Phoenix-area cities among best in US for buying investment properties
PHOENIX — The Phoenix area was cited as a great place for buying investment properties, with three Valley cities among the nation’s top 10 of a personal finance company’s rankings.
Mesa was rated as the second-best market for investment properties in a study of 117 cities with populations of at least 200,000 by SmartAsset.
The East Valley city was joined by No. 5 Glendale and No. 7 Phoenix near the top of the list, which was released this week. Gilbert checked in at No. 11.
AJ Smith, vice president of content and financial education for SmartAsset, explained why the Valley did so well in the rankings.
“The five-year home value appreciation numbers were relatively high compared to the other cities that we looked at,” she told KTAR News 92.3 FM on Thursday. “The housing demand was high. Supply was low for the number of people moving into the city.”
Mesa had the 10th-lowest effective property tax rate in the study, one element that keeps longterm expense down and makes investment properties more attractive.
“It is important to think about those other ongoing costs, things like maintenance, things like property tax, things like homeowners insurance,” Smith said. “Those are costs that are going to continue year after year with your investment property.”
The rankings weighed cities’ performance in five categories: effective property tax rate, ratio of rent to median home value, housing demand, five-year home value appreciation and five-year rent cost change.
Mesa landed behind only Aurora, Colorado. The entire top 25 consisted of cities in western and southwestern states or Florida.
KTAR News 92.3 FM’s Jeremy Foster contributed to this report.