According to the Kansas City Star, residents in the city’s metropolitan area are increasingly choosing to rent, rather than own homes.

Rents have risen and construction of new rental units is up, the news source reports, to meet the desires of a population who are largely renters by choice. One renter noted it made no sense to buy since he was uncertain how many years he would stay in the city.

One area brokerage manager stated that the long-term commitment a mortgage may require is a major factor, also citing efforts by rental managers and owners to offer higher-quality properties with more amenities, better appliances and furnishings, or other perks.

Another expert told the source that the current single-family housing market has caused people to rethink homeownership, and many have decided they do not want to pursue it. While he said the housing market will likely recover in time, this attitude shift may be an opportunity for investors willing to rent a home to give residents the best of both worlds, allowing them to live in a single-family property without being tied to it long-term.

According to GlobeSt.com, demand for rental housing in Phoenix is expected to level off this year after a moderate increase during 2011, though investment activity is expected to remain strong.

Such an increase in demand would represent a continuation of the trend that marked 2011, in which demand was high enough for rents to increase sharply. Net effective rents rose 12 percent overall since 2009, one expert told the source.

The demand for rental housing is high enough that construction of several new apartment units are planned, indicating there is likely an opportunity for investors to purchase profitable rentals in the area. Rental property services are available for those who wish to own a property without operating it.

According to the source, Phoenix has been the target of significant investment recently because of the market conditions. One aspect of the market that has improved recently is the number of real estate-owned properties in the metro area, which decreased in 2011.

Some investors are reportedly pursuing value-add deals in the area to better appeal to prospective tenants. Colliers International executive Brad Cooke told the source this year would see a shift from REOs to traditional sellers.

Multi-Housing News reports that Long Island City has attracted enough residents in the past six or seven months to decrease the area apartment vacancy rate from 3.5 to 2 percent, according to a report from brokerage and marketing firm Modern Spaces.

Many of the new residents are first-timers, according to the report. Modern Spaces president Eric Benaim told the source that residents weer likely drawn by the variety of cultural attractions and restaurants, noting that the neighborhood hosts many galleries and museums.

The report suggests that the location is also good for many commuters, suggesting short travel times to get to work from the area are an appealing characteristic for the neighborhood’s new renters.

Additional rental properties are planned to open in the near future, while a number of businesses have opened in recent years to meet residents’ needs. Similarly commuter-friendly areas may be strong investment opportunities, especially with the help of property management companies in operating a rental residence.

Overall, the report indicates 2011 was a good year for the area, partly due to the rising rents in other parts of the city.

photo credit: roarofthefour

You’re thinking about a move but don’t know whether to sell your current property or to rent it. It’s a difficult decision for some as the thought of added income every month may be tempting but the idea of having to deal with tenants may be daunting.

Before you decide to sell or rent consider whether you’ll be able to manage the property or if you’ll have to hire a property management company. If you’re going to do it yourself you’ll have to be ready to deal with the headaches that could ensue but you’ll save a bit of money. If you’re going to hire a property management company you will be shelling out a bit of cash to pay for their services, but you wont have to deal with the routine issues that arise in a rental property.

In addition, you’ll have to look at your income or potential income from the property. Will you be creating positive income through your rental? Even if the rent pays for your mortgage you might not be getting a positive income as you’ll have repair and maintenance expenses. You’ll also want to consider vacant times when the current tenant is gone and how long you will have to cover the entire mortgage while you search for new tenants.

When done correctly, property ownership can be a very lucrative deal, but you should really think about this commitment before you jump at the chance as, for some, be more trouble than its worth.

Before you figure your depreciation you need to meet two criteria; you need to own the property, the property must be for business and income generating activities, and the property must have a useful lifespan of more than one year. If you meet all of these criteria you qualify for tax benefits on the deprecation of that property. For the record, depreciation is an income tax deduction that lets you recover the costs of wear and tear, and deterioration.

Your depreciation begins the moment you place property you own into business use. This applies to rental units as well as to home office and equipment. Remember that if you are planning on selling the property within the same year as you purchased it, you do not qualify for any depreciation benefits.

To figure your depreciation use the IRS’s Modified Accelerated Cost Recovery System, which can be found in publication 946 while Form 4562 is what you’ll need to file with your taxes.

If you have trouble figuring out your depreciation, contact a professional. It’s a valuable enough tax deduction that it’s well worth your time and effort to get it right.