Rent Vs. Buy Heat Maps: A Tool For Small Investors

First time real estate investors are often torn between investing in commercial real estate, or residential/multi-family property. A while back we wrote a post about Rentometer, a quick and dirty rent analysis tool apartment investors could use to gauge market rents.

HotPads.com has gone one step further and introduced a Rent vs. Buy Heatmap showing areas which have a low (or high) ratio of Avg. Home Prices to Annual Rent. It is not exactly scientific, and the system is only as good as the data, but the heat maps provide some insight as to what areas might warrant further research.

The system shows North Sunnyvale/Alviso as having a low ratio of Prices:Rent, but it seems the system has been gamed by limited availability of rental units and for sale housing that is mostly mobile homes. That said, other areas hit hardest by foreclosures (Brentwood, Tracy, Hollister, etc.) seem to have decent amounts of data on both rentals and for sale making the heat maps more relevant.

They also have heat maps for median rent, foreclosures per household, and others.

Similar Posts:

• PIMCO: House Prices Yet To Bottom
• Weakness In Apartments; San Jose Rent Falls Most
• Apartment Vacancy At 30-Year High; San Jose Leads Rent Declines
• Volume Up (Thanks to Foreclosures); Median Prices Down For Bay Area Residential Real Estate
• Apartment Investors Out In Full Force

Comments

Nick June 12, 2008

I like the heat maps but I think http://www.rentometer.com is more useful for actually comparing rents. For the areas I’ve check Rentometer seems more accurate for rental data. I’ve also found their property management tool, http://www.rentomatic.com to be very useful.

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