320,000 |
$437,200 |
$1,910 |
$2,090 |
| Birmingham, Ala. |
12.0% |
37 |
$76,700 |
$110,000 |
$970 |
$1,050 |
| Washington, D.C. |
11.8% |
45 |
$255,000 |
$333,300 |
$1,800 |
$2,020 |
| Tampa |
11.7% |
21 |
$109,100 |
$130,000 |
$1,160 |
$1,210 |
| St. Louis |
11.5% |
49 |
$85,000 |
$105,000 |
$1,050 |
$1,100 |
| Jacksonville |
11.4% |
27 |
$103,900 |
$166,800 |
$1,160 |
$1,250 |
| New York |
11.3% |
45 |
$310,000 |
$408,000 |
$2,090 |
$2,300 |
| San Jose |
11.1% |
24 |
$742,000 |
$1,050,000 |
$3,350 |
$3,740 |
| Houston |
10.7% |
30 |
$145,100 |
$170,000 |
$1,500 |
$1,610 |
| Minneapolis |
10.4% |
59 |
$146,000 |
$179,000 |
$1,380 |
$1,490 |
| Austin |
10.2% |
34 |
$219,300 |
$257,700 |
$1,560 |
$1,680 |
| Portland, Ore. |
10.2% |
33 |
$260,000 |
$300,000 |
$1,660 |
$1,760 |
| Salt Lake City |
9.6% |
54 |
$187,500 |
$251,500 |
$1,260 |
$1,380 |
| Oakland, Calif. |
9.4% |
24 |
$428,000 |
$545,000 |
$2,510 |
$2,700 |
| Denver |
8.1% |
43 |
$283,000 |
$335,000 |
$1,810 |
$1,970 |
| Baltimore |
7.9% |
45 |
$173,000 |
$200,000 |
$1,520 |
$1,660 |
| Miami |
7.8% |
14 |
$192,400 |
$215,400 |
$1,850 |
$1,990 |
| Dallas |
7.7% |
38 |
$136,500 |
$178,600 |
$1,440 |
$1,530 |
| Orange County |
7.6% |
15 |
$615,000 |
$716,600 |
$2,900 |
$3,250 |
| Phoenix |
7.6% |
38 |
$161,900 |
$186,000 |
$1,110 |
$1,200 |
| Memphis |
7.2% |
43 |
$82,400 |
$89,400 |
$980 |
$1,040 |
| Indianapolis |
7.0% |
49 |
$87,000 |
$106,200 |
$1,060 |
$1,100 |
| Atlanta |
7.0% |
37 |
$104,000 |
$117,000 |
$1,130 |
$1,180 |
| Orlando |
7.0% |
21 |
$147,800 |
$165,000 |
$1,240 |
$1,280 |
| Los Angeles |
6.8% |
18 |
$455,000 |
$550,000 |
$2,380 |
$2,530 |
| Nashville |
6.5% |
42 |
$129,900 |
$150,000 |
$1,220 |
$1,300 |
| Sacramento |
6.2% |
40 |
$260,000 |
$306,000 |
$1,440 |
$1,570 |
| San Antonio |
6.0% |
32 |
$125,000 |
$157,700 |
$1,300 |
$1,380 |
| San Diego |
5.6% |
12 |
$452,000 |
$495,000 |
$2,290 |
$2,460 |
| Las Vegas |
4.9% |
46 |
$178,300 |
$204,000 |
$1,250 |
$1,310 |
| Raleigh, N.C. |
4.9% |
39 |
$147,500 |
$180,000 |
$1,200 |
$1,350 |
| Kansas City |
4.8% |
49 |
$92,000 |
$106,875 |
$970 |
$1,080 |
| Charlotte |
4.6% |
38 |
$110,000 |
$137,000 |
$1,130 |
$1,170 |
| Riverside |
3.9% |
30 |
$250,600 |
$272,000 |
$1,590 |
$1,670 |
| Sources: HomeUnion Research Services, Maponics |
About HomeUnion
HomeUnion is an online real estate investment management firm. Based in Irvine, Calif., it provides all the services needed for individuals to invest remotely in single-family rental (SFR) properties. The company uses a combination of research and data-driven proprietary analytics to incorporate over 110 million homes and 200,000 neighborhoods into their database, and then delivers its solutions to an on-the-ground infrastructure that currently serves 18 locations. HomeUnion's role spans the lifecycle of the investment transaction: identifying sound investments, handling all aspects of acquisition, maximizing income, protecting asset value, and selling the asset when the time comes.
SOURCE HomeUnion
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