“Buy real estate when other people want to sell. Hold what you buy!” -John Jacob Astor.
Time and time again, experts have said that the key to building wealth in real estate is buying and holding. It’s why owning a rental property is a great investment. So while the buy and sell market may be hot, here’s why you shouldn’t sell your Denver rental property in 2022. Instead, consider taking Astor’s words into action and hold what you buy!
You Shouldn’t Sell Your Denver Rental Property When You Can Still Profit!
Rental properties in Denver are in high demand for several reasons. The Mile High City remains a top destination for people looking to move to Colorado. According to census data, Denver has grown nearly 20% over the last decade. That’s a little over 115,000 new residents calling Denver home from 2010 to 2020. Now you know the answer to why Denver’s traffic has gotten so bad!
Traffic problems aside, the increased population comes with a lot of benefits, especially to housing providers. All of those transplants need a place to live, right? Many have found themselves priced out of the Denver buy/sell market, leaving renting as their only option. But not everyone wants the responsibility of owning a home, leading to increased demand for rental homes. In fact, the number of “lifestyle renters” is increasing. In other words, you have the potential of finding good, long-term renters who will stay and take care of your investment property so long as you do your part to maintain the home and stay fair and consistent on the rent.
Going Uphill Isn’t Always A Battle!
When we say uphill, we mean the upwards curve of both rental rates and home appreciation over the last few years. Increased rents and home values are a win-win for landlords and real estate investors. Not only do you get a higher profit each month (aka short-term goals), you also gain more equity (aka long-term goals). Even in the last year, rents and home values have shot up to astronomical amounts. Since 2020, rents have increased 8-10% in the Denver metro area. Home values have increased 15-18% in that same time frame. And while rents may not see those same double-digit gains going into 2022, experts still predict them to increase in the coming year.
Why Put Money In Someone Else’s Pocket?
According to data from Redfin, 2021 saw record numbers of investors buying homes for sale to use them as rentals. Nationally, 18.2% of homes for sale were purchased by investors during the third quarter of 2021. In Denver, 17% of homes were snatched by investors compared to 11% in 2020. Why, you ask? Because rising rents and demand have created a veritable feast for landlords and real estate investors. So why let someone else capitalize on your potential profits by selling your rental gold mine?
Owning a rental property can be difficult. Tenants can pose numerous and sometimes ridiculous challenges, maintaining your rental home isn’t always cheap, and legal changes continuously impose more regulations and restrictions on landlords. But despite the many risks and hardships, the reward of owning and continuing to hold on to rental property outweighs them all. So if you come up to the question of whether or not to sell your rental property in 2022, consider the numerous reasons why you shouldn’t let go of your Denver gold mine!