Texas cities top a new list for best markets for real estate investment, according to a new release from Local Market Monitor and HomeVestors.
“The Top 10 markets for real estate investment all have a common thread: a fast growing economy, which means more jobs and more renters,” Ingo Winzer, president and founder of Local Market Monitor, said in the release. “This also means that rent and property values will be increasing in many markets because housing construction has been at very low levels for years and can’t possibly catch up with the increased demand.”
Topping the Best Markets list once again are Texas cities: Houston (1), Austin (2) and Dallas (3), with Denver (4) and Orlando (5) rounding out the top 5, all which have seen substantial job and population growth.
“Texas continues to be a sure bet when it comes to real estate investing. Lower oil prices may slow some areas, but the diversified economy and pent up demand for real estate will help to mitigate the impact on rental markets,” David Hicks, HomeVestors co-president, said in the release. “Places like Austin and Dallas have rapidly growing technology and financial sectors that make the oil slump less significant.”
Along with job growth and population growth, relatively low home prices are factors making investments in single-family homes as rental properties a nearly risk-free opportunity in some markets. All top five markets have a median home price below $300,000.
A couple of California cities broke the Top 10 list, with San Jose and Oakland at number six and eight, respectively. “California has higher home prices, but the state is growing again, both in jobs and population. Because most of these markets are no longer underpriced, investors in these markets are likely to see more of their gain come from price appreciation and less from a long-term rental stream,” HomeVestors co-president Ken Channel said in the release.
Seattle (7) and Portland’s (10) growing technology sectors and their desirable quality of life make them valuable markets, while Miami’s rapidly growing population and high rents take the list at number 9.
“We believe 2015 bodes well for rental property investors. The economy shows no sign of slowing down and consistently low home prices and population growth make investing conditions ideal,” Channel said.
The top 10 best markets for real estate investment:
- Houston-Baytown-Sugar Land, TX
- Austin-Round Rock, TX
- Dallas-Plano-Irving, TX
- Denver-Aurora, CO
- Orlando, FL
- San Jose-Sunnyvale-Santa Clara, CA
- Seattle-Bellevue-Everett, WA
- Oakland-Fremont-Hayward, CA
- Miami-Miami Beach-Kendall, FL
- Portland-Vancouver-Beaverton, OR
About the quarterly data on best markets for real estate investment
The data identifies markets that will be good rental markets and where home prices are likely to increase at a good rate over the next few years.
Criteria include markets where:
- The population has been growing at above-average rates (4% or better) with growth coming from people moving there in search of jobs;
- The current rate of job growth of 2% or better; and
- There is low unemployment, so that new jobs will be filled by people who move there, not by unemployed people who are already there.
Markets are excluded that: Have a small population because they don’t have stable economies.
About the companies in this release:
Dallas-based HomeVestors of America, Inc. is the largest professional house buying franchise in the U.S. with over 60,000 houses purchased since 1996.
Local Market Monitor offers investors in homes and home mortgages the local market risk intelligence they need to make informed decisions.
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