Utah has become a prime destination for real estate investors seeking both cash flow and appreciation, attracting them to build rental portfolios in the state. With numerous favorable elements such as a robust and steady economy, a growing population with high education levels, and picturesque markets ideal for vacation investment properties, the Beehive State has emerged as a favored choice. At Easy Street Capital, we take pride in being a prominent source of investment property loans, catering to the needs of real estate investors aiming to establish investment properties in Utah.
Investment Property Loan Types In Utah
When it comes to real estate investment opportunities in Utah, there is a wide range of investment property loans to choose from. Due to frequent snowfall and rugged conditions, there are lucrative properties in need of renovations. For investors skilled in property rehab, hard money renovation loans are a perfect choice! These loans enable you to swiftly purchase a property while financing the renovation costs. Once the rehabilitation is complete, you have the flexibility to either “flip” the property for a quick profit or pursue the BRRRR Method by renting it out and subsequently refinancing it into a long-term, low-interest DSCR loan!
DSCR Loans with long-term fixed rates are an excellent option for investing in turnkey rental properties. Turnkey properties are ready to rent without requiring any renovation work. Move-in ready single-family residences and fully furnished vacation rentals offer a great combination of cash flow and price appreciation. By opting for a fixed-rate DSCR Loan spanning thirty years, you secure a stable interest rate over an extended period. Assuming historical trends persist, rents and appreciation tend to steadily rise each year, while the debt costs remain unchanged for the duration of the fixed-rate 30-year loan. As a result, properties financed through a DSCR rental loan should experience increasing cash flow every year of ownership.
Utah: Landlord-Friendly State
With is business-friendly laws and regulations, Utah is a landlord-friendly state. Owners of rental properties, such as typical DSCR Loan borrower, are secure investing in the state. Utah does not have any form of rent control laws that apply state-wide. This means rental property owners are free to set rents at whatever level the market will bear. This can be an advantage for landlords who are looking to maximize their profits. Utah has relatively efficient and straightforward eviction procedures in place, allowing landlords to regain possession of their rental properties in a timely manner when necessary. The state provides clear guidelines for serving eviction notices and handling eviction lawsuits. Additionally, Utah allows landlords to include various provisions in their lease agreements, such as pet policies, late fees, and rules regarding the use of common areas. This flexibility allows landlords to establish clear expectations and rules for their rental properties.
Where To Invest In Real Estate In Utah
Utah is also a favorite market for real estate investors because of its diverse market options. There are lots of varying markets that offer great potential for each type of real estate investor. Salt Lake City is the largest city in the state and home to the flagship university, University of Utah. Ogden is the state’s eighth largest city with a growing population and thriving economy. St. George is known for its natural beauty and historical sites. Provo is located south of Salt Lake City and is home to BYU. Orderville is a vacation mountain town known for outdoor recreation options and small-town charm.
Salt Lake City
Salt Lake City is the largest city in the state of Utah, with a population of over 204,000, according to the US Census Bureau. It serves as the economic and cultural hub of the state. Salt Lake City is renowned for its diverse economy, encompassing sectors such as healthcare, finance, technology, and outdoor recreation. The city has numerous major companies, including Zions Bancorporation and Sinclair Oil Corporation. These companies create a stable employment base and attract professionals who need rental properties. Salt Lake City has a thriving startup scene, with a growing number of companies emerging in industries like software development, and biotechnology.
Salt Lake City’s strong economy and diverse population make it an appealing market for real estate investors. The city experiences steady job growth and population expansion, which generates consistent demand for rental properties across various lease terms, including long-term, medium-term rentals, and short-term rentals. Additionally, Salt Lake City is a popular tourist destination, with attractions like Utah State Capitol and the Great Salt Lake. The city’s cultural offerings, outdoor recreational opportunities, and professional sports teams like the Utah Jazz and Real Salt Lake contribute to a thriving market for short-term rentals. Salt Lake City’s unique combination of beauty, cultural attractions, and economic stability make it an excellent choice for real estate investment opportunities.
Salt Lake City is also a prime market for investors specializing in niche strategies such as student housing. The University of Utah, with its enrollment of over 35,000 students, creates a consistent demand for rental properties.
In summary, Salt Lake City’s strong economy, diverse attractions, and growing population make it an excellent market for real estate investors interested in single-family and multifamily properties. The city’s dynamic environment offers numerous opportunities for rental property investments and the potential for steady returns.
Ogden
Ogden is a beautiful city located in Weber County, with a population of over 87,000 residents. It is renowned for its stunning natural surroundings and abundance of outdoor recreational opportunities, making it a popular destination for nature lovers and adventure enthusiasts. Situated at the foot of the majestic Wasatch Mountains, Ogden offers breathtaking landscapes and easy access to activities such as hiking, skiing, and mountain biking.
Real estate investors can find a wide range of investment opportunities in Ogden. The city offers a mix of affordable housing options, with the median sales price for a single-family residence reported at $245,000 in March 2024, according to Redfin. The median sales price went from $200,000 to $245,000 in just two years! This demonstrates that the market in Ogden is strong, with a growing demand for both long-term and short-term rentals.
Ogden also boasts a diverse economy with various thriving industries. The city has a strong presence in sectors such as outdoor recreation, advanced manufacturing, aerospace, and information technology. According to BiggerPockets, Ogden is in the top 5 cities forecasted for fastest demand growth in the next five years! This diverse economic base provides stability and contributes to the demand for rental properties in the area.
Additionally, Ogden has a rich cultural heritage, with historic buildings, museums, and art galleries. The historic 25th Street is a popular destination, known for its charming boutiques, eateries, and entertainment venues.
Overall, Ogden offers a unique blend of scenery, outdoor recreation opportunities, and a diverse economy. These factors make it an attractive location for real estate investors looking to capitalize on the city’s growing popularity and potential for rental property investments.
St. George
St. George is a vibrant city known for its natural beauty and diverse offerings. The city offers a rich array of attractions and a population of over 102,000 residents. The city embraces its unique charm and is surrounded by landscapes, including Snow Canyon State Park and the red rock formations. St. George boasts several cultural attractions, such as the St. George Utah Temple and the St. George Art Festival, where residents and visitors can enjoy a variety of artistic performances and exhibitions. The city also hosts numerous community events and festivals, showcasing its lively spirit and community engagement. St. George’s natural beauty, cultural amenities, and thriving community make it an appealing destination for both residents and visitors alike.
The city of St. George also appeals to short-term rental investors seeking opportunities driven by specific events that attract visitors. The St. George area hosts a range of events throughout the year, creating consistent demand for short-term rentals. St. George hosts cultural festivals, including the St. George Arts Festival and the St. George Marathon. These events contribute to the year-round demand for short-term rentals, catering to visitors beyond the realm of sports. The diverse event calendar in St. George provides an attractive opportunity for investors looking to capitalize on the city’s event-driven tourism.
Overall, St. George’s diverse attractions, stunning natural surroundings, and growing population make it an enticing market for real estate investors. The city’s cultural vibrancy and strong demand create favorable conditions for successful investments.
Provo
Provo is situated in the central part of the state and has a population of over 117,000 residents, making it the fourth largest city in Utah. The city boasts a diversified economy. Leading industries include manufacturing, technology, and education. Provo is home to several large companies, such as Qualtrics and Vox Marketing, which provide a strong employment base for renters. Additionally, BYU attracts many students and young professionals who require rental properties.
Real estate investors can find promising investment opportunities in Provo. The city offers a range of affordable options. In March 2024, Provo property prices were up 5.4% compared to last year, at a median price of $437,375 by Redfin. Furthermore, Provo has a strong rental market, with the average market rent in April 2024 reaching $1,395 per month according to Zillow. The median market rent is up a very strong $136 year-over-year. This makes it an attractive market for investors seeking rental properties with potential for solid cash flow and returns.
With its scenic location near the foothills of the Wasatch Mountains and its close proximity to outdoor recreational areas such Provo Canyon, Provo is also a desirable destination for nature enthusiasts. BiggerPockets ranked Provo as the #1 city in the US for a high growth in demand in the next decade.
Overall, Provo’s diverse economy, cultural attractions, and access to outdoor opportunities make it an appealing market for real estate investors. The city offers a mix of affordable housing options, with strong rental demand and attractive amenities, making it an ideal location. Provo’s thriving economy, arts scene, and proximity to natural landscapes create a favorable environment for both residents, visitors and investors.
Orderville
Nestled in the stunning landscapes of southern Utah, Orderville is a charming town celebrated for its natural beauty and proximity to outdoor adventures. The town’s historic downtown area reflects its heritage and offers an ambiance with a variety of shops, art galleries, and local establishments. Orderville is a destination for outdoor enthusiasts, offering activities such as hiking, camping, and exploring the nearby national parks. Surrounded by breathtaking red rock landscapes, Orderville provides an idyllic setting for residents and visitors.
According to AirDNA, a leading data provider for short-term rental investors, Orderville boasts a strong market score of 91/100 with above-average rental demand and a grade of 96 for “investability.” Investors can expect an annual revenue of approximately $65,100! This ensures steady cash flow for short-term rental owners. Investors utilizing DSCR loans from forward-thinking lenders like Easy Street Capital, which consider AirDNA projections for income qualification, can capitalize on the market’s potential and maximize their returns. Additionally, Orderville is ranked #11 on Awning Airbnb 2024 United States market rankings, insinuating constant demand for short-term rentals.
Overall, Orderville’s natural beauty and year-round appeal make it an attractive market for real estate investors specializing in short-term rentals. The town’s location amidst stunning red rock landscapes and its proximity to national parks creates a unique and captivating setting. Outdoor enthusiasts flock to Orderville for activities such as hiking, camping, and exploring the surrounding natural wonders. This steady stream of visitors ensures a consistent demand for rental properties. This presents a lucrative opportunity for investors looking to capitalize on Orderville’s allure and charm.
Ready to Get Started?
Ready to invest in real estate in Utah? Easy Street Capital is a top lender for investment properties in Utah, both hard money rehabs and long-term investment properties.
About the Author
- Fix and Flip - May 23, 2024
- Single-Family Residence - May 23, 2024
- Single-Family Residence - May 21, 2024
Stay in the Loop
Subscribe to our newsletter