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Savannah Market Spotlight for Long-Term Rentals and Short-Term Rentals

Tybee Island Light House

Welcome to our market spotlight series where we’ll do a deep-dive on some of our favorite markets for long-term rentals and short-term rental investments. Today, we’re focusing on Savannah, GA — a city known for its rich history (founded in 1733 in case you were wondering!), beautiful scenery, and vibrant community. Let’s explore what makes Savannah an attractive market for both long-term and short-term rentals.

 

[Disclaimer: We are not accountants, lawyers, or financial advisors, so please consult your own team of professionals about the topics covered in this article.]

 

Brief Overview:

Savannah, GA has many of the characteristics of an attractive rental market. It has rapid population growth. It’s affordable. It is economically resilient. With that said, it’s not as popular of a market choice among the students of our real estate courses, compared to other markets. Given Savannah’s favorable market characteristics, this probably has more to do with the market flying under the radar rather than it being a poor choice. Maybe that’s about to change with this market spotlight!

Forsyth Park Fountain

What Makes Savannah a Great Market for Long-Term Rentals?

  • The city’s population is growing at a rate of 1.5% annually, which is nearly four times the national average.
  • The average home price is over $100,000 less than the national average
  • Cost of living is 3% below the national average – the affordability makes it easier for renters to absorb rent increases.
  • Rents have increased by about 23% year-over-year over the last three years.
  • Savannah’s economy is driven by a number of diverse industries: manufacturing, healthcare, logistics/distribution, military and film. The manufacturing industry got a huge boost recently with Hyundai building a $7.6 billion electric vehicle and battery plant.
  • Savannah is economically resilient – during past recessions, the City experienced relatively minimal economic impact.

What Makes Savannah a Great Market for Short-Term Rentals?

  • Savannah is a popular tourist destination due to its historic charm and year-round activities – the City hosted 17 million visitors in 2022. It is consistently ranked in the top 5 best Cities by Travel+Leisure Magazine.
  • The City is a hot spot for film production, which brings many temporary visitors driving considerable short-term rental demand.
  • The market scores well in short-term rental metrics such as investability, rental demand, revenue growth, and seasonality .
  • Savannah has established regulations for short-term rentals, leading to a stable operating environment, preventing market oversaturation and ensuring sustained demand.

What Do Our Investor Agents Say About the Savannah Market?

Our investor agents are bullish on Savannah for both long-term and short-term rental investments. They see Savannah as a “hidden gem” — relatively under-recognized by investors. While it might be challenging to find cashflowing properties in most major markets across the Country, our agents tell us that they are consistently finding good opportunities.
Rather than just taking our word for it, we asked our agents to provide an example short-term rental and long-term rental so you can judge for yourself!

The Merrit at White Marsh

Example Short-Term Rental: 1520 Randee Drive, Savannah, GA 31406

This is a recently renovated 3-bedroom, 1 bathroom single family home that the buyer plans to turn into a short-term rental. According to the analysis by one of our investor agents, this property is expected to have a cash-on-cash return of 20%. This is based on a purchase price of $265,000, monthly income of about $5,000 and 20% for property management. The cash-on-cash return would be even higher if you were to self-manage this property.  Some of the features that make this an attractive short-term rental include: affordable purchase price, ranch-style property (the entire living space on a single level) making it ADA friendly, great location in the heart of Savannah, large backyard with a potential to force appreciation by adding a pool or other amenities in the backyard.

Savannah Brick Ranch Before Renovations

Example Long-Term Rental: 29 E 67th St. Savannah, GA 31405

This is a 9-unit multifamily property located in midtown Savannah. According to the analysis by one of our investor agents, this property is expected to have a cash-on-cash return of 8% at baseline, without any improvements. With smart upgrades, the units could rent for even more, boosting the cash-on-cash return above 10%. What’s even more exciting about this property is the location near a couple of hospitals, so there’s the potential to furnish the units and rent them to medical professionals as a mid-term rental. This should boost returns even higher, further driving up the cash-on-cash returns.

9-unit multifamily property

References: 

Do you want to learn how to creatively fund your real estate portfolio and achieve financial freedom? Join the conversation! Follow our Semi-Retired MD  Facebook page and join our Doctors or Professionals  group!

Semi-Retired M.D. and its owners, presenters, and employees are not in the business of providing personal, financial, tax, legal or investment advice and specifically disclaims any liability, loss or risk, which is incurred as a consequence, either directly or indirectly, by the use of any of the information contained in this blog. Semi-Retired M.D., its website, this blog and any online tools, if any, do NOT provide ANY legal, accounting, securities, investment, tax or other professional services advice and are not intended to be a substitute for meeting with professional advisors. If legal advice or other expert assistance is required, the services of competent, licensed and certified professionals should be sought. In addition, Semi-Retired M.D. does not endorse ANY specific investments, investment strategies, advisors, or financial service firms.

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Hi, we’re Kenji and Leti

we provide coaching and mentorship for doctors and high-income earners

Several years ago, we were newlyweds working as full-time hospitalists. On paper, it looked like we had everything: the prestigious careers, the happy marriage, the luxurious rental home, the cars, etc.

But in reality? Despite having worked for several years, we had very little savings. Despite our high income, we had very little freedom in terms of time or money.

One thing was clear: we had to do something.

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