Best city in Arizona for Real Estate investing

16 Replies

@AJ H.

My goal is to live there for 3-5 years build up a RE portfolio consisting of multi unit to SFR properties. Reason for Arizona is that it's a 5 hour drive from so cal if I ever want to go back and visit during the weekend and also RE is much cheaper. Thoughts?

@Jaime Martinez Jr What are your goals in investing the properties?  Is it for cash flow or appreciation?  

It may be hard to find cash flow properties in Arizona.  It is a very hot location for investment. The competition has really driven up prices. 

Do you have investment criteria for your deals?  These should be established before you start looking. 

@Jaime Martinez Jr The AZ market is super hot. The segment that I'm following the closest is Northern Arizona, where the weather is cooler. I think there's some very good long term opportunity as things continue to develop in the Phoenix market. 

Originally posted by @Jaime Martinez Jr :

What are the best cities to invest in out in Arizona currently living in southern Cal.

I would have to echo some of the comments already made in this thread. Really is going to depend if cash flow or appreciation is your biggest driver.  Best cash flow opportunities lately have been short term vacation rentals in great areas like Scottsdale.  Upfront costs are much higher though as well as property management fees. 

There are still some great areas for a good balance of cash flow and upside appreciation in SFR. I like Peoria a lot for this reason. That price point is now in the $400k's and still requires going significantly over asking price to get the deal under contract.

Small multi-family inventory has become so anemic, that a break even deal is getting hard to find.

Jaime, I personally think the far west/east communities are ideal for SFR properties. You can still purchase a home (even new builds) for high 200s/low 300s, and the market is still climbing. We are personally buying new builds in the area for equity purposes.

@Ashwin Gudipati I would look at Florence & Casa Grande for east valley cities and Waddell, Goodyear, and Surprise for west valley. Maricopa is also another to look at- sits southwest of the valley. 

New build prices have climbed since my post and the least expensive new build is likely low-mid $300's now. I sold a new build for $280k in Feb that is now selling for $340k. 

Feel free to reach out with any questions!

Jaime Martinez Jr I assume you live in LA County at this time. If you have to stick to the 5-6 Hours’ drive on interstate 10, then you need to focus on Phoenix area. Phoenix is pretty saturated and very competitive. But if you can extend the drive further to 8 hours and 90 miles south from phoenix, then Tucson would be the front runner as far as real estate. I did this drive for 5 years from LA to Tucson, and it is not pleasant. So I would suggest if you decide on Southern Arizona, to limit your drive to LA as much as possible.

I had a good conversation with a property manager a few weeks ago.  She stated that the rents on the East side of the Valley are higher.  So depends on what you are looking for.  

Hi Jaime.

Many Californians (myself included- raised in Ventura) end up buying or full on moving to Arizona. We don't have the ocean, but the state does have a lot to offer, and a lot of CA negatives that we don't offer ;)

I love the comments on this thread- they are spot on. And yes, location and type depends upon your financial goals for the portfolio. I know I'm further north (Sedona area) and a bit of extra driving, but if you are looking for hot ROI and appreciation for Single family STR's, or even just some no-strings guidance to help you get started in AZ, I'm happy to help. Feel free to call or message me if I can assist you. Arizona has many very hot real estate market areas/towns and the state is landlord friendly, as well.

Welcome to AZ... and good luck to you.

@Jaime Martinez Jr In general the Phoenix, AZ market is the broadest with the greatest employment growth and diversity of employment in the state. Not to say the other markets don't have strengths, Flagstaff and Sedona are beautiful, Tucson has the University, etc but in general Phoenix is over 75% of the state's population and has so much to offer. Employment is like a rocket ship in many sectors.

Phoenix has a housing shortage, the homebuilders built fewer units between 2010 and 2020 than normal so the supply (inventory) is tight. It is expected to take a few years for the new construction to actually catch up to the population growth. Arizona is one of the leading inbound states regarding population growth and the last stats I saw CA was 19% of that inbound traffic.

When you look at the Phoenix market we have many opportunities that tend to work based on the investor, the investor's wants, and needs. Nothing is a one size fits all, it's just not that easy. The outlying areas tend to offer newer, more affordable options while others enjoy the muti-family in the core. It's not right or wrong overall, it's what's right for you.

The key to it is understanding what you want and then finding the spot in the market that best fits. We manage a diverse portfolio from a single condo, single family, 4-Plex, up into small apartment complexes. Having that diversity of portfolio can be beneficial to understand the sector and match it to an investor.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

We hate spam just as much as you