Are you thinking of buying an investment property in Metro Detroit, MI?

Growing your wealth is possible in several ways. One of the common approaches is rental property investments. This can have an incredible effect on your future, especially as it generates regular monthly income for you.

Metro Detroit is quickly transforming into a premier city for real estate investment. The job market has become strong again considering the high number of municipalities and businesses in the area. Moreover, Metro Detroit is where Fortune 500 firms have chosen to put up their headquarters.

In terms of population growth, Metro Detroit has a growing population of millennials that supplement the workforce in this city. The employment rate is growing every year. This is a great opportunity for investors to take advantage of the lower real estate prices, especially single-family homes in this city. What’s more, the rental demand is high given that almost half of the local population are renting!

It’s advised that new investors check updated news and information before dipping into real estate investment. Even if purchasing a rental property can be a means to increasing your financial assets, you still need to study the market and determine if you’re making the right move.

In this article, we here at Nelson Property Management will discuss the basics of buying an investment property in Metro Detroit. Check out our recommendations for boosting your income by investing in real estate property!

What Is the Metro Detroit Real Estate Market Like?

In Metro Detroit, the barriers to becoming a real estate investor are low since purchasing properties is affordable. Given the high rental demand, real estate investors have a huge opportunity to gain double-digit net yields with quick ROI possibilities.

metro detroit real estate market

Compared to other similar markets in other cities like Atlanta, Buffalo, Chicago and Memphis, Metro Detroit’s present returns are higher, making it perform better.

Rental demand is projected to remain high in Metro Detroit since home financing options are limited. The city is also known for being the best place for a young workforce with its stable economy and positive job growth. Most important of all, the lower cost of living here will continue to attract new residents.

Top Tips for Real Estate Investments in Metro Detroit

1: Find Properties in Your Price Range

The first thing an investor has to focus on is finding the type of property you can afford to invest in. Metro Detroit offers several kinds of real estate, but the single-family home is currently hot given its low prices and accessibility in this city.

When you have carefully evaluated your budget and matched it with your goal, you can now focus on picking the right property for you. Remember that taxes and HOA fees will come into play, so include this in your calculations when determining the price range for your investment.

2. Opt for High-Rent Neighborhoods

Metro Detroit is known to be a renter-dominant location. To maximize your real estate earnings, look for neighborhoods where you can earn a high profit, but take into account the purchase price of your chosen property.

metro detroit rental neighborhoods

Note that you’ll also be allocating cash for renovation and improvement projects, so consider this aspect when looking at your projected profit. Be mindful when creating your financial projections and strive to find a balance between the necessary spending and meeting your financial targets.

3: Consider the Benefits of Professional Property Management Services

Seasoned investors generally opt to hire professional property management companies to oversee their rental properties. This strategy enables them to focus on increasing their wealth portfolio while leaving the day-to-day tasks of managing a rental to skilled professionals.

As a Metro Detroit landlord, you’ll be expected to keep your rental unit habitable and to attend to the repairs and maintenance all the time. Your presence is also vital to deal with emergencies, complaints, and other inefficiencies.

Not all investors are top-notch rental property managers who have the spare time to address issues related to renting. This is why engaging the services of a professional property management company like Nelson Property Management can leave you with more time, freedom, and peace of mind. The right property manager can work on fulfilling your financial goals while delivering the best customer service to your renters.

4. Crunch the Numbers

Before purchasing the investment property, it’s helpful to perform a number of calculations. Use different projected earnings based on market performances. This way, you have several perspectives on the forecasted returns for your Metro Detroit real estate investment.

metro detroit best real estate investment

Be careful when running your table of calculations. Consider the market changes and avoid overly optimistic scenarios. You might end up with less-than-stellar returns that can prove disappointing. It’s best to be prepared for low market performances so when the reality proves to be better, you can happily enjoy the positive returns from your investment.

5. Find the Right Location

Take time to do a comparative analysis of different rentals. Look at how they’re affected by the market movements. Some neighborhoods have higher rental potential. You can ride the growth of the neighborhoods that are projected to be positively impacted by the city’s development.

Look at where city construction is heavy and attractions are being developed. The more progressive changes in an area, the better profit you will earn.

In a Nutshell: Real Estate Investing Tips in Metro Detroit

When considering real estate investment in Metro Detroit, gauge your budget, evaluate the neighborhoods in terms of growth, run the numbers, and narrow down your choices to high-rent neighborhoods.

Lastly, try hiring a property management company like Nelson Property Management so you can have access to a more efficient way of running a rental business. You want to maximize your returns and avoid costly management errors. Your life doesn’t have to be entirely tied down to your rental properties with our help!