Richmond, Virginia has become an increasingly attractive destination for real estate investors in recent years. With its diversifying economy, revitalized downtown, and relative affordability compared to nearby DC, Richmond offers many benefits for those looking to invest in property. In this article, we will explore 5 key reasons why Richmond can be a smart choice for real estate investment.
Richmond’s economy is expanding with new industries
Over the past decade, Richmond has successfully diversified its economy beyond just government and tobacco. New sectors like financial services, cybersecurity, biosciences, and advanced manufacturing have taken root in the region. Major corporations including Capital One, Altria, Dominion Energy, and Amazon have large footprints in Richmond. The city’s economic growth and relatively low cost of living have attracted young professionals, bringing a vibrancy to the urban core.
Richmond’s real estate market has room to grow
While parts of Virginia like Northern Virginia and Hampton Roads saw rapid price appreciation post-recession, Richmond’s market remained more affordable. This creates an opportunity for investors to get into a market that still has room to grow. Richmond home prices are rising faster than the national average but remain about 25% below the statewide median price point in Virginia.
Richmond benefits from its location
Situated along I-95, Richmond enjoys convenient access to major East Coast metropolitan areas. It’s just 1.5 hours from Washington D.C., 2.5 hours from Raleigh, and within a day’s drive of New York City, Philadelphia, and Atlanta among others. For investors, Richmond provides relatively affordable housing stock with easy access to major job centers.
Richmond real estate brings strong yields
Investment property in Richmond produces some of the best rental yields in Virginia. While the nationwide average gross rental yield is about 9%, Richmond properties see yields between 10-12% on average, higher than most other parts of the state. Reasonable property prices combined with high demand from tenants translate to solid returns.
Richmond’s renaissance attracts new residents
Downtown Richmond has undergone a major revitalization in recent years thanks to investments in the arts, restaurant scene, parks system, and historic canal walk. Neighborhoods like Scotts Addition and the Fan have become trendy areas, attracting Millenials and empty nesters. With its history, culture, and amenities, Richmond offers an appealing lifestyle that continues to attract new residents.
In summary, Richmond presents investors an opportunity to buy into an up-and-coming real estate market before prices escalate too far. Factors like a strengthening economy, affordability, location, strong rental yields, and urban renaissance make Richmond a smart choice for those looking to invest in property.