Why Invest in Berkeley Real Estate?
Thanks to its booming real estate market, Berkeley is a good option for investors to own single-family homes. The city is located in Northern California, very close to San Francisco and is home to the world-class University of California, Berkley. For many years, the area has drawn students, young professionals, and people working in the education sector. In 2017, Berkeley's population growth rate was 1.02%, which is higher than the national average of 0.7% and the numbers are still increasing.
The city's economy is strong and prosperous, mainly thanks to the continuous UC-related transactions that generate billions. Besides the education sector, other important industries in Berkeley are healthcare, social assistance, and scientific, tech, & professional services. The economic growth leads to an influx of renters and active home buyers.
While real estate prices are on the rise, Berkeley's market still favors investment, as many neighborhoods boast affordable properties. Therefore, Berkeley remains a city with a plethora of profitable opportunities for real estate investors in single-family homes.
Investment Considerations for Berkeley Real Estate
There are a number of factors to consider, including:
- Job Market Growth - Berkeley's job market experienced a 2.6% increase during 2017, which has helped the real estate scene remain stable. Future job growth for the next decade is predicted at 41.4%; this is higher than the national average of 38%. At 3.8%, the unemployment rate is low as well, significantly lower than the US average of 5.2%. The University of California, which is located in Berkeley, makes for 1.8% of the state's gross state product. Moreover, 25.1% of the city's residents are working in the education sector and the University is Berkeley's top employer. Thus, renters and active homebuyers are attracted to the area, which means that real estate investors are likely to enjoy a positive cash flow.
- Popular Living Destination - More and more students, education professionals, and recent graduates are drawn to Berkeley thanks to its state-of-the-art University and a solid economy. As a result, the area's population is constantly growing. In addition, the city is appreciated for its diverse restaurant scene, numerous shopping centers, and a lively vibe. Hence, real estate investors can benefit from low vacancy rates on their properties which leads to a secure and continuous income stream.
- Affordable Entry Price of Homes - There is a large number of affordable properties in Berkeley. The median home value has increased by 7.1% in 2017 and is predicted to rise by 1.3% during 2018. The sales have also gone up by 7% in 2017, which indicates a high demand. Another good news is that there are approximately 50,000 new housing units added in the Bay Area. All of these facts, together with the increasing rent prices give real estate investors the opportunity to earn a solid and continuously growing income from rental properties and flipping houses.
- High Rental Demand- With over 40,000 students enrolled in courses at the University of California, Berkeley, there are always people looking for a place to rent. Plus, the low vacancy rates and skyrocketing rent prices lead to a stable yearly influx of tenants and a high return on investments.
What are the best neighborhoods to invest in Berkeley
- In terms of top neighborhoods, West Berkeley has a high supply of available properties, which means higher days on market numbers. Especially compared to the more competitive neighborhoods, this makes the west part of the city more attractive to real estate investors. Telegraph and Claremont are regarded as some of the safest areas, so real estate investors can also consider them.
- In spite of its reputation for a highly competitive real estate market, Berkeley offers a bunch of awesome opportunities for real estate investors in single-family homes.
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