Why Invest in Riverside Real Estate?
While not as fast-growing as other cities in Southern California, Riverside's real estate market is showing a promising development. The area is close to several busy ports, thus became visible as SoCal's distribution hub. Riverside County has experienced a 1.54% population rate growth in 2017, which is significantly higher than the national average (0.7%). This means that there are many potential tenants and home buyers looking for a place to rent or own, and this is always good news for real estate investors.
Riverside's economy is stimulated by a commercial warehouses influx, which has also lifted consumer confidence. The main industries in the city are healthcare, retail trade, and construction.
All these factors, together with a cost of living that's lower than its neighboring areas make the real estate market in Riverside a favorable candidate for future growth.
Investment Considerations for Riverside Real Estate
There are a number of factors to consider, including:
- Affordable entry prices of homes - Riverside's entry prices of homes are still affordable (with the median home price of $281,000) and hinting towards improvement. The city is close to Los Angeles and San Diego, and the population growth rate is above the national average. Therefore, there are plenty of potential renters attracted to this area. This is extremely valuable to real estate investors who are looking to buy and rent until the properties' values increase.
- Fast appreciation - Over the past years, the housing market in Riverside has been pretty hot. Homes have appreciated by up to about 60%, well above the national average. This has made the real estate market in the area very attractive and has taken off in front of growing equity. Therefore, real estate investors in Riverside can enjoy high returns on their property investments.
- Rent prices growth - As people are moving to Riverside and the rent demand grows, rent prices are going up. For example, there was an increase of approximately 11% over the past year in rent prices. Also, in 2016, the rental vacancy rate was 4.36% and it continues improving. Real estate investors looking for high returns on investment, increasing profits, and a steady stream of year-round income can benefit from the high rental demand, growing rent prices, and low vacancy rate.
- Job growth - Riverside is in an area with plenty of industrial activity. There are industrial developments taking place in the Inland Empire and key companies (such as McLane Company, Sysco, United Parcel Service, and Apria Healthcare) built warehouses to accommodate the predicted growth. With more and more organizations opening up shop in the city, local employment is growing strong, thus the job market is expanding. Real estate investors in Riverside can choose from potential tenants who are employed and have a steady income, which makes them able to pay rent.
What are the Best Neighborhoods to Invest in Riverside
The best neighborhoods to invest in Riverside are Alessandro Heights (median home value: $560,267, median income: $161,286), Hawarden Hills (median home value: $508,300, median income: $135,944), Orange Crest (median home value: $343,467, median income: $107,853), Mission Grove (median home value: $348,500, median income: $109,121), and Victoria (median home value: $294,922, median income: $85,220). These are the areas with the highest incomes, lowest unemployment rates, increasing home prices, as well as highest population densities.
While the real estate market in Riverside isn't ideal, there are plenty of factors working in its favor. Its economy, supported by the numerous large warehouses, would definitely help drive the area's housing market. Real estate investors in single-family homes can take into consideration Riverside as a place that's in a key position to excel.
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