Check out http://www.azdor.gov/Business/TransactionPrivilegeTax.aspx . For rentals, it is only the city tax that applies. Each city has it own tax rate. Some city collect their own tax and others use the state to collect the tax. The tax is usually passed on to the tenant and is on top of the rent. Your property manager usually handles all the licensing and tax collection. You may be required to get a business license in addition to the property manager for some cities (such as Surprise).

I realized there is an additional tax in Phoenix
can anyone help me with the taxation on rent income in phoenix ?

Suggest north part of Phoenix and Scottsdale.

Kailash Bhatt
Prestige Realty
602-620-1683

Yossi,
It would appear that you have already received valuable input regarding the Phoenix market and it's desirability for investment properties.
The only thing I would add is that Phoenix has been a growth market for years because of certain "commodities" that still remain through this market/economic correction: Sunshine (lack of inclement weather), land and opportunity. These remain and will continue to be some of the contributing factors to the rebound of the Valley of the Sun.

Hi Yossi,

It is still possible to purchase in Phoenix in the price range you quote, but you need to be aware that the market is extremely active for anything under about $200,000. Prices are ticking slightly upwards and many properties sell very quickly, with multiple bids, and the buyer needs to be prepared to offer above list price. Yes, you read that correctly. Above list price. Having said that, the key to successfully purchasing in this price range is (1) to be a cash buyer, (2) receive accurate and fast notification of new listings, and (3) be prepared to submit an offer very quickly.

Another thing to consider is the area in which you wish to purchase. As a Realtor, I cannot, by law, advise you on "good" or "bad" neighborhoods, so it is important you do this homework yourself. Although there are people buying property sight-unseen, this is not a course of action I would ever recommend. Come out here, spend a day with me, and I will show you where the good deals are, so when listings come up in the future, you'll be assured it is the type of place you wish to invest.

I am not familiar with the Atlanta market so my comments apply to Phoenix only. Strange that no Atlanta agents have submitted answers yet!

Best of luck, and please contact me if I can assist you further.

Ann Griffin, Realtor
480-789-9584
ann.griffin@pruaz.com

Yossi,

In either market the Realtors in both markets are going to tell you their markets are the best to invest in because they want your business. What it comes down to is if it's possible to purchase what you are looking for or not. Prices in the Phoenix Metropolitan area have decreased 50% or more in some area in the last 4 years. There are good deals to be purchased here in the Phoenix market but I am sure there are good deals in Atlanta as well but I don't think their market has seen the declining values like our market. For example, I just purchased a townhouse in Scottsdale in the popular 85254 zip code (2 bed, 2 bath, 2 car garage) for $90,000 (previous owner paid $250,000) and I just rented it for $1,100 per month. That's a 14.7% ROI. Is it possible to find these deal in this market, you bet ya!!

My best advice for you is to go to Realty Times to research the different markets on your own since the realtors in each market will tell you to invest in their market even if its not the best option for you and your investors. Here is the link: http://realtytimes.com/rtmcrtop/home.htm

If you do decide to invest some money in the Phoenix market, then I hope you will call me. Also, check out my web site and about what my company can offer you. http://www.positionrealty.com I hope this help and good luck with your investments!

Sean Heideman, BROKER
Position Realty
Office: 480-213-5251
Fax: 866-232-2256

Hi Yossi,
You are wise to consider Phoenix as one of your top choices in the USA. Recent data for our greater Phoenix area has said - In January Maricopa County established a new record high for the percentage of resale homes that were purchased by investors to become rental properties. This percentage was 30.5% and compares with 27.4% in January 2011, 19.7% in January 2010 and 18.2% in January 2009.

One reason that investors think Phoenix is a great place to invest- I'm looking at price ranges for single family homes across greater Phoenix:
• Below $100,000 supply is down 62% compared with last year while monthly sales pricing is up 7.1% on a $/SF basis. Projections are that prices will be up significantly by year end.
- The change in monthly average sales $/SF between January 2011 and January 2012 for single family detached homes: Phoenix (city itself) is up 11.8%. Outlying cities are up by an even higher percentage.
At this pace, you will achieve some capital gains in your desired time-frame. Rental demand is high.

The Landlord Tenant laws do favor landlords, which is also another draw for investors.

Let me know if I can be of service to you!
Jennifer Ferguson, West USA Realty, 602-284-4747

Yossi Sofer,

As a real estate agent, property manager and investor myself in Phoenix, I can only comment on the Phoenix area as an investor. I moved to Phoenix in 1996 for the same reasons that makes Phoenix an attractive place to live for many. Phoenix has a diverse economy supporting a wide range of employment along with great weather. This attracts people from all over of all age groups.

Phoenix unemployment rate is just about always lower than the national average and has one of the highest growth rates. For long term investing, Phoenix has always been attractive.

Investing for the longer term (5+ yrs), best appreciation will most likely be in newer single family homes. In the under $100K homes that are in newer areas, we are currently seeing cap rates in the 6% to 8% (depending on how much maintenance and vacancy you factor into your calculation).

Phoenix was one of the hardest hit areas in the housing crash as it was one the most popular areas for speculators in the boom. Therefore, we have one of the best opportunities for recovery. Factoring in appreciation, 15% might be optimistic, but possible. No one can predict for sure how fast and how much our housing market is going to recover in the next 5 to 10 years. However, I would wager that Phoenix still has one of the best potentials.

Arizona also has very good landlord and tenant laws. They are fair, but strict. From what I have seen in other states, I would never consider some of them over Arizona just because the the landlord and tenant laws. Not familiar with Atlanta, but something you may want to compare.

The Phoenix market has already started to turn. We saw our second low in August 2011. Prices have been going up steady since then especially in the lower end. It is now common to see multiple cash offers in the first day or two on good homes under $100K with many selling above list price. I have seen over 20 offers with most being cash within 2 days on one house that was listed a market price. It is not too late to get in, but you are not going to find house in good areas in good condition under $70K. Still can get a decent home under $100K, but it is competitive and be prepare to pay more than list price.

My expertise lies in working with cash investors. the msjority of my clients have purchased 4 or more houses from me. Phoenix is an excellent choice. The population growth continues to rise 3% annually. The buiders have been shut down for several years. The excess inventory is almost gone. Our economy is reliant upon construction which should be back in full swing by the end of 2012. Our valley has an excess of 4 ... million in population. The real estate prices are currently accelerating at a fast rate. In the mentioned price range, it is imperative that you act fast. 6 to 8 months from now, when the inventory will be slim and the builders go back to work, the wllling will have jobs and cash will flow abundantly. the rest is self explanatory. My prediction is based on my expertise and experience. I was a liscensed contractor with over 20 years experience prior to becoming a real estate professional. There is still a golden once in a lifetime opportunity in Phoenix for te next 6 to 8 months Jim Ghigo 602-367-8897 GRI / AHWD / E-PRO

Hello, I would say invest in Phoenix, I have 3 houses for sale at this moment for under 60k that would make great rentals in Phoenix. I have direct access to trustee sale and foreclosed properties that come with a drive by, photos, and a clear chain of title. Call me AJ 480-217-2167

Yossi,
Phoenix is attractive and the market has become Seller's practically in the parameter's you are looking for. Worth watching it, and making a decision quickly when you see a project that matches your requirements. You are welcome to go to my site and start a search.