When it comes to investing in property, certain cities in the United States get more attention than others, if only because those cities are commonly associated with growth and booming real estate markets. Cities like Orlando and Atlanta immediately come to mind. When it comes to some of America’s bigger cities, it may be too late. Chicago, New York, and Los Angeles are full of expensive homes and properties, so unless you already own something there, or have the capital to buy property, the price to enter the market may be too high to bear.
Here, it is worth noting that where to buy really depends on the buyer– if you have lots of capital and are looking to buy property to flip for a much greater price, the fastest-growing markets may be what you need. If, however, you are looking for steady, but long-term profitability, younger real estate markets would probably work better for you.
If the second approach seems more up your alley, there are so many cities in the United States which have both more modest entry prices (if you act fast) that are also growing at rates that point to value increases in the years to come, making them both less intimidating and more suitable for those thinking of long-term profitability.
Below, we have listed five cities anyone hoping to get involved in real estate property investing should keep their eyes on. As with any investment, exercise some caution, but do not delay– these cities are catching the attention of buyers and investors around the world at such an impressive rate, you may miss your chance.
1. Raleigh, North Carolina
About 1.5 million people currently live in the Raleigh area, including downtown and suburbs, with about half of those residents being renters. Rent is increasing at an average rate of approximately15% percent a year, which is promising for investors who wish to buy rental property and use rent as income. In a few years, not only will you have made money over time with the rent you receive from tenants, but the value of the property itself will have also likely increased, meaning you could sell it for much more than what you paid initially. Currently, property prices are increasing at a rate of approximately 18% year-over-year.
2. Lakeland, Florida
Nestled between Tampa and Orlando, Lakeland, Florida is one of the state’s often overlooked cities when it comes to real estate investing. Lakeland is a family town– it does not quite have the reputation of being a hoppin destination for night-life or sports fans. However, because of its proximity to other major cities, Lakeland is highly desirable for those wishing for the peace and quiet of the suburbs, the charm of a quaint downtown, without totally sacrificing the benefits of bustling urban areas. Home values are increasing steadily at a rate of approximately 5% per year, making Lakeland a great place to watch for those who want to buy property and sit on it for a few years, and sell it for a profit.
3. Spokane, Washington
If you are able to get your foot in the door in this hot housing market, you will likely be able to make a considerable profit on your property. Residential property in particular in Spokane is in such high-demand that sellers are commanding are widely regarded as having some of the best selling leverage in the country. In fact, the average selling price for homes in Spokane increased by over 23% between 2021 and 2022. For investors, flipping or converting to rental property will sell or fill fast. Spokane rental property managers Utopia Management have been keeping their investors properties full with top rental rates.
4. Austin, Texas
Austin, Texas has been a hip destination for folks of all walks of life for decades, but it has still managed to stay somewhat of a hidden gem. Unlike Houston and Dallas, Austin has a local quality about it that gives people the impression of exclusivity, while remaining inviting and alluring to new families, recent college graduates, and businesspeople alike.
People want to live in Austin. Statistics show that less than 3% of rental dwellings are unoccupied at any given moment in Texas– which is the lowest it’s been in years. Because of the desirability, rent prices are increasing fast. Ranked highly on the U.S. fastest-growing cities, anyone who is interested in buying property in Austin should not hesitate.
5. Birmingham, Alabama
Like some of the others mentioned above, Birmingham, Alabama is an excellent city to look toward for those wishing to invest in rental property, or buy and later sell residential property. Rents for 3-bedroom apartments in the state’s second most population dense city have increased at a rate of approximately 14% in the past year. Further, according to Zillow, average home value has increased by over 23% in the past year.