Why You Should Invest in Rental Properties in These 5 Cities

Location is key in real estate investment. From novice to veteran, as an investor the right city is everything. There are also a handful of spots in the state that could produce good returns, consistent appreciation, and create renter demand. Today, I will be going into five such cities: Roseville, Elk Grove, East Sacramento, Natomas and Folsom and what makes them special. But, why are these the best 5 cities to invest in a rental property?

1. Roseville: A Family-Friendly Suburban Haven

Roseville has experienced tremendous growth through the years and for very good reason. This suburban splendor located a mere 30 minutes from Sacramento has an extremely high quality of life, home to the best schools in town as well as bountiful shopping and dining opportunities accompanied by outdoor activities galore. Roseville has a strong economy, based on a good mix of industries, such as healthcare and retail and technology companies alike ensure that the job market in Roseville is stable, attracting families with kids as well as young professionals to the city.

Why it’s great for rentals:

• Family appeal: Because of top-notch schools and safe neighborhoods, families are always looking for long-term rentals in Roseville.
• Low vacancy rates: This is because it is simply such a nice place to live that rental properties tend to go pretty quickly here.
• More people: With the population steadily rising there is still a high demand for housing so it makes good sense to invest now.
  

2. Elk Grove: The Up-and-Coming Suburban Star

Coming in second is another suburban area, Elk Grove. Elk Grove, CA: As the locals in Elk Grove will tell you, it's not all that far from Sacramento AND double dipping as an affordable place to live. Young families, and city professionals alike have come to love the lifestyle River Edge has to offer. Competitive real estate prices in relation to neighboring areas: this is an attractive investment area for investors who are looking at good deals.

Why it’s great for rentals:

• Strong Job Market: Elk Grove has a diverse and growing employment base, particularly in healthcare, education, and the public sector.
• Diverse tenant pool: The rental market attracts a very wide variety of tenants from families, professionals and even students.
• Steady appreciation: the residents of Elk Grove have witnessed property values increase, and this bodes well for investors in search of long-term opportunities.
  

3. East Sacramento: Trendy and Timeless

Whether you’re looking for an urban, walkable lifestyle in desirable East Sacramento (just minutes from downtown), or prefer a more typical suburban community nestled into the foothills like Fair Oaks, Crosswoods is the perfect. Over the years, East Sac has retained its charm with tree-lined streets and historical homes and access to shopping, dining and parks. Its appeal to young professionals, medical students (with its proximity to UC Davis Medical Center), and empty-nesters seeking an urban experience with some serenity.

Why it’s great for rentals:

• High rental demand: The proximity to downtown Sacramento and major medical centers means there’s always a demand for rentals.
• Premium rents: East Sacramento is known for its high-end properties, which can command premium rental rates.
• Charming appeal: People are willing to pay more for the unique, historic charm that East Sacramento offers.
  

4. Natomas: A Hidden Gem with Huge Potential

Natomas is a rapidly developing neighborhood located just north of downtown Sacramento. With easy access to major highways, Sacramento International Airport, and the city center, Natomas is becoming a hotspot for renters who want to be close to the action but still enjoy suburban comforts. This area is undergoing significant growth, with new businesses, schools, and residential developments cropping up regularly.

Why it’s great for rentals:

• Development boom: With plenty of new construction, Natomas is one of the few areas near Sacramento that offers affordable newer homes—a big draw for renters.
• Attractive to a variety of renters: From young professionals commuting to Sacramento to families seeking affordable suburban living, Natomas appeals to a broad range of renters.
• High potential for appreciation: As more people discover Natomas, property values are expected to rise, making it a great time to invest.
  

5. Folsom: Nature, Luxury, and Growth

Folsom is known for its beautiful scenery, outdoor lifestyle, and growing job market, making it one of the most attractive cities for renters in the greater Sacramento area. Located near Folsom Lake, it’s a perfect spot for those who love nature, while its luxury developments and high-end shopping appeal to those with more refined tastes. Folsom’s rapid population growth and proximity to tech companies also make it a prime rental market.

Why it’s great for rentals:

• High-income renters: Folsom’s luxury homes and proximity to high-paying tech jobs attract affluent renters.
• Low vacancy rates: With a desirable lifestyle and limited supply, rentals in Folsom tend to get snatched up quickly.
• Long-term growth: Folsom continues to expand with new developments, meaning increased housing demand in the coming years.

Whether you’re looking for steady appreciation, a strong renter pool, or a mix of urban and suburban appeal, Roseville, Elk Grove, East Sacramento, Natomas, and Folsom offer something for every type of investor. Each of these cities has its own unique advantages, from excellent schools to booming job markets to luxury living, making them some of the best areas to buy rental properties in California.