The best places to buy single-family rentals are counties in Maryland, Michigan, Illinois, New Jersey and Georgia, according to an analysis by ATTOM Data Solutions.
In its Q1 2019 Single Family Rental Market report, ATTOM analyzed single-family rental returns in 432 U.S. counties each with populations of at least 100,000.
Nationally, ATTOM said the average annual gross rental yield (annualized gross rent income divided by median purchase price of single-family homes) among the 432 counties was 8.8 percent for 2019, up from an average of 8.7 percent in 2018.
“Buying single-family homes to rent them out is a better deal for investors so far this year, than it was at the same time in 2018, as profit margins are rising in a majority of counties across the United States,” ATTOM Chief Product Officer Todd Teta said in a release. “Last year, at this time, investors were seeing returns drop in three-quarters of the counties that were analyzed.
“So far this year, those margins are up in six out of every 10 counties analyzed. But despite the generally rosier picture, profits vary widely and investing in the single-family home rental market is not always a great move,” Teta said. “The typical bottom-line gain from county to county this year has ranged from as high as 29 percent to as little as 3 percent.”
According to the report, the counties with the highest potential annual gross rental yields for 2019 are Baltimore (24.5 percent); Bibb County, Ga. (21.9 percent); Cumberland, N.J. (21.2 percent); Winnebago, Ill. (17.1 percent); and Wayne County, Mich. (17.1 percent).