Top Locations 8 Cheapest States to Buy a House for Investment in 2021 by Charles Mburugu January 25, 2021January 25, 2021 by Charles Mburugu January 25, 2021January 25, 2021 When COVID-19 struck last year, many expected the housing market to crumble. However, despite a struggling economy and record levels of unemployment, many people were still buying a house for investment or as a primary residence. And the housing market data confirms the presence of high demand. A recent study conducted by Redfin of 400+ US metro areas revealed that the median home sale price rose 15% year over year to $322,616 in December 2020. This was the highest increase on record. New listings of property for sale were up 13% from a year earlier. 39% of properties that went under contract got an offer within the first 14 days on the market. It’s clear we ended the year in a seller’s market. The question many are asking now is ‘Will prices continue rising in 2021?’ Yes, chances are very high that 2021 will see a further spike in home prices. As mortgage rates remain low and real estate remains a good investment for 2021, people will continue to flood into the housing market to look for property. This high demand will lead to more bidding wars that will drive house prices further up. Economists at Realtor.com predict that the median home price will rise by 5.7% by the end of the year. Related: Will House Prices Go Down in 2021? With prices rising across the nation, where can you find the most affordable real estate? After all, you probably have a budget in mind and you need to stick to it, despite the rising home prices. In this article, we explore some of the cheapest states to buy a house to help you find a good real estate deal. The 8 Best States to Invest in Real Estate for Affordability in 2021 Wondering where to invest in real estate? If you are planning on buying a house for investment, you shouldn’t be too worried about the rising home prices. The best states to invest in real estate aren’t necessarily the most expensive ones. And with some research, you can still find some investment properties that are relatively affordable. Based on Mashvisor’s housing market data, here are the cheapest states to buy a house in the US: #1. Iowa Median Property Price: $230,620 Price per Square Foot: $157 Price to Rent Ratio: 18 Monthly Traditional Rental Income: $1,082 Traditional Cash on Cash Return: 3.0% Average Airbnb Daily Rate: $157 Monthly Airbnb Rental Income: $2,118 Airbnb Cash on Cash Return: 4.0% Airbnb Occupancy Rate: 53% #2. North Dakota Median Property Price: $242,621 Price per Square Foot: $116 Price to Rent Ratio: 16 Monthly Traditional Rental Income: $1,271 Traditional Cash on Cash Return: 3.6% Average Airbnb Daily Rate: $102 Monthly Airbnb Rental Income: $1,634 Airbnb Cash on Cash Return: 3.1% Airbnb Occupancy Rate: 61% Related: 2 New Ways to Find Cheap Investment Property for Sale #3. Ohio Median Property Price: $249,141 Price per Square Foot: $128 Price to Rent Ratio: 18 Monthly Traditional Rental Income: $1,169 Traditional Cash on Cash Return: 3.2% Average Airbnb Daily Rate: $145 Monthly Airbnb Rental Income: $2,134 Airbnb Cash on Cash Return: 4.1% Airbnb Occupancy Rate: 58% #4. West Virginia Median Property Price: $254,747 Price per Square Foot: $122 Price to Rent Ratio: 19 Monthly Traditional Rental Income: $1,094 Traditional Cash on Cash Return: 3.8% Average Airbnb Daily Rate: $186 Monthly Airbnb Rental Income: $2,060 Airbnb Cash on Cash Return: 4.9% Airbnb Occupancy Rate: 59% #5. Indiana Median Property Price: $255,237 Price per Square Foot: $124 Price to Rent Ratio: 19 Monthly Traditional Rental Income: $1,115 Traditional Cash on Cash Return: 3.6% Average Airbnb Daily Rate: $134 Monthly Airbnb Rental Income: $2,015 Airbnb Cash on Cash Return: 4.1% Airbnb Occupancy Rate: 59% Related: 8 Ways to Find Cheap Multi Family Homes for Sale #6. Kentucky Median Property Price: $272,533 Price per Square Foot: $389 Price to Rent Ratio: 20 Monthly Traditional Rental Income: $1,115 Traditional Cash on Cash Return: 3.2% Average Airbnb Daily Rate: $182 Monthly Airbnb Rental Income: $2,021 Airbnb Cash on Cash Return: 4.4% Airbnb Occupancy Rate: 53% #7. Mississippi Median Property Price: $285,687 Price per Square Foot: $130 Price to Rent Ratio: 20 Monthly Traditional Rental Income: $1,200 Traditional Cash on Cash Return: 3.5% Average Airbnb Daily Rate: $140 Monthly Airbnb Rental Income: $1,912 Airbnb Cash on Cash Return: 4.0% Airbnb Occupancy Rate: 58% #8. Arkansas Median Property Price: $288,898 Price per Square Foot: $129 Price to Rent Ratio: 22 Monthly Traditional Rental Income: $1,095 Traditional Cash on Cash Return: 3.1% Average Airbnb Daily Rate: $138 Monthly Airbnb Rental Income: $2,434 Airbnb Cash on Cash Return: 5.1% Airbnb Occupancy Rate: 60% Search for My Investment Property How to Find and Analyze Properties in the US Housing Market 2021 Now that you are armed with a list of the cheapest states to buy a house, there are a few more steps you’ll need to take before you finally find that affordable, money-making investment property for sale. You could try to identify the affordable real estate markets within the state of your choice. Alternatively, you can dive right into your property search and Mashvisor can help. Simply visit our State Guides. From there, you can select a few different filters to find the perfect property: Investment Property Type – Choose between single family homes, multi family homes, condos, townhouses, and other homes. City – If you have a city in mind, select it. Otherwise, do a general investment property search across the state. Neighborhood – If you select a city, you can also narrow down the search by neighborhood. Use our real estate heatmap to help you with a neighborhood analysis. Sorting – Sort the massive list of investment properties for sale by your desired criteria. Here, it would be the price in ascending order. But there are other filters including the number of bedrooms, the traditional cash on cash return, and the Airbnb cash on cash return. Here’s what these filters return for our #1 most affordable state, the Iowa real estate market: Search for Iowa investment properties for sale on Mashvisor. As you can see, the two most affordable properties turn up in Des Moines and Burlington, IA. Check out the property analysis page for any listing you find to analyze it and make sure that you’re not just buying a cheap house for investment, but a profitable one, too. Conclusion If you do your homework, you should be able to find a great deal in the cheapest states to buy a house. Just remember, you’re looking for something cheap and profitable. Buying a house for investment that meets both of these criteria will be easier if you use Mashvisor’s real estate investment tools like our State Guides for your property search and the rental property calculator for your property analysis. To start looking for and analyzing the best investment properties, click here. Start Your Investment Property Search! START FREE TRIAL Affordable MarketsIndianaIowaKentuckyMississippiOhio 0 FacebookTwitterGoogle +PinterestLinkedin Charles Mburugu Charles Mburugu is a HubSpot-certified content writer/marketer for B2B, B2C and SaaS companies. He loves writing on topics that help real estate investors and agents make better choices. Previous Post Rental Property Investing for Beginners: 10 Best Tips Next Post An Airbnb Pricing Tool That Does a Whole Lot More Related Posts What You Should Know About Investment Properties in Atlanta Los Angeles Real Estate Market 2018 and Long Term Rental Properties: What You Need to Know Where to Buy California Multifamily Properties for Sale in 2019 All You Need to Know About Dallas Investment Properties Airbnb Panama City Beach 2020: Should I Invest? Why Nashville Real Estate Has Become So Popular Las Vegas Housing Market Beats Seattle Real Estate for #1 Spot in the US How About Investing in Airbnb Nashville in Early 2018? 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