Article about rental rates in Shelby County

4 Replies | Memphis, Tennessee

http://www.commercialappeal.com/business/real-esta...

I'm pretty sure the link isn't paywalled.  The main idea is that 1 in 3 renters in Memphis have to spend more than half their income on rent.

As someone who is looking into getting his foot into the door of real estate investment here in Memphis (where I live and work as a teacher), I have been conflicted by wanting to make money with a property and the ethical obligation of providing quality housing.

At the beginning of each school year, as some may know, schools have to verify addresses to make sure that the student still lives in the district.  We have to have two official proofs, usually an MLGW bill and a drivers license.  Annually, I'm stunned by the number of cutoff notices and relatively brand new leases I see.  That, and how many people have to show signed affidavits of shared residence because they can't afford to live on their own.

This is not to say that individuals are not responsible for themselves or their families, but it does raise the issue of the pricing in the rental industry.  Like I said, I am a complete newcomer and am personally interested in purchasing rental property, but I'm just wondering how this piece fits into the overall puzzle. 

Thoughts?

I think there is a way for you to accomplish both goals. I know my property management company will not place a tenant if the rent is 50% of their income. By purchasing a home and completing a rehab can provide a better environment than the apartment options they may have and still make a nice return. 

I would not let this keep you from investing in Memphis real estate. 

The biggest issue I see from our tenant's who's rent is under $650 a month is  mismanagement of money. We have placed tenant's that make well over what we require, but for many reasons they just can't seem to get it together for an extended period of time.