Best Growth Markets in Residential Real Estate in 2017
Successful real estate investing depends on a few components and of which the location/market is the topmost, otherwise known as growth markets.
The right place to invest your money
First, choosing the right real estate growth markets for your investment properties includes a few considerations. However many considerations go past the simple property and neighborhood selection. Buying investment properties for a passive cash flow income is considered a more solid and predictable approach. While at the same time, investing for appreciation has a tendency to be more speculative in nature. Because where you are at in your retirement savings path and how your retirement plan fits into your wealth portfolio, all make a difference. In addition, things like high-risk tolerance and measure of accessible capital will all play a role in your path forward.
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A few urban areas provide preferable options over others in light of a few variables. For instance, the relative cost of housing to average income, accessibility of steady employment, and statistic patterns, each influence the marketability of the area. Additionally, other factors such as the quality of schools, the neighborhood well being, access to parks, shopping and entertainment all play a part. And, could possibly be the most important factors.
Finally, you have likely heard a lot about seasoned investors buying a home, renovating it, and reselling at a much higher price to another investor. That investor then holds the property for few years by renting it out through a property management company. Furthermore, buy and hold is the true core of successful real estate investing. Historically there has been very little real price appreciation in housing. Essentially, rentals generate a steady monthly paycheck for you, like a classic dividend-paying utility stock. Essentially, any price appreciation of your turnkey rental property is a bonus for you. Where should you go for the growth markets?
- job growth
- population growth
- the condition of the local housing market (inventory, price trends, etc.)
Most of all, growth markets must make sense from an economic and investment perspective and not based on fads and investor demand.
Growth Markets to Consider in the Southeast
- Atlanta, Georgia: Ranked the #1 rental market in the US. Properties start at $70,000 with 3-year appreciation forecast of 9.3%. Up to $750/mo cash flow.
- Birmingham, Alabama: It was considered to be the 8th Hottest Housing Market for 2014 on CNN/Money. It is ranked #2 for lowest property taxes. It has a 3-Year appreciation forecast of 10.6%.
- Charlotte, North Carolina: With renting constantly on the rise, the cost of living is below the national average. It has a 3-year appreciation forecast of 5.4%.
- Fayetteville, Arkansas: It is the fastest growing city in the state with an unemployment rate of only 4.5%. Cost of living 10% lower the U.S. average. Beautifully renovated properties with stable rental income.
- Jacksonville, Florida: Experts predict 50% population growth in 10 Years. Our properties start at $45,000 with up to $600/mo cash-flow (Net Operating Income). They have a 3-Year appreciation forecast of 10.4%.
- Memphis, Tennessee: Affordable housing in the non-bubble market. Fully rehabbed properties with great cash flow. 43% of Memphis rents vs. 33% U.S. Cost of living ~10% below U.S. average. Our properties are 10% – 30% below fair market value with a 3-Year appreciation forecast of 9.4%.
- Montgomery, Alabama: It is ranked #8 Hottest Housing Market in the U.S. (CNN Money 2014). There is a strong demand for rental housing. Cost of living is 5% lower than the U.S. average. Low unemployment rate.
- Palm Bay, Florida: Turnkey new-construction homes. America’s 15th Fastest Growing City (Forbes 2014). Cost of living 5.7% is below the national average and the investment properties have a very strong appreciation potential.
- Tampa, Florida: 5th hottest real estate market for 2017. Moderate price increases expected in 2017. Cost of living 23% below U.S. average. The unemployment rate of only 4.5%.
Growth Markets to Consider in the Midwest
- Chicago, Illinois: Third Largest Metropolitan Area in the U.S and over 50% of the population rents. We have fully renovated single family homes for both new and seasoned investors.
- Indianapolis, Indiana: Ranked the #1 most affordable place to own real estate. (Forbes Magazine) Highest Job Growth in the Midwest. Properties are up to 10% below market with a 3-Year appreciation forecast of 10.3%.
- Kansas City, Missouri: Turnkey rental properties starting at only $45,000 with cash flow of up to $650/mo. Cost of living is 15.3% below the U.S. average. Properties up to 10% below market with a 3- Year appreciation forecast of 9.0%.
- Little Rock, Arkansas: #1 Place to Live in the United States (Kiplinger July 2013). Newly refurbished properties w/ tenants starting at $79,000. Median home cost is $114,100. Cost of living is 10.9% lower than the US average. Very low unemployment at ~4%. 10-year projected job growth of 32%.
Growth Markets to Consider in the Southwest
- Dallas, Texas: One of the leaders in the U.S. for employment and population growth which is expected to double in the next 10-15 years. 52.9% of Dallas rents vs. 33% nationally. Newly remodeled REOs (2004 or newer). Properties 5% – 15% below market value and have a 3-Year appreciation forecast of 11.4%.
- Houston, Texas: 4th largest city in the US and #1 Market in the US for Job Creation. Our rental properties are 5%-20% below current fair market value. 12 Month ‘No Vacancy’ Guarantee. $75,000 average purchase price and a 3-Year appreciation forecast of 10.5%.
- Salt Lake City, Utah: 5th fastest growing city in U.S. (Forbes). Low unemployment (3.3% in Feb 2015) and a 3-year appreciation forecast of 16.0%.
- San Antonio, Texas: Ranked #2 recession-proof city (Forbes). We have single-family, duplexes, fourplexes with a 3-Year appreciation forecast of 9.1%. The unemployment rate is below 4%.
At Norada Real Estate Investments, we will help you in finding the best investment properties which have been fully renovated with vetted tenants in place so that you do not have to worry about anything. We offer investors fully refurbished as well as new construction residential properties ranging from single-family homes on up to four-plex multi-units. Our investment properties make sense the day you buy them.
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Before you leave:Don't forget to check out our free rental property calculator. This will be a valuable tool in your arsenal as you analyze your existing or potential rental properties.
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