My wife and I are currently looking for a new primary residence, that we would eventually look to rent out. We would hope for around 1% rent of purchase price.However, it seems hard to make work in Durham. My job is south Durham, where we are leaning toward (27713 or 27707), her job is at Duke. Are there particular areas that do particularly well as rentals around these areas?
We're looking at houses in the $200k range. I really don't know much about the market of rentals at around the $2000/month range. However, I've heard from some that Doctors here temporarily may be looking for a nicer home for a period of around 4 years at a time or so. Can landlords in Durham chime in here? Is there a market for ~$200k homes in Durham? If so, what areas?
On a side note, attached bathrooms to the bedrooms are a huge perk for us, as we would be renting out a room while we lived in the residence as well. Any knowledge of neighborhoods with this type of layout, I'd appreciate the recommendation.
Ben, if you have ruled out townhomes at that price, to me the best values seem to be single family homes in East Durham and adjacent Cleveland/Holloway. With their proximity to downtown, those areas are seeing lots of development. Look at Canal St. for example. Downside is for the price you'd probably be looking at renovating the interior especially the kitchen and bathroom, and also quality of life, with sidewalks often lacking and crime an issue. But you could rent a clean, updated house in that area very easily, and values will go up over time. Hope that is helpful.
There is reasonably large demand for nice rentals due to all the visiting faculty, doctors, business school students, etc that are here for 2-3 year appointments. There's a reason 1 bedroom condos across from Duke are going for well over $200K. It's not your normal rental market. They also make better renters than students.
I would target 27705, 27707 or anywhere near American Tobacco. Avoid going north of 85. The areas to the west of 147 around lakewood cemetery are still depressed and ripe for development. I also like the area around Bennett Memorial/America Village for bargains and large lots. Check out the schools carefully, if it's a family home you will want to make sure you are picking something zoned for a popular school. 1 mile can make a lot of difference in Durham.
South of I-40 and around the mall can be tricky, just a little bit further and you are in Cary which is probably the better investment. You are taking a hit just for being in a less desirable school area. You are better off going for a premium urban neighborhood in Durham or close to Duke in terms of value.
The new highway 70 connector is going in which will make it easy to get to Duke, you might want to check the area around highway 70 near 540 for some good bargains.