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7 Best Arizona Cities for Real Estate Investments

Are you ready to invest in real estate? If so, Arizona is a great place to make this investment. But, do you know which cities are best when it comes to real estate investments? If not, then you definitely need the information found here.

If you want to invest in the best markets for real estate in Arizona, you definitely are not alone. When it comes to real estate activity, Arizona’s a hot bed; however, the following seven cities are considered the best when it comes to making a real estate investment.

Each of the cities in this list have made top spots in real estate guides and are considered great locations by experts in the industry. Also, due to the fact that the areas are growing, the investment you make will only appreciate in value.

1. Laveen

Considered one of the strongest real estate investment locations, this city has a vacancy rate that’s under one percent. When you add that to the fact that the neighborhood has a rental return rate that is, on average, 11 percent, it’s pretty clear why Laveen is such a great place to look for investment real estate.

2. Scottsdale

While Scottsdale may be considered part of the valley, it’s also a pretty unique suburb that is attractive to individuals from all walks of life. Featuring a wide array of exciting nightlife, a unique western flair, amazing hotels and highly rated restaurants, it’s not surprising that so many visitors have decided to call Scottsdale home. As an extremely desirable area in the valley, there’s also a huge supply of investing opportunities found here.

3. Queen Creek

One of the factors that has made this location grow in popularity is how close it is to Mesa Airport. Another factor is the real estate prices. Vacancy rates are low and the returns on rental properties are almost as high as what’s seen in Laveen.

4. El Mirage

Affordability is the driving factor when it comes to growth in El Mirage. Right now, the median home value in this city is $110,000. This location is home to more than thirty bars, coffee shops and restaurants. If you want a great opportunity, then you should check out El Mirage.

5. South Phoenix

Another city that boasts lower than average vacancy rates and great returns on rentals is South Phoenix. It’s also close to many popular attractions, such as Tempe Town Lake, the Botanical gardens and the zoo.

6. Maricopa City

With a vacancy rate under one percent, this area has seen an increase in residents. There’s also a 10 percent return on real estate investments here, which makes this is a great place to make investments.

7. Tucson

Tucson is to the south of Phoenix and home to three natural forests. It also boasts a mild climate and great culture, making it a growing market. This city attracts both renters and buyers from the entire country.

Real Estate Investment Loans

Finding the right location and property is the first step when investing in real estate in Arizona. The next step is to get financing. You can opt for non-traditional lenders, which offer the money you need faster than a traditional bank. Hard money lenders also don’t require mountains of red tape like a traditional lender does. This makes it much easier to get the financing needed.

Why Real Estate Investors Use Hard Money Loans

There are several reasons that real estate investors are choosing hard money loans. The primary reason is the ability the lender has to fund a loan quickly. In the majority of situations, hard money loans can be funded in a week or less. If you compare that to the 30 to 45 days that it can take to have a bank loan funded, it’s pretty speedy. Additionally, the application process for a hard money loan usually only takes a day or two, and in some situations, your application can be approved during the same day. You will never hear from a traditional lender about approval within the same week.

The ability that you have to obtain funding faster than a bank loan is a huge advantage for the average real estate investor. This is especially true when an investor is working to acquire a property with quite a few competing bids. Having a fast closing with a hard money loan can help to get a seller’s attention and ensure that the offer is set apart from the remainder of buyers who are using conventional financing methods.

Another reason that a real estate investor may opt for a hard money loan is if they have already applied with banks but have been rejected. Unfortunately, life isn’t always perfect, and it doesn’t always go as planned. Credit issues, foreclosures and short sales all happen. Another crucial thing that banks need access to is a person’s income history. If the borrower has recently begun a new job, then the bank may decide to deny their request for a loan because of an insufficient income history. This is the case even if a borrower has a pretty good income.

A hard money lender can look past all these issues. They will make a decision based on whether or not the loan will actually be repaid and whether or not the borrower has plenty of equity invested in the property in question.

Points and Interest Rates Paid for a Hard Money Loan

The points and interest rates charged by a hard money lender are going to vary from one to another. They can also vary from one region to another.

Because these lenders are taking on more risk compared to traditional financing methods, the interest rates are typically higher. Additionally, the points usually range from two to four percent of the total amount of the loan. Be sure to keep this in mind when considering this type of loan for your real estate investment.

Loan to Value Ratios

The loan amount that the hard money lender lends is usually determined by the value of the property divided into the loan amount. In most cases, a borrower will be able to access 65 to 75 percent of the property’s current value. While this is a riskier loan, it’s still beneficial to anyone who is borrowing the money in order to have access to faster funds.

When it comes to taking out a hard money loan for a real estate investment, there are many things you have to keep in mind. It’s best to be informed to get the best possible results. To find out more, contact Barrett Financial Group today at 480-999-6183.