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Top 10 Cities for Real Estate Investment in 2018

By Guest Author | January 26, 2018

As most real estate agents know, affordability and growth are at the top of the list when it comes to choosing a great investment. Your clients might be looking to buy their forever home or simply expand their portfolio with an investment property, but you assure them that real estate is a sound choice.

This is especially true in appreciating markets, where median home price is still affordable and the amount of high-paying jobs is decent. Cities that appear to have upward growth potential sweeten the deal.

If your clients are looking for some of the best-buy cities for 2018, this list of top cities for real estate investment is a great place to start. They all either have high opportunity for growth, high CAP rates, a healthy job market, or a healthy mix of these factors.

1. Jacksonville, Florida:

Jacksonville topped the list for its reasonable median home price of around $232,000 but high appreciation rate. With CAP rates at a healthy 7.2 percent, Jacksonville is a great place to invest. Their beaches, urban parks, and emerging social scene ensure people will want to move there for years to come!

2. Raleigh, North Carolina

Raleigh’s combination of high growth rate, high job growth rate, and relatively affordable median home price ($278,300) make it a great buy. Rental vacancies are at a low 4.3 percent because of its thriving job market, so investors are sure to see high ROI’s.

3. Columbus, Ohio

Columbus, Ohio has a median home price of $200,000, which is one of the most affordable on our list. Those who invest are sure to see appreciation quickly, though as their combination of growing population and robust job market are sure to ramp those prices up! Employers like Honda, Nationwide Insurance, and JPMorgan Chase & Co. are headquartered there with no plans to move anytime soon!

4. Charlotte, North Carolina

Charlotte’s onslaught of new restaurants and attractions has drawn visitors and those looking for a new, exciting place to live. Their CAP rate is at 6.8 percent, meaning ROI is strong here. The median home price is at $234,400, making it affordable at the moment!

5. Minneapolis-St. Paul, Minnesota

Minneapolis-St. Paul boasts a solid job growth ranking and CAP rates that reflects the demand for homes. The cooler temperatires and big-city amenities offered here continue to attract more and more people every year. Their average home price of $259,000 means it’s an optimal time to invest here.

6. Atlanta, Georgia

Atlanta continues to grow, and its low median home price of $204,900 assures that these people can find affordable housing. However, it’s unlikely to stay that way forever, as its job market recovers and buyer confidence grows. It’s the perfect time to grab some real estate here!

7. Orlando, Florida

Its healthy job market and rapidly growing population means Orlando is a solid place to invest right now. Posting some of the highest gains in the U.S. during 2017, home values in Orlando are expected to continue to rise.

8. Oklahoma City, Oklahoma

Oklahoma City has an incredibly low median home price ($160,200) and its solid population growth gives it one of the highest CAP rates on our list (8.4 percent). Demand for homes is rising as the cities revitalization takes place, so now is a great time to invest here.

9. Cincinnati, Ohio

Cincinatti’s low median home price and rapid growth give it an extremely high CAP rate of 9.4 percent. With a still low median home price of $168,600, it’s in a similar boat as Oklahoma City as it bounces back from the resession. It’s the perfect time to buy here!

10. Indianapolis, Indiana

Despite a slightly lower job and population growth than some of the other cities, Indianapolis’s high CAP rate and rapidly appreciating home values put it on the list. It’s relatively low cost of living means it’s a great place to live or invest.

Methodology: Renoviso took the top 100 most populated cities in the US and ranked them according to CAP rate, job growth ranking, population growth percent and single family home price. They assigned points for each rank in each category.

These points were then multiplied by the percent rank of importance (HomeUnion CAP Rate: 25 percent, Glassdoor Job Growth Ranking: 20 percent, Rental Vacancy Rates: 20 percent, Population Growth: 20 percent and Low Single-Family Home Price: 15 percent). They then took the top 50 cities and analyzed their markets further, determining if they were a good fit and throwing out any that disqualified. Those with the highest scores across the board made the list.

About The Author: Karli Jaenike is a real estate expert working on behalf of Renoviso to determine strong real estate investments around the country. She enjoys writing and sharing her knowledge with other people

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