Are you wondering about the best places to invest in real estate in 2017? We’ve laid out the top 5 that show the most potential for investment in 2017.
Best Places to Invest in Real Estate: Denver
One of the best places to invest in real estate is Denver. Denver doesn’t usually receive a lot of attention, but the city is actually a hidden gem. Home values in Denver have appreciated by 10% over the past year. The year-over-year home value appreciation is 10.7% which makes it the 4th highest in the US, according to Zillow. Plus, the city does not suffer from a sever supply problem, meaning demand does not exceed supply by a great deal. And while there is a lack of inventory, Denver is seeing some construction of new property.
Denver’s economy is growing and so is the population. Denver’s population is a highly educated one, consisting of mainly young entrepreneurs and Millennials who are moving to the city in search of job opportunities. There’s been a recent boom in the tech and energy industries, which has created jobs for a large number of people. Why does this matter? Because the more jobs there are, the more people are moving to an area, and the more they can afford to rent property and pay on time! The tech and energy industries still have room for growth. The latest job growth is occurring in healthcare and universities which are the new source of employment for the Denver population.
Denver’s tourism and Airbnb industry are also doing very well. Recently, Denver passed a new law which legalized renting out short-term rentals (including Airbnb) for less than 30 days. This new legislation is making Airbnb investment even more appealing to Denver investors – yet another reason Denver is one of the best places to invest in real estate!
- Median Home Price: $558,975
- CoC Return
- Airbnb: 4.66%
- Traditional: 2.77%
- Average Rental Income/month
- Airbnb: $3,472
- Traditional: $2,539
Best Places to Invest in Real Estate: Chicago
Next on our list is Chicago real estate. Chicago has seen evident increase in home sales in 2016. Sales haven’t been as high as 2015, but the city has had a few strong months showing potential for 2017. And while there is a shortage of inventory in Chicago, the city has seen over $5.9 billion invested in construction of real estate properties in the past year, an increase of 72%.
Chicago’s also witnessed a slight shift in income and therefore demand. Recently, there has been increased demand for apartments as opposed to single-family homes. Property prices are rather high compared to income, so more people are moving towards renting because they cannot afford to buy. This is your window. Chicago’s young demographic, majority of whom are Millennials, are your prospect tenants.
We must also not forget to mention Chicago’s tourist significance. The Windy City is one of the most popular places to visit in the US, which makes it a top Airbnb city. Chicago is currently rater number three of cities with highest Airbnb revenue, and highest ROI. This is reflected by the increasing number of investors moving towards investing in Chicago Airbnb rentals.
- Median Home Price: $699,900
- CoC Return
- Airbnb: 5.8%
- Traditional: 2.59%
- Average Rental Income/month
- Airbnb: $2,577
- Traditional: $1,790
Best Places to Invest in Real Estate: Seattle
For one, Seattle’s got a booming economy. The city is home to many of the country’s huge companies such as Amazon, Microsoft, Starbucks, Costco, MSNBC, Nordstrom, T-Mobile, among many others. The high tech industry in specific is taking off. So you’ve got a city that’s creating jobs, and paying its employees high salaries. The effect on Seattle real estate? More people moving in who can afford to rent and buy property, and an opportunity for you as an investor. With unemployment at 4.0%, Seattle’s economy is expected further grow – a fact that is driving more investors into the city and making it one of the best places to invest in real estate. Additionally, property prices in Seattle are on the rise, and they expected to further increase in the next few years. So if you’re considering Seattle as your next investment, go for it now!
Furthermore, Seattle is a very popular tourist destination, which makes it one of the best places to invest in real estate, Airbnb specifically. From the iconic Seattle Space Needle, to the Museum of Flight, to Lake Union, the Pike Place Market, and the array of outdoor activities, Seattle’s got so much to offer to tourists and locals alike. Seattle’s tourism industry has grown and is expected to see further growth in home-sharing services specifically. In fact, Mashvisor data shows that Seattle is among the top cities in terms of Airbnb occupancy rates. Moreover, Seattle is a rather flexible city in terms of Airbnb regulations and legislations – not many have been put into place – which puts Airbnb Chicago on top of an investors list.
- Median Home Price: $700,100
- CoC Return
- Airbnb: 0.09%
- Traditional: 1.4%
- Average Rental Income/month
- Airbnb: $1,409
- Traditional: $2,308
If you’re planning on investing in investing in Seattle real estate, or if you already have, make sure you acquaint yourself with the new Seattle tenant law.
Don’t let it intimidate you, but make sure you’ve done your research and see how much the law will affect you as an investor.
Related: What’s Up With Seattle Real Estate Investing
Best Places to Invest in Real Estate: Dallas
Dallas is the fourth largest city in the US by population, and one that is growing at twice the US average. Dallas is a great investment opportunity for several reasons. To begin with, as all cities on our list, its economy is doing great. From the telecommunications industry, to healthcare, to energy, and the recent focus on business services and finance industry has made Dallas very diverse economy – a factor that has made Dallas a popular destination for young entrepreneurs and Millennials alike.
Speaking of, Millennials make up the most of Dallas’ population, where the median age is 33. They are surging the Dallas market as they look for employment opportunities and renting and/or buying property. In fact, out of the 1200 people move to Texas every day, half go to Dallas–Fort Worth Metroplex – the biggest inland metropolitan area in the US. Because of this, prices are increasing in Dallas and are expected to continue to rise. Moreover, Rents are high compared to home prices, so it’s in your advantage to invest in a rental property.
These are just a few reasons Dallas is one of the best places to invest in real estate in 2017.
Related: The Millennial Effect on the Real Estate Market
- Median Home Price: $630,848
- CoC Return
- Airbnb: 2.48%
- Traditional: 0.88%
- Average Rental Income/month
- Airbnb: $2,607
- Traditional: $1,860
Best Places to Invest in Real Estate: San Diego
It is well known that San Diego is an excellent location for both traditional and Airbnb investment. It is no secret that San Diego real estate is an expensive, competitive, well-positioned, and growing market – all reasons why it pays off in the long run. So if you have the financial ability to make the investment, what’s holding you back?
The current trend in San Diego real estate is a high demand for rental property, increasing rents and property appreciation. Furthermore, the rise in property values in San Diego gives you, as an investor, the opportunity to receive high rental returns and cash flow. The above trends for San Diego real estate are expected to continue well into 2017, and even further ahead. And while the city does have limited inventory, 2016 has seen a rise in construction, with emphasis on single-family homes, of property in San Diego.
Additionally, the tourist industry in San Diego is among the most successful in the nation. The city hosts 34.3 million visitors annually and is the fastest growing Airbnb rental market in the US. San Diego is definitely among the best places to invest in real estate. But we cannot stress this enough: Timing is key when it comes to San Diego real investment, and now is the optimal time to invest.
- Median Home Price: $2,195,000
- CoC Return
- Airbnb: 4.96%
- Traditional: 2.33%
- Average Rental Income/month
- Airbnb: $3,422
- Traditional: $2,520
Related: Top 4 Benefits of Investing in San Diego Real Estate
For more information on specific neighborhoods and properties in these cities, use Mashvisor’s investment analytical tools to view information on CoC return, cap rate, occupancy rate, rental income, and much more. Our interactive investment property calculator will help you decide in which city you will achieve the most returns.