Have you been considering investing in the Memphis, Tennessee real estate market? Keep reading to learn why you should do it!

Investing in the Tennessee real estate market can be an incredibly profitable venture. After all, rental properties, both residential and commercial, allow investors to earn a steady passive income. They also allow investors to grow their wealth and equity in the long term, thanks to property appreciation. 

Location is key when making a real estate investment. You want to make sure you invest in an area with a solid economy, growing job market, high quality of life, plenty of amenities and local attractions, and a healthy rental market. The good news is that Memphis has all of these characteristics!

If you’re still on the fence about buying an investment property in Memphis, you’ve come to the right place! In this guide, the experts at Specialized Property Management Memphis will go over the major factors that make this area ripe for high-ROI real estate investments. Let’s dive in!

Why Invest in Rental Properties in Memphis, Tennessee

As the seat of Shelby County, Memphis is the second-most populous city in Tennessee, only behind Nashville. With a low cost of living, plenty of local attractions, and a high quality of life, it’s no wonder why this city is so popular among renters. Plus, Memphis is widely sought after by real estate investors. Keep reading to learn why!

1. Strong Local Economy

One factor that makes Memphis a great place for real estate investments is its strong, stable economy. Due to its prime location near the Mississippi River and its closeness to five major freight railroads and two Interstate Highways, Memphis has become a major hub in the transportation and shipping industry. 

Moreover, the Memphis International Airport is the busiest cargo airport in the world. Because of this, Memphis is home to the headquarters of major companies such as Nike, International Paper, FedEx, and Autozone. Additionally, plenty of Amazon distribution centers have been built in the area over the years.

The strength of the Memphis economy creates a favorable climate for real estate investments. After all, a strong local economy creates job opportunities, attracts businesses, and increases consumer spending, leading to higher occupancy rates and rental income for investors. Additionally, a thriving economy often results in significant property appreciation, which allows investors to gain value from their real estate holdings over time.

2. Thriving Tourism

Tourism plays a key role in Memphis’ strong local economy, and the city attracts millions of visitors every year thanks to all the things there are to do here. Some of the main points of interest in Memphis include museums, fine art galleries, and parks, as well as Graceland, the former home of Elvis Presley, the Beale Street entertainment district, and a variety of sporting events help through the year.

3. Affordable Real Estate 

Despite its booming economy, you can find great property deals in the Memphis real estate market. According to Zillow, the median price of homes in Memphis is well below the national average. Thanks to the local market’s affordable property prices, you can get more for your money in Memphis than in other comparable areas. 

4. Landlord-Friendly Laws

The rental laws in Tennessee generally tend to be landlord-friendly. When it comes to laws regulating what you can do as a property owner, you’ll have to face less pressure than other investors in other states. After all, there is no state-imposed maximum limit on how much you can charge for rent or how much you can raise rental rates. 

As long as you understand and abide by the Tennessee landlord-tenant laws, you can rest assured that your Memphis rental will be safe!

5. Booming Real Estate Market

The real estate market in Memphis is booming, with property prices appreciating significantly in recent years. In 2023, the value of homes in Memphis had grown over 22% in comparison to the previous year. 

According to Doorloop, home values in this city have increased by about 93% in the past five years and are expected to increase even more as time goes on. So, you can rest assured that your investment in the Memphis real estate market will pay off! 

6. Good Local Education

Rental properties near schools are always a great investment. Luckily, Memphis has a great local school system. The Memphis-Shelby County School System operates 222 elementary, middle, and high schools. There are also plenty of top-rated private schools in the city. 

Memphis is also home to many colleges and universities, including The University of Memphis, Rhodes College, Christian Brothers University, LeMoyne-Owen College, Visible Music College, and Baptist Health Sciences University.

7. Plenty of Local Attractions

Investing in an area with plenty of things to do is key not only to attracting but also to retaining tenants for the long term. Luckily, the city of Memphis has many sights, attractions, and activities that not only attract thousands of tourists but also improve the residents’ quality of life. Here are just a few of the many things you can do in Memphis:

• Enjoy a day out at any of the city’s many parks, including W.C. Handy Park, Tom Lee Park, Audubon Park, Overton Park, the Old Forest Arboretum, the Lichterman Nature Center, the Memphis Botanic Garden, and Jesse H. Turner Park.
• Learn about the city’s musical heritage by walking down Beale Street.
• Visit Graceland, the home of the late Elvis Presley.
• Visit the Memphis Zoo.

• Visit Sun Studio, a former recording studio turned museum.
• Enjoy a performance of the Ballet Memphis or the Opera Memphis at Orpheum Theatre.
• Enjoy a concert at Mud Island Amphitheatre.
• Shop or enjoy the views at Memphis Pyramid.
• Visit any of the many museums in the city, including the National Civil Rights Museum, Memphis Brooks Museum of Art, Dixon Gallery and Gardens, and the Pink Palace Museum and Planetarium.

The Bottom Line: Invest in Memphis!

Real estate in Memphis is a great opportunity for real estate investors. The city has a strong local economy, thriving tourism, good education, and plenty of attractions, all of which contribute to a healthy rental market. Moreover, the affordable home prices and landlord-friendly laws ensure that you’ll get a great return on your investment!

If this is your first time investing in real estate, hiring professional help may be in your best interests. Contact Specialized Property Management Memphis to learn how we can help you make a smart investment and avoid common pitfalls.