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Published: March 12th 2020
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In a year that has already been characterized by several market scares and an extremely volatile stock market, many capital investors are looking for alternatives for storing—and growing—their wealth. Real estate property, a tangible asset that can be expected to increase in value over time, has become increasingly attractive to investors of all varieties.
Within the broader real estate market,
vacation property ownership has become especially popular. By owning a vacation rental property, you will not only be able to increase your wealth through the property’s appreciation, but you will also be able to generate a steady stream of income that could potentially offset the property’s ownership.
To become a successful vacation property owner, the first thing you will need to do is hire a reputable
vacation property management firm. These firms, such as VacayAZ, offer a wide range of services and benefits. Rather than needing to market the property, clean the property, and directly interact with guests, you can have access to an experienced and knowledgeable team that can manage each of these responsibilities on your behalf.
The Scottsdale, Arizona vacation property market has been growing at a rate that is well above the national average. In this article,
we will discuss the most important things to know about buying a vacation property in Scottsdale. Additionally, we will discuss the keys to ensuring that your property ownership experience is a success.
Getting to Know Scottsdale, Arizona
Located directly east of Phoenix, the City of Scottsdale has grown in population by more than 17 percent since 2010. As of 2018, the population is estimated to be about 255,000 and the broader Phoenix Metropolitan Area, with a population of nearly 5 million, is currently the 11
th largest metro in the United States.
Scottsdale is known for having some of the warmest and sunniest weather in the nation, which is why it has become an extremely popular vacation destination. The city has been described by the New York Times as being “a desert version of Miami’s South Beach” and tourism plays a very important role in the local economy. Complete with many golf courses, conference centers, and access to popular tourist attractions, the city of Scottsdale enjoys more than
9 million visitors per year. Overnight visitors typically stay an average of 4 nights, which is above the average for comparable cities. Additionally,
the city’s tourist report claims that visitors have brought roughly
$2.4 billion to the city each year.
Scottsdale, Arizona Property Ownership Trends
When compared to both the broader Phoenix Metro Area as well as the rest of the United States, Scottsdale properties have been increasing in value at a rate that is well above average. The median home value in Scottsdale is $478,300, building on a projected value increase of about 3.6 percent per year. The median rent in Scottsdale is about $2,500, which also suggests that vacation rental property owners can likely earn more in Scottsdale than they could in most other locations.
Almost every metric—price per square foot, median value, median sales price, etc.—suggests that Scottsdale properties will be worth more in ten years than they are in the status quo. Over the past decade, for example, property values increased by roughly 20 percent. The city also has an average income that is roughly double the state’s average, meaning that properties will be generally more stable in the event of a recession.
Why Are Scottsdale Properties Expected to Increase in Value?
Though, since the property market crash in 2008, most US properties have been
generally increasing in value, there are quite a few reasons why Scottsdale has been growing at an above-average rate.
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Commanding Tourist Market: because Scottsdale has such a dominant tourist industry, the demand for short-term rentals is exceptionally high. Investing in a single unit or multi-unit property can create a steady secondary income stream. When compared to other cities, attracting guests in Scottsdale is relatively easy.
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Attractive Job Market: Scottsdale has an unemployment rating that is lower than most of the region, in addition to having above-average salaries and many new jobs being added each month. Each of these factors helps put upward pressure on property values.
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Growth Constraints: Scottsdale is surrounded by National Forest, as well as nearby desert and Native American reservations. Because of these factors, outward development is extremely limited, meaning that existing properties have a unique advantage.
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Property Owner Benefits: when compared to nearby California, Scottsdale has lower property tax rates, fewer landlord and building restrictions, and many other details that are attractive to aspiring property owners.
Each of these factors helps ensure that a standard Scottsdale property is likely to increase in value. Additionally, these factors are especially appealing to individuals hoping to enter the vacation property rental market.
How to Become a Successful Vacation Rental Property Owner
Once you have decided that you want to invest in Scottsdale vacation rental properties, the next step will be deciding which property is right for you. While each neighborhood in the city has at least seem appeal to tourists, Old Town Scottsdale often experiences the most attention from out-of-town visitors. Looking at a property rental map will reveal that this is the most competitive rental neighborhood that can also command the highest overnight rates. North Scottsdale, on the other hand, maintains the highest property values but isn’t necessarily as appealing to short-term vacationers.
After purchasing your Scottsdale vacation property, you will need to develop a few strategies for maximizing your ROI. Fortunately, there are quite a few ways you can do this. Encouraging positive reviews, actively maintaining the property, and utilizing a flexible pricing schedule will all help you attract new visitors and maximize your profit. Having a qualified and experienced property management firm by your side will make it much more likely that you can earn more money and have a generally successful experience.
Conclusion - The Future of Scottsdale Property Ownership (2020 Guide)
There are many attractive vacation property markets in the United States, but Scottsdale is a city that remains truly exceptional. Scottsdale vacation properties have been steadily increasing in value and this trend can be expected to continue into the foreseeable future. As long as you can choose a
tourist-friendly property and work with the right vacation rental management team, owning vacation property in Scottsdale can be an incredibly lucrative endeavor.
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