Houston, with its fascinating history, is considered to be one of the most desirable places to live and raise a family. For a savvy real estate investor, this makes the city a desirable location to invest in real estate. The Houston real estate market is booming in 2018 and becoming one of the top destinations for property investors looking to invest in long-term rental properties. So, if you’re thinking of buying an investment property, keep reading to learn why we say “yes” to the Houston real estate market, which neighborhoods you should consider, and how we can help you find the most profitable investment properties in the city!
Related: Top 10 Real Estate Markets for Buying Rental Property in 2018
5 Reasons to Invest in Houston Real Estate Market
1. High Population
Houston is the largest city in the state of Texas and it’s the 4th most populous city in America with a population of over 2.2 million people. Houston is a popular city in the US with thriving business culture, fashion, sport, research, technology, and education. All these factors lead hundreds of people (not just from the state of Texas, but from across the nation as well) to move to Houston every day. Simultaneously, this allowed the Houston real estate market to boom as demand for rental properties continues to increase, especially for single-family homes.
2. Variety of Investment Properties to Invest in
Investing in the Houston real estate market is a great option for property investors because there is a lot of variety of investment properties available. Houston has an extremely good business infrastructure. Plus, residential housing costs provide an operating cost advantage to future property investors. Moreover, property investors can easily find both old and new properties in the Houston real estate market. This means a real estate investor can find a lot of investment opportunities in whatever type of real estate – commercial or residential. Whatever type of investment property you’re looking for, you just might find it in Houston, TX.
Related: Residential Real Estate Investing vs. Commercial Real Estate Investing: Which One is Right for You?
3. Booming Trade
One of the reasons why people migrate to a certain place is international trade and ease of business, and Houston has the largest and busiest port in the US when it comes to foreign trade. The city’s massive international trade is yet another job boost to the city – the port employs workers and also attracts numerous business people from around the world, and these people need places to stay in. This is another reason why property investors should consider the Houston real estate market. Savvy property investors are encouraged to buy an investment property in a housing market with strong employment and job growth because these locations have strong economies and it’s easier to find good tenants in them.
4. Job Growth
Houston is the country’s #1 job creator – the unemployment rate in Houston is far below the national level, and the forecast for 2018 expects even stronger job growth! The city is home to America’s booming oil and gas industry, and big companies want to have their headquarters in Houston. This will definitely bring new jobs in the area, giving the Houston real estate market and economy a great boost.
5. Economy
Speaking of the economy, Houston is one of the most important industrial bases in the world and ranks #2 in manufacturing GDP in the United States. It has over 1,760 companies, hospitals, health facilities and research institutions. Houston is also considered a world center for almost every segment of the oil and gas industry. It is home to 6,400 manufacturers who employ more than 240,000 workers and produce $80 billion in goods annually. All of the above are reasons to invest in the Houston real estate market- with an economy this strong, you can guarantee a good return on investment.
Click here to search for and analyze the best investment properties in the Houston real estate market!
Houston Real Estate Market Statistics
To further prove why Houston is a good location for real estate investing, take a look at these numbers regarding the Houston real estate market for 2018. These numbers are computed using Mashvisor’s investment property calculator – to learn more about our product, click here!
Note: Seeing as our data shows that traditional real estate investing is optimal in the Houston real estate market, we’re only providing the numbers regarding this rental strategy.
- Median Property Price: $421,159
- Traditional Rental Income: $1,819
- Cash on Cash Return: 1.34%
- Cap Rate: 1.34%
Where to Invest in Houston?
According to data from Mashvisor’s investment property calculator, here are some of the best neighborhoods to consider when looking to buy an investment property in Houston:
Houston Real Estate Market – Downtown
- Median Property Price: $412,457
- Traditional Rental Income: $2,396
- Cash on Cash Return: 2.66%
- Cap Rate: 2.66%
Houston Real Estate Market – Astrodome Area
- Median Property Price: $184,970
- Traditional Rental Income: $1,287
- Cash on Cash Return: 2.04%
- Cap Rate: 2.04%
Houston Real Estate Market – Midtown
- Median Property Price: $371,125
- Traditional Rental Income: $2,540
- Cash on Cash Return: 2.02%
- Cap Rate: 2.02%
Houston Real Estate Market – Binz
- Median Property Price: $433,252
- Traditional Rental Income: $2,488
- Cash on Cash Return: 1.59%
- Cap Rate: 1.59%
Houston Real Estate Market – Washington Avenue Coalition – Memorial Park
- Median Property Price: $482,359
- Traditional Rental Income: $2,575
- Cash on Cash Return: 1.46%
- Cap Rate: 1.46%
Houston Real Estate Market – Fourth Ward
- Median Property Price: $507,568
- Traditional Rental Income: $2,640
- Cash on Cash Return: 1.44%
- Cap Rate: 1.44%
Houston Real Estate Market – Montrose
- Median Property Price: $726,504
- Traditional Rental Income: $2,731
- Cash on Cash Return: 0.91%
- Cap Rate: 0.91%
Houston Real Estate Market – Greater Uptown
- Median Property Price: $700,704
- Traditional Rental Income: $2,267
- Cash on Cash Return: 0.72%
- Cap Rate: 0.72%
To analyze and find the best investment properties in any neighborhood of your choice, click here!
How to Find the Best Investment Property in Houston
We understand the difficulties property investors face while searching for the right investment property in the right location, and we offer the solution! Mashvisor helps property investors find the best investment properties in any city or neighborhood in just 15 minutes based on real estate analytics. To find the best investment properties in the Houston real estate market, make use of our:
- Investment Property Calculator: A versatile tool that allows you to calculate the different values related to a rental property, including the cash on cash return, cap rate, cash flow, and occupancy rate (for both traditional and short-term Airbnb investment). This will help you evaluate the profitability of buying a rental property.
- Investment Property Finder: A powerful and heavily customizable search tool that allows you to search for investment properties based on specific criteria using different filters, such as finding rental properties of a certain price range, in a certain neighborhood, or with a certain cap rate. This will help you easily compare different investment properties in the same neighborhood to determine which one will yield a better return on investment.
- Heat Map Function: The heat map function allows you to find investment properties much faster using visual cues. For example, you can set the heat map to indicate the areas in the Houston real estate market with the highest rental income, and the heat map will highlight areas as either hot or cold for this feature. This will make it easier to compare different neighborhoods and see which one has more profitability for real estate investing.
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Related: Mashvisor: A Real Estate Investing Tool for All Your Investment Needs
The Bottom Line
For someone planning on buying an investment property in 2018, we recommend investing in the Houston real estate market. The city has everything – the people, the diversity, the strong economy and growing job market. Thus, if you’re a real estate investor and you have the opportunity to invest in the Houston real estate market, don’t hesitate! Click here to learn more about how we help property investors make faster and smarter real estate investment decisions.
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