Realtor.com recently publicized the 10 hottest cities for investors. Analysts looked for “areas where inventory has fallen although demand hasn’t risen steeply yet, and where the job market is on the upswing,” stated Steve Berkowitz, Realtor.com Chief Executive Officer. The timeframe is February 2011-February 2012.
Here are excerpts from the Realtor.com report as summarized by The Wall Street Journal- Market Watch column which combined the two part report:
1. Tucson, AZ
- Tucson experienced home price deflation of 31% during the course of the market correction.
- Median list price of $170,000 in February, an increase of 3.03% year over year.
- Tucson is a college town. The climate and scenic beauty make it a vacation destination.
2. Austin, TX
- “Austin has been a little of a clone of Silicon Valley in terms of tech [businesses],” stated Berkowitz.
- Strong job market with low unemployment rate of 6.3%.
- February median price of $229,500.
- University Town. Seven lakes provide scenic beauty. Luxury resort destination. Music and arts contribute to a rich entertainment culture.
3. Kansas City, MO
- “Prices are recovering in Kansas City and interested investors may want to consider acting soon,” according to Realtor.com.
- Median list price of $134,000 in February, showed a year over year improvement of nearly 4%.
- Housing inventory has been reduced by 21% since last year.
4. Baltimore, MD
- “Investors should consider buying now for maximum gains on properties in this area,” indicated Realtor.com.
- February median list price of $239,500 was up 3% for the year, indicating market stabilization.
5. Fort Worth, TX
- “Homes there are selling 20 times faster than last year.”¹
- Median list price is $160,000 which has jumped 8% since last year.
- Fort Worth sits on the The Barnett Shale, a natural gas field covering 20 north Texas counties. Experts project that wells could produce through 2080 if not longer. This promotes a strong employment and infrastructure.2
6. Salt Lake City, UT
- A popular tourist destination, this city is attractive to investors preferring vacation rentals.
- February median list price of $195,000 was up 5.46% over the prior year.
- Inventories of for sale properties decreased 30% as compared to last year.
7. San Jose, CA
- “It becomes a very good investment market because they get the potential price appreciation and get the rental opportunity,” Berkowitz asserted.
- San Jose has a housing shortage due to job growth.
- The February median list price of $468,888 corroborates the market dynamic.
- The high median list price fuels the need for rental housing.
8. Raleigh, NC
- Apartment complexes are 95% occupied and the unemployment rate is low.
- February’s median list price of $215,000 increased 7.5% during the preceding year.
- Single family residential inventory dropped nearly 24% versus prior year.
- Raleigh doubles as a college town and a vacation destination; presenting a wealth of opportunities for investors.
9. Milwaukee, WI
- Low unemployment rate at 6.9%
- Median list price of $175,000
- Residential housing inventory down 21% compared to former year.
10. St. Louis, MO
- Home prices are decreasing.
- Median list price is $159,000.
- Realtor.com recommends the market for long-term investment.
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