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Rental Yields Drop in Nearly 60% of Counties Studied

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ATTOM’s  Q1 2020 Single-Family Rental Market report reveals that the annual gross rental yield (annual rent income divided by the average purchase price of single-family homes) is 8.4% for 2020, which is down slightly from the 8.6% average of 2019.

“The business of buying single-family homes for rent has lost a little steam this year across the United States as rents aren’t rising quite as fast as prices for investment rental properties in a majority of the country,” said Todd Teta, Chief Product Officer at ATTOM Data Solutions. “But from the national perspective, things are generally holding steady for landlords in the single-family home rental market. Also, profit trends are moving in favor of investors in higher-rent counties and against those in lower-rent regions.”

Baltimore City and County in Maryland has the highest potential gross rental yields for 2020 at 28.9%. Following were Cumberland County, New Jersey (20.1%); Bibb County, Georgia (18.2%); Mobile County, Alabama (15.7%); and Clayton County, Georgia (15.1%)

Baltimore City, Cumberland, and Bibb Counties had the top yields in 2019, also. 

Of the counties with a population of at least 1 million, the highest potential gross yield in 2020 are in Wayne County, Michigan (14.5%); Cuyahoga County, Ohio (11.8%); Cook County, Illinois (9.3%); Dallas County, Texas (9.1%); and Harris County, Texas (8.7%).

ATTOM also reported that the annual gross rental yields for 2020 decreased in 231 of the 389 (59.4%) counties when compared to 2019. Delaware County, Pennsylvania, led the nation with its 30.5% decline. 

Prices rose faster than rents in 2019 in 231 of the 389 counties, including in Harris County; Maricopa County, Arizona; Kings County, New York; Riverside County, California; and San Bernardino County. 

However, rents rose faster than prices in just 40.6% of counties studied. Markets with accelerating rental prices include Los Angeles County, California; Cook County; San Diego County, California; Orange County, California: and Miami-Dade County, Florida. 

Markets that are expected to see growth in the single-family rental market include Wayne County; Cuyahoga County, Milwaukee County, Wisconsin; Shelby County; and Macomb County, Mississippi.

About Author: Mike Albanese

A graduate of the University of Alabama, Mike Albanese has worked for news publications since 2011 in Texas and Colorado. He has built a portfolio of more than 1,000 articles, covering city government, police and crime, business, sports, and is experienced in crafting engaging features and enterprise pieces. He spent time as the sports editor for the "Pilot Point Post-Signal," and has covered the DFW Metroplex for several years. He has also assisted with sports coverage and editing duties with the "Dallas Morning News" and "Denton Record-Chronicle" over the past several years.
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