The average size for a Anaheim, CA apartment is 845 square feet, but this number varies greatly depending on apartment type. Studio apartments are the smallest and most affordable, 1-bedroom apartments are closer to the average, while 2-bedroom apartments and 3-bedroom apartments offer a more generous square footage.
Regarded as one of the top housing markets on the beautiful West Coast, Anaheim's real estate market is constantly developing. Settled right outside of Los Angeles and famous for its theme parks, Anaheim is the 10th most populated city in California, hosting over 351,000 residents. However, the population growth rate was 0.24% in 2017, lower than the national average of 0.7%.
When analyzing the local economy, we've noticed that Anaheim boasts some strong economic indicators. The largest industries in the city are the retail trade, manufacturing, healthcare, and business services. Also, a substantial part of the city's economy is based on tourism thanks to the world famous Disneyland, which attracts an influx of workers and visitors to the area. Thus, real estate investors can consider investing in both single-family homes and vacation rental properties.
Thanks to its flourishing economy sectors and steady population number, Anaheim's real estate market facilitates a solid rental property demand.
Investment Considerations for Anaheim Real Estate
There are a number of factors to consider, including:
High rental demand - With a strong economy, the rental demand in Anaheim is very high now. Renters make up more than half (55.4%) of the city's population and the vacancy rate is 4.5%. The rent prices have also increased by 8.64% since 2017. For traditional rental properties, the rental income is $2,763, and the cash on cash return and cap rate are 2.22%. For short-term vacation rental properties, the rental income is $4,121, and the cash on cash return and cap rate are 4.84%. Therefore, Anaheim shows a favorable future for real estate investors in single-family homes and vacation rental properties.
Growing job market - The robust job growth along with the low unemployment rate (3% in 2018) make the city's economy one of the strongest in the United States. Disneyland Park and Disney California Adventure theme parks are the largest employers in the area. Besides that, companies like Carl's Jr, Yogurtland, and Genisco Technology have their headquarters in Anaheim. The job market is predicted to increase by 38.9% over the next decade, which is higher than the national 38% average. Therefore, there are plenty of employed or job-seeking renters and buyers that real estate investors in Anaheim can find for their properties.
High appreciation rate - Over the past decade, the city's housing market cumulative appreciation rate has been about 14%, which places Anaheim in the top 30% nationwide. This shows long-term benefits for real estate investors in Anaheim that want to buy and hold properties until their values increase.
Popular tourist destination - Anaheim's economy is strongly supported by tourism, as the city hosts two renowned theme parks: Disneyland and Disney California Adventure. In 2017, the city had 24.2 million tourists, which was a record-breaker for the fifth year in a row. This makes Anaheim's real estate market a great one to invest in short-term vacation rental properties.
What are the Best Neighborhoods to Invest in Anaheim
Rental units are always on demand all over Anaheim. However, the neighborhoods that are experiencing the fastest growth, as well as best cap rate and cash on cash return are Southwest Anaheim (median property price: $568,000 cap rate & CoC return: 2.03%, vacation rental cap rate & CoC return: 7.73%), Anaheim Resort (median property price: $625,000 cap rate & CoC return: 2.69%, vacation rental cap rate & CoC return: 3.46%), Southeast Anaheim (median property price: $612,450 cap rate & CoC return: 2.14%, vacation rental cap rate & CoC return: 4.71%), The Colony (median property price: $569,000 cap rate & CoC return: 1.61%, vacation rental cap rate & CoC return: 3.97%), and West Anaheim (median property price: $549,000 cap rate & CoC return: 2.62%, vacation rental cap rate & CoC return: 4.15%).
Therefore, these areas are ideal for real estate investors who want to purchase properties that will generate a good return on investment.
Anaheim is a smart call for real estate investors looking for appreciation, growing their wealth, positive cash flow likelihood, together with good traditional and vacation rental income for properties. With a strong economy and a continuously booming tourism sector, Anaheim is a solid option when it comes to opportunities for real estate investing.
The average rent for an apartment in Anaheim is $1,787, a 3% increase compared to the previous year, when the average rent was $1,732.
Reasons To Invest
- High Rental Demand
- Growing Job Market
- High Appreciation Rate
- Popular Tourist Destination
- Large Tenant Base
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