Major cities like New York are seeing surging, sky-high rental prices.
But the New York metro area property market isn’t greater for investors who want to buy a place and rent it out for income.
A new report by RealtyTrac ranked US housing markets by gross rental yield, which is “the average fair market rent of three-bedroom homes in each county, annualized, and divided by the median sales price of residential properties in the third quarter.”
Among America’s big metro areas, New York came in last place. The gross rental yield averaged just 2.40% in Q3.
By comparison, smaller markets — like Rocky Mount, North Carolina — offer gross rental yields up to 41.57%. In these markets, investors could earn huge amounts of income on their investments.
It’s important to note that in this report the New York metro area encompasses New York City, Northern New Jersey, Long Island, and Pennsylvania — not only Manhattan.
Plus, this data looks at the yield rates, and not the exact dollar-value of return. While the New York metro area has the lowest annual return rate, the dollar-value of this return may still be incredibly high since you have to access to much more volume.