Norada Real Estate Investments

Is it a Good Time to Buy a House or Should I Wait Until 2023-2024

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Should I Buy a House Now or Wait?

Check out the latest housing trends for the previous month if you're unsure whether it is a good time to buy a house or if should you wait until 2023. It’s becoming harder to buy a house as prices are up year over year, and mortgage rates are soaring in 2022. At the same time, consumer prices on everything are also on the rise making it even more difficult to save money to buy a house next year.

In an effort to tamp down inflation, the Federal Reserve is raising interest rates. The Fed hiked interest rates by three-quarters of a percentage point, following a similarly aggressive rate hike in June which was already weighing on housing, business investment, and consumer demand. The Fed has raised interest rates in less than four months which it took three years to do the previous time.

The cumulative effect of these sharp rate increases has cooled the housing market and caused the economy to slow, but has done little to lower inflation. Although Fed doesn't control mortgage rates it has a ripple effect on the mortgage industry. The recent rate hike will correspond with a rise in the prime rate and immediately send financing costs higher for many forms of consumer borrowing. On the flip side, higher interest rates also mean savers will earn more money on their deposits.

Don’t expect much relief in the form of lower rates in the coming months. Therefore, it certainly does not seem to be a good time to buy a house as rates have risen much more rapidly in 2022 than most industry analysts and economists had initially predicted. But when it comes to the possibility of significant savings, looking for the best mortgage offer provides an outstanding return on investment. Because it only takes a little more effort to browse around for the greatest mortgage rate, why not take advantage of it?

<<< Will the Housing Market Crash? >>>

Is it a Good Time to Buy a House or Should I Wait?

As of October 4, 2022, the average rate for the benchmark 30-year fixed mortgage is 6.85 percent (source: Bankrate). It is an increase of 13 basis points from a week ago. At the current average rate, you’ll pay a combined $654.59 in principal and interest for every $100,000 you borrow to buy a house. That’s up $15.93 from what it would have been last week.

The average 15-year fixed mortgage rate is 6.07 percent, up 21 basis points over the last week. At that rate, monthly payments on a 15-year fixed mortgage will be around $600 per $100,000 borrowed to buy a house. The larger monthly payment may be harder to fit into your budget than a 30-year mortgage payment, but it has huge advantages: You'll save several thousand dollars in interest and create equity much faster.

Let's compare the figures between now and eight months ago when the buyers financed their houses with a mortgage. On a $300,000 loan, a 30-year, fixed-rate mortgage at December’s rate of 3.11% would have meant a monthly payment of about $1,282 (Principal & interest).

  • Loan amount = $300,000
  • Total interest paid = $161,923
  • Total cost of loan = $461,923

Today’s rate of 6.85% brings the monthly payment to $1,965 (Principal & interest). That’s an extra $683 a month or $8,196 more a year and $246,398 more over the lifetime of the loan.

  • Loan amount = $300,000
  • Total interest paid = $408,321
  • Total cost of loan = $708,321

The Fannie Mae (FNMA/OTCQB) Economic and Strategic Research (ESR) Group revised downward its forecast for total home sales growth through 2023. They now project 2022 total year existing sales to decline 16.5 percent from 2021, followed by a further decline of 13.3 percent in 2023.

Their forecast for 2022 purchase volumes remains at $1.7 trillion, essentially unchanged from last month. The group now expects purchase volumes to fall about 1.5 percent in 2023 to just under $1.7 trillion, a downward revision of $17 billion from last month’s forecast, driven by downward revisions to their forecast for home sales.

The rise in rates is having the Fed’s desired effect on housing, as house price growth began to slow in June. They expect the slowdown in housing to continue through 2023 as affordability constraints mount for potential homebuyers, and considering, too, that refinance activity has been significantly curtailed by the rise in mortgage rates. The group continues to anticipate a strong deceleration in home price growth going forward due to the lagged effects of higher mortgage rates and the slowing economy weighing on purchase demand.

If the economy suffers a downturn, mortgage interest rates will very probably fall to about 4% or even lower. If it does, this could be a good time to put off buying a home and save some money, especially for first-time buyers. Fannie Mae forecasted at the start of the year that the average 30-year fixed mortgage rate will rise from 3.1% to 3.3% by the end of 2022.

The Mortgage Bankers Association was somewhat more optimistic about mortgage rates, projecting that the average rate will increase to 4% by the end of 2022. It is now evident that neither Fannie Mae's nor the Mortgage Bankers Association's predictions were even somewhat accurate.

The 30-year fixed mortgage rate, which hovered at 3% throughout 2021, is treading close to 7 percent, a steep increase from last year. It has almost doubled since last year. Some experts are forecasting that the 30-year, fixed-mortgage rate will vary from 5% to 7% by the end of 2022. According to Nadia Evangelou, director of Forecasting for the National Association of Realtors, rates may exceed 6 percent. They did momentarily before the Federal Reserve's June announcement of a rate rise, but have subsequently backed off.

The most likely scenario is that the Fed will continue to raise the fed funds rate to combat inflation and will continue to reduce its position in the market for mortgage-backed securities. The Federal Reserve is expected to continue its course of raising short-term interest rates and anticipate an additional 75 basis point hike at its September meeting, though markets are partially pricing in the possibility of a full 100 basis point increase.

As a buyer, you do not want to hear this because higher interest rates make home loans less affordable. Rising rates make homes more expensive for buyers, and, for prospective borrowers, steeper monthly mortgage payments. It will thereby reduce the demand for home purchases. The latest housing stats for August already point to an increasing inventory amidst moderating demand.

The mortgage credit availability again decreased in August as investors reduced their offerings of ARM and non-QM loan programs. With the overall origination volume expected to shrink in 2022, some lenders continue to streamline their operations by dropping certain loan programs to simplify their offerings, according to the Mortgage Bankers Association.

The MCAI fell by 0.5 percent to 108.3 in August. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of loosening credit. The index was benchmarked to 100 in March 2012. The Conventional MCAI decreased by 1.0 percent, while the Government MCAI remained essentially unchanged. Of the component indices of the Conventional MCAI, the Jumbo MCAI decreased by 0.7 percent, and the Conforming MCAI fell by 1.2 percent.

The competition for housing results in fewer options, higher prices, and faster sales. In a seller's housing market, there are more interested buyers than available homes and that makes it a difficult time to buy a house, especially for first-time buyers. According to the NAR, the national median price for existing homes sold in August was $389,500, up 7.7% from the same month in 2021.

This is the longest streak of year-over-year growth ever recorded, spanning 126 months. However, it was the second month in a row that the median sales price retracted after reaching a record high of $413,800 in June, the usual seasonal trend of prices declining after peaking in the early summer.

Fannie Mae released a nationwide housing survey for August 2022 that reveals only 27 percent of respondents believe it is a good time to buy a house in 2022.

“The share of consumers expecting home prices to go down over the next year increased substantially in August. Accompanying this, HPSI respondents reported a significant decrease in home-selling sentiment,” said Doug Duncan, Fannie Mae Senior Vice President, and Chief Economist.

The Home Purchase Sentiment Index® (HPSI) decreased 0.8 points in August to 62.0, its sixth consecutive monthly decline, as high home prices and elevated mortgage rates continue to weigh on consumer sentiment, particularly home-selling sentiment. Month over month, consumers reported that home-selling conditions have worsened – although that component remains strongly positive on the net. Consumers also reported that homebuying conditions have improved, but 73% continue to report that it’s a “bad time to buy a house in 2022.”

Meanwhile, a greater share reported the expectation that mortgage rates will decline, even though a majority continue to believe that mortgage rates will go up over the next 12 months. Year over year, the full index is down 13.7 points.

Is 2022 a Good Time to Buy a House?

The percentage of respondents who say it is a good time to buy a home increased from 17% to 22%, while the percentage who say it is a bad time to buy decreased from 76% to 73%. As a result, the net share of those who say it is a good time to buy increased 8 percentage points month over month.

Is 2022 a Good Time to Sell a House?

The percentage of respondents who say it is a good time to sell a home decreased from 67% to 59%, while the percentage who say it’s a bad time to sell increased from 27% to 35%. As a result, the net share of those who say it is a good time to sell decreased 16 percentage points month over month.

Home Price & Mortgage Rate Expectations

The percentage of respondents who say home prices will go up in the next 12 months decreased from 39% to 33%, while the percentage who say home prices will go down increased from 30% to 33%. The share who think home prices will stay the same increased from 26% to 28%. As a result, the net share of Americans who say home prices will go up decreased 9 percentage points month over month.

The percentage of respondents who say mortgage rates will go down in the next 12 months increased from 6% to 11%, while the percentage who expect mortgage rates to go up decreased from 67% to 61%. The share who think mortgage rates will stay the same increased from 21% to 25%. As a result, the net share of Americans who say mortgage rates will go down over the next 12 months increased 11 percentage points month over month.

Is It a Good Time to Buy a House or Wait Until 2023?
Source: Fannie Mae

The HPSI is constructed from answers to six of 100 national housing survey questions that solicit consumers’ evaluations of housing market conditions and address topics that are related to their home purchase decisions.

Is it a Good Time to Buy a House for First-Time Buyers?

According to a recent Fannie Mae survey, many consumers are hesitant to buy a home in 2022. About 67% of survey respondents expect mortgage rates to increase, and there are rising concerns about job stability and escalating housing prices. Some homebuyers will find the current market conditions easier, while others will find them more difficult to buy a house. The current upward trend in home prices is likely to continue throughout the year, which could price out some prospective buyers.

However, it is anticipated that prices will rise at a slower rate than they did in 2021. The current lack of entry-level supply and the rapid increase in mortgage rates appear to be negatively impacting potential first-time homebuyers in particular, as evidenced by the larger proportion of younger respondents (aged 18 to 34 years old) who believe it is a bad time to buy a house. The advantage of the historically low mortgage rate environment of the previous year appears to have diminished for first-time homebuyers, and affordability is projected to become an even greater constraint for them in the future.

In August 2022, the first-time buyers were responsible for 29% of sales, consistent with July 2022 and August 2021. According to NAR, the annual share of first-time buyers was 34% in 2021. Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in August, up from 14% in July and 15% in August 2021.

In 2022, rising mortgage rates are piling onto record-breaking home prices, locking even more potential buyers out of the red-hot housing market. Historically, rising interest rates cause more prospective buyers to delay purchases, and the recent increase in financing terms has already resulted in a decline in mortgage applications.

The prices are not going down in 2022. The various forecasts from experts show that 2022 will remain a moderate sellers' housing market, and home values may still increase by single-digit percentage points. While affordability concerns continue to grow, low mortgage rates, increased savings, and a strengthening job market all contribute to making homeownership more accessible to a wide number of prospective buyers.

Realtor.com’s September 2022 data shows that the housing market is continuing to moderate. Homes are selling more slowly than they did a year ago, house inventory growth has stalled, and listing price rise is moderating. However, homes are still selling faster than they were before the pandemic, and the price rise remains in double digits. This year, the last week of September was the greatest time to purchase a home, and while sellers are putting their homes on hold, buyers may anticipate less competition and somewhat lower pricing this fall.

In September, newly listed homes declined by 9.8% compared to the same time last year, a lower rate of decline compared to last month’s 13.0% year-over-year decrease, but far shy of levels seen earlier this year. In August, seller sentiment continued to decline. Fannie Mae’s Home Purchase Sentiment Index (HPSI) revealed that the net share of respondents saying now is a good time to sell decreased by 16 percentage points compared to the previous month and by 30 percentage points compared to last year.

Nationally, the inventory of homes actively for sale on a typical day in September increased by 26.9% over the past year. This amounted to 155,000 more homes actively for sale on a typical day in September compared to the previous year. The growth rate of inventory remained stable compared to last month’s growth rate of 26.9%.

  • In September 2022, the nationwide median listing price for active listings was $427,000, an increase of 13.9 percent year over year.
  • It was a deceleration from last month’s growth rate of 15.4% and down from a peak growth rate of 18.2% in June.
  • The share of homes having their price reduced grew from 11.0% last September to 19.5% this year.
  • In large metros, median listing prices grew by 10.2% compared to last year, on average.
  • Nationally, the typical home spent 50 days, 7 days more than last year but 18 days less than typical pre-pandemic levels.
  • The national inventory of active listings increased by 26.9% over last year.
  • The total inventory of unsold homes, including pending listings, increased by just 0.7% year-over-year due to a decline in pending inventory (-23.7%).
  • Sellers are less active than last year, as newly listed homes declined by 9.8% on a year-over-year basis.

Housing Markets that saw the largest year-over-year increase in listing prices in September 2022:

  • Miami, where the median listing price grew by +28.3%
  • Memphis, where the median listing price grew by +27.3%
  • Milwaukee, where the median listing price grew by +27%

Housing Markets that saw the greatest increase in their share of price reductions compared to last year:

  • Phoenix (+32.3 percentage points)
  • Austin (+27.4 percentage points)
  • Las Vegas (+20.0 percentage points)

Western metros saw the greatest increase in the share of price reductions (+15.6 percentage points), followed by southern metros (+10.7 percentage points).

Conclusion: The Best Time To Buy A Home Depends On You

Higher interest rates pose a challenge to existing homeowners looking to buy a new home at the same time as selling their current home. Existing homeowners may benefit from lower interest rates than those offered right now because they already have mortgages. Their monthly expenses could rise dramatically as a result of the purchase of a new property.

In other words, if you don't have a specific date in mind for when you want to buy a new property, you may be better off waiting till it does. Every potential buyer's best time to buy a property is different, and the greatest time to buy a house is not the same for everyone. It’s essential to consider your financial situation and understand how buying will impact your bottom line each month.

Sources:

  • https://www.realtor.com/research/june-2022-data/
  • https://www.bankrate.com/mortgages/todays-rates/
  • https://www.nar.realtor/research-and-statistics/housing-statistics/existing-home-sales
  • https://www.bankrate.com/mortgages/will-mortgage-rates-go-up-in-july-2022/
  • https://www.fanniemae.com/research-and-insights/surveys-indices/national-housing-survey
  • https://www.mba.org/news-and-research/research-and-economics/single-family-research/mortgage-credit-availability-index-x241340

Housing Market: Should You Buy a Turnkey Property or Fixer-Upper?

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The current housing market means you’ll likely pay top dollar for a home that’s considered turnkey — immediately ready for you to move in. Plus, the competition is steep. Perhaps those two reasons are why 52% of American homebuyers are looking for a starter home or a fixer-upper rather than a forever home, according to TD Bank‘s First-Time Homebuyer Pulse, which polled buyers planning to purchase in 2022. If you’re struggling with whether to keep combing the housing market for a move-in-ready home that fits your budget or to take your chances with a fixer-upper, here’s the expert insight you need.

Pros of Buying a Fixer-Upper

Buying a fixer-upper can provide you with advantages that a turnkey home doesn’t offer. Consider the following.

Cheaper Taxes

“Fixer-uppers can be a great way to get a deal on a property and save money on taxes,” said Jeremy Luebke, founder of WeLoveLand. “In many cases, fixer-uppers are sold for less than the market value because the seller is motivated to move the property quickly. This can be a great opportunity for bargain hunters. Additionally, fixer-uppers often come with significant tax breaks. The government offers tax breaks for people who rehabilitate or redevelop properties, so if you’re planning to do major work on your fixer-upper, you may be eligible for some significant tax deductions.”

Flip Potential

“The big advantage to taking the risk on a fixer-upper is the equity you build while improving the value of the property,” said Doug Greene, owner of Signature Properties. “This is the flip potential that exists, while in a turnkey home you are essentially buying the property at full price (i.e., market value).”

Potential for Creativity

“An advantage of purchasing a fixer-upper is the opportunity to put money into the features of your house that are most important to you,” said John Riedl of Easy Cash Offer Florida. “Do you want a modern kitchen? What about a luxurious soaking tub? If you are purchasing a property that is move-in ready, you can find yourself subject to the taste and interests of the past owner.”

Riedl also pointed out that fixer-uppers give you a lot of control over the renovation process by selecting paint colors, floor materials, contractors, and anything else you desire.

Cons of Buying a Fixer-Upper

Time, money and effort are all required when it comes to getting a fixer-upper where you want it to be. Here’s more on the potential disadvantages of going this route.

Renovation Costs

“The cost of labor and materials is near its highest price ever, and if you are hiring contractors to perform work on your home, unless you have a crew on standby, it could be months before the work is done,” said Tony Grech real estate investor and lending expert with Luxury Mortgage. “Just like there is a shortage of home inventory that has driven prices up, there is a shortage of qualified tradespeople as well as a shortage in raw materials due to supply chain issues that stretch back to the beginning of COVID. So you save $20,000 or $30,000 on the price of the home, but it costs you $60,000 to perform the work that you want.”

Effort

Beyond the costs in labor and materials, renovating a home comes with some other headaches and risks,” said Brian Davis, real estate investor and founder at Spark Rental. “You have to navigate the treacherous waters of permits, which involves not just filing fees and dealing with the permit office, but also hassling with inspectors.”

Ryan Fitzgerald, owner of UpHomes also said that renovating a fixer-upper requires a lot of effort. “Renovations are time-consuming and stressful so make sure you’re up for the challenge if you decide to get a fixer-upper,” he cautioned. “If you don’t want to deal with the construction, managing contractors, and living in a home that isn’t finished, a fixer-upper may not be the best choice for you.”

Live Richer Podcast: First-Time Homebuying During Inflation: Is It Worth It?

Pros of Buying a Turnkey Home

While a home that’s ready to move in will likely cost much more than a fixer-upper, there are some definite advantages that are worth considering.

No Renovation Costs

“When you purchase a turnkey home, the price you see is the price you pay,” said Luebke. “There are no additional costs for things like landscape or certain home upgrades. This can be a big advantage when budgeting for your new home. You know exactly how much money you need to bring to the table, and there are no unpleasant surprises down the road.”

Minimal Effort Required

If you’re looking to move in and start enjoying your new home as soon as possible, turnkey home is a perfect choice. “Turnkey homes require much lower effort because you can move right in and start enjoying the home after you unpack,” said Ryan Fitzgerald, owner of UpHomes.

Cons of Buying a Turnkey Home

However, buying a turnkey home also comes with a few drawbacks. It’s up to you to decide if they are worth it.

More Expensive Taxes Upfront

While you can get a lower property tax rate by buying a cheaper fixer-upper, that’s likely not the case with a turnkey home.

“If you opt for a turnkey home, the municipality will have likely already caught up to the new assessed value by the time you move in,” said Greene. “It’s usually the sale of the property that triggers a property reassessment in the system.”

Flip Potential Is Nonexistent

“Buying turnkey is certainly the way to go if you have no desire to make repairs to a home and want it move-in ready,” said Jeff Shipwash, CEO of Shipwash Properties LLC. “Unfortunately, in today’s market, turnkey properties are at a premium. This means you will more than likely have strong competition and will be paying top dollar for it. This results in buying with little to no equity to spare.”

And without any equity to spare, there is no flip potential.

Limited Opportunities for Creativity or Customization

“The home might not be exactly what you want,” said Luebke. “Since the home has already been built, you may be limited in terms of customizations or changes that you can make. The home might come equipped with most, if not all, of the features and amenities that you desire, but there is always the chance that something will not be quite to your liking. This can be frustrating if you have specific ideas about how you want your new home to look and function.”

>>This article originally appeared on GOBankingRates.com.<<

Best Houston Neighborhoods To Buy Investment Properties in 2022

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Houston neighborhoods come with an urban charm and a family-friendly vibe. Houston alternately makes the news for massive traffic jams, hurricanes that periodically hit the city, falling oil prices, and its rampant rate of growth. For example, Hurricane Harvey flooded more than a hundred thousand homes in August 2017 which kind of froze the Houston real estate market.

However, the Houston housing market recovered from that bust and is booming. Factors like affordable housing and good-paying jobs are still drawing people to the area. If you're looking for real estate investment, read this article to find some of the best neighborhoods in Houston to purchase a house or investment property. But before that let's discuss current trends and forecasts of the Houston real estate market.

Houston Real Estate Investment Forecast 2022

Houston housing market was in the news after Hurricane Harvey. After the hurricane hit, the nation learned how many homes, especially in west Houston, had suffered repeated “100-year floods”. But this didn’t stop the real estate market from remaining strong. The sheer demand for housing led many investors to snap up flooded properties for remediation and renovation.

By the time 2017 drew to a close, buyers closed on 3.5% more homes than they bought in 2016. Median home prices, too, were up 3.8% year over year. However, that doesn’t mean that there aren’t better or worse locations in which you could buy rental real estate. The best Houston neighborhoods are those close to major job centers and are considered livable, while newly constructed homes tend to be too expensive for potential landlords.

We recommend that you should invest in Houston real estate as it is one of the fastest-growing cities both in terms of population and jobs. This is driving up property values while guaranteeing a large population of renters. The city provides several opportunities for investing in up-and-coming neighborhoods, communities whose demographics guarantee a large supply of renters, and fast-appreciating areas that are a good way to generate both capital gains and rental income.

Houston is a diverse city with lots to offer that will cater to the tastes of a variety of potential buyers and tenants. Many of Houston’s neighborhoods are some of the most attractive places to live in the whole of Texas, and it’s not hard to see why. With a great balance of urban regions and open spaces in the suburbs, the potential for development is clear to see, and the natural features of the land are some of the most attractive features you could hope for in an investment district.

Looking at the current statistics, what is the Houston real estate market forecast for 2022? Let us examine the price trends recorded by Zillow over the past few years.  Since Mar 2012, the Greater Houston home values have appreciated by nearly 99.97% — Zillow Home Value Index. 

ZHVI represents the whole housing stock and not just the homes that list or sell in a given month. The typical home value of homes in Greater Houston is currently $287,957. It indicates that 50 percent of all housing stock in the area is worth more than $287,957 and 50 percent is worth less (adjusting for seasonal fluctuations). In Feb 2021, the typical value of homes in Greater Houston was around $239,000. Houston home values have gone up 20% over the last twelve months.

NeighborhoodScout.com's data also shows that Houston real estate appreciated by nearly 75.49% over the last ten years. Its annual appreciation rate has been averaging 5.79%. This figure puts it in the top 30% nationally for real estate appreciation. During the last twelve months, the Houston appreciation rate was nearly 9.51%, and in the latest quarter, the appreciation rate was 4.61%. If it remains steady, it annualizes to a rate of 19.76%.

The forecast by Zillow also points in the same direction — a rise in home values over the next 12-months. This indicates that the prices will rise in 2022. Hence, it is a good time to buy a house in Houston. 

This shows that Houston is currently a seller's real estate market. There exists a limited supply of homes in Houston, and buyers are forced to compete often resulting in higher prices and/or quicker sales that tend to benefit sellers. In other words, based on the last latest key housing market indicators, the demand is exceeding the supply, giving sellers an advantage over buyers in price negotiations. There are fewer homes for sale than there are active buyers in the marketplace.

Clearly, for the long-term investment, you cannot ignore underestimating Houston. Investing in a rental property for the long term would build your equity and also generate cash flow through rental income. If you want to increase your cash flow in 2022, you will find great deals in the Houston real estate market.

Here is Zillow's home price forecast for Houston, Harris County, and Houston – The Woodlands-Sugar Land. You can expect to see very strong home price gains in this region.

  • Houston home values have gone up 19.6% over the past year and they will continue to rise over the next twelve months.
  • Harris County home values have gone up 20.3% over the past year and they will continue to rise over the next twelve months.
  • Houston-The Woodlands-Sugar Land Metro home values have gone up 21.3% over the past year and they will continue to rise over the next twelve months.

10 Best Houston Neighborhoods For Investing in Real Estate

Houston investment properties

You won’t feel limited when it comes to choosing the best neighborhoods in Houston to buy investment properties. There’s something for every age and stage in life. Best of all, Houston enjoys some of the lowest housing costs in the nation. When compared to the 20 most populous metros, housing costs in Houston are 36.6 percent below average. Here is the list of 10 neighborhoods in Houston where you can buy a house or invest in a rental property.

1. Greater Heights, Houston, TX

Greater Heights is a suburb north of Highway 10 and west of I-45, and it is a short hop to Hardy Toll Road. This community is within commuting distance of jobs in downtown Houston and all of the northern suburbs. Public schools in the area range from 4 to 6 on a 1-10 scale. One of the highlights of this community is being close to the Northline Commons. It is one of the best neighborhoods in Houston to purchase a house or investment property.

Greater Heights Real Estate Market Trends

Greater Heights is a seller's market. A seller's market arises when demand exceeds supply. In other words, there are many interested buyers in this neighborhood, but the real estate inventory is low. According to Realtor.com, the median list price of homes in Greater Heights was $619K in March 2022, trending up 17.9% year-over-year, and the median listing price per square foot was $288.

As we write this, there are 355 active rental listings (houses and apartments) on Realtor.com with a median rent of $2,390. On average, homes in Greater Heights sell after 42 days on the market. The trend for median days on market in Greater Heights has gone down since last month, and slightly down since last year.

2. River Oaks, Houston, TX

River Oaks is so hot that Trulia reports average rents of $2500-$3000 per bedroom. St. John’s upper and lower schools are located in the heart of this community. The public River Oak’s elementary school received a 10 out of 10 from Greatschools.com. Nearby Lanier Middle School was rated 10/10, as well. Lamar High School was an average 5 out of 10. This community is a short hop from I-69 and Highway 610 without leaving residents to live with the noise.

River Oaks Real Estate Market Trends

River Oaks is a balanced real estate market, which means that the supply and demand of homes are about the same. Housing prices in a balanced market are stable, perhaps rising slightly, and influenced more by inflation than by an increase in demand. You can expect sellers to accept reasonable, close-to-list-price offers.

Data released by Realtor.com shows that the median list price of homes in River Oaks was $2M in March 2022, trending down by 7.7% year-over-year. The median listing price per square foot was $468. As we write this, there are 86 active rental listings (houses and apartments) on Realtor.com with a median rent of $3,900.

In a balanced market while homes generally sit on the market for an average or typical length of time (this can vary from market to market). On average, homes in River Oaks sell after 62 days on the market. The trend for median days on market in River Oaks has gone down since last month, and slightly down since last year. It is one of the best neighborhoods in Houston to purchase a house or investment property.

3. Uptown-Galleria, Houston, TX

Uptown puts residents right next to Highway 610. St. Michael Catholic School and Fusion Academy are located in this neighborhood. There are several other private schools in the area. Public schools in this community are average. It is a major shopping area. It's also known as The Galleria, for the vast retail complex of that name, with its mix of designer boutiques, chains, and department stores, plus a year-round ice rink.

One of the reasons why people pay such high rent here is the incredibly short commutes given the fact that you’re living in Houston. It is a great place to buy an investment property in Houston, Texas. Uptown is one of the best neighborhoods in Houston to purchase a house or investment property.

Uptown Real Estate Market Trends

Current housing trends show that Uptown-Galleria is a buyer's market, which means that the supply of homes is greater than the demand for homes. Most experts agree that if six months or more of inventory is on the market, it is a buyer's market. There is no better timing to get a new home or buy an investment property. Buyers have the upper hand and enjoy more choices in properties, as well as more negotiating power when making a purchase. If you’re looking to buy a property, Uptown-Galleria is the ideal market to do it in.

Data by Realtor.com shows that the median list price of homes in Uptown-Galleria was $365K in March 2022, trending down -1.3% year-over-year. The median listing price per square foot was $261. As we write this, there are 652 active rental listings (houses and apartments) on Realtor.com with a median rent of $1,820. On average, homes in Uptown-Galleria sell after 66 days on the market. The trend for median days on market in Uptown-Galleria has gone down since last month, and slightly down since last year.

4. EaDo, Houston, TX

EaDo or East Downtown sits due north of Gulf Freeway and east of South Freeway. The community costs a little more to live in than downtown but is safer than downtown. Past trends show us that property has been appreciating here much faster than downtown, making it one of the “best Houston neighborhoods” to invest in rental properties.

East Downtown Real Estate Market Trends

Currently, East Downtown Houston is a balanced market. As a buyer, you would be on even ground with sellers. The number of homes for sale is on-par with the level of demand, so there is usually a sufficient number of homes to compare and choose from. Data by Realtor.com shows that the median list price of homes in East Downtown Houston was $389K in March 2022, trending up 1.1% year-over-year. The median listing price per square foot was $202.

As we write this, there are 12 active rental listings (houses and apartments) on Realtor.com with a median rent of $2,470. On average, homes in East Downtown Houston sell after 45 days on the market. The trend for median days on market in East Downtown Houston has gone up since last month, and slightly down since last year.

5. The Museum District, Houston, TX

The Museum District is due west of the Medical Center, putting residents in easy reach of both major medical employers and downtown Houston jobs. You do have to earn two to three times as much to afford to live here. This area is attractive to both young adults and empty nesters who want to live near the 19 museums in the area. Others appreciate the proximity to Rice University, whether they work there or attend the school.

This makes the Museum District one of the best neighborhoods in Houston for buying investment properties. Rental rates are falling in most inner loop neighborhoods because of the high supply relative to demand. The rental rates would look even worse if it were not for the influx of new, high-rent properties coming onto the market, pulling the average up. Rents here are stable and rival those of the Medical Center district making it one of the “best Houston neighborhoods” to invest in rental properties.

The Museum District Real Estate Market Trends

Current market indicators show that the Museum District is a buyer's real estate market, which means that the supply of homes is greater than the demand for homes. If you’re looking to invest in real estate, the Museum District is another ideal market for it. Buyers will have more negotiating power when making a purchase.

Data by Realtor.com shows that the median list price of homes in The Museum District was $525K in March 2022, trending up 9.6% year-over-year. The median listing price per square foot was $216. As we write this, there are 42 active rental listings (houses and apartments) on Realtor.com with a median rent of $1,200. On average, homes in The Museum District sell after 80 days on the market. The trend for median days on market in The Museum District has gone down since last month, and slightly down since last year.

6. Downtown Houston, TX

Downtown Houston is still attracting many new residents because of its proximity to major employers and excellent public transit. It is considered one of the most up-and-coming areas of the city. Real estate developers have been building condos for both the middle and top of the real estate market. The majority of Downtown’s residential options are Historic Houston Lofts and Downtown Houston Condos which offer great “lock and leave” benefits.

Downtown Houston’s residential market has doubled in the last few years. Property values have remained strong in the area. There are no single-family homes in the Downtown area, however, there are plenty available in surrounding neighborhoods including Midtown, the Heights, Montrose, Northside Village, and EaDo. Several new developments are under construction in the area, with others still in the planning stages.

Downtown is a great part of Houston for homebuyers who enjoy both indoor and outdoor activities. Even though the ambiance is not the liveliest in this neighborhood places to go out at night are well-spread throughout the area. Renters occupy roughly 70% of the units in the neighborhood whereas the rest are occupied by owners. Large apartment buildings are the most common housing type, representing the majority of dwellings in this area, while single detached homes are also present in the housing stock.

Downtown Houston Real Estate Market Trends

An average Downtown Houston condo for sale can feature 2 to 3 bedrooms, though bigger units with 4-bedroom floor plans are also available. Prices typically start at around $150,000 and can go as high as $3,500,000. Downtown Houston has enough homes on the market to fuel a year of sales. According to ZILLOW Home Value Index, the typical value of homes in Downtown Houston is $355,059. This value is seasonally adjusted and only includes the middle price tier of homes. Downtown Houston's home values have gone up 8.2% over the past year. Downtown is one of the best neighborhoods in Houston to purchase a house or investment property.

7. West University Place, TX

West University and the Southside Area has been one of the highest appreciating inner ring neighborhoods in Houston. West U is a city located within the Houston–The Woodlands-Sugar Land metropolitan area and southwestern Harris County. It is one of the best places to live in Texas. West University Elementary School was given 10 out of 10 points by Great Schools.

According to Zillow, the typical value of homes in West University Place is $1,538,233. West University Place's home values have gone up 14% over the past year. Real estate investing in this Houston suburb will lead to a good rental income as well as a property appreciation. The average household income in West University Place is $359,834 with a poverty rate of 1.67%.

The median rental costs in recent years come to $2,260 per month, and the median house value is $1.11 Mn. The median age in West University Place is 42.1 years, 44 years for males, and 40.4 years for females. This is one of the best neighborhoods in Houston for buying an investment property.

West University Real Estate Market Trends

West University Place, TX is a seller's market, which means that more people are looking to buy than there are homes available. Hence, sellers have an upper hand when it comes to price negotiations. Buyers can expect to pay over and above the asking price. Data by Realtor.com shows that the median list price of homes in West University Place, TX was $1.6M in March 2022. The median listing price per square foot was $448.

As we write this, there are 22 active rental listings (houses and apartments) on Realtor.com with a median rent of $4,950. On average, homes in West University Place, TX sell after 46 days on the market. The trend for median days on market in West University Place, TX has gone up since last month, and slightly down since last year.

8. Rice Military, Houston, TX

The Rice Military neighborhood is just southwest of Washington Avenue/Memorial Park. Rice Military is an excellent real estate investment opportunity. You can rent to students attending Rice University or those that can’t afford to live in more desirable communities. This community is far more affordable than nearby upscale Memorial Park. There are many quality private schools in the area, while public schools in the area are average.

Surrounding subdivisions and neighborhoods are often lumped together with Rice Military. The bigger area commonly referred to as Rice Military/Washington Avenue or Washington Corridor stretches south of I-10 (Katy Freeway), east of Washington and Westcott, north of the Buffalo Bayou, and west of Sawyer Street. It is one of the best neighborhoods in Houston for investing in rental properties due to guaranteed demand, accessibility, and appreciation.

Rice Military Real Estate Market Trends

According to Redfin, the Rice Military / Washington Corridor housing market is somewhat competitive. The average homes sell for about 1% below the list price and go pending in around 22 days. Hot properties can sell for about 1% above the list price and go pending in around 6 days. The average sale price of a home in Rice Military / Washington Corridor was $497K last month, up 17.0% since last year. The average sale price per square foot in Rice Military / Washington Corridor is $214, up 9.4% since last year.

9. Humble, Texas

Several Houston suburbs have appreciated significantly as many Houston residents settle there. For example, the suburb of Humble has gone up in value along I-69. Humble’s public schools have average scores of 4 to 6 according to Greatschools.com. There are several private schools in Humble, as well. Humble is one of the most popular suburbs in Houston, demonstrated by the fact nearby Kingswood has declined. Humble is a good neighborhood in Houston to buy investment properties for rental income.

Humble Real Estate Market Trends

Current market indicators show that Humble, TX is a seller's market, which means that more people are looking to buy than there are homes available. Because of a shortage of inventory, homebuyers may encounter bidding wars or their home search might take longer than expected. Realtor.com's data shows that the median list price of homes in Humble, TX was $297K in March 2022, trending up 11.7% year-over-year. The median listing price per square foot was $137.

As we write this, there are 340 active rental listings (houses and apartments) on Realtor.com with a median rent of $1,790. On average, homes in Humble, TX sell after 42 days on the market. The trend for median days on market in Humble, TX has gone down since last month, and slightly down since last year.

10. Webster, Texas

Webster, Texas real estate has gone up more than Nassau Bay and Friendswood. This is interesting since Nassau Bay sits on the shore, perched between Space Center Houston and the namesake bay. Webster is directly southwest of the NASA Johnson Space Center, while residents on the east side are close to Clear Lake. Homes here are in demand because the community is a short trip up I-45 to Houston for those who don’t work for NASA or local oil and gas companies. This is one of the “Best Houston neighborhoods” for buying investment properties in 2022.

Webster Real Estate Market Trends

Currently, Webster, TX is a seller's market, which means that more people are looking to buy than there are homes available. According to Redfin, the Webster housing market is most competitive. In March 2022, Webster's home prices were up 16.4% compared to last year, selling for a median price of $326K. On average, homes in Webster sell after 7 days on the market compared to 7 days last year. There were 27 homes sold in March this year, up from 25 last year. Most homes get multiple offers, often with waived contingencies. The average homes sell for about 12% above the list price and go pending in around 7 days.

On Realtor.com, the median list price of homes in Webster, TX was $230K in March 2022, trending up 4% year-over-year. The median listing price per square foot was $154. As we write this, there are 136 active rental listings (houses and apartments) on Realtor.com with a median rent of $1,250. On average, homes in Webster, TX sell after 42 days on the market. The trend for median days on market in Webster, TX has gone up since last month, and slightly down since last year.

Disclaimer: When referencing the median rents of the local neighborhoods, please keep in mind that the data provided was taken from different credible sources. While deemed reliable, it may not accurately depict the current reality of the local real estate market. The pandemic may have impacted rent rates in a way that is not yet reflected in this blog.

How To Find Best Investment Properties In Houston?

Buying an investment property is different from buying an owner-occupied home. Whether you are a beginner or a seasoned pro you probably realize the most important factor that will determine your success as a Real Estate Investor is your ability to find great real estate investments.

Maybe you have done a bit of real estate investing in Houston, TX but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. If you invest wisely, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it is very important to read good books on real estate.

At Norada Real Estate investments, we offer “Investment Properties” which are located in some of the best neighborhoods of Houston, TX. Our properties in Houston are designed to make money as rentals, which means you must look at it solely as an income-producing entity just like any other business.

Norada Real Estate investments strive to set the standard for their industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in various growth markets. We can help you succeed by minimizing risk and maximizing profitability. You can contact us for a “Free Strategy Session” by clicking here.

Remember, caveat emptor still applies when buying a property anywhere. The information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.

REFERENCES

  • https://www.realtor.com/
  • https://www.trulia.com/real_estate/Houston-Texas
  • https://www.rentcafe.com/average-rent-market-trends/us/tx/houston
  • https://www.houstonproperties.com/houston-neighborhoods/hottest-inner-loop
  • https://www.houstoniamag.com/articles/2018/2/28/real-estate-houston-hurricane-harvey
  • https://www.houstonchronicle.com/business/article/Harvey-ushered-in-a-new-reality-for-local-real-12866924.php

Raleigh Real Estate Market 2022: Prices, Trends & Forecast

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If you are looking to invest in Raleigh real estate, you must read till the end. Raleigh, North Carolina is a southeastern city often overshadowed by the larger Charlotte market. Raleigh's housing market is already scorching, with prices at record highs, but they are set to soar even further in 2022, with the Raleigh market expected to be the third hottest in the United States this year, according to a new study.

Home values in the capital city's real estate market are expected to increase by over 24%, bringing the average home value to well over $450,000 from the current average of $391,444, according to an estimate by a real estate company Zillow. All of the top 10 markets are located in the Sunbelt, which has been a hot region over the last year and will continue to be so through 2022.

Raleigh is the capital of North Carolina. It is the second-largest city in the state. It is home to roughly half a million people. However, the Raleigh housing market is much larger than this. The Raleigh metropolitan area – the city and its surrounding suburbs – account for about one and a half million people.

<<Read About North Carolina Housing Market Forecast>>>

The Raleigh real estate market is landlord-friendly, contains several large populations of renters, and has an economic future that ensures long-term growth in housing demand and rents. Owning a piece of Raleigh real estate is a great achievement for many people. Homeowners in Raleigh continue to see their homes appreciate because they are in such high demand. From Millennials moving to the area to retirees living here, Raleigh continues to be a great place for people from all walks of life.

Raleigh's real estate market is already scorching, with prices at record highs, but they are set to soar even further in 2022, with the Raleigh market expected to be the third hottest in the United States this year, according to a new study. Home values in the capital city's real estate market are expected to increase nearly 24%, bringing the average home value to well over $450,000 from the current average of $391,444, according to an analysis by Zillow. Only Tampa and Jacksonville, Florida, are expected to experience greater home value appreciation through November 2022, according to Zillow's analysis.

Raleigh Housing Market Trends & Forecasts 2022

Analyzing real estate data from multiple sources gives us a much broader perspective of the direction in which a market is moving. We shall now discuss some of the most recent housing trends in the Raleigh area from multiple sources and compare them with the past couple of years. We shall mainly discuss median home prices, inventory, and growth, which will help you understand the way the local real estate market moves in this region.

If you are a home buyer who’s looking for a new place to call home or a savvy real estate investor who is looking for a strong ROI, then you should consider all that Raleigh NC real estate market has to offer. Raleigh is a minimally walkable city in Wake County with a population of approximately 467K people (2020). The Raleigh housing market has been on the incline in 2021.

The United States Census Bureau released new data on how much each county's housing stock expanded over the decade from 2010 to 2020, and a new analysis by Apartment List finds that Raleigh ranks third among the top 100 most populous metropolitan areas, behind Provo, Utah, and Austin, Texas, but just ahead of Boise, Idaho, with housing growth of 23.5 percent.

According to Charlotte mortgage site LendingTree, Raleigh is the third most competitive market in the United States, owing to a high proportion of homebuyers with credit scores above 700, a 20% or greater down payment, and mortgage shopping prior to looking for a home. Raleigh is also experiencing an increase in rental rates, as Apartment List discovered in a recent analysis of the rental market. Raleigh rents have decreased by 1% compared to last month, and are up by 20.91% compared to last year. 82% of apartments in Raleigh cost between $1,000 and $1,999 per month. 38% of apartments in Raleigh are 1-bedroom apartments while 39.2% are 2-bedroom apartments.

Raleigh (Wake County) Housing Market Trends

Prices in the Triangle, particularly in Wake County, are already skyrocketing. The median sale price of a home in the entire Triangle region was $394,950 in March 2022, up 24.2% from last year. 3,736 transactions closed in March compared to 3,918 last year, according to the most recent Triangle Multiple Listing Service reports. Months Supply of Inventory is 0.5, down from 0.7 months (March 2021).

Apple announced that it will open its first East Coast campus in Wake County, creating 3,000 new jobs and investing more than $1 billion in the Research Triangle area. With Apple bringing 3,000 high-paying jobs on the way to Wake County, prices in the local housing market would go up considerably. The company said it will also create a new $100 million fund for schools and community initiatives in the Triangle and around North Carolina.

According to the latest analysis of Wake County real estate data conducted by the Triangle Multiple Listing Service:

  • In March 2022, new listings in Wake County were down 9.7% from last year.
  • Closed Sales dropped from 1,882 to 1,694, down – 10% year-over-year.
  • Median Sales Price increased from $360,500 to $450,000, up +24.8%.
  • Average Sales Price increased from $421,589 to $527,567, up +25.1%.
  • Days on Market Until Sale dropped from 13 to 9, down – 30.8%.
  • Inventory of Homes for Sale dropped from 1,255 to 774, down, – 38.3%.
  • Months Supply of Inventory also dropped from 0.6 to 0.4, down – 33.3%.

Raleigh Housing Demand

Raleigh home sales fell this month compared to last February. February sales were down by 5.3% over February of last year, according to the data from Triangle Multiple Listing Service (source). The low inventory continues to be a factor in this decrease. The average sale price rose this month in relation to last February. The average price of homes sold in February was $466,359. That's an increase of 15% over last year in February. The average number of days on market before a sale decreased significantly again this month when compared to last year. February's average days on market were 16 days. This is a decrease of 30.4 percent from March last year.

Raleigh Housing Supply Trends

This remains a significant issue as active listings decrease again. In Feb, new listings fell by 7.9 percent compared to last year. The months' supply of inventory is just 0.4 months. It refers to the number of months it would take for the current inventory of homes on the market to sell given the current sales pace. Historically, six months of supply is associated with moderate price appreciation, and a lower level of months' supply tends to push prices up more rapidly. Active listings continue to be a major issue. Active listings fell again this month. Listings dropped a whopping 53% from last year in February.

Raleigh Home Listing Prices

The median list price of homes in Raleigh, NC was $389K, trending up 18.2% year-over-year. The median listing price per square foot was $210, according to Realtor.com's March 2022 report.

  • Raleigh, NC was a buyer's market in March 2022, which means that the supply of homes is greater than the demand for homes.
  • It also means that a total sales to total listings ratio was below 0.12 which tends to favor buyers.
  • There are 73 neighborhoods in Raleigh.
  • Popular neighborhoods include North Hills, North Raleigh, Glenwood, Northwest Raleigh, Downtown Raleigh, Southwest Raleigh, West Raleigh, and Oakwood.
  • Glenwood has a median listing price of $1.3M, making it the most expensive neighborhood in Raleigh.
  • Atlantic is the most affordable neighborhood, with a median listing price of $275K.

According to Redfin, in March 2022, Raleigh home prices were up 22.0% compared to last year, selling for a median price of $405K. On average, homes in Raleigh sell after 22 days on the market compared to 35 days last year. There were 662 homes sold in March this year, down from 722 last year. Many homes get multiple offers, some with waived contingencies. The average homes sell for about 5% above the list price and go pending in around 26 days. Hot homes can sell for about 12% above the list price and go pending in around 6 days.

  • Homes Sold Above List Price = 74.6%, +14% year-over-year.
  • Homes with Price Drops = 9.3%, +0.1% year-over-year.
  • Sale-to-List Price = 106.7%, +4.6 pt year-over-year.
  • The average homes sell for about 5% above the list price and go pending in around 26 days.
  • Hot home listings can sell for about 12% above the list price and go pending in around 6 days.
  • At present, homes for sale in Raleigh have a median listing price of $415K.

Raleigh Rent Price Trends: Is Renting in Raleigh Affordable?

Raleigh has a mixture of owner-occupied (51%) and renter-occupied (49%) housing units. The average rent for a 1-bedroom apartment in Raleigh, NC is currently $1,195. This is a 19% increase compared to the previous year. Over the past month, the average rent for a studio apartment in Raleigh increased by 1% to $1,490. The average rent for a 1-bedroom apartment increased by 3% to $1,195, and the average rent for a 2-bedroom apartment increased by 2% to $1,527.

  • The average rent for a 2-bedroom apartment in Raleigh, NC is currently $1,527, a 22% increase compared to the previous year.
  • The average rent for a 3-bedroom apartment in Raleigh, NC is currently $1,795, a 10% increase compared to the previous year.
  • The average rent for a 4-bedroom apartment in Raleigh, NC is currently $2,050, an 11% increase compared to the previous year.

According to Apartment List, 2.5% of apartments in Raleigh cost less than $1,000 per month while 82% of apartments in Raleigh cost between $1,000-and $1,999 per month. 13% of apartments in Raleigh are priced between $2,000 and $2,999 per month and 2.1% of apartments in Raleigh cost over $3,000 per month. Using the 30% rule, you can get a rough estimate of the salary needed to rent an apartment in Raleigh.

  • If you are renting an average-priced studio apartment in Raleigh, your annual salary should be around $60,440 or higher.
  • If you are renting an average-priced 1-bedroom apartment in Raleigh, your annual salary should be around $58,000 or higher.
  • If you are renting an average-priced 2-bedroom apartment in Raleigh, your annual salary should be around $69,400 or higher.
  • If you are renting an average-priced 3-bedroom apartment in Raleigh, your annual salary should be around $77,400 or higher.

Raleigh Real Estate Market Forecast 2022

Recent forecasts and predictions for the Raleigh, North Carolina housing market suggest that home prices will continue rising in 2022. Prices are expected to rise at a more or less average pace between now and the summer of 2022. The Raleigh real estate market is currently experiencing a supply shortage, which is partly why home prices are climbing in the region. The Months Supply of Inventory is just 0.6.

The cumulative appreciation rate over the ten years has been 72.95%, which ranks in the top 30% nationwide. This equates to an annual average Raleigh house appreciation rate of 5.63%, according to NeighborhoodScout.com. During the latest twelve months, Raleigh's appreciation rate, at 14.29%, has been at or slightly above the national average. In the latest quarter, Raleigh's appreciation rate has been 7.08%, which annualizes to a rate of 31.46%.

According to Zillow, the Raleigh housing market is expected to be the third hottest in the United States in 2022. Home values are forecasted to soar by nearly 24% in the capital city’s real estate market, pushing a typical home value to well over $450,000 from the current average price of $391,444.

Let us look at the price trends recorded by Zillow over the past few years. Since the last decade (Apr 2012), the typical home prices in Raleigh have appreciated by roughly 117.2%, according to Zillow’s Home Value Index. Raleigh home values have gone up 33.3% over the past year. The typical value of homes in Raleigh is now $436,641 (which only includes the middle price tier of homes).

  • The typical value of homes in Raleigh Metro is $433,065, up 34.9% over the past year.
  • Triangle prices, especially in Wake County, are already soaring in 2022.
  • The median price of all real estate transactions in Wake County increased in March to a record high of $450,000 (Triangle Multiple Listing Service).
  • The typical value of homes in Wake County is $474,600, up 34.9% over the past year.
  • The Raleigh real estate market forecast is that the home prices will continue to increase in the next twelve months.
Raleigh real estate market forecast
Source: Zillow

Is Raleigh a Good Place For Real Estate Investment?

Should you invest in Raleigh real estate? If you want to find out whether Raleigh real estate is a good investment or not, you need to drill deeper into local trends. The Raleigh real estate trends will tell what the market holds for the year 2022. We have already discussed the Raleigh housing market forecast for answers on why to put invest in this market. Purchasing an investment property in Raleigh real estate is a little different from shopping for your car or primary residence.

While you still want to get the most for your money, if you are looking to make a profit, you don’t want to buy the most expensive property on the Raleigh real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, a turnkey investment property in Raleigh that you might move into or sell at retirement in the future! Either way, knowing your profit potential and purpose is the first thing to consider.

According to Neighborhoodscout.com, a real estate data provider, three and four-bedroom single-family detached homes are the most common housing units in Raleigh. Other types of housing that are prevalent in Raleigh include large apartment complexes, duplexes, rowhouses, and homes converted to apartments.

About a third of Americans rent their homes. In the Raleigh NC real estate market, the rate is 43%. This is partially due to the large student market, but it is also fueled by young people moving here for work. That explains why downtown Raleigh rents grew 9% in 2018. It also explains why you can rent out a studio for $900 a month and one-bedroom apartments for a thousand dollars a month.

Kiplinger, a leading publisher of business forecasts and personal finance advice, uses ATTOM Data Services to compile data on home price changes and housing affordability in the country's top 100 markets. The affordability index indicates a city's relative affordability (1 is the most affordable, 10 is the least affordable). It is calculated as the percentage of annual income required to purchase a median-priced home in late 2020 in each metro area. Raleigh has an affordability index of six out of ten, making it one of the most expensive cities in the United States to own a home. New York City is the most expensive city, while Augusta, Georgia is the least expensive.

To consider the prospects of investing in the Raleigh NC real estate market, we’ll focus on factors that matter to investors instead of citing the many high quality of life metrics and awards the city receives that draw new residents to the area.

The Student Market

College towns can be a great place to buy investment real estate, but the rise and fall of the flagship campus affect demand for real estate. Any state capital will be home to at least one flagship university. North Carolina State University is located here. However, the Raleigh NC real estate market for those catering to students is diversified, so to speak. Meredith College, St. Augustine’s University, and Shaw University are also located here, as are several other private religious schools.

If you invest in the Raleigh suburbs, you could attract students from Duke University in Durham and the University of North Carolina in Chapel Hill. Young people from across the globe want to experience Raleigh. From attending school at one of the local, prestigious colleges to working in the infamous Research Triangle Park, Raleigh is the new destination for young people who are interested in a fresh start and a great home to live in.

The Growing Technological Employment Base

The Research Triangle Park area consists of Raleigh, Durham, and Chapel Hill. These research centers are generating many high-tech startups and jobs, bringing people to the area for high-paying jobs. Red Hat is one of the biggest employers in the area, despite the school system, and state & local governments being major employers. The high-tech sector helps explain why Raleigh’s income per capita is roughly $33,682 while the national average is $29,829 and far above the $26,779 state average. Raleigh was ranked number one in Glassdoor’s 25 Best Cities for Jobs report.

In April, Apple announced a new campus and engineering hub that will bring many high-paying jobs to the area. The site will be located off the Triangle Expressway between Louis Stephens Drive and Davis Drive. In addition, Apple will invest $100 million to support schools and community initiatives in the Triangle and will put more than $110 million toward infrastructure in 80 North Carolina counties. In total, Apple said it will invest more than $1 billion in the state.

Raleigh's Diverse Economic Base

Unemployment tends to be lower in areas with diverse economies. Raleigh is home to several major hospitals. It hosts an international airport. The high-tech sector is so large we’ve already mentioned it as a point in favor of the Raleigh NC real estate market. This diverse economic base protects a community from the rise and fall of employment tied to a single market sector. This explains why Raleigh’s unemployment rate was one point lower than the state average in 2018 and was three points lower than the unemployment rate for the state during the Great Recession.

The BLS reported that the unemployment rate for Raleigh fell 0.1 percentage points in July 2021 to 3.7%. For the same month, the metro unemployment rate was 0.7 percentage points lower than the North Carolina rate. The unemployment rate in Raleigh peaked in May 2020 at 12.1% and is now 8.4 percentage points lower. The relative abundance of jobs brings many to the Raleigh area, while it will keep many students graduating from their schools in the area.

Low Overall Taxes

North Carolina’s overall tax burden is roughly 30th out of the 50 states according to WalletHub. Property taxes clock in at an average of 2.3%. That’s 11th in the country but far better than a number of eastern states. Georgia’s property tax rate, for example, is 2.75%, and neighboring South Carolina’s comes in at 2.91%.

It Is Landlord Friendly

North Carolina on the whole is landlord-friendly. There are payment grace period laws, but you can charge late fees. There are no pet laws or rekeying laws in North Carolina. And unlike other states, North Carolina has been becoming more landlord-friendly. For example, a law passed in 2018 allows landlords to recover legal fees and the cost to issue a court summons when they had to go to court to evict a tenant. This isn’t a blank check, though. Recovered legal fees can’t exceed 15% of the amount owed.

Raleigh Real Estate is Relatively Affordable

North Carolina homes cost an average of $180,000. You can buy several investment properties here for the cost of one middle-class home in California or a loft in New York City. The area is so affordable that housing costs score 92 on the cost of the living index while the national average is 100. The median home value of roughly $254,000 (Zillow). NerdWallet had ranked Raleigh one of the best places to own a home. Over 70% of Raleigh's land is zoned for residential use, which contributes to the city's affordability of housing relative to Austin, Atlanta, and Charlotte.

The Modest Military Market

Raleigh is almost ideal in this case. The community isn’t the home of Fort Bragg, but that means the community’s real estate market won’t rise and fall based on the fate of a large base. Instead, there are several moderately sized military employers in the area. Raleigh is home to one of 65 MEPS to induct people into the military. Raleigh is home to the North Carolina National Guard, Civil Air Patrol, a US Army Corp of Engineers, and an Army Research Office. An office of the Defense Criminal Investigative Service is located here, as well.

Conclusion

Maybe you have done a bit of real estate investing in Raleigh but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. The strong US real estate market shows no signs of slowing and is slated to remain among the world’s top performers. Whether you are a Baby Boomer or a Millennial, you will find living in Raleigh is a unique experience. From being a leader in the job market to being a hub for entertainment, it’s pretty clear why many people love to call Raleigh home.

A good cash flow from Raleigh rental property means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt. Therefore, finding a good Raleigh real estate investment opportunity would be a key to your success. If you invest wisely in Raleigh real estate, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it is very important to read good books on real estate.

The less expensive the Raleigh investment property is, the lower your ongoing expenses will be. Some of the most popular neighborhoods in Raleigh are Downtown Raleigh, Southwest Raleigh, Wake Forest, West Cary, Oakwood, Forestville, Stonehenge, North Hills, Northeast Raleigh, Lochmere, Fayetteville Street District, North Raleigh, Five Points East, Northwest Raleigh, and Brier Creek.

Apart from the Raleigh market, you can go to Tucson, AZ. The Tucson housing market has recovered and is poised for slow, steady, and certain long-term growth. The shifting demographics and known groups eager to sell at the right price provide an excellent opportunity to find bargains almost anywhere in the Tucson real estate market. Tucson consists of 583 neighborhoods. Many people move to Tucson and then commute to work in surrounding cities.

Tucson’s relatively slow and steady growth rate means that new construction is at a crawl. That is causing rents to rise faster than average, especially at the low end of the market. Another factor propping up home prices is the relatively small inventory on the market; snowbirds typically sell when they need to instead of based on market conditions.

Another market that we suggest is Dayton, Ohio. The Dayton Ohio real estate market is one of the best deals in the Midwest. It balances affordable properties with strong future growth, a large rental market and stable property values, low carrying costs, and decent ROI. The average home size is roughly 1,350 square feet. Downtown Dayton and its suburbs are doing a nice job of incentivizing new businesses to come into the area. Existing businesses are also benefiting from positive housing market trends in Dayton. While the overall Dayton housing market is booming, downtown Dayton has struggled with crime from time to time. The good news is that the city has steadily reduced crime.

Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.

NORADA REAL ESTATE INVESTMENTS strives to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in the U.S. growth markets. We can help you succeed by minimizing risk and maximizing profitability. Consult with one of the investment counselors who can help build you a custom portfolio of turnkey cash-flow rental properties in the various growth markets across the United States.

All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching top real estate growth markets and structuring complete turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

Remember, caveat emptor still applies when buying a property anywhere. The information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.

References

Market Trends And Forecast
https://www.zillow.com/raleigh-nc/home-values
https://www.trianglemls.com/tmls/market-trends/
https://www.realtor.com/local/Raleigh_NC
https://www.redfin.com/city/35711/NC/Raleigh/housing-market
http://www.homesinraleigh.org/raleigh-housing-report.html
http://www.metrodepth.com/raleigh-forecast-another-average-year
http://www.freddiemac.com/research/indices/house-price-index.page

Rental Market
www.zumper.com/rent-research/raleigh-nc
www.bestplaces.net/housing/city/north_carolina/raleigh
www.rentcafe.com/average-rent-market-trends/us/nc/raleigh
https://www.apartmentlist.com/renter-life/average-rent-in-raleigh

Universities and demographics
www.en.wikipedia.org/wiki/Raleigh,_North_Carolina

Higher average income
www.areavibes.com/raleigh-nc/employment

Tax rates
www.wallethub.com/edu/states-with-highest-lowest-tax-burden/20494/

Landlord friendly
www.portcitydaily.com/local-news/2018/06/30/heres-how-north-carolinas-new-eviction-fee-law-changes-things-for

Landlords-and-tenants
www.avail.co/education/laws/north-carolina-landlord-tenant-law

Military market
www.mepcom.army.mil/Units/Eastern-Sector/ 12th-Battalion/Raleigh

Is Now a Good Time to Invest in Rental Property 2022

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Should You Buy a Rental Property in 2022?

Investing in a rental property means buying a property that can generate an income in the form of rent. There is no doubt that rental property investment can be a great way for beginners to generate positive cash flow every month. However, many people still find it challenging due to expenses typically associated with traditional real estate investments including property management and renovation works. In this article, we'll give you an overview of how rental property can easily be bought as a turnkey investment.

Home prices are skyrocketing, and mortgage rates are higher than they've been in well over a decade. That implies that many individuals just cannot afford to buy a home right now. If you acquire a rental property, you may take advantage of high rental demand and perhaps charge tenants a premium. Furthermore, some real estate investors have sufficient wealth to eliminate the need for a mortgage. Higher borrowing rates won't be a problem if that's the case.

The only downside is that if you buy a rental property today, you'll likely pay a premium, especially if you're competing with other purchasers. With a limited housing inventory, you may not locate a property that meets all your needs. Due to low inventory, you may have to venture beyond the desired radius of your preferred neighborhoods.

This might make it tougher to locate tenants who can afford your monthly rent. If you want to mortgage your rental property, you'll pay more now than a year ago. That's an extra fee. But it's also a good time to be a landlord since many people are eager to rent out their homes. If you can find a rental property at a reasonable price, you can definitely invest right now.

In contrast to the set monthly mortgage payment, rents grow over time. The national median rent jumped by a record-setting 17.5 percent in 2021, according to national rent data. Although rent growth has slowed in 2022, it is still accelerating relative to the years preceding the epidemic. During the first half of 2022, rents climbed by a total of 5.4%.

The annual increase in rent is an astounding 14.1%. With rising inflation afflicting the economy, it is probable that rents will continue to climb, which provides a compelling argument for investing in rental properties today in order to capitalize on the predicted growth in rents over the next decade.

Mortgage rates fell last week. While mortgage rates are still much higher than at the start of the year, they've fallen 0.50 percent since mid-June. Last week's economic figures showed sluggish growth and rising unemployment claims. As affordability issues rise and builder confidence declines, buyer competition in the home market eases.

Despite robust labor markets and rising inflation, investors are pricing greater recession risk into medium to long-term interest rates, assuming the Fed will have to stop raising rates. This reduces longer-term borrowing rates and boosts equities prices from earlier this year's lows. The Fed hiked the federal funds rate by 0.75 percent today, as expected. Investors will be looking for hawkish or dovish statements from the Fed this week to determine interest rate forecasts.

Rental Property Definition (Turnkey)

A rental property, also called ‘turnkey', is a real estate property that is fully rehabilitated, functional, and ready to use. It is usually managed by a third-party property management company whose aim is to make the real estate investing process as simple as possible for you as an investor so that all you have to do is to “turn the key”. This type of property is highly appreciated by new real estate investors who have little experience in rehabilitation, or even seasoned investors who simply prefer to have someone else do the analysis and renovation for them.

It is a well know fact get started in real estate investing can be very tricky and overwhelming. In recent years, the solution to this problem has emerged under the so-called turnkey rental properties. Why did investing in turnkey rental property become so popular? The answer is because, on top of all of the advantages it entails, investing in rental properties offers an ideal solution to investors' biggest problem: Headache. Turnkey rental properties allow investors to sit and enjoy their passive cash flows while someone else does all the hard property management work for them.

Is Rental Property A Good Investment Right Now?

investing in rental property in 2022

Should you invest in rental properties? Real Estate is a proven wealth-building vehicle. The most common form of real estate investing, the “buy and hold strategy” involves purchasing a property and renting it out for an extended period of time. Essentially, a “buy and hold investor” seeks to create wealth by renting the property out and either collecting monthly cash flow or simply holding the property until it can be sold for profit in the future.

Among the advantages of this strategy is that during the time that you hold the property and rent it out, the mortgage is paid down every month, decreasing your principal balance and increasing your equity in the rental property. Investing in rental properties can generate passive income, significant tax benefits (being an income property), and build equity from price appreciation over the years.

Real estate is the only investment vehicle that you can live in or rent to produce income. You can also derive large tax-free profits when you sell your investment property at a higher price than you paid for it. But, before investing in a rental property you must consider your investment priorities and temperament. How much time do you have to devote to rental property investing? Can you solve the problems on your own? You can also click on this link to know about the various risks in rental property investing.

You need to know how to estimate a rental income and learn about the other ways you can use to monetize a rental property. Make sure you understand all of the expenses associated with rental property investing. There is a lot more than just a mortgage to think about. It is important to understand the two different types of appreciation and how they can impact what type of property you want to buy and where to buy it. Appreciation in the rent and property value.

Rental Property Appreciation

Rental Properties Generate Passive Income

Investing in turnkey rental properties is a highly appealing approach to many investors who prefer “hands-off” property management of their properties, while still enjoying the return on their investment. In this case, the third-party property management company is responsible entirely for the management of your property which you don’t even have to see.

All that you need to see is your ROI flowing into your bank account each month. For example, if maintenance is needed, it will be the property management company that will receive the call, not you. They will also be collecting rent from the tenants and addressing their complaints.

Investing in rental properties has many advantages that may not be considered by first-time investors. The things mentioned above are not a cup of tea for every investor. Although it is important to learn all things, if you can't due to any reason, you can choose so-called Turnkey Rental Property Companies to help you out. The easiest way to get started in rental property investing is by buying rental properties from reputed Turnkey providers.

The Importance of Real Estate Education

The best investment you make is in your education. Real estate investing is not a “get rich quick” scheme. When it comes to your real estate education, a solid foundation is a key to a long-lasting business. As you analyze your deals, make sure to learn the trade and perfect it. You need to tune in to sources of real estate education so that you can continue building your knowledge base and avoid critical mistakes.

Books are fundamental in gaining an education in real estate and perhaps the most widespread learning method for investors. Real estate books are produced each year by the thousands, and every major bookstore in the world contains a whole section on real estate investing. With the advent of the internet, you can buy e-books on real estate education at cheaper rates than paper books.

You can subscribe to real estate blogs, which can be an amazing source of free information. Real estate podcasts are one of the newest innovations in the world of real estate investor education. You cannot fly solo. Building a large network is a vital part of being a real estate investor. You need to build a network in the real estate market that will help you to succeed.

Finding a mentor and learning from those who have come before you is one of the most important steps you can take in your real estate investing education. Concentrate first on establishing a relationship with seasoned investors who you would like to learn from. A mentor doesn't need to be a real estate mandate Donald Trump or Robert Kiyosaki.

A mentor can be the investor down the street who owns a half-dozen rentals and works a full-time job. You can join portals like BiggerPockets and learn from real investors who have built wealth specifically through rental property investment.

Rental Property Investment Can Be Simplified

Rental Property Investing

The first and foremost advantage of buying a rental property is that you get to simplify the process. Most of the investors interested in real estate are looking to generate a second income, not a second job. Doing it all by yourself takes a lot of your time, which otherwise can be saved by choosing a Turnkey rental property company that will do the heavy lifting for you.

Unless you have been investing in real estate for a long time, the odds are that turnkey operators have better rental property management experience than you do. They know how to deal with tenants and contractors, and they have a property management strategy that ensures routine rent collection and handling of any payment problems.

If you decide to buy a rental property on your own, you will have to do plenty of market research to decide on the best area to invest in. However, a good turnkey rental property company will know the sweet spots of the market by heart. They already know which markets are sustainable and good to invest in.

This experience takes plenty of time to build and having it will save you a lot of money as well as energy. These companies want to be in this business for the long term, so they make sure to sell the best rental properties to their clients. However, it is wise to hire your turnkey property consultant to cross-check their proposed ROI. You need to invest in markets where development is heading. The best rental properties are the ones that are well located and physically sound.

These companies can purchase properties such as REOs in bulk every month. They have good relationships with banks, close deals quickly with cash, and usually get better pricing than an individual investor. They also have their team for renovation work which will typically cost you less than hiring contractors on your own since they can buy materials in bulk.

To make sure your rental property is purchased and managed in the right way, you may have to have professionals such as contractors, brokers, loan officers, tax advisors, attorneys, appraisers, title/escrow agents, and accountants, which you may not be able to do on your own. Instead of it, turnkey providers already have ongoing relationships with all these professionals which saves your time and ensures your property is managed in the best way. They also have their contractors do the repair work. They can help you with financing as well.

How To Find Rental Properties For Sale Online?

Knowing where to find rental properties is an increasingly expensive challenge. Online databases are a great place to start your property search because they allow you to query and filter properties from all over the country based on specific qualities. Norada Real Estate Investments makes real estate investing easy. It helps you by finding your next rental property for sale with big data analysis supported by their investment experts.

We have exclusive off-market rental property deals in multiple markets in the United States. Sites like Trulia, Zillow, or Loopnet are good but there are some intricacies you need to know when searching on them. You need to find a diverse list of suburbs across the city and in different price brackets which have good transport, schools, lifestyle, high sales volume, and high percentage value growth.

If you are interested in buying rental properties and portfolios at this time, you can choose the Houston Housing Market. Houston has everything: the people, the diversity, the business climate, being world-renowned in energy, medicine, space, and manufacturing, and above all a booming real estate market.

Importance of Rental Investment Analysis

Once you have found a bunch of rental properties that you are interested in, it's time for analysis. Before buying the rental property, the real you should know if the property value in the market changes dramatically or not. There are several primary factors to consider, but cash flow and appreciation are the two most important variables in rental property investment.

Cash flow is simply the money left after all the bills have been paid, and appreciation is the equity gained as the property value increases. You need to crunch the numbers and figure out if it's a good investment. As an investor, you need to understand how to evaluate deals and opportunities. By far the most common mistake that we see new investors make with this strategy is buying bad deals because they simply don't understand property evaluation.

That's why analyzing nearby properties (comparables within a mile or two) is very important. Market “comps” determine the value of single-family homes. These comps or “comparables” are nearby properties with similar characteristics. They share variables like the floorplan, number of bedrooms and bathrooms, garage size, and amenities. A single-family investment home generally rises in value if a similar home is also rising in value and vice versa.

Other common problems include underestimating expenses, making bad decisions on tenant selection, and failing to manage properly. You need to learn how to figure out income, expenses, cash flow, and whether it's a good deal for you. You need to see what is tenancy type of the market. Is it a periodic tenancy or a fixed term of 6-12 months? A fixed-term rental property has a rent assessment at the end of every fixed term where rent typically goes up a percentage.

Know Your Area Before Purchasing a Rental Property

We recommend buying in an area that you are familiar with, at least for your first few properties as you get your feet wet. It could perhaps be your college town or your hometown. It helps to have some knowledge of the area. As a bonus, if you buy in an area that you visit anyway, your leisure travel can become at least partly tax-deductible because you will be adding a business component to those trips to check up on your property.

If you are not familiar with an area, try spending a few weekends in your target market over a period of months. Drive around in 2-3 zip codes you are interested in and talk to neighbors, local shop owners, property managers, etc. You'll need a network of local professionals to help you manage your property.

Understand Market Dynamics Before Purchasing a Rental Property

You need to think strategically when choosing and purchasing your rental property, and to work in line with both market trends and the general guidelines that dictate whether your investment is poised to succeed or not. Data and analyses can help you understand market dynamics such as — supply and demand, median home prices, median days on market, median rent prices, new construction, mortgage rates, and local economic indicators.

The most desirable rental markets for property investors aren't always in big cities. Investors prefer to buy property in growing markets having strong economic growth, low median housing prices, high rents, and low vacancy rates. You can also buy an out-of-state rental property without having to live in that state or handle the management.

This process also helps you as an investor to diversify your portfolio of rental properties. For example, if you live in New York City and cannot afford to buy a rental property, you can diversify your portfolio and still generate passive cash flows by buying rental properties in more affordable distant growth markets like Atlanta, Dallas, Memphis, or Indianapolis.

What is Buyer's Market?

In a buyer's market, there are more homes for sale than there are buyers in the marketplace, so the housing market is favorable to buyers. For real estate investors, buyer's markets are the perfect time to buy an investment property because the negotiating power is on their side and they can easily move on to the next potential deal if a seller won’t agree to their contract terms.

What is Seller's Market?

In a seller's market, more buyers are looking for homes than there are homes available. In other words, there are many interested buyers, but the real estate inventory is low. Since there are fewer homes available, sellers are at an advantage as they are more likely to receive multiple offers (above their asking price).

Financing Your Rental Property Investment

You need to assess your current financial position to get a realistic sense of your budget and timeline for making your first rental property investment. Make sure you're financially fit before investing in rental properties. Most successful real estate investors build their investment portfolio through saving money and then gradually buying properties over the years. Going for a mortgage can help you quickly build your portfolio of rental properties.

Instead of putting all your savings into one rental property, you can contact lenders and borrow from them and buy multiple rental properties. Typically investors need to put 20% of their money as a down payment and the rest of the amount is covered by the loan amount. The best returns on real estate rely upon the use of credit to obtain the leverage of using other people's money. Pay attention to your monthly budget and make sure you have adequate insurance coverage as well.

5 Markets To Invest in Rental Property Right Now

Single-family housing starts are expected to grow in 2022. On the whole, the market will remain seller-friendly, but buyers will still have relatively low mortgage rates and an eventually improving selection of homes for sale. We'll discuss 5 markets that are great for choosing your next rental property in 2022.

These markets also made the list of PWC's top 10 real estate markets for 2021. Since 2015 PWC has been publishing an annual report on “Emerging Trends in Real Estate®: US and Canada.” The report discusses the top 10 overall real estate prospects, powered by strong growth, homebuilding outlook, affordability, and job prospects.

Rental Property Investing in Raleigh, North Carolina

The Raleigh metropolitan area – the city and its surrounding suburbs – account for about one and a half million people. About a third of Americans rent their homes. In the Raleigh NC real estate market, the rate is 43%. This is partially due to the large student market, but it is also fueled by young people moving here for work. That explains why downtown Raleigh rents grew 9% in 2018. It also explains why you can rent out a studio for $900 a month and one-bedroom apartments for a thousand dollars a month.

The cumulative appreciation rate over the ten years has been 47.67%, which ranks in the top 30% nationwide. This equates to an annual average Raleigh house appreciation rate of 3.98%, according to NeighborhoodScout.com's data.

Recent forecasts and predictions for the Raleigh housing market suggest that home prices will continue rising in 2022. Raleigh home values have gone up 6.6% over the past year and Zillow predicts they will rise 9.8% in the next year. In the latest quarter, Raleigh's appreciation rate has been 1.78%, which annualizes to a rate of 7.32%.

  • Median Property Price: $307,349 (Zillow)
  • An Estimate of Median Property Price After 12 Months: $337,000
  • Average Rent: $1,258, up 2% YTY (RENTCafe)
  • Renter-occupied Households: 43%

Rental Property Investing in Durham, North Carolina

The Durham housing market has made considerable improvements since the housing bubble burst. Only two years after the market crash in 2008, Durham was considered one of the few favorable locations to invest in real estate. With strong population growth and a solid economy, the rental demand in Durham, North Carolina is continuously increasing.

Durham real estate typically performed stronger than the U.S. average due to the popularity of the Triangle area among new and out-of-state residents, as well as investors. Rents in downtown Durham grew by 10% or more in 2016 and 2017, though an influx of new apartments in the area helped it cool down to the single digits.

Rent for the average one-bedroom apartment in Durham hit $1100 a month in January 2019. This is a 7% increase over 2018 figures. Two-bedroom apartments increased by about 6% to $1350 a month. Single-family homes, of course, rent for much more.

Durham real estate appreciated 51.32% over the last ten years, which is an average annual home appreciation rate of 4.23%, putting Durham in the top 20% nationally for real estate appreciation. Recent forecasts and predictions for the Durham housing market suggest that home prices will continue rising in 2022. Durham home values have gone up 7.0% over the past year and Zillow predicts they will rise 9.7% in the next year. In the latest quarter, NeighborhoodScout's data show that house appreciation rates in Durham were at 0.71%, which equates to an annual appreciation rate of 2.86%.

  • Median Property Price: $269,287 (Zillow)
  • An Estimate of Median Property Price After 12 Months: $295,000
  • Average Rent: $1,201 (RENTCafe)
  • Renter-occupied Households: 43%

Rental Property Investing in Austin, Texas

Austin is second-ranked, with a positive outlook for all property sectors in general, specifically for multifamily and single-family housing. The local economy is strong with no shortage of available investment capital. Austin's high quality of life and a strong economy have the city once again leading the pack when it comes to population growth. New data from the U.S. Census Bureau shows Austin is fifth in the nation for the population increase in the past decade, with an increase of 177,079 people between April 1, 2010, and July 1, 2019.

The decade ending 2018 saw a 32.7% increase in population, and growth was 2.5% for the year ending July 2018. The Austin housing market has gained a lot of steam, with home values almost doubling since 2010. The Austin real estate market isn’t as big as Dallas, San Antonio, or Houston. Austin is only the fourth largest city in the state.

However, the Austin housing market is sizable – it is the eleventh largest city in the U.S. as of this writing, and it is the center of a large metro area. Austin has come up as another tech hub in the last 5 to 6 years. There are tons of high-paying tech jobs moved to Austin in the last couple of years. As Austin is a young city by many standards, Millennials will be the largest buying force in Austin in 2022, and this trend should continue in the coming years.

Austin real estate appreciated 97.02% over the last ten years, which is an average annual home appreciation rate of 7.02%, putting Austin in the top 10% nationally for real estate appreciation. Recent forecasts and predictions for the Austin housing market suggest that home prices will continue rising in 2022. Austin home values have gone up 12.8% over the past year and Zillow predicts they will rise 11.6% in the next year. Austin appreciation rates in the latest quarter were at 2.28%, which equates to an annual appreciation rate of 9.42%, according to NeighborhoodScout's data.

  • Median Property Price: $437,800 (Zillow)
  • An Estimate of Median Property Price After 12 Months: $488,000
  • Average Rent: $1,441 (RentJungle)
  • Renter-occupied Households: 48% (RENTCafe)

Rental Property Investing in Salt Lake City

Salt Lake City is witnessing a strong local economy. The next 5 to 10 years are expected to be an exciting time for tech in Salt Lake City —thanks to the tremendous growth of Silicon Slopes and Salt Lake City's business ecosystem. It has the winning combination of lower costs, great amenities, and top-ranked universities that provide the necessary workforce and incubators. 30% of the population is aged between 15 and 34.

Salt Lake City real estate appreciated 86.26% over the last ten years, which is an average annual home appreciation rate of 6.42%, putting Salt Lake City in the top 10% nationally for real estate appreciation. Recent forecasts and predictions for the Salt Lake City housing market suggest that home prices will continue rising in 2022.

Salt Lake City home values have gone up 11.2% over the past year and Zillow predicts they will rise 11.5% in the next year. Salt Lake City appreciation rates in the latest quarter were at 2.87%, which equates to an annual appreciation rate of 11.97%, according to NeighborhoodScout's data.

  • Median Property Price: $454,403 (Zillow)
  • An Estimate of Median Property Price After 12 Months: $506,000
  • Average Rent: $1,220 (RentJungle)
  • Renter-occupied Households: 48% (RENTCafe)

Rental Property Investing in Dallas, Texas

Dallas has a great outlook for the local property regarding industrial and single-family properties. The local economy and investor demand are also positive with good capital availability. The city is expected to have 87,000 new residents a year for the next 5 years and is projected to have a population aged 15-34 grow by 10.9%. The cost of doing business is 94% of the national average and the disposable income growth is 6.9%. The city also has strong healthcare and livability ranking. For a more in-depth review, click the link –  Dallas Real Estate Market.

Dallas real estate appreciated 74.33% over the last ten years, which is an average annual home appreciation rate of 5.71%, putting Dallas in the top 10% nationally for real estate appreciation. Recent forecasts and predictions for the Dallas housing market suggest that home prices will continue rising in 2022. Dallas home values have gone up 6.9% over the past year and Zillow predicts they will rise 11.1% in the next year.

In the latest quarter, NeighborhoodScout's data show that house appreciation rates in Dallas were at 1.12%, which equates to an annual appreciation rate of 4.55%.

  • Median Property Price: $237,200 (Zillow)
  • An Estimate of Median Property Price After 12 Months: $263,000
  • Average Rent: $1,228 (RentJungle)
  • Renter-occupied Households: 42% (RENTCafe)

The US housing market has been on fire this year with record-low mortgage rates and a sudden wave of relocations made possible by remote work. Meanwhile, home prices have pushed new boundaries as buyer demand continues to surge. As we enter into 2022, housing market experts predict sales to grow 7 percent and prices to rise another 5.7 percent. If you need to explore more markets for rental property investment, here's our new article on the best places to invest in real estate in 2022.

Summary

One of the most commonly stated reasons that people give for investing in real estate is that they are seeking out financial freedom. Investing in rental property is an alternate path for seeking financial freedom.  While active investors enjoy spending time on research and management, passive investors tend to have less time or simply do not prefer to be engaged in this tedious task; this is when turnkey rental properties become a great solution.

Rental properties are incredibly passive; they allow you to generate cash flows at distance, while other people who are specialized and professional do all the hard work for you. Whether you are a new investor, or a seasoned investor looking to diversify your portfolio or invest with no hassle, investing in rental properties is something you should not miss. Click on the link to know How To Buy Rental Properties With No Money Down.

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