Despite the current forecast of high interest rates in 2023, investing in real estate can still be viewed as a realistic alternative. Due to the possibility of generating ongoing income from rentals, real estate continues to be a desirable asset class for investors. In the past two years, a lack of available inventory and historically low mortgage rates have kept buyer demand high in the US housing market. Even if mortgage rates have increased, the high demand for homes is still raising prices, albeit gradually.
With annual price growth moderating and inventory rising, the US housing market is still mostly a seller’s market. If they are shopping for a new home in the 2023 spring purchasing season, they can still encounter a bidding war. Analyzing the figures and choosing the best cities to invest in is crucial for tulum mexico real estate investors.
Prospective homeowners paid top dollar for properties during the epidemic, with remote workers’ desire for more opulent residences and the market being fueled by their demand. But with so few houses on the market, many prospective purchasers would struggle to find entry-level housing that is cheap, making them more likely to move into single-family rentals. As a result, rental demand is anticipated to grow in 2023.
According to Arbor’s Q3 2022 Single-Family Rental Investment Trends Report, the US single-family rental market remained healthy as tenants moved in droves to the suburbs. SFR is seen as an excellent substitute for prospective homebuyers who are priced out of the market. According to the research, build-to-rent (BTR) construction starts over the last year hit a new high of 69,000, while SFR rent growth slowed but remained strong. In addition, despite rising interest rates, cap rates stayed the same at 5.3%.
For real estate investors looking to buy single-family rental residences, this is a fantastic opportunity. In the upcoming years, this asset class is best positioned to expand. Throughout this pandemic, investors’ interest in single-family rental properties has increased significantly. Significant investors are drawn to it.
So it’s crucial to carry out careful research and select the top real estate investment locations for 2023. Understanding the local elements that may influence your investment is essential because all real estate is local. For families and individuals looking for a good place to live, single-family rental homes offer an economical and adaptable option.
As of currently, institutional investors account for barely 2 percent of the 90-million unit market, according to NHRC. When compared to the American multifamily market, where institutional investors hold more than 50% of the ownership, this is paltry. As a result, for both individual and institutional investors, the single-family rental market continues to be an emerging market.
In conclusion, real estate investing can still offer a dependable source of ongoing income despite rising interest rates. Particularly promising is the single-family rental sector, which is expanding and luring more investors. When choosing a city to invest in, it’s crucial to do your research, but with the right planning and approach, real estate can offer a profitable investment opportunity in 2023. Let’s look at some of the top locations for real estate investments in 2023.
How Do I Choose the World’s Greatest Real Estate Investment Locations?
The fundamentals of the real estate business apply regardless of where you are in the world; you want to pick locations for your investment properties where the return on investment is good. If you want to get the most money back on your real estate investment, look for properties in areas that have the following characteristics:
high rental occupancy: Determine the percentage of unoccupied housing in a given area;
High rental costs in comparison to your mortgage payments: It’s best if you can use rental income to pay off more of your mortgage; and
Low tenant default rate: Purchasing real estate in a neighborhood where rent arrears are common is the last thing you want.
In-depth research is necessary for real estate investing. Market timing is important since some cities have relatively low inventories but excellent potential for rental income. Finding a business that meets your investing criteria and closing it become exceedingly challenging in that situation. As a result, you must respond quickly and carefully.
Do your research before making any rash decisions, and determine whether the real estate market you want to invest in is expanding, stabilizing, or contracting. Are you preparing for long-term buy and hold or short-term capital gains? To make things simple for you, we advise getting in touch with an investment advisor who can assist you in making investments in some of the top real estate markets in the US.
The 21 Best Locations for Real Estate Investment in 2023 are listed below.
There are a few markets worth looking into further if you’re thinking about investing in real estate in the upcoming year because of expected price hikes. This ranking of the top 21 real estate investment locations in the US for 2023 is the result of our analysis of data and trends from throughout the country. Here are the top locations for real estate investments and rental property purchases. Although each of them has unique advantages and downsides, several of them are more affordable than the national average.
First, Boise, Idaho
For a number of reasons, Boise, the capital of Idaho, is growing in popularity among real estate investors. Real estate investors find Boise to be a desirable location because of the city’s robust job market, affordable housing options, expanding population, steady real estate market, and low property taxes. Boise is a tremendous opportunity for investors, whether they are wanting to buy a rental property or invest in real estate for capital growth.
The following are the main factors that make Boise one of the top locations for real estate investments:
Real estate appreciation: According to NeighborhoodScout’s data, the real estate market in Boise, Idaho, has experienced rapid growth over the last ten years, with a home appreciation rate of 217.86% and an average annual rate of 12.26%, placing it in the top 10% of all U.S. markets for real estate appreciation. Boise’s most recent quarter revealed a 3.87% appreciation rate, which is equivalent to a 16.41% annual rate, despite a lower yearly appreciation rate of 7.62%. In contrast to 80% of the other cities and towns in Idaho, this rate is lower. The investment potential of certain Boise areas might vary significantly, despite the fact that these rates are average for the city.
Boise’s successful economy is fueled by a robust job market in sectors including technology, healthcare, and education. New residents are drawn to this expanding job sector, increasing home demand and property values.
Cheap housing: Boise has more affordable housing options than other major US cities, which attracts first-time homebuyers and investors. This can therefore result in consistent rental income for investors and the possibility of long-term capital growth.
Boise’s population is steadily increasing as a result of residents’ attraction to the area’s high standard of living, abundance of outdoor activity, and low cost of living. Due to the demand for housing created by the expanding population, property values may rise.
Real estate market is steady: Boise’s real estate market is steady, with few foreclosures and a steady rate of property price growth. For investors looking for consistency and predictability in their investments, this makes it an appealing choice.
Real estate trends in Boise, ID: In December 2022, the median listed home price in Boise, ID was $528.9K, going down -2.9% from the previous year. The average listing home cost $292 per square foot. In December 2022, there were more buyers than there were houses on the market in Boise, Idaho, making it a seller’s market.
The total sales-to-total listings ratio in the market was higher than 0.2, which generally favors sellers. In Boise, Idaho, houses typically sell after 62 days on the market. In Boise, Idaho, the median days on market have increased from last month and a little bit since previous year. These Boise real estate market trends are based on listings for single-family, condo, and townhome homes on Realtor.com. Other property types, such as land, are not included.
Houston, Texas 2.
One of the top cities in the world to buy real estate is Houston. This city, which houses the US oil and gas industry, constantly has job openings. With more than 7.2 million residents, Greater Houston is the fifth-largest metro region in Texas. Its population growth is roughly twice as fast as the national average. In the Houston area, 41 Fortune 1000 firms have their headquarters. By this metric, Houston comes in fourth place nationwide, after only Greater New York, Chicago, and Dallas-Ft. The Houston housing market is still being driven by these potent macroeconomic drivers.
The real estate market in Houston, Texas is robust due to a number of variables. Some of the causes are as follows:
Strong job market: Houston’s economy is diverse and strong, with a strong energy sector, medical center, and aerospace industry among others, which supports job growth and draws in new residents.
Affordable housing: Houston has relatively affordable housing when compared to other major cities, which can offer investment opportunities for both rental properties and flips.
Increasing population: With a growing population and a rising demand for housing, Houston is one of the fastest-growing cities in the United States.
Tax advantages: Texas does not impose a state income tax, which makes it a more desirable location for both residents and businesses and may raise housing demand.
Real estate market in Houston is robust and has a long history of appreciation, giving investors opportunities for long-term growth and stability.
Houston Real Estate Trends: In December 2022, the median listing price for a home in Houston, Texas, was $340K, increasing 3.1% from the previous year. The average listing home cost $174 per square foot. In December 2022, Houston, Texas, saw a balanced housing market, which means that the supply and demand for homes are roughly equal.
Total sales to total listings in the market ranged between 0.12 and 0.2. Homes in Houston, Texas, typically sell after 59 days on the market. From last month and a little bit since previous year, Houston, Texas’s median days on market have increased. Based on single-family, condo, and townhome properties offered for sale on Realtor.com, these housing market trends in Houston. Other property kinds, such as land, are not included.
3. Texas’s Dallas
Dallas is another excellent location to make real estate investments in 2023. Dallas, Texas, is one of the American cities with the fastest population growth, and for good reason. It boasts an expanding population, a strong economy, and a broad real estate market that presents chances for both residential and commercial investments.
Due to its robust job market, inexpensive housing options, expanding population, broad real estate market, favorable real estate trend, and pro-business atmosphere, Dallas is a fantastic city to invest in real estate. Dallas has plenty to offer everyone wishing to invest in residential or commercial properties.
Dallas is among the top locations for real estate investment for the following main reasons:
Inexpensive Housing: When compared to other significant American cities, Dallas is renowned for its affordable housing. Due to this, it has become a desirable location for homebuyers, increasing house demand and, consequently, home values.
Good job market: Dallas’s economy is robust and diversified, as seen by the city’s low unemployment rate and rapid job growth. The city’s major industries, which all contribute to a continual stream of new residents and enterprises, include technology, finance, and healthcare.
Increasing Population: Over the next ten years, it is predicted that Dallas’ population will expand by 1.5 million. The strong job market and population growth will probably increase demand for both residential and commercial real estate.
Real estate market diversity: Dallas has a real estate market that is both residentially and commercially varied, providing opportunities for investment in both types of properties. There are many single-family homes, townhouses, and flats throughout the city, along with office buildings, malls, and industrial properties. There are many investment homes available on the Dallas real estate market; all you need to do is find renters. Finding tenants for your Dallas rental property might be made easier by working with a local property management company.
Good Real Estate Trend: Over the past few years, housing values and rental rates have steadily increased in Dallas, indicating a positive real estate market. It’s a fantastic moment to invest in the Dallas real estate market as this trend is anticipated to continue.
Pro-Business Climate: Dallas has a pro-business climate, which has encouraged the expansion of numerous important firms in the area. Due to the rising need for residential and commercial real estate as businesses and workers hunt for locations to live and work, this has raised demand for both types of properties.
Dallas Real Estate Trends: In January 2023, the median listing price for a home in Dallas, Texas, was $424.9K, increasing 7.6% from the previous year. The average listing home cost $237 per square foot. In Dallas, Texas, the housing supply and demand are roughly equal as of January 2023, which is considered a balanced market.
Total sales to total listings in the market ranged between 0.12 and 0.2. Dallas, Texas homes typically sell after 62 days on the market. Dallas, Texas’s median days on market have increased since last month and a little bit since last year. Based on single-family, condo, and townhome properties offered for sale on Realtor.com, these housing market trends in Dallas. Other property kinds, such as land, are not included.
4. Nevada’s Las Vegas
How is Las Vegas not among the top locations for real estate investment? In its history, Las Vegas has gone through various booms. And during the Great Recession, it saw a spectacular real estate implosion. The comeback in Las Vegas hasn’t garnered as much attention as the 50% or more drops in property values did ten years ago. Investors shouldn’t stay away, despite its comeback. The housing market in Las Vegas was among the hottest in the country throughout the pandemic.
Las Vegas is a city renowned for its thriving entertainment industry, opulent casinos, and top-notch culinary establishments. It’s a fantastic area to vacation, but it’s also an excellent spot to invest in real estate. Due to its robust job market, high rental demand, affordable housing, expanding population, infrastructure investments, thriving tourism sector, and advantageous tax advantages, Las Vegas is a great place to invest in real estate. Las Vegas is a top destination to take into consideration if you’re thinking about investing in real estate.
Here are the main factors that make Las Vegas one of the top locations for real estate investments:
Strong employment market and population expansion in the city have led to a high demand for rental houses. In turn, this results in consistent rental income and a steady rise in property values.
Inexpensive Housing: Las Vegas provides affordable housing options when compared to other significant American cities. The cost of living is generally cheap, and real estate values are lower. For individuals wishing to invest in real estate on a tight budget, this makes it a desirable location.
One of the cities in the US with the greatest population growth is Las Vegas. Housing is in high demand due to a growing population, which raises real estate values and presents a reliable investment opportunity.
Strong job market: Las Vegas has a strong job market, with a number of industries, such as tourism, gaming, construction, and technology, contributing to its expansion. Real estate investors benefit from the city’s robust economy and low unemployment rate as a result. The 28th most populous city in the United States and the most populous city in the state of Nevada is Las Vegas. Nevada’s principal financial, commercial, and cultural hub is the Las Vegas Valley as a whole. Health-related, high-tech, and other economic interests fuel a diversified economy.
Infrastructure investment: The construction industry contributes significantly to the economy. The city is now working on new business parks, residential developments, and transit projects as part of a considerable investment in its infrastructure. Long-term gains for real estate owners will come from the influx of new enterprises, visitors, and locals brought in by this infrastructural investment.
Las Vegas is one of the most well-liked travel destinations in the world, drawing millions of tourists there each year. The city’s burgeoning tourism sector contributes significantly to its economy and offers real estate investors a steady stream of rental revenue.
Advantages from Taxation: Nevada is one of the few states in the US without a state income tax, which makes it a popular destination for real estate investors. Nevada also offers reasonable property tax rates, which makes it a desirable place to own property.
Las Vegas Real Estate Trends: In January 2023, the median listing price for a home in Las Vegas was $425K, increasing up 6.3% from the previous year. The average listing home cost $245 per square foot. 52 neighborhoods may be found in Las Vegas. The Paseos is the priciest neighborhood, with a median listing price of $889.9K.
The least expensive neighborhood is Pioneer Park, where the median listing price of a home is $290.5K. Based on single-family, condo, and townhome properties offered for sale on Realtor.com, these housing market trends in Dallas. Other property kinds, such as land, are not included.
5. Georgia’s Atlanta
Atlanta, Georgia, is a city that has grown remarkably over the past few years and is now regarded as one of the top locations for real estate investment. There are several benefits to investing in Atlanta real estate, including its thriving economy and diversified culture. The capital and hub of Georgia’s economy is Atlanta. It is regarded as one of the ten states with the highest GDP contributions to the Nation.
For real estate investors, Atlanta is a city with a lot of potential. There are several benefits to investing in this city, including its robust economy and expanding population. Atlanta is one of the finest cities to invest in real estate in the United States because of its low cost of living, diversified culture, and high returns on investment.
The main justifications for thinking about investing in this city are listed below.
Low Cost of Living: Atlanta has a low cost of living when compared to other large cities. Renters and investors alike find it to be a desirable place because of this. Young professionals make up a significant portion of the city’s population, which increases the demand for cheap housing alternatives.
Increasing Population: Young professionals and families are migrating to Atlanta in large numbers, contributing to the city’s demographic growth. It’s a terrific moment to invest in the real estate industry because of the rising demand for houses caused by the expanding population.
Atlanta is renowned for its vibrant atmosphere and diverse culture. The city is a fantastic destination to live and invest because it has numerous cultural events, festivals, and attractions.
Strong and diverse economy: Atlanta’s economy is thriving and is expanding. The city is a center for the technology, financial, and healthcare industries as well as several Fortune 500 corporations. This indicates that there are numerous career prospects and a high home demand in the neighborhood.
Robust real estate market: With a rising population and a high demand for housing, Atlanta’s real estate market is strong. This indicates that real estate investors have many potential to profit. A wide range of investors can invest in the city because it has many cheap housing options.
Good Returns on Investment: Atlanta has a proven track record of giving real estate investors good returns on their investments. The city is a safe and lucrative site for real estate investments due to its expanding population and robust economy.
Atlanta is conveniently positioned in the center of the Southeast and is reachable by road, rail, and air. This makes it a fantastic location for folks who want to travel or who wish to live in a connected city.
Atlanta Real Estate Trends: In January 2023, the median listing price for a home in Atlanta, Georgia, was $399.9K, which was unchanged from the previous month. The average listing home cost $255 per square foot. The supply and demand for homes in Atlanta were roughly equal in January 2023, which indicates that the market is balanced.
Total sales to total listings in the market ranged between 0.12 and 0.2. Atlanta, Georgia homes typically sell after 73 days on the market. Atlanta, Georgia’s median days on market have increased since last month and a little bit since previous year. Based on single-family, condo, and townhome properties offered for sale on Realtor.com, these housing market trends in Atlanta. Other property kinds, such as land, are not included.