Top 10 Neighborhoods for Buying an Investment Property in Raleigh

Where should you buy an investment property in Raleigh, North Carolina?

Raleigh, North Carolina was marked as the #2 housing market in the US for investing in 2018 by Zillow.

This means that if you’re looking to purchase an investment property and start making profits in real estate, then you should definitely consider investing in the Raleigh real estate market 2018.

Raleigh, the capital of North Carolina and the second largest city in the state, is one of the fastest growing cities in the country, and it is home to numerous cultural, educational, and historic sites, including museums of art, history, and natural sciences.

Some of the major universities and colleges in Raleigh include Shaw University, the first historically black university in the American South, and North Carolina State University.

Raleigh was also the #1 on Forbes’ list of the best places for businesses and careers for 2015. This means that the city is a major hub for businesses, both small and large, and it includes companies such as the BB&T Insurance Services, Carquest, First Citizens BankShares, Red Hat, and Waste Industries.

Raleigh Real Estate Market Trends 2018

When considering the purchase of an investment property in the Raleigh real estate market, it is important to look at the housing market trends and its historic performance in Raleigh. The market trends in Raleigh indicate an increase of $12,000 (5%) in median home sales over the past year, according to Trulia. The average price per square foot for this same period rose to $139, up from $131.

Additionally, according to Zillow, Raleigh’s income grew by 9% last year, and the city has an unemployment rate of 3.6%.

With the steadily increasing median home prices and rental rates, finding a suitable investment property in Raleigh could be a challenge, but it can also be very profitable and worth the effort.

One of the major aspects of purchasing an investment property in Raleigh is finding the right market or neighborhood to invest in. This is where Mashvisor can help you out.

Note: To learn more about our product and how it can help you make the best real estate investment decisions, click here.

Before jumping into the top 10 neighborhoods for purchasing an investment property in the Raleigh real estate market, let’s first take a look at the average performance of the Raleigh housing market 2018 according to Mashvisor’s stats:

  • Median investment property price: $363,374
  • Median traditional rental rate: $1,539
  • Median Airbnb rental rate: $1,693
  • Average traditional cap rate: 1.9%
  • Average Airbnb cap rate: 2.54%
  • Average Airbnb occupancy rate: 55.27%

Best Neighborhoods for Buying an Investment Property in the Raleigh Real Estate Market

Now that you have a general overview of the Raleigh housing market’s performance in 2018, let’s go through each neighborhood and see how its stats fair against the average performance of the city’s housing market to help you determine the best neighborhood for buying an investment property in Raleigh, North Carolina.

Northwest Raleigh

  • Median investment property price: $329,900
  • Median traditional rental rate: $1,522
  • Median Airbnb rental rate: $3,239
  • Average traditional cap rate: 1.93%
  • Average Airbnb cap rate: 6.34%
  • Average Airbnb occupancy rate: 50%

Hillsborough

  • Median investment property price: $454,950
  • Median traditional rental rate: $1,520
  • Median Airbnb rental rate: $1,789
  • Average traditional cap rate: 1.05%
  • Average Airbnb cap rate: 2.5%
  • Average Airbnb occupancy rate: 63.81%

North Central

  • Median investment property price: $451,894
  • Median traditional rental rate: $1,824
  • Median Airbnb rental rate: $1,986
  • Average traditional cap rate: 1.68%
  • Average Airbnb cap rate: 1.84%
  • Average Airbnb occupancy rate: 50.14%

Related: What’s a good cap rate for investment properties?

Wade

  • Median investment property price: $525,000
  • Median traditional rental rate: $1,737
  • Median Airbnb rental rate: $2,004
  • Average traditional cap rate: 1.21%
  • Average Airbnb cap rate: 1.51%
  • Average Airbnb occupancy rate: 46.93%

Six Forks

Median investment property price: $450,000

Median traditional rental rate: $2,125

Median Airbnb rental rate: $2,677

Average traditional cap rate: 2.45%

Average Airbnb cap rate: 4.03%

Average Airbnb occupancy rate: 42.62%

Related: Best Places to Invest in Real Estate Based on Cap Rate

Central

  • Median investment property price: $442,450
  • Median traditional rental rate: $1,957
  • Median Airbnb rental rate: $2,419
  • Average traditional cap rate: 2.1%
  • Average Airbnb cap rate: 2.76%
  • Average Airbnb occupancy rate: 61.46%

Northeast Raleigh

  • Median investment property price: $212,450
  • Median traditional rental rate: $1,255
  • Median Airbnb rental rate: $1,373
  • Average traditional cap rate: 2.77%
  • Average Airbnb cap rate: 3.62%
  • Average Airbnb occupancy rate: 49.58%

West Raleigh

  • Median investment property price: $369,900
  • Median traditional rental rate: $1,355
  • Median Airbnb rental rate: $1,926
  • Average traditional cap rate: 1.78%
  • Average Airbnb cap rate: 1.44%
  • Average Airbnb occupancy rate: 71.09%

Related: How to Easily Find Real Estate Comps

Five Points

  • Median investment property price: $499,900
  • Median traditional rental rate: $1,731
  • Median Airbnb rental rate: $2,237
  • Average traditional cap rate: 1.19%
  • Average Airbnb cap rate: 1.97%
  • Average Airbnb occupancy rate: 62.45%

Mordecai

  • Median investment property price: $363,000
  • Median traditional rental rate: $1,665
  • Median Airbnb rental rate: $2,022
  • Average traditional cap rate: 1.62%
  • Average Airbnb cap rate: 2.41%
  • Average Airbnb occupancy rate: 54.64%

Note: To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.

Conclusions about the Raleigh Real Estate Market 2018

Based on these stats, you can conclude that the Raleigh housing market 2018 is looking stable and solid for buying an investment property. Both traditional and Airbnb rentals are performing very well in the city, with Northwest Raleigh showing the best performance for Airbnb rentals (with a cap rate of 6.34%), and Central showing the best performance for traditional rentals (with a cap rate of 2.77%). If you’re looking for affordability, then Central is the most affordable neighborhood to buy an investment property in Raleigh, with a median property price of $212,450, which is over $150,000 lower than the city’s average. Finally, if you’re looking for the lowest risk for investing in Airbnb rental properties, West Raleigh is your safest bet due to the very high average Airbnb occupancy rate (71.09%).

Are you looking to find the best investment property in any of these neighborhoods? Head over to Mashvisor and type in the name of the neighborhood that you want to invest in and then download our Excel sheet report containing all of the listed properties in that neighborhood to make an easy comparison and identify the most profitable investment property to buy and rent out either traditionally or as an Airbnb rental.

Start Your Investment Property Search!
comments powered by Disqus