Real Estate Investment in Rural America
Many real estate investors are naturally attracted to properties in urban and suburban areas. They don’t even consider investing in small towns or rural areas. However, in many parts of America, “the country” is no more than an hour away from an urban center. If you were to jump in the car and take an old-fashioned Sunday drive, you will quickly see the concrete recede in favor of green and open spaces.
The Pros and Cons of Rural Real Estate Investment
As you explore rural America, you will discover many benefits of investing in small towns and pastoral areas. Firstly, the properties tend to be a lot less expensive. This is one of the most attractive features, since you can buy more with less and this can create better cash-flow and a greater return. Moreover, you will find far less competition when bidding at a sheriff sale or a judicial auction. You will also discover fewer regulations, zoning hassles, or required building permits. Finally, country living is very attractive.
Of course, rural real estate is not all rainbows and unicorns. These areas can be slower and tougher. It can take some time to find a tenant for your rental property because these locations are low population areas. Additionally, fewer employment opportunities can translate into fewer qualified applicants. If the local community only relies on farming or one industry, things can spiral downward quickly. Plus, the lack of regulation means you don’t know what is going to be built or opened next to your property. And, public water and sewage are often replaced with wells and septic tanks.
Nevertheless, rural America can be a great place to make an investment. All the same, just as you would with other real estate, you must take the time to educate yourself and understand the market. You don’t want to start thinking the grass is greener just because you can get better prices.
Thinking About Rural Real Estate Investment?
Even the most seasoned and experienced real estate investor may make a mistake with their first rural investment property. Sometimes, there are “hidden risks” that those who are more urbanized may not know to consider. Frankly, these are concerns that someone would not even think about when it comes to a city or suburban investment property. Why would you even think about a local livestock disease issue? Or, how about potential drought conditions creating a fire danger?
Doing your market research and due diligence is important. Issues that are unique to rural areas and communities are not likely to show up on a disclosure. Why would they? These are fact of life issues for people living in rural America. Still, you can likely find out all the things that you need to know by contacting the state and local governments about rural areas.
Regardless, none of these concerns should have you shying away from rural America. If you take the time to evaluate the risks, there are many rewards for investing in rural real estate. These investment properties are ideal for investors with a buy and hold strategy, which can make rural real estate ultimately more profitable than other similar investments. This is especially true in rural communities experiencing economic development.
A Final Thought
While rural and small town investment properties are a bit different compared to more densely populated areas, they also come with some unique advantages. They are the kind of benefits that an investor should not ignore,. The scale of rural America offers everything from ranches and farmhouses to lakeside houses and mountain cottages. While today’s article is only a brief introduction, it should provide you with a general idea of what owning a rural property is like and an incentive for investors to do more research.
For help finding a real estate investment property, acreage or home for your family in Ohio, West Virginia and Western Pennsylvania, please contact us. Ask us about traditional listings and real estate auctions.
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