That is why I suggest, expanding your search to include cities that are NOT your own. While, being a landlord in your own city may make it easier for you to be "hands on," is that really what you want? Personally, I am in favor of using a management company. That being said, the property does NOT need to be in the city I live.
So, what are you looking for in choosing a city to buy rental property?
- Find a city with a low purchase price and a high rental price.
4. Research foreclosure rates.
By doing so, you might get an idea how the city is bouncing back from the recession. You don't want to invest in a situation where there are blocks upon blocks filled with empty, vandalized houses and one or two houses with people living in them. That is a recipe for disaster. You may be able to get this data from state or local bureaus in statistical form, but I also recommend looking for local news articles to get "the real story" about what's going on in that realm.
5. Research rental vacancy rates vs. occupancy rates.
Ideally, you want to know if places in this city sit unoccupied for long periods of time, or if a ton of people are constantly looking for rentals. Real estate companies and news articles are sometimes good sources for this information.
Once you've done this sort of research, I recommend setting some automatic alerts on your favorite real estate search sites so that you can keep an eye on the market in your chosen location while you make your plans to move in on it!