Choosing where to invest in a vacation rental is a difficult decision. You not only have to select a location that’s desirable to live. You also have to consider whether your property will appreciate the area’s property taxes, and whether you can consistently fill the place with occupants.
That’s why Arizona makes so much sense. Not only does Arizona have one of the highest population growth rates in the nation, but it also has a comparably low cost-of-living. Additionally, Arizona has many upstanding Scottsdale vacation rental companies.
This article discusses the many reasons why buying an Arizona rental property makes financial sense. Whether it’s the increasing demand, year-round sunshine, or the many tourist attractions, Arizona is one of the best places to invest in for your vacation rental property.
Population Growth
Population growth is a leading determinant of whether property values increase or decrease. It’s simple supply and demand– the more people move to a destination, the fewer homes are available.
Arizona saw a 13.9 percent population increase between 2010 and 2019. That increase made Arizona the sixth fastest-growing state in the United States. Most of the other states that saw population growth of that magnitude were also in the country’s west and southwestern regions.
Because of the west’s and southwest’s sustained growth, trends are likely to continue in the same direction, and southwest home rentals show no signs of slowing.
Considerably Low Cost of Living
Arizona is in the country’s top half for affordability. It is more affordable than Utah and much more affordable than states such as Nevada and California. Arizona’s affordability and population increase make Arizona one of the most promising long-term opportunities for real estate investors.
High-Quality Vacation Property Management Companies
Rental management companies are essential for any real estate market. However, it’s even more critical when you’re just starting with your investments or living out-of-state. Arizona’s rental property management companies assist with many responsibilities such as marketing, maintenance, filling vacancies, setting prices, and helping with taxes and legal needs.
Warm Weather, Year-Round
Part of the reason Arizona is such a popular living destination is because of its year-round warm weather. In fact, Phoenix is the warmest metropolitan area in the United States. It is also one of the only urban areas in the United States with an average temperature of over 50 degrees.
Popular Vacation Destination
Despite some tourists steering clear in the summer due to the extreme heat, Arizona remains a popular tourist destination year-round. The Grand Canyon, gorgeous golf courses, Lake Powell, Antelope Canyon, Arizona has no shortage of natural wonders.
Also, Phoenix is also the fifth-largest city in the nation, which means visitors can have the best of both worlds, a bustling city with the rugged wilderness right outside the city limits. In fact, California is the only state in the western region that attracts more tourists. However, when you adjust metrics to account for population differences, Arizona attracts more visitors per capita.
Diverse Investment Opportunities
Arizona’s diverse attractions equate to more investment opportunities. You can invest in a vacation home in Scottsdale or opt for a cabin by the Grand Canyon. Wherever you settle, you have options.
The landscape isn’t the only type of flexibility Arizona offers. Prices vary in the region as well, meaning you can make Arizona work in your favor regardless of your investment budget.
Low Property Taxes
When deciding on whether an investment property is right for you, you should consider the property taxes. Property taxes can eat into your investment if they’re too high, and Arizona only ranges from 0.87 to 1.5 percent of the market value.
New Jersey has the highest property taxes in the nation at 2.17%. Considering the demand for property and the population increase, Arizona’s property taxes are relatively low. These indicators make for a promising investment outlook.
Close Proximity To Popular Destinations
Arizona is enticing enough on its own, but when you add destinations like California, Utah, and Las Vegas, it gets even more desirable. People investing in Arizona property can use its proximity to these tourist hotbeds as a selling point. Many people who visit Las Vegas tack on the Grand Canyon to their itinerary and vice versa.
Repeat Visitors
Because Arizona has so many attractions, people never visit twice. They usually make a Grand Canyon trip and then want to come back. Additionally, the Arizona snowbird always flocks to Arizona when temperatures drop in the northern states during the winter. Who doesn’t want to escape those brutal Chicago winters and spend a few months in the southwestern sunshine?
A Broader Look At the Benefits of Investing In a Vacation Rental Property?
The following examples represent a few of the many benefits that investing in a rental property can provide.
Appreciation
The most attractive aspect of investing in real estate comes from real estate appreciation. Appreciation refers to the land’s value increasing after you buy it.
The rental income you receive from owning a vacation rental gives you short-term profits. However, your property value appreciation is what gives you long-term gains.
Side Income
The rent you get from tenants can equate to a nice side income. Side income is the primary reason most people invest in property. When you have a vacation property that’s in high-demand, generating a payment isn’t that difficult. You just have to make sure you know how to rent your place out to visitors.
One easy way to do this is by using a vacation rental property management company. These companies handle your market research and take care of your maintenance issues.
Conclusion- What Should I Buy an Arizona Vacation Rental Property?
While the perks of investing in an Arizona vacation rental property come from it being a desirable place to visit, there is more than meets the eye with this popular travel destination. Sure, the Grand Canyon is in your backyard, so you can always count on a tourist influx.
However, low property taxes, a steadily increasing population, and high-quality companies with low vacation rental property management fees make the Copper State one of the most promising real estate opportunities in the nation. When it comes to deciding where to get your investment vacation property, Arizona has all you need.
