Investing in real estate can be risky, but the Tampa Bay area is one of the best places to try it, a new study says.
Over the past year, investors have earned an average gross return of 16.7 percent on local residential properties they bought, according to the online real estate investment site BiggerPockets.com. That ranks the bay area sixth among the nation’s top 50 metro areas.
“If you can afford to buy a home in your local market, then by definition you can afford to buy (residential) investment properties,” said Scott Trench, author of the study.
Don’t rush out just yet, though, to grab that foreclosed house down the street. The high returns cited by BiggerPockets don’t factor in the many costs of investing, including closing costs, property taxes, insurance and — in the case of many properties — substantial sums for repairs and renovation.
As the housing market recovers, it’s also getting harder to find good deals in sought-after areas.
“Carrollwood and South Tampa are almost impossible,” Chris Smith, owner of Bay to Gulf Holdings, said Friday. “Those are probably the two hottest places — everybody wants to live there.”