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America’s Top 5 Cities For Real Estate Investors

By Mike Wheatley | December 12, 2012

Home sales continue to drop around the United States, despite excellent interest rates on thirty-day loans and huge supplies in the housing market. High unemployment and lenders requiring larger down payments also contribute to plummeting real estate market values. This news may be disheartening to some people, but it also provides a great opportunity to those who have the means to invest in real estate, today.

Top five

© kovaleff -

Anyone who does not qualify for a mortgage will still need a place to live. This provides an opportunity for homeowners to rent out their properties while waiting for their investments to appreciate. The question for these investors becomes, “In this see-saw real estate market, where is the best place to buy a property?”

The following list can shed light on this dilemma, as it highlights the top five cities in the United States where rental demand is high and housing inventories are falling.

1. Tucson, Arizona, a city with a median single-family home list price at $170K, this metropolis is now the number-one city for real estate investing in the United States. The investment strategy in Tuscan is to buy a home at a discount in a market where prices have dropped thirty-one percent, hold it, and rent the property out while waiting for its value to appreciate. Collecting rent offers property owners a steady monthly income, which they can use to help pay their taxes, mortgagees or maintenance. Tucson is a college town and popular vacation spot where there is no shortage of renters, since the average Joe in Arizona still cannot qualify for a home loan.

Tucson Arizona

Tucson, Arizona: Number one in the US for investors right now © Andy -

2. Austin, Texas, is next on the list, mostly because the city is one of the newest tech-business hubs in the United States. For 230K, investors can find a home in a city that was immune to the housing crisis, as Austin’s property values remained stable when the rest of the country broke down. This metro-area is also a college community and is well-known for its vibrant nightlife. The student housing demand and yuppies in the area who are looking for a place to live provides a winning mix that has investors finding it hard to lose in the city of Austin.

Austin Texas Downtown

The tech hub that is Austin could be a source of riches for all wannabe investors © Brandon Seidel -

3. Kansas City, Missouri, home prices were hit hard a few years ago, but property values in this city have now become some of the fastest in the country to recover. At an average increase of four percent per annum, investors can buy a single-family home, condo or co-op for about $135K. However, new home buyers will need to act quickly, as the word is out on Kansas City where housing inventory is down twenty percent from a year ago and is shrinking fast.

Kansas City on map're looking to make a quick buck, you want make it anywhere faster than Kansas © Tupungato - Fotolia

If you're looking to make a quick buck, you want make it anywhere faster than Kansas © Tupungato - Fotolia

4. Baltimore, Maryland, home prices are stabilizing, and according to, property values have hit the bottom. The average median list price in this city is $240K with a forecast to increase over three percent a year. Economists also estimate that Baltimore will receive a full economic recovery within the next two years, which is the reason why investors are scooping up properties in this high-demand metropolis. Most likely, an economic recovery will appreciate city’s property values, dramatically.

Baltimore skyline reflected in the Inner Harbor's only one direction in which it can go © John Keith -

Baltimore hit rock bottom months ago - now, there's only one direction in which it can go © John Keith -

5. Salt Lake City, Utah, a town where housing inventories have shrunk the most out of all the five cites on the list. Buyers scooped up more than thirty-eight percent of the available units in Salt Lake City after realizing a five-and-half increase in median price in the last year. The small town has become a growing tourist site, and most people residing in Utah still cannot qualify for a home mortgage, which forces them to rent properties.

Salt Lake City Utah at sunset

Salt Lake City: Inventory may have sunk, but few residents can afford to buy anyway © Andy -

Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at [email protected].
  • 6 comments on “America’s Top 5 Cities For Real Estate Investors”

      1. Yes you're right, Charleston is another one but unfortunately I could only include five cities this time around 😉

    1. Very good article Mike.

      I would add that these cities are also growth areas because of a stable to growing employment base. Those cities with plentiful, good paying jobs will always recover first and have the highest demand from tenants or buyers.

      1. Yes, most definitely. Employment is always a key factor in any recovery and I'm pretty sure these cities are healthier than most in that department 😉

    2. Great information in this article. I knew about Austin, but didn't know about Tucson. Not to bring about bad news, but the word on the web is that soon there will be many refugees from California needing places to stay in Arizona. I guess they are speaking about the "big one".

    3. This article has good information for those that are interested in the real estate investing market. The information that you have shared here goes right along with the research that I have done for myself.

      Kansas City, Missouri and Austin Texas are the two cities that my research has been leaning me towards.

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