Hey BP I have been wondering if I should buy or rent. I'm being moved by my job to Fort Rucker, AL and I can't decide on whether or not I should buy or just rent. I will only be assigned to the area for a relatively short time (1 or 2 years; maybe only 6 months I won't know until I'm there). I'm eligible for VA loans so this would be a great opportunity to find a place to buy with no money down (OPM). The only problem is that I'm not that good at doing market research. I hear other military folks say the market there is "flooded" with rentals. How do I know if that is the case? I don't want to buy a property with the intention of renting it down the road only to realize that it won't rent. What's the best indication of a healthy rental market? Thanks for your advice in advance.
@Jason Burton What is your criteria for investing in real estate? Does Ft. Rucker, AL have the attributes that fit your criteria? Will there be sufficient demand from renters if you buy a house there that fits your criteria? Would the rent you could get cover your mortgage?
If you were not moving to Fort Rucker, AL, is that a market you would look at to buy rental property? If the answer is "no," then you shouldn't buy property there, you should just be a renter.
If you're only going to be assigned to that area for a short period of time, do you really want to take on the burden of owning a house and then having to property manage it long distance when you get transferred to another base?
I did a quick Google search about Fort Rucker, AL and it has an extremely small population, less than 5,000 people. That's not a large enough market to be able to count on a good pipeline of potential renters, in my opinion. If other military people who have lived in the area are telling you there are a ton of rentals there, that means there's more supply than demand, which means that renters, not landlords, have the upper hand. More supply than demand means property owners may have to lower their rent and/or their standards to attract tenants and lease a property. Is that the sort of situation you want to be in, especially long distance?
To answer your question about what are the best signs of a healthy rental market, of course it depends on the market and the demographics of that market. But generally, you want to look for job growth and/or population growth/stability and a variety of employers. You don't want to invest in an area that is reliant on one employer because if the company/organization cuts back, there go the jobs. Demographics are also very important. An area where young people are leaving, not moving to, is generally not a good sign, for example.
It sounds like you have to do some more research and establish what your criteria should be for investing in a market that serves your needs and meets your financial objectives.
Thank you for the honest feedback. I have some more research and thinking to do. And just to clarify one point the area that I would buy in is in Enterprise, AL. It has a slightly larger population but like you said, there is only one main employer and that is the military. Time to look for something to rent. :)
different perspective! My husband is active duty. We try to buy a personal property at every duty station location that makes sense. I have found that most small town actually have to little supply for the area because people won't buy and therefore nt enough rentals. This strategy has helped us accumulate houses wih little down payment. On the other hand even the "personal property" we buy are bought as rentals in mind that we are just going to live in till we are moved again. We have bought in many towns that without the military stationing us there we would never have bought.
It is important to look at the stability of the small town and if they are replaceable or move able in the next closing. My husband is a pilot, air based are hard to totally close because there are not a lot if town that enjoys the "sound of freedom" that f-18 make. Just my thoughts, pm me if you have any questions
I enjoyed reading replys from Eleena and Elizabeth
One of my BIL's now retired was some kind of bomb and or demolition instructor ( he got to train others how to blow stuff up ) he spent time at several different bases every year and ended up purchasing something near each of them ,he always said they may downsize for a while very seldom close.
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