Is this is right time to buy a rental property in current conditions
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Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votesDo the numbers make sense? Are you looking to make a quick buck or are you looking to buy a long term rental? If the numbers work and you are looking for a longer term investment, then buy when you find the right property.
15 Replies
- Investor · Pacific Northwest · Member since 2026 · 538 posts · 313 votes7mo
A lot of the factors you mentioned (AI layoffs, inflation, war, etc.) absolutely influence markets, but real estate usually responds to them indirectly and locally.
The first question I’d usually ask before deciding whether it’s a good time to buy is: what’s actually happening in the specific market you’re looking at?
A few things tend to drive rental property performance much more directly than the headlines:
• Population and job growth – Are people moving into the area or leaving?
• New construction pipeline – Are a lot of apartments or houses being built right now?
• Rental demand vs supply – Even if rents flatten for a year, strong demand can stabilize things quickly.
• Cost of financing – Higher interest rates slow buying activity, which sometimes creates better purchase opportunities.
• Local employment mix – Markets tied to a single industry behave very differently than diversified job markets.
For example, in many markets rents softened recently mainly because a lot of new multifamily construction came online at the same time, not because people suddenly stopped needing housing.
So instead of asking “Is this the right time to buy?”, a more useful question might be:
What is happening in the specific city or neighborhood you’re considering?
In some markets, rising interest rates and slower buyer demand actually create better entry points for long-term investors, even if the broader news cycle feels uncertain.
If you’re comfortable sharing the city or region you’re looking at, people here could probably give more specific feedback based on what’s happening locally.
- 7moTheresa HarrisPro MemberMember since 2019 · 15k+ posts · 11k+ votes
Do the numbers make sense? Are you looking to make a quick buck or are you looking to buy a long term rental? If the numbers work and you are looking for a longer term investment, then buy when you find the right property.
- Real Estate Broker · Atlanta · Member since 2024 · 1k+ posts · 608 votes7mo
GP, it really depends on the local market and the numbers. If the property cash flows, has strong rental demand and you plan to hold it long term, it can still be a good time to buy. Market cycles come and go but well-purchased rental properties tend to perform well over time. The key is buying at the right price and ensuring the rent covers expenses with a reasonable margin.
Another important question is whether you are financing the purchase or paying cash. Here in Atlanta, we are currently in a buyer’s market which means buyers have more negotiating power and can find better deals.
When my buyers ask, “Is now a good time to buy?” my answer is always: you buy when you find the right home and you can afford it. For investors, the answer is similar, you buy when the numbers make sense and you can afford the investment.
Seems like now is always the best time as long as the fundamentals make sense and you're holding long term. The only reason to wait is if you suspect your market to decline for a particular reason — less demand, overbuilding, main employers leaving or laying off, neighborhood decay, etc.
Quote from @Gp G.:
Hi,
Lot of companies firing thousands of employees giving AI as reason. Also war making gas prices raise. Seems inflation also high. Rents coming down. Property values coming down. I see lot of internal, external factors impacting real estate market also stock market. Is this is right time to buy a rental property in current conditions? Please advise
Some Of the items you listed historically can result in lower RE returns. Rising unemployment, lower rents, lower property values.
But RE is considered a good hedge against inflation. Typically RE values increase more than inflation. Typically rents rise with inflation.
My belief is do thorough and conservative underwriting. If you do this, most (virtually all) properties on the mls purchased with market financing will not reflect a return that justifies the effort and risk of residential RE.
However, if you find one that works, get a good value add, buy off market below market price, use below market financing, use alternative rent models such as STR, MTR, or rent by room, the projected return can justify the effort and risk of residential RE. Note I am not intending to imply these are easy.
There are a lot of strategies in RE. There is typically a way to achieve a return that justifies the effort and risk if you put forth the effort. The easy purchase off the mls using market financing without a value add or alternative rent model is unlikely to produce a great return.
Good luck
- Investor · Austin, TX · Member since 2017 · 107 posts · 89 votes7mo
Quote from @Gp G.:
Hi,
Lot of companies firing thousands of employees giving AI as reason. Also war making gas prices raise. Seems inflation also high. Rents coming down. Property values coming down. I see lot of internal, external factors impacting real estate market also stock market. Is this is right time to buy a rental property in current conditions? Please advise
Frankly, I’m seeing a lot more reward per unit risk on the lending side. There’s always a buy case. Doesn’t mean it’s like for 95% LTVs and thin margins. You’re on the right track looking at the downside as well as the upside. If you’re doing that, it’s always a good time to execute on your plan.
- 7moDavid PeschioBusiness MemberRichmond, VA · Member since 2019 · 358 posts · 181 votes
If Target was having a sale would you run into the store or out? Look for the smart buy in the right location and you will be on the right track.
- Member since 2011 · 152 posts · 113 votes7mo
In any given market, there are good deals and bad deals. The best deals are typically off market deals with motivated sellers. And there are always motivated sellers that are motivated by factors completely independent of the real estate market.
- Tacoma, WA · Member since 2026 · 28 posts · 29 votes7mo
I bought my first rental (a duplex) about three years ago in Tacoma WA and I had similar concerns about timing. Rates had just gone up, people were talking about a correction, and I nearly talked myself out of it.
What pushed me forward was running the numbers on the specific property rather than trying to time the macro market. The duplex cash flowed about 200 a month after all expenses even at a higher interest rate, and the neighborhood had steady demand from military families and hospital workers. Three years in, rents have gone up modestly and the property has been consistently occupied.
Since then I picked up a 4-plex in the same area. Same approach -- I ignored the headlines and focused on whether the deal worked with conservative assumptions. I underwrote both properties assuming no appreciation and a 10% vacancy rate, which is higher than what I have actually experienced.
The one thing I would add to what others have said is that self-managing made a huge difference in making the numbers work at smaller scale. A PM taking 8-10% of gross rent can turn a solid deal into a marginal one when you are only working with a handful of units. If you are willing to put in the time to learn the basics of tenant screening, lease management, and maintenance coordination, you can make deals pencil out that would not work otherwise.
To directly answer your question -- if the numbers work today with conservative assumptions and you plan to hold long term, the macro environment matters a lot less than people think. There is never going to be a moment when every indicator looks perfect.
Quote from @Alex Rivera:
I bought my first rental (a duplex) about three years ago in Tacoma WA and I had similar concerns about timing. Rates had just gone up, people were talking about a correction, and I nearly talked myself out of it.
What pushed me forward was running the numbers on the specific property rather than trying to time the macro market. The duplex cash flowed about 200 a month after all expenses even at a higher interest rate, and the neighborhood had steady demand from military families and hospital workers. Three years in, rents have gone up modestly and the property has been consistently occupied.
Since then I picked up a 4-plex in the same area. Same approach -- I ignored the headlines and focused on whether the deal worked with conservative assumptions. I underwrote both properties assuming no appreciation and a 10% vacancy rate, which is higher than what I have actually experienced.
The one thing I would add to what others have said is that self-managing made a huge difference in making the numbers work at smaller scale. A PM taking 8-10% of gross rent can turn a solid deal into a marginal one when you are only working with a handful of units. If you are willing to put in the time to learn the basics of tenant screening, lease management, and maintenance coordination, you can make deals pencil out that would not work otherwise.
To directly answer your question -- if the numbers work today with conservative assumptions and you plan to hold long term, the macro environment matters a lot less than people think. There is never going to be a moment when every indicator looks perfect.
In general, I agree with your post, but …..
> A PM taking 8-10% of gross rent can turn a solid deal into a marginal one when you are only working with a handful of units. If you are willing to put in the time to learn the basics of tenant screening, lease management, and maintenance coordination, you can make deals pencil out that would not work otherwise.
I see newbies taking this approach without allocating any compensation for the PM efforts. This amounts to working for free.
Now for your example, if you made $200/month cash flow at purchase but did not include any allocation for the PM responsibilities, you were doing the work of the PM (assuming the rents were above $2k/unit) for less than PM charge. Granted there could be other sources of RE return but you indicated you did your underwriting with no appreciation (I currently am doing my underwriting with 5 years no appreciation). You do not say how you are underwriting rent, but I have been doing 5 years no market rent increase)
Note this implies that you purchased a property with the effort and risk for a projected return below what a pm would charge. Due to market rent increases it appears to have worked for you but I question your return after allocating for you time.
I do not invest in RE to make PM money. I invest in PM. t achieve returns far in excess of what I can obtain in passive options such as the sp500. Are you accomplishing that.
Note we self manage our LTR rentals, but we 1) allocate market rate pricing for our efforts 2) delegate out as much as makes sense. In other words we allocate market rate PM, but strive to do as little effort as possible for that allocation.
I see less experienced RE investors not account for the value of their time whether it is in buy and holds or flips, value adds, etc. my time is very valuable, I expect to get a high compensation for my time. What is the value of your time?
good luck
- Rental Property Investor · TN · Member since 2013 · 54 posts · 50 votes7mo
Theres always a deal out there, you just gotta find it. Not sure who said this, "But the best time to plant a tree was 20 years ago, the next best time is today."
- 7moDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
Quote from @Gp G.:
Hi,
Lot of companies firing thousands of employees giving AI as reason. Also war making gas prices raise. Seems inflation also high. Rents coming down. Property values coming down. I see lot of internal, external factors impacting real estate market also stock market. Is this is right time to buy a rental property in current conditions? Please advise
Your profile states, "Real estate investor and realtor focused on Single Family and Multi Family Homes" and you joined BP in 2019.
So, why are you posting like this?
If you're trying start a discussion about something, why include, "please advise"?
Logical Property Management4.9469 Reviews - Real Estate Agent · Memphis · Member since 2026 · 603 posts · 352 votes7mo
Timing the market is always tricky, especially when headlines feel uncertain. Most long-term investors focus less on whether the market is perfect and more on whether a specific deal makes sense under conservative assumptions.
A few things that usually matter more than the macro noise:
- Cash flow at today’s rents, not projected increases
- Local supply and job stability in the specific area you’re buying
- Financing terms and reserves so you can handle vacancies or repairs
- Buying with enough margin that the deal still works if rents stay flat for a while
Markets go through cycles, but properties bought with solid fundamentals and long-term financing tend to ride those cycles better.
In other words, it’s less about “Is this the perfect time to buy?” and more about “Does this particular property still work if conditions stay uncertain for a few years?”
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