Top 8 Cities For Real Estate Investing

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In this article, we'll explorer some of the top cities for real estate investors.

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The U.S. housing market has remained high in consumer demand due to record-low mortgage rates and a scarcity of inventory. The U.S. housing industry is now a seller’s market with average price increases approaching historical highs and inventory beginning to decline.  

Without enough houses for sale, the majority of would-be homeowners who can’t afford entry-level housing will be forced to rent single-family homes. As a result, rental demand will begin to rise in 2021. 

Various parts of the world are seeing massive increases in demand, which is causing house prices to inflate at a rapid pace. Because of this, a lot of houses remain unaffordable to prospective buyers. Both of these reasons are causing a number of people to rent a home rather than buy one or to stay in their rental longer than they had originally planned.

Single-family rental homes are a perfect investment choice for buyers. They provide a cost-effective and adaptable solution to satisfy the needs of both families and single individuals. 

The market has a bright outlook for 2021, according to Arbor’s analysis. However, it warns that renters will also face difficulties in collecting rent due to the current pandemic that has harmed the economy. Outward movement from significant cities to suburbs has been boosted by the pandemic, which increased demand for single-family rental homes. Single-family rentals had an annual occupancy rate of 95.3 percent in the third quarter of 2020. 

How To Choose The Best Places To Invest In Real Estate

Real estate investment necessitates extensive analysis. Market timing is also important since certain cities have excellent rental income potential but little inventory. In this case, finding and closing a sale that meets the investment expectations becomes very complicated. As a result, you must act quickly and carefully.

You can be anywhere in the world, but the fundamental rules of the real estate industry remain the same: pick locations for your investment assets that have a high return-on-investment. To get the most out of your real estate purchase, look for properties that have:

    • A low tenant default rate
    • High rental occupancy
  • High rentals relative to your mortgage repayments

Best Places To Invest in Real Estate

  1. Dallas, Texas 
Dallas

Dallas is the first on our list due to its high rental rates and rich availability of rental stock. Being a major urban city, you can also hire various property management companies to help you find the right tenants. 

Not only does Dallas have the lowest homeownership rate in the country, the demand for rental units has hiked up to 14 percent, as compared to the previous year. The city has a total of 50,000 family apartments available. At such rates, analysts expect the population to double in the coming decade. Median monthly rent here is $1,800-$2,000.

  1. Atlanta, Georgia 

With its ever-growing population and high need for skilled professionals, this city is ideal for people who want to come in and make a career among the diverse crowd that is found here. So, you should take advantage of the high migration scale and invest here. 

This city is also the economic and main capital of the Georgia state. While the median rent is $1,500 and construction of new properties is ongoing, up to 500 people move into the city every day and it expects more than 2 million residents in the upcoming decade.

3. Las Vegas, Nevada 

Las Vegas, Nevada

The friendly environment here can be a supporting factor in increasing the real estate market trends and significantly improving the economy. 

The city stands 28th on the list of most populated cities in the U.S. with a population just above 2.6 million. With various gaming and recreational centers, visitors are easily drawn to the properties here. The average monthly rate of an apartment is $1,107.

  1. Spokane, Washington 

This city is serving tough competition to the city of Seattle in terms of apartment sales. With a small population of just above 210,000, there’s plenty of room for new real estate hotspots. The property rates have increased up to 13 percent, as compared to the last quarter of 2019. The average monthly rental price is $1,295.

The city has more than 85 parks and also has various aquatic centers. It has rich diversity and has lots of tourist attractions, shops, and walking trails. 

  1. Tampa, Florida
Tampa, Florida

With a median rental value of $1,600, this city offers some great deals to multiply your assets if purchased at the right location. The property rates have also slightly risen (up by 5.3 percent since 2019).

Sporting a population of about 4 million, the city is home to the headquarters of 4 companies listed in the fortune 500, which makes it appealing for the potential workforce. The city also has a well-equipped health care and education system even though the cost of living is 5 percent lower than the national average. 

  1. Chicago, Illinois

It is the third largest metropolis in the U.S. with about 13 million residents in the city and its surrounding vicinity. The city is also home to 32 of the top 500 companies in the fortune 500. Statistics show that more than half of the population lives on rent and is employed in private sector firms. 

The price of rental properties is increasing at 0.9 percent a year. The city is full of blue collar areas, which offer high rent and great ROI. The median monthly rent is approximately $1,761. The city has also been in the top 5 for the best City Life Index. 

  1. Lakeland, Florida 
Lakeland, Florida

Since the average income is quite low in this city, standing at $23,000 a year, the rent is also low at $1,084. This creates a strong demand in residents who are looking for an affordable place to live. 

Being a transportation hub, the tourism industry has been booming. The house prices are also quite low in Lakeland as compared to the national average. The city has plenty of studio apartments, which are ideal for those who want to live on a tight budget. 

  1. Birmingham, Alabama 

Single rental homes account for 3/5 of the city’s housing units. Despite a nationwide overlay in the property market, property rates have been rising consistently. With an estimated population of about 219,000 people, this city is home to engineering companies, construction firms and plenty of schools and colleges. 

The median rent in the city is about $968 and the cost of purchasing a property on average comes to be $64,480, which is quite lower than the national average. 

Because of the ability to gain recurring income from leases, real estate remains a popular asset for investors. If business conditions are favorable, your monthly rental income could be sufficient enough to cover all of your mortgage servicing costs. Interest rates are also low, making loans affordable. 

 

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About the AuthorCharles at infoSpike

Charles is the founder of infoSpike.com. He enjoys real estate investing, marketing, and personal finance. Read more about Charles here.