Why Should I Purchase a Rental Property in Chapel Hill, NC
Learn why Chapel Hill, NC is a great place to purchase an investment property and how a local property manager can help you make smart decisions when it comes to setting rent accurately to reduce days on market.
When you are looking for new investment opportunities to scale your rental property portfolio, it is important to understand what type of returns you can expect from that market. Can you expect to receive some cash flow, appreciation, or both? You are looking for deals that work with your investments strategy to get you to your goals.
What are the trends telling you?
- What is feeding the growth in the area?
- What industries and companies are in the city?
- What are the real estate trends?
- Are they seeing appreciation each year?
This data gives you a general overview of the health of the city and the forecasted growth potential. Let’s take a deeper look at Chapel Hill.
About Chapel Hill, NC
Chapel Hill is part of the Triangle area in central North Carolina and home to the University of North Carolina Chapel Hill, one of the oldest public universities in the country. It is conveniently located near RTP (Research Triangle Park) which is the largest research park in the U.S. and houses hundreds of companies. Many of these companies are in the science and technology industry. It is known for its beautiful tree lined streets downtown and blooming azaleas in gardens around the city. Being a college town, it is very walkable/bikeable and has an excellent public transportation system.
- Population: 60,988
- Ranked #2 for “2020 Places with the Best Public Schools in North Carolina”
- Highly educated area with 75% having a 4 year college degree or higher
- More than 25 parks and trails focused on the conservation of trees and nature
- Top rated schools
- Cost of living is less than the national average
Chapel Hill Real Estate
- $410,105 average price of home
- 2.4% appreciation in the past year
- 6.1% appreciation expected in the next year
- 7.9% appreciation over the last 10 years
Chapel Hill offers a mix of older, historic homes and newer master planned communities. Popular neighborhoods in the area include Meadowmont, The Oaks, and Winmore.
Economy and industry
- $65,373 median household income
- 95% employed in white-collar jobs
The city is next to Research Triangle Park which includes large employers such as Cisco, Biogen, GlaxoSmithKline, and Lenovo. The largest employers in Chapel Hill include UNC-CH, UNC Hospitals, and BlueCross/Blue Shield of NC.
Looking at the trends, Chapel Hill continues to offer steady appreciation. In addition to the large companies located in the city, it also benefits economically from nearby RTP.
How to Accurately Set Rent for my Chapel Hill, NC Rental Property
How do you know how to set the proper rent so you can maximize your return while also leasing it quickly?
To start, do a like for like comparable to see what properties are renting for today. Make sure you are looking at the same property type and size as your rental. Compare the current home prices to what they are renting for in the Chapel Hill area. Are you looking for cash flow? Run the numbers to see if that is possible in this market.
Several factors can affect the rent rent as well as the days on market:
- Are you renting in the peak leasing season? You can typically get a higher rent in the prime leasing season than the off season due to demand. It may take longer to find a tenant in the off season, so plan for that vacancy time.
- How is the economy in the city? If the city has taken a downturn economically, you may get less than during a booming economy.
- Is the city growing? Typically rent prices grow with a city. If the city is consistently growing, you could expect your rent price can be increased over time as well.
- Is your home type what people are looking for? If most people are looking for a 2-3 bedroom home and you have a 1 bedroom home, it may take longer to fill the vacancy.
Rental market in Chapel Hill, NC
- $1,409 average rent for a 2-bedroom house
- Single family homes are the most common (43%)
- 47% renter occupied
- 52% owner occupied
Chapel Hill ‘s population is made up of ideal renters. Most of the population are highly educated workers with good paying jobs. More than half the homes are owner occupied, and your home value will benefit from that.
A Chapel Hill, NC property manager can give you more detailed information on the city and the rental market. Mynd offers a FREE rental analysis if you want to know what kind of rent you can expect to receive from your investment property.
Why Should I Hire a Property Management Company in Chapel Hill, NC
What does a Chapel Hill property management company do?
Does it make sense to hire one? Whether you are buying an investment property or looking for management services, your property manager can be a key part of your team. They have valuable knowledge about the market that can help you before purchasing your property.
A good property manager is a valuable resource for information on where to buy and what to charge. When you are running the numbers before a purchase, it helps to have the feedback of someone with extensive knowledge about the rental market.
Day to day operations of a rental property
A property manager will take care of the day to day tasks associated with your property such as:
- Advertising and marketing the property
- Finding a quality tenant
- Handling the leasing process
- Enforcing the lease
- Collecting rent
- Handling an eviction should that become necessary
Laws and Regulations
Each of the operational tasks listed above have laws and regulations you must follow associated with them. For instance, there are things you can’t ask on an application and laws that cover service animals. Mistakes like this can cost you thousands. When you hire a property manager, make sure they are familiar with all the local, state, and federal laws that apply to your rental. Mynd has in-house counsel to ensure our systems and procedures follow the applicable laws. An example of a few laws that would apply to a rental property in Chapel Hill include:
- License Law
- North Carolina’s State Fair Housing Act
- Vacation Rental Act
- North Carolina Homestead Laws
- North Carolina Rental Agreement Laws
Your property manager will take care of maintenance issues when needed. You will no longer have to deal with middle of the night emergency calls. They have access to quality vendors to take care of your property.
Typical maintenance issues in the Chapel Hill area
- Plumbing leaks. Prevention is key to avoid these in older homes.
- Permits to have a pet in the home.
Hire a Chapel Hill Property Manager
Mynd offers property management in Chapel Hill. With our three tier pricing, you can choose the level of service that best fits your needs. Contact us today to learn more.
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