Everybody seems to have a different set of opinions on what makes up a good list of where to look for investment real estate. Do you look for the highest return rates, where the most bang for your buck is on flips, or where the quality of life is great and people really might want to raise a family there? With Millennials starting to think about where they can actually afford to buy a home and still have a career, I have come up with some thoughts that combine a several factors and places you might not think of that investment radar probably should be on, but aren’t. Let’s go explore some of those best cities less known for potential real estate investment.
Some factors to look at for off top-20 real estate investment radar
Naturally one of the first factors most investors look at is the uptick of property values over the past few years in any area they are considering dropping investment bucks. It is unwise to look just at property values, though, as they can change very quickly and get you stuck with property that you end up eating months of lost income while you try and sell or rent it. Rental income tends to be strong where housing prices are increasing, yes, especially for those who cannot qualify easily for a mortgage in that particular market. There are other factors that you need to examine, though.
A good overview of the economy and factors pushing growth in an area is warranted in all locations you are looking for a potential fit for your investment dollars. What is the employment situation in the area and does it show promise of growing over the next several years? Consistent growth, companies moving in or planning on moving in that will increase jobs availability, and the local wage structure all are important factors to the age demographic of your target audience. The local jobs market needs to be stable and growing to help keep housing prices or average median rental prices increasing. Along with that, who is your target audience for your investment property? A working renter, family, or retiree? Makes a difference. What income level do they need to be at? How much risk are you willing to assume for unpaid rent?
Is the area increasing or decreasing in population? There are a couple different sides to this thought. Some investment groups (in particular) look for areas undergoing loss of population as a way to scoop up chunks of city blocks and neighborhoods thinking that it may be the urban revitalization of the future. While this can be a big win for long-term strategy, it is a risky one. You need careful analysis of why people are leaving, and who are the people leaving.
Some big towns like Chicago and Baltimore are having population decreases due to the baby boomers moving out. While there is some international business moving in, and some areas in Chicago’s upscale neighborhoods are steadily increasing, you need to buy where the new population wants to live, not where the old population is leaving and has a reason, often due to decay and crime. Knowing the neighborhoods and what is being done to increase job growth and location desirability by local government need to be looked at carefully so you do end up where you cannot get it sold or rented.
If you are interested in long term rental, you need to consider the increase in home values over a period of time, and the increase in rental yield – how much return you get in rent compared to what it will cost you to buy a place. For example, Honolulu has had massive housing cost increases steadily for over a decade. Compared to rental prices, while they are very high, the cost ratio to the rate of return often does not provide a good enough return on investment to make it worthwhile to tie up the large amount of money it takes to buy a top location property there.
Am I looking for rental property or houses to flip?
Roughly 2/3 of the major metropolitan areas in the U.S. are seeing home prices increase, steadily in most cases over the last few years. While that makes it harder on homebuyers, it is better for home investors, especially if you are looking to buy a place to turn into rental income. Most of the time when prices are going up, rental availability goes down, and average rental prices raise due to decreased availability. This is especially true in places where Millennials are flocking to get jobs, more so if straight out of college and they cannot qualify for a mortgage yet. Look to cities that have manufacturing, technology cyber security, and functions relating to supply chain for investing to attract them.
Another rental push is in areas seeing high growth from the influx of baby boomers starting to transition to retirement. Places with good weather, a lower (or rumored to be, as it is no longer always true) cost of living, lower fuel and utility costs, good medical care including home health services, recreational activities, and lower overall property maintenance expense are on the cross-hairs for many boomers. The places seeing a lot of growth are Florida, New Mexico, and Arizona. There are secondary markets in North Carolina, Washington, and places closer to where they are leaving, such as suburban or rural towns in the Midwest but out of metropolitan areas.
What are some of the more known best cities to invest in real estate?
In some of my other articles I have discussed the obvious locations like Atlanta and Houston that are growing, especially in manufacturing and technology segments, and that growth is making the possibility of investing for Millennial renters or buyers more realistic. Again, though, caution is especially advised in a place like Houston (Or Oklahoma City, Austin, Mobile and elsewhere) that are so heavily dependent on the oil and gas industries. The national economy has a lot of influence on how the local employment situation is, and when something shuts down – such as happened to the fracking fields in North and South Dakota, Colorado, Nebraska, Wyoming and elsewhere, many people in very high paying jobs were suddenly unable to pay those exorbitant rental prices to people who scarfed up anything that looked like it could be rented, often at many times the realistic value of the property.
Among the cities that have held their own, I would have to include Denver, CO, Durham, N.C., Seattle, WA, and Jacksonville, FL. Denver has regularly beaten the S&P 500 for increases in property values over what you would make on the stock market. Colorado also is posting record tax revenue from their aggressive medical marijuana industry, which has eased the tax burden on a lot of the rest of the state. Services are readily available there, and Denver consistently ranks high on quality of living scores in nearly all surveys, as well as many other locations in Colorado. The downside is Denver is not cheap, and neither is Colorado Springs and other locations. If you look in the suburbs, though, you can still buy property, especially for rentals, that can make a tidy margin.
Seattle is kind of obvious due to the influx of technology and large players like Boeing being there and Apple moving to town. Decent weather, progressive health care and social values, and availability of tremendous outdoors recreation are big drawing cards. Seattle, as has most of the Puget Sound region, has seen double digit housing valuation median increases for several years, with no major slowing down in sight. Be prepared, though, cost of living is high, very high, in Seattle. For someone with career aspirations, Seattle has some of the best job growth in the nation as well as some of the highest rates of population increase, especially for their location far out of the Sun Belt.
Less known places for good real estate investing
The two sleepers are Durham and Jacksonville. Durham NC (and not too far away Charlotte) have seen some of the highest average property value increases in the nation for the last several years running, as well as healthy jobs increases. One of the reasons is multi-national companies moving to the areas, finding favorable tax base for manufacturing and engineering-technology ventures. North Carolina has been aggressive to invite players to down, and Charlotte now has one of the busiest airports in the U.S., a big surprise for what most people consider a nice small Southern Blue Ridge gem.
Jacksonville, FL has undergone massive revitalization of many areas of town in the past two decades, and its efforts have been rewarded. With a growing upscale business and financial hub, Jacksonville is ideally suited for supply chain and import/export due to their strategic location on the Atlantic with one of the largest and busiest ports in the nation. They also sit at the crossroads of I-95 and I-10, controlling passage of goods and services to burgeoning Florida, points west, and all points northeast along the eastern seaboard. Manufacturing and warehousing are big in Jacksonville, which means that rental property does well due to the pay level of those employed in those industries. Add to that five major military installations and a younger population than much of the rest of Florida, and Jacksonville is growing.
When I think of investing in real estate, I like to know I have the money to do it without a strain, sweating the mortgage on the rental property every month. I do it with my lead gen business, which has literally blown up the last few years. I make 80-90% returns on my digital properties, which is way better than the average of 10-12% of even the top returns on real estate investments. If you want to see how I do it, check out this link https://www.bestrealestatedirectory.com/lead-gen/
So what if I want to avoid the bidding wars in the “logical” investments places?
You can. There are some great up and coming, trending places to look at investment property that are off the radar for the most part – or you have never heard of, period.
One of the first places that comes to mind is Arlington, Texas. Jammed between Ft. Worth and Dallas, most people do not even know Arlington is there, but its central location makes it ideal for commuting to either city. The local economy is good, and job increases are above decent. The best thing, though, is the median house value runs around $240,000, well below either DFW side and well within the budget of most first time home buyers or people needing to expand due to a growing family. Rentals are hot there, and with the strong rental market you could actually pay off a house investment in 13 years.
One of the things you need to check too is local wages. Wages vary more than most people realize across the nation, and how much somebody takes home is completely relevant to your rental rate and your down time between renters, which must be figured into your overall costs of owning property. That is a challenge in many areas of Texas and Florida, as wages are disproportionately low for the population, technology, and educational facilities in the states.
Another town on the radar is Tucker, GA. Situated just outside Atlanta, Tucker is not way up in the life quality rankings but is slightly above average. From a price standpoint, though, Tucker has some of the best median home prices around Atlanta. Atlanta is growing and strong when it comes to job growth and the local economy. This makes Tucker a good place for both housing flips and rental property investment.
So where are the boomers headed off to?
Florida, New Mexico, and Arizona are all high on the list for boomer relocation. Places like St. Petersburg, Naples (some neighborhoods are growing by 40% a year!) and Orlando are all growing very strong. Most of that growth is retirees, though, and places like The Crossings, while not cheap to buy into, has one of the highest livability scores in the nation at 82 out of 100. They are geared at 55 up, though, so a Millennial, unless going in with an at home business like my lead generation business, or with a landed company and certain of a good salary, might not want to look there. If you want to live in sunny Florida and make your own money, check out this link to see how I did it https://www.bestrealestatedirectory.com/lead-gen/
Of those states, New Mexico has the most advantage. Albuquerque, in particular, is seeing growth. Strategically located on cross country interstates, Albuquerque has been a sleepy town for decades that is now seeing expansion as retirees who do not want to deal with urban sprawl or water rights issues. You can still buy a home to remodel and rent in Albuquerque for a decent price and the rental market is healthy.
Other places that the boomers are headed you might not think about, though, are near where they are coming from. For example, people leaving Chicago that really are not thrilled with retiring to the traffic of Florida or Phoenix are looking around the Great Lakes and Midwest for other options. In particular, Kenosha WI, Schererville, IN and Minooka, IL are all seeing very healthy home markets, have above average to good livability scores, and houses are much less – sometimes well below $200,000 median – to buy. Retirees that want to stay in decent driving distance to grandkids are relocating to smaller Midwest towns that have the same values and culture as where they spent their lives, with far less traffic, lower costs of living, four seasons, and family.
How do I find out where I want to look for investment property?
As we joke in my lead gen industry, you get unlimited free Google searches with your subscription. Research is the name of the game when you decide where you want to look for investment. What draws you? You have to have a like for something about an area to really do good, fair research. You also need to control your enthusiasm with good solid business sense. Make yourself a list of what you are looking for – is it residual income? Is it a chunk in one swoop? Is it to buy one, fix it up, get income, and go on to the next one to stack your investments? How much are you willing to risk and what to you is an acceptable return on your investment?
I know when I started to look at investing in real estate, I was clueless and I had to do a lot of reading, some note taking, and be willing to say “Yup, that is possible” or “Uhhh, nope…” and cross a location off the list. I also had to take an honest, realistic, transparent look at my finances and what I was willing to risk, how much I could afford to float on a monthly basis if every property was not rented out, and how much stress and DIY labor I wanted to put in. Most people looking to invest do not look seriously and honestly at what they can afford to risk without endangering their primary residence or credit. You have to assume the worst case, and hope it never happens, especially when things like the national and local economies, natural disasters, and other issues are completely out of your control. You have to have a fall back position.
That is why I truly love my lead generation business. Let me tell you a little about why I only go for solid, high returns on investment. Honestly, I do not get tying up the money it takes to get a decent real estate parcel and making only 3-5% back if you are lucky after repairs and taxes. It just is not worth it to me when I am making 80, 90% consistently on every digital real estate parcel I rent out.
Digital real estate is the real estate investment of the future – now
Let me explain what I am talking about. I own websites that get referrals for businesses that need more customers. And who doesn’t want more customers? There are 46 million new businesses every year, and trust me, few of them know how to leverage the internet. Over 70% of all searches for goods and services are done on a mobile device. Whoever is up there to be found is whom they are going to click on and book the service call. That is where my lead gens come in. I rent out the results of my site, the referrals, to businesses. I am making well into six digits a month after five years in business. And yes, I am serious. I’ll take a minute to tell you how I got into this and what it looks like.
When I graduated from college I got a job making about $35K a year, and thought it was the bomb. Well, I really fast figured out I could barely eek by on that living in the big city I was in. I knew I had to make more just to put back for an emergency, and to heck with even thinking about a vacation. I started looking for a side business, as my job did not allow me to take a second job due to schedule. I settled on multi-level marketing at first. Little did I know how little money was to be made at my level, let alone the time, cost of classes and memberships, and worst, how much I would irritate my family and friends with it. I quickly figured out that was not going to work.
After some more looking I knew the internet was the new shopping channel, so to speak, so I looked into drop shipping. I made a little money, got some of my friends back, but my apartment was stacked absolutely every where in stuff! I was also working crazy hours to keep up with it. I made a little, but not a lot, and still not enough to invest, travel or do the things I really wanted. I kept looking and trying to find something more promising. I knew it would take work, but I also knew by then that being in business for myself was how I wanted to do it.
One night I was surfing business blogs and ran into an article talking about a young guy not much older than me that was killing it in getting referrals for businesses. He had written training to teach others how to do it. I knew there were massive amounts of opportunity with businesses and few of them knew anything about how to do internet marketing right. I read the article with interest and did some research, and found out the guy, Dan, had a good reputation and seemed to have a good product in his training, so I found the article again and clicked on this link https://www.bestrealestatedirectory.com/lead-gen/ to schedule a call to ask some questions.
When the time for the call came, Dan shot straight from the hip. He told me it was not free money, you had to put in the effort to set up the sites, take care of the business owners, and do the work. I had no problem with that, I knew any business that was honest and ethical would take work, but it would be mine. That was important to me. We chatted, and his training was reasonable, so I signed up and started to learn. The first website, I built in six hours (even though I did not know website design it was really pretty simple) is this one
which I still own to this day. I found a business that was really happy to get the referrals and offered to pay me $750/mo for them. I still have this same site and same customer, five years later. He has paid me well over $38,000 in profit in the last five years. I hardly ever have to do anything on the site, either.
Wow, that was exciting and I was hooked. I continued to build sites, working my regular job still, and growing my new business. In five months I turned in my resignation to the corporate position, as I was now able to pay all my bills and reinvest in my business. That was really fulfilling for me, and I was making a go of it. Yes, it was some work. That was ok, as the profits went into my pocket instead of someone else’s.
I just turned 30 a few months ago, and I have owned my business right at 5 years. I will make well into seven digits this year. My business keeps growing by leaps and bounds, and it all started with the training I got in Dan’s program and putting in some elbow grease. I travel now, in fact I just got back from a long trip to visit the land of my ancestors, something I have wanted to do for many years. It felt so great that I did not have to sweat spending the money to do it. I own a nice car and live in a super nice home on the side of the hill. Some days I work long hours, but it is because I want to. Others I go recreate, party, or do what I want, when I want, how I want, and I do not have to worry if I have enough to cover all the mortgages, because I do.
If you are tired of making someone else a lot of money and little to none ends up in your pocket, have some respect for your own abilities and drive and click this link https://www.bestrealestatedirectory.com/lead-gen/
It will give you some information about the huge opportunity in lead generation websites and how to get training for your own business. Yes, it takes a little work, but so is sweating repairing a rental house.
Do something good for yourself, your future, and your sanity. There is no obligation. You will not get on some spam phone call list. You will not be pressured. It is just my way of passing forward the opportunity I got to make myself wealthy, sane, and very happy.
Click here now to set up a call to get more information and find out what you are missing and how easy it is to get into your own legitimate business that totally rocks the future >>>>
I am so grateful I trusted my gut and did. Trust yours.