Phoenix Rental Investment

[Dhea Suseno]

Hello there! I am a newbie in real estate investing who have been reading BP forums, and this is the first time asking a question myself. I live in Cali, and after getting inspired by Long Distance Real Estate Investing book by David Greene, I finally decided to start looking into investing out-of-state. 

Phoenix seems to be growing tremendously in terms of jobs and people living HCOL area moving there. Looking to hear about your rental investment experience in Phoenix, like what's a reasonable cash on cash to expect in that area, which zipcodes should be avoided, any other thing you'd like to share? 

Thank you in advance, happy to finally join the BP community!

Dhea

[Paul Welden]

Hi @Dhea Suseno and welcome to BP!

If you intend to get a mortgage for your real estate investment(s), please be aware of the new FHFA rule that came out last week where Fannie/Freddie will, starting 4/1/2021, will reduce their purchase of investment loans and 2nd home loans by 50% to only 7% of their portfolio. 

I think this is HUGE! 

Some lenders like Prime and Academy have already adjusted these loans by 200bps!

So, it could be much more expensive and more difficult to get a non-owner occupant or 2nd home loan after 4/1/2021. 

In Phoenix, I don't think any area should be avoided but the area to buy in depends on your investment strategy and the type of renter you want to attract.  Every area and zip code has its pros/cons.