Harvard’s annual rental housing report reveals a lot about the condition of the market in the U.S. This year, it unveils the cooling of the rental market and several other trends.

 

Annual Rental Housing Report Key Takeaways

The Joint Center for Housing Studies of Harvard University annually releases a report regarding the country’s rental housing market. The 2024 America’s Rental Housing Report has several notable trends and key takeaways.

 

Softening Rental Markets

According to the report, apartment growth has stalled. The rental market rapidly increased during 2021 and 2022. However, rent growth for apartments with professional management fell during the third quarter (Q3) of 2023. It dropped from 15.3% to just 0.4%.

This decline was widespread and affected most areas, regardless of geography. Only 1% of the markets reported a rent growth of 10% in Q3 of 2023. This slowing demand has stabilized the rental market after 18 months of turbulence. The deceleration is good for renters, though rental home prices are still much higher than pre-pandemic levels.

 

Record High Unaffordability

Despite the slowdown in rent growth, renter households are still more cost-burdened than ever due to the rental market overheating during the pandemic. Thus, there is a much greater need for rental assistance.

In 2022, a record-high number of renter households (approximately 22.4 million) spent over 30% of their income on utilities and rent. Among cost-burdened households, there were 12.1 million that consumed over half of their income. The number of cost-burdened renters has reached 50% — up by 3.2% from 2019.

Moreover, there has been a dwindling supply of low-cost rental units. Yes, many new apartments may become available according to the 2024 rental market predictions. However, they are usually high-end apartments that have a high asking price. This is unhelpful to cost-burdened renters.

According to Whitney Airgood-Obrycki, the rental housing report’s lead author and a senior research associate for the Joint Center for Housing Studies, what they are building is at the high end. This is because there has been an increase in the cost of construction. There is also a lot of demand from higher-income renters. In the last decade, most new apartments cost $1,400 monthly or higher. It’s unaffordable to a bulk of the country’s renters.

In addition, older apartments — often more affordable — require more significant investment to address several inadequacies. Some of these include climate risks and inaccessibility. Investors find these challenging given the market’s current environment, increasing operating costs, and rising interest rates.

According to the annual rental housing report, millennials, baby boomers, and the strong demand from Gen Z must ensure this slowdown doesn’t last long despite the difficult conditions.

 

Homelessness is at a Record High

During the pandemic, financial support was provided to those who needed it. This temporarily decreased eviction filings and provided a safety net for overburdened renters. However, these pandemic-era renter protections are slowing down, and many have expired. As a result, housing instability is rising once again. Unsurprisingly, there has been a spike in homelessness.

Roughly 653,000 people were experiencing homelessness in January 2023. That’s up by approximately 12% from the previous year. Moreover, it’s 48% higher than the homelessness rate in 2015. Harvard researchers noted that this increase is the highest single-year increase in the nation’s unhoused population record.

 

Income Unable to Keep Up With Rent Increases

The declining supply of apartments with low rental prices only exacerbates renters’ financial burdens. According to the annual rental housing report, only 7.2 million units had rental contracts under $600 in 2022. This maximum rent is affordable to those in the $24,000 annual income bracket. That makes up roughly 26% of all renters.

If we adjust for inflation, the U.S. has lost 2.1 million affordable units since 2012. The trend accelerated when the asking rent price spiked during the pandemic. Over half a million low-rent apartment units were lost between 2019 and 2022.

Since 2001, median rents have almost continuously risen in inflation-adjusted terms. They are 21% higher as of 2022. However, renter incomes have only risen 2% during the same time.

 

Financially Vulnerable Renters Make Difficult Choices

According to the Consumer Expenditure Survey in 2022, financially burdened renters have been forced to make difficult choices due to their tight budgets. For example, the survey reported that extremely cost-burdened renter households spent 39% less on food. They’re also spending 42% less on healthcare than unburdened renters.

Meanwhile, other overburdened renters may choose to live in overcrowded spaces or structurally inadequate homes. This further threatens their health and well-being.

 

Reinvestment Needed for Aging Stock of Rental Housing

The annual rental housing report states that the current supply of rental housing units is older than ever. In 2021, the median age was 44 years. That’s 10 years older than what it was two decades prior. As a result, there may be problems when it comes to structural inadequacy, habitability, and safety.

Granted, there have been changes to building construction standards. Moreover, property owners have repaired many existing units to minimize the problem. Nonetheless, there is still a large number of rental units that do not meet the minimum standards. Property owners must reinvest in repairs and maintenance costs to keep them in good condition.

 

High-Interest Rates Slowing Market Activity

Interest rates rose into 2023, and building and purchasing multifamily properties cost more. In addition, there has been an increased cost of equity due to high treasury yields. Apartments must offer greater returns on investment to keep up with Treasury notes.

As a result, there has been a downturn in borrowing and transaction activity. Half of the banks surveyed by the Federal Reserve reported declining demand for multifamily homes. Moreover, almost two-thirds of multifamily lenders created heightened criteria for underwriting due to hikes in interest rates and uncertain property performance. Mortgage borrowing for multifamily properties was down 48% year over year in Q2 of 2023.

 

Gen Z Driving Rental Demand

Millennials are still a significant source of demand in the rental property market. However, they are aging and entering their prime homeownership years. The current market is already bearing witness to this transition.

Instead, Gen Z is now fueling the growth in rental households. The number of members in this generation is slightly smaller but still large enough to drive demand. The members of Gen Z are those born between 1995 and 2009.

 

Adjusting to the Trends

The annual rental housing report has shed much light on the current market trends. Landlords and property investors would pay attention to these trends to protect their investments and make the right purchases moving forward.

Are you a property owner in need of professional rental property management? Look for a reliable property management company through our online directory!

 

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What are the best cities for renters in 2024? Renting has become more popular in the past year due to a competitive housing market and skyrocketing interest rates. Investors and property owners must pay attention to these changing trends and seize opportunities to stay profitable.

 

Best Cities for Renters in 2024

First-time homeownership has been difficult for the average American, especially in 2023. Home prices are unreasonably high, while interest rates are only rising. As a result, many Americans have decided to rent as a short-term (and, at times, even long-term) solution.

However, just because renting is becoming the norm doesn’t mean all cities will see an equal rise in renters. Some cities will have more than others, as different factors can affect renter behavior. Where are rents growing the fastest? Here are the 2024 top rental cities property investors should keep in mind.

 

1. Atlanta, GA

According to RentCafe, Atlanta is one of the most sought-after cities in the United States. It had a large amount of traffic from apartment seekers in 2023. This is expected to continue in 2024 as the Southern city has a transformed Midtown and an attractive IT institution, Georgia Tech.

 

2. Austin, TX

Austin is the capital of Texas and is one of the best cities for renters in 2024. The rental rates have dropped in the city, making it an attractive place to move to. Moreover, the household income is decent, and less than 47% of its residents pay 30% or more for rent.

Apart from this, Austin is attractive because of its decent transit modes. The city has 82 restaurants for every 1,000 companies, making it a decent place for foodies. Also, Austin has many pet-friendly apartments and rentals with dishwashers. These are some of the most important renter priorities landlords should consider. However, it doesn’t have the best crime rate.

 

3. Chandler, AZ

According to Forbes, Chandler takes the top spot in the top 10 cities for rentals in the USA. It’s the first of four cities in the Phoenix metropolitan area. While it doesn’t have cheap rent, renters flock to it because its rental prices have been dropping year after year. Moreover, the city has lots of pet-friendly and spacious rental units. Its median household income is also higher than average, making it one of the best desert cities for renters.

Apart from this, Chandler’s rental units have many useful amenities and appliances. It ranked in the top 10 cities with the most rental properties with dishwashers, washers, dryers, and gyms. Furthermore, only 44.89% of households spend 30% or more of their income on rent.

 

4. Denver, CO

Denver is a pet-friendly city as most rentals allow pets, and there are many parks for dogs to enjoy. Moreover, the city has many outdoor facilities for cyclists and is overall bike-friendly. Denver’s rental properties also have many on-site or in-unit dishwashers, laundries, parking, and gyms. However, pools are scarce in the area, and the city has a relatively high crime rate.

 

5. Gilbert, AZ

Gilbert is the best city to buy a rental property in the USA for property investors targeting families. It has the lowest crime rate in the United States’ most populated cities. Moreover, it has a high median income and a low percentage of renters paying 30% or more of their income on rent.

Apart from this, Gilbert has a decent variety of rentals available. It provides a diverse range of non-apartment rental units. The city also has a lively farmers market every Saturday with over 100 vendors at once. New residents are sure to be attracted to the city.

 

6. Henderson, NV

Dog-loving renters have taken a liking to Henderson as it is the third-best city for dog parks. It has around 5 dog parks for every 100 people. Parks are also usually only a 10-minute walk away. Moreover, most of its rental units allow pets.

Apart from its pet-friendliness, Henderson is one of the best cities for food and beverages in the United States. It has roughly 100 food and beverage establishments for every 1,000 companies in the city. Furthermore, the rental prices within the metropolitan area have decreased significantly — down by 6.77%.

 

7. Kansas City, MO

Kansas is a Midwestern hub that many renters prefer to live in. It’s vibrant, has an affordable cost of living, and has ample job opportunities. It’s a city that receives a lot of traffic, according to RentCafe.

 

8. Las Vegas, NV

Sin City is one of the best cities for renters in 2024 because of its food and beverage establishments,  stable rent prices, and numerous pools. The city also offers a decent number of rentals — particularly houses and townhouses for rent.

However, Las Vegas isn’t the most walkable or bike-friendly city. Most rental units also lack parking, laundry facilities, and dishwashers.

 

9. Lincoln, NE

Lincoln has one of the lowest rental prices and provides affordable one- to two-bedroom apartments. Its spacious apartments include many amenities and facilities like dishwashers and pools. Moreover, it has a low unemployment rate, making it a great place to live for renters. The city is also walkable and bikeable. Residents typically live only a 10-minute walk away from a park.

 

10. Minneapolis, MN

Renters who love to bike flock to Minneapolis for its walkable and bikeable streets. The city is a great option for those who love to explore or travel using public transit. Most of the city’s population also lives within a 10-minute walk to the park, making it great for leisure.

Furthermore, it boasts affordable one- and two-bedroom rental prices. It has one of the cheapest rent prices on the list of best cities for renters in 2024. However, it’s not the best place to live for renters who want a high concentration of food and beverage establishments.

 

11. Plano, TX

Renters want a safe space with ample facilities and low rent. Where can you find all of that? In Plano, Texas. This city has a low crime rate and is a pet owner’s dream. Most rental units allow pets, and the properties usually have many amenities. These include on-site laundry facilities and the increasingly important gym.

Apart from this, less than 42% of the population spends 30% or more of their income on rent. The rental units are also spacious, making it one of the most wanted cities for renters in 2024. However, it’s not the best place to invest if you prefer purchasing non-apartment properties.

 

12. Washington, D.C.

Washington is one of the most ideal cities for renters in 2024. It has a very low unemployment rate, and most residents are within walking distance of a park. Moreover, its rental units are usually furnished with on-site or in-unit dishwashers and laundries.

It’s also a great dining place and good public transportation access. However, most apartments and rental properties do not have on-site gyms. Washington, D.C., is also not the safest place in the United States in terms of violent and property crime.

 

Frequently Asked Questions

 

Which city has the highest rental yield?

Houston, Texas, has the highest rental yield. It lacks affordable single-family residences while having a strong job market. Thus, there is an increased demand for rental properties.

 

What state is the easiest to rent?

North Dakota, South Dakota, and Iowa are the easiest places to rent. Residents in these states spend a lower-than-average percentage of their household income on rent. They also come with cheaper monthly electric bills, decent laws and statutes protecting tenants, and many affordable and available rental units.

 

Where do most renters live?

Which cities have the highest percentage of renters? According to Fox Business, Newark, New Jersey, has the largest population of renters. Over 79% of its residents are renters.

 

Which city is best for apartment investment?

Plano, Texas, is one of the best cities for apartment investments. It’s one of the most sought-after cities for renters. Only 7% of rental properties within the city are not apartments.

 

Invest Wisely

Property owners and investors need to know where renters move to maximize profit. That’s why staying on top of the trends and knowing the best cities for renters in 2024 is so important. With this information, you can make wiser investments and avoid potential losses.

Do you need help managing your rental property? Find a property management company through our online directory today!

 

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People are moving all the time. But, for rental property investors, it pays to know which states have the hottest rental markets.

 

Why Are People Moving?

People move for many reasons. And while people move for job-related or family-related purposes, housing remains a primary contributor. It can stem from a desire for more space or a better neighborhood. Often, people move in search of more affordable prices.

According to Census data, migration has been at record-low rates for more than 7 years. And although the pandemic saw a slight uptick, it did not cause significant or upward swings in domestic migration. However, it did change the way people moved.

Historically, major cities and economic hubs welcomed thousands of new residents yearly. But now, more people are moving to the Southern and Western areas of the country. This is likely due to housing costs and a change in workplace setups.

The COVID-19 pandemic saw a huge shift in how people worked. Because the often-lethal virus could easily be transmitted from person to person, many companies ordered employees to start working from home. Two years and a few vaccines later, offices are returning to work. Yet, a good number of companies continue to allow employees to work from home or, at the very least, use a hybrid format.

The rise in remote work had a direct impact on housing and relocation. Working from home meant people could move to farther places for a quieter lifestyle and a cheaper cost of living. Mortgage rates also fell to record lows at the pandemic’s peak, pushing people to buy homes. After securing low-interest rates, those same people have no incentive to move.

 

Where Are Americans Moving to?

When you look at the data, it is clear that people prefer to move to certain states more than others. This gives property investors a hint of the following booming rental markets. Some cities are also evidently more attractive. An analysis shows that these cities saw more population growth because jobs recovered faster here after the pandemic.

So, what states are people moving to?

 

1. Florida

Florida is topping the list, which experienced a 1.9% population change between 2021 and 2022. Domestic net migration gains were at 318,855. Ocala, Tallahassee, Deltona, and Miami, in particular, are very hot right now.

 

2. Texas

Texas is also a popular choice among movers. The population changed by 1.6% between 2021 and 2022, with domestic net migration gains at 230,961. Houston and McAllen are two cities that experienced the most growth.

 

3. North Carolina

In North Carolina, Charlotte remains the hottest place to move to. The population grew by 1.3% between 2021 and 2022. Finally, net domestic migration gains were at 99,796.

 

4. South Carolina

Another Carolina made the list as well. South Carolina experienced a population growth of 1.7% between 2021 and 2022. Domestic net migration rose by 84,030, with Myrtle Beach welcoming the most movers.

 

5. Tennessee

Tennessee is not far off from the list. Here, net domestic migration for 2022 was 81,646, equating to a population growth of 1.2%.

 

6. Georgia

Next on the list is Georgia, which experienced a 1.2% population change between 2021 and 2022. Domestic net migration gains were at 81,406. Savannah, in particular, is very hot right now.

 

7. Arizona

Arizona is another popular choice among movers. The population changed by 1.3% between 2021 and 2022, with domestic net migration gains at 70,984, though no particular city experienced higher population growth.

 

8. Idaho

Idaho also made a list. Here, net domestic migration for the year 2022 was 28,639. While net domestic migration is not as high as its immediate predecessor on the list, this still equates to a population growth of 1.8%.

 

9. Alabama

In Alabama, Hunstville remains the most attractive place to relocate to. The population grew by 0.5% between 2021 and 2022. And domestic net migration gains were at 28,609.

 

10. Oklahoma

Oklahoma takes the tenth spot, experiencing a population growth of 0.7% between 2021 and 2022. Domestic net migration rose by 26,791.

 

Where Are People Moving From?

The Southern and Western parts of the United States are experiencing a growth in new residents. But those residents have to come from somewhere. According to the same data, certain states have seen a decrease in population. The decline is likely due to expensive housing, high taxes, slow job recovery, or a combination. Interestingly, some of the states that experienced a drop in population are the very states that are typically considered attractive.

California, for instance, lost around 343,230 residents. This equates to -0.3% in population change between 2021 and 2022. New York also experienced a -0.9% population change, losing roughly 299,557 residents. Other states that also lost residents include Illinois (-0.8%), New Jersey (-0.1%), Massachusetts (-0.1%), Louisiana (-0.8%), and Maryland (-0.2%).

 

Advice for Rental Property Investors

Unsurprisingly, California and New York are two states that have some of the highest rents in the country. As of October 2022, estimates place the average rent in New York at $1,678, and California is not much better, with an average rent of $1,658. And while some investors might find high rent desirable, the drop in the renter population should turn them off to potential investments.

Instead of targeting states like California and New York, rental property investors should consider conditions that experienced the most population growth. Of course, performing a cost-benefit analysis and thorough market research is still important. While a particular state may have a large renter population, that does not necessarily mean that investors can expect gains, especially if housing costs remain high.

 

Where Are People Moving? The Bottom Line

The housing and rental market in the United States will likely continue to shift with time. Apart from understanding where people are moving to and from, investors must analyze the situation from every angle. And the best way for investors to adapt is to hire a property management company. A property manager is more well-versed in local market trends and can provide better advice.

Rental Choice offers a comprehensive online directory of property management companies. Start your search for the best one in your area today!

 

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Everyone wants to have a place to call home for the holidays. For this reason, is renting or selling your home during the holidays a good idea? Let’s learn more about how the holiday season can affect the real estate market.

 

5 Great Reasons for Selling Your Home During the Holidays

When is the best time of year to sell a house? Spring to early summer is the time when most people put their homes up for sale. The first two weeks of May also tend to be the most profitable when selling a house. However, that doesn’t mean that selling your home during the holidays can’t be profitable as well. Here are some good reasons to consider.

 

1.  Fewer Homes for Sale

There are fewer homes for sale during the holiday season. As such, there is less competition in the market. You can command your full asking price — or very close to it — as homebuyers do not have very many options during this time.

 

2. Attract More Serious Buyers

There are more open houses during the prime real estate season compared to the holidays.

This encourages homebuyers to visit as many properties as they can — even those that are outside of their budget.

In the wintertime, though, not many people will be willing to withstand cold weather to view houses that they cannot really afford. Thus, you’re more likely to entertain serious buyers when selling during the holidays.

 

3. Tap into Holiday Nostalgia

Many people feel nostalgic during the holidays. A home decked out in Christmas lights with the fireplace creating a warm and cozy vibe can be enough of an emotional trigger for some homebuyers.

You can stage your house in a way that taps into the holiday nostalgia. Those who are buying a house can feel good when they look at your property.

 

4. Get a Better Sense of the Neighborhood

Seeing how neighbors celebrate the holidays can provide homebuyers with a better sense of your neighborhood. Most people will prefer to buy a property that’s surrounded by friendly and cheerful neighbors rather than a property on a bare and lifeless street. Sense of community is a major factor for many homebuyers.

 

5. Take Advantage of Tax Breaks

You have a good chance of selling your house during the holidays because of the benefits for homebuyers. They can take advantage of tax breaks if the sale closes before December 31. Interest rates also tend to be lower from December to January so homebuyers may be able to get lower mortgage payments.

 

How to Sell Your Home During the Holidays

Here are Christmas real estate marketing ideas that can increase the chances of selling your home during the holidays:

 

1. Decorate for the Holidays

Holiday decorations can help boost the curb appeal of your property.  You can use twinkling lights on your freshly cut trees, hang ornaments on newly painted walls, and place outdoor decorations on your perfectly manicured lawn. Then, inside, create a warm and cozy interior that will make potential homebuyers feel at home during showings.

 

2. Enlist the Services of a Capable Real Estate Agent

To sell a house during the holiday season, you need to work with a real estate agent that is willing to work from Thanksgiving to New Year’s. Working during the holidays is not ideal but if your real estate agent is capable, it’s worth paying a slightly higher rate. At least with your real estate agent working hard, you’ll be able to enjoy stress-free holidays with your family.

 

3. Create Online Listings

The Internet has made it easier to sell homes even during the holidays. Since most people are busy with holiday preparations, the best way to put eyes on your property is through online listings. This makes it more convenient for those who are looking to buy a house. They won’t have to deal with traffic, bad weather, and other hassles just to look at your property. Just make sure to include high-quality pictures, detailed information about your property, and even a walkthrough video — if possible.

 

4. Make Price Adjustments

If the real estate market is tough, consider making adjustments that will make your property more attractive to homebuyers.

You can make small adjustments that will allow you to lower the asking price. It’s possible to slash prices but still guarantee profits when selling your house.

 

5. Eliminate Barriers to Home Showings

Make it easier for homebuyers to view your home during the holidays. Ensure that your driveways, walkways, and patios are clean and hazard-free. If you live in a place where there is snow, make sure to remove ice and snow. Inside, serve hot chocolate and Christmas treats to relieve the stress that homebuyers may have experienced on the way to your property. These are small touches that can play a large role in selling your house during the holidays.

 

A Case for Renting Your Home This Holiday Season

If selling your home during the holidays isn’t possible, you can consider renting it instead. The same benefits apply such as less competition and more serious tenants. The New Year is also a time for many changes. People who are moving to new jobs or pursuing new opportunities will be looking for great places to rent during the holiday season.

Renting your vacation or secondary home can also be very profitable during the holidays. There are a lot of people who head to states like Florida to escape the colder climates. Thus, there is a high demand for rental homes during the holiday season.

 

The Holiday Season: Is Now a Good Time to Sell a House?

While most people will wait for May to sell their house, you may want to consider selling your house during the holidays. As you can see, there are many benefits in doing so—such as less competition and more motivated buyers. You can also take advantage of holiday nostalgia in making your house more attractive and appealing to homebuyers. Nevertheless, make sure to consult real estate Christmas trends to see if now is a good time to sell your house.

If you need advice for selling your home during the holidays, feel free to browse our online directory for the property management companies in your local area.

 

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Deciding to become a property owner is a major step. To get a good return on your investment, it’s important to do thorough research on the real estate market. One of the most important factors to consider is the location of your property investment. If you need some guidance, here are the 10 best states to invest in real estate.

 

10 of the Best States to Invest in Real Estate

Location isn’t the only consideration when deciding to invest in real estate. However, it can help you narrow down the places where there is a good chance of real estate profitability. If you’re going to be a first-time property owner, here are some of the best states to invest in.

 

1. Indiana

Indiana is currently one of the best states for real estate.

The median home cost is $142,600 with an 8.9% growth in the last 12 months. Compared to the U.S. average, the cost of living in Indiana is 17.9% lower.

Among the population, 27.1% are renters. The average rent is $573 for a studio, $662 for a one-bedroom, $825 for a two-bedroom, $1084 for a three-bedroom, and $1221 for a four-bedroom. Indianapolis is one of the best cities to invest in Indiana.

 

2. Ohio

Ohio is also a good place to invest in property. The median home cost is $140,700 with a 6.5% growth in the last 12 months. Compared to the U.S. average, the cost of living in Ohio is 17.4% lower.

Among the population, 29.5% are renters. The average rent is $551 for a studio, $636 for a one-bedroom, $811 for a two-bedroom, $1067 for a three-bedroom, and $1791 for a four-bedroom. Columbus and Cincinnati are two of the best cities to invest in Ohio.

 

3. North Carolina

One of the best states to buy rental property is North Carolina.

The median home cost is $187,300 with a growth of 8.5% in the last 12 months. Compared to the U.S. average, the cost of living in North Carolina is 9.4% lower.

Among the population, 29.2% are renters. The average rent is $697 for a studio, $731 for a one-bedroom, $875 for a two-bedroom, $1172 for a three-bedroom, and $1430 for a four-bedroom. Raleigh, Durham, and Charlotte are the top cities to invest in North Carolina.

 

4. Tennessee

If you want a good return on your investment, consider buying rental property in Tennessee. The median home cost is $164,500 with an 8% growth in the last 12 months. Compared to the U.S. average, the cost of living in Tennessee is 12.4% lower.

Among the population, 28.8% are renters. The average rent is $622 for a studio, $696 for a one-bedroom, $852 for a two-bedroom, $1134 for a three-bedroom, and $1332 for a four-bedroom. Nashville is one of the best cities to invest in Tennessee.

 

5. Missouri

Real estate is also a worthwhile investment in Missouri. The median home cost is $159,500 with a 6.7% growth in the last 12 months. Compared to the U.S. average, the cost of living in Missouri is 14.1% lower.

Among the population, 27.8% are renters. The average rent is $569 for a studio, $650 for a one-bedroom, $827 for a two-bedroom, $1110 for a three-bedroom, and $1276 for a four-bedroom. Springfield and Kansas City are some of the best cities to invest in Missouri.

 

6. Idaho

Idaho is another state that is worth buying real estate. Compared to other states on this list, the median home cost is higher at $263,900.

However, there has also been a 14% growth in the last 12 months. The cost of living in Idaho is 2.3% lower than the U.S. average.

Among the population, 26.7% are renters. The average rent is $542 for a studio, $626 for a one-bedroom, $802 for a two-bedroom, $1129 for a three-bedroom, and $1338 for a four-bedroom. Boise is one of the best cities to invest in Idaho.

 

7. Georgia

Next on the list of the best states to invest in real estate is Georgia. The median home cost is $186,500 with a 9.1% growth in the last 12 months. Compared to the U.S. average, the cost of living in Georgia is 6.6% lower.

Among the population, 30.8% are renters. The average rent is $790 for a studio, $821 for a one-bedroom, $958 for a two-bedroom, $1256 for a three-bedroom, and $ 1520 for a four-bedroom. Atlanta is one of the best cities to invest in Georgia.

 

8. Florida

Florida is one of the more expensive states on this list.

However, as home to some of the most popular tourist destinations in the country, buying real estate in this state is still a good investment.

The median home cost is $237,100 with a 7.8% growth in the last 12 months. Compared to the U.S. average, the cost of living in Florida is 2.8% higher.

Among the population, 27% are renters. The average rent is $832 for a studio, $945 for a one-bedroom, $1174 for a two-bedroom, $1584 for a three-bedroom, and $1903 for a four-bedroom. Orlando, Jacksonville, and Tampa are the top cities to invest in Florida.

 

9. Alabama

Alabama is another best place to buy real estate. The median home cost is $120,300 with a 6.9% growth in the last 12 months. Compared to the U.S. average, the cost of living in Alabama is 17.7% lower.

Among the population, 25.9% are renters. The average rent is $591 for a studio, $639 for a one-bedroom, $772 for a two-bedroom, $1021 for a three-bedroom, and $1191 for a four-bedroom. Huntsville is one of the best cities to invest in Alabama.

 

10. Texas

Last but not least on our list of best places to invest in real estate is Texas.

The median home cost is $195,000 with a 6.7% growth in the last 12 months. Compared to the U.S. average, the cost of living in Texas is 6.1% lower.

Among the population, 33% are renters. The average rent is $738 for a studio, $841 for a one-bedroom, $1036 for a two-bedroom, $1291 for a three-bedroom, and $1721 for a four-bedroom. Houston, Arlington, Austin, and San Antonio are the top cities to invest in Texas.

 

Other Considerations When Investing in Real Estate

Property Taxes

Investors should also consider the property tax rate of states when buying real estate. Alabama has the second-lowest property tax rate in the country. The effective property tax rate is 0.37% so property owners pay about $543 in taxes each year.

Idaho is also notable with an effective property tax rate of 0.72%, which means property owners pay about $1,246 in annual taxes. It’s worth noting that Texas has one of the highest property tax rates in the country at 1.62%. Property owners will pay about $2,578 in taxes each year.

Migration

Investors may also want to purchase real estate in states where there is high migration. Florida, Texas, North Carolina, Georgia, Tennessee, and Idaho have seen a high influx of people in the last year. Thus, there are greater housing demands in these states.

Valuation

Some investors may also want to consider the price-to-income ratio when deciding to purchase real estate in a particular state. Based on valuation, Texas, Tennessee, North Carolina, Florida, and Idaho are some of the best states to invest in real estate.

Money Magnets

It’s also worth investing in states that are money magnets since this helps drive up home prices. Some of the best money-magnet states are Florida, Texas, North Carolina, and Tennessee.

 

Choose with Confidence

Jumping into real estate investment can be scary. Since you’re investing your money, you want to make sure that you are making the right choices. Given the unpredictability of the economy, it’s wise to invest in states that have the best real estate markets in the country. For a good return on investment, confidently consider the 10 best states to invest in real estate mentioned.

Once you’ve found the perfect property, feel free to browse our online directory of property management companies to help you manage your real estate investment.

 

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