What Makes Alabama a Great Rental Property Investment?
One of the biggest challenges you can face when investing in rental properties is picking out the right locations. You have major markets like Orlando, Miami and Atlanta getting tons of exposure, but their name recognition can lead to inflated prices and steeper barriers to entry. Smaller markets provide cheaper options, but too small a market can limit your returns. But, what if we told you that there’s a state that gives you the best of both worlds? Here’s why you should consider investing in Alabama.
Higher ROI
Because the major cities in Alabama such as Birmingham and Mobile don’t receive as much exposure as other markets in the region, they’ve become hidden gems for investors. With less investors aware of the state’s potential growth, it means less competition for you. This leads to more buying power, more affordable properties, and better deals overall.
Rise in Development
More and more companies and industries are starting to plant their roots in Alabama. This economic infusion has placed the state on the precipice of a real estate boom within the next 3-10 years.
Within the last year, the state has seen an influx of startups such as 23 Venture and internally-recognized businesses like Aldi, plant roots and invest more than $500 million into local economies. On top of that, the Mobile Downtown Airport was just awarded a $9.1 million grant to improve its facilities.
When you look at markets like Denver 10 years ago, you can see that the people that invested at the ground floor of the city’s development have been able to reap the rewards.
Stability
When you’re investing in rental properties, you’re investing in their long-term performance. One of the most important factors of a successful long-term investment is the market’s stability. And that’s exactly what you’ll find in Alabama. If you look at other major markets in the last 10-20 years, they’ve experienced stark appreciations and steep declines (like the economic recession in 2008).
But in that same time span, Alabama has seen steady appreciation even in the most extreme of conditions. This stability allows you to better plan for your future while also providing more secure variables for your investment performance.
It is important to note that just like with any investment, it’s important to do your due diligence before investing. Whether you’re working with a property management company that is familiar with the area, or if you’re going solo, it’s crucial that you get accurate numbers and estimations about property value and any additional costs that may arise.
