MSAs in South Region Rank at Top of RentRange List of Markets with Largest SFR Rent Increases from Q4 2014 to Q4 2015

Markets in the South region in Florida, Louisiana, Arkansas and Tennessee account for eight of the top 10 places on RentRange’s list of the 25 MSAs with the largest single-family-home rental rate increases between the fourth quarters of 2014 and 2015.

For real estate investors, the rental increases are only half of the full picture they should consider, the data and analytics provider said in a news release announcing the rankings. The gross yield data, which demonstrate income return from an investment prior to operating costs, indicate that markets in the South region are also ripe for investment and account for the highest gross yield percentage returns on the list. (The gross yield is the total annual income an investor receives from an investment property, divided by the price or value for the property. This figure does not account for any operating expenses including property taxes.)

In the West region, where the nation’s home prices are the highest, markets across California, Washington and Hawaii occupy nine spots on the top 25 list. While the strong growth in rents is encouraging, current price levels in many of these Western markets suppress gross yields as they are consistently among the lowest on the list, according to RentRange.

“The single-family rental market remains strong across the United States as the homeownership rate continues to decline and a higher percentage of the population migrates to rental housing,” RentRange CEO Walter Charnoff said in the release. “As the real estate market continues to improve, we are seeing significant rental price increases in many markets, which bodes well for investors in this space.”

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