Tiffany Elder, MBA, Realtor
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Raleigh-Durham Real Estate Blog

The Raleigh-Durham rental market is on an upswing!
May 9th, 2015 4:36 PM


I realized last week that I’ve been a lazy landlord.  I yap about lazy landlords all the time and now I’m one of them!?  That’s a hard pill to swallow.  But not in the way you might think.  I’m lazy because I recently realized that I haven’t raised rents for some of my tenants in over 7 years!  Mind you, I’ve been blessed with long-term tenants who love living in my properties, and who want to stay in place.  7+ years for tenant longevity ain’t bad!  This consistency has lowered, and in some cases negated the turnover and re-leasing expenses in my portfolio on an annual basis, so it has been well worth the tradeoff.  The tenants take great care of the properties, and in return, I haven’t increased rents, in part, because I bought desirable properties, at formidable prices, in solid areas.  They generated a tremendous amount of cashflow to begin with, so short-term rent increases weren’t needed, which created a win-win for everyone.  No need to be greedy…especially since happy tenants make for a happy owner!  

Well, I recently noticed that other rentals were currently going for 20% more per month, so it might be time to make adjustments.  It’s good to know that the local rental market is on an upswing.  That means it’s time for investors to buy!  Call our office if you have an interest in acquiring local income property.  We'd love to help you sort through the myriad of options available to find the perfect next addition to your portfolio.

Lessons learned
  • Providing attractive housing in sought-after areas, and at competitive rents can dramatically increase tenant retention and lower turnover and vacancy expenses in your portfolio. 
  • Location should play a strong role in your decision to buy.
  • Investors  should take extra time before buying to be sure their properties will perform well long-term.   
  • Don’t buy if today’s rental rates don’t support your required cashflow.
  • As an add-on to the prior point, don’t bank on what rates “can” be unless your reserves can cover the property operating in the red short-term. 
  • Keep in mind that rents should increase over time, but so will expenses.  
  • Gradually increase rents over time to maximize your cashflow.  Try to remain competitively priced.  
  • Pricing at a premium may be warranted if your property includes amenities/benefits not offered by others in the area. 
Of course these are pretty obvious assumptions, but seeing them in action has made them crystal clear.  So…being lazy isn’t such a bad thing after all.  But, given the improving Raleigh-Durham rental market, it’s time for me to play catch-up with rental rates! 

Market Update Reports
Things are looking good for Raleigh-Durham Real Estate!  Sales volume is up…Prices are up…and in some areas, days on the market has dropped!  We've seen more multiple-offer situations recently as well, so buyers are competing for desirable homes that fit their buying criteria.  In addition, sellers are closing at prices that are closer to their asking prices. All of these point to a solid (and improving) local market.  Market updates report, as provided by Triangle MLS, can be viewed at the links below:

Articles of Note

The following are a few articles that point to the favorability of the NC housing market, especially in the Triangle Region:

Happy Investing!

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Posted by Tiffany Elder on May 9th, 2015 4:36 PMPost a Comment

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