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.

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

Richmond Housing Market Trends

Richmond metro is a hot housing market in Virginia. Forbes ranked Richmond #55 as the best place for business and careers in the U.S. Richmond's real estate market remains brisk, with buyers willing to pay more for homes than sellers are asking. Richmond homes are getting sold quickly and the metro area’s housing inventory has been squeezed significantly over the last two years.

There is a dearth of housing supply in the Richmond Metro. Over the last two years, available homes for sale have dropped by more than half. In August 2022, the Months Supply of Inventory for the Richmond Metro Area decreased by 10 percent for single-family homes, according to the Richmond Association of REALTORS®. It has dropped to a low of 0.9 months, which means that’s how long it would take to deplete the inventory to zero at the current sales pace.

<<<READ: Virginia Housing Market Forecast 2023>>>

For condos and townhomes, the inventory would also dwindle in just one month, if no new listings are put on the market. From January through August, 9,329 single-family homes were sold in the Richmond metro area, a 13.4 percent decrease over last year's busy market. August sales posted a decline of 20.7% over last year for single-family homes.

The new listings were down 29.6% and the total inventory dropped by 19.1% pushing the home prices up 10.1 percent to a median of $380,000. The difference between this August and last August's median home price is $35,000. Pending Sales (forward-looking indicator) decreased by 22.2 percent which shows that buyers are pulling back due to rising prices and high mortgage rates.

The following real estate statistics are collected by the Richmond Association of REALTORS® for the time frame August 1 through August 31, 2022. It shows the percentage change of some of the key housing indicators of the Richmond Metro Housing Market (Chesterfield, Hanover, Henrico, and Richmond City), when compared to August 2021.

The direction and rate of change in home prices are indicators of the housing market's health and whether homes are becoming more or less affordable. Looking at these trends, it's a seller's market in the Richmond Metro Area. Strong buyer demand is likely to continue into what is typically the slowest time of year. With inventory remaining constrained in most market segments, sellers continue to benefit from tight market conditions. However, higher mortgage rates are impacting home sales and moderating home price gains.

• New Listings decreased 29.6 percent for Single Family homes and 13.7 percent for Condo/Town homes.
• Pending Sales decreased 22.2 percent for Single Family homes and 12.2 percent for Condo/Town homes.
• Inventory decreased 19.1 percent for Single Family homes and 27.2 percent for Condo/Town homes.
• Median Sales Price increased 10.1 percent to $380,000 for Single Family homes and 14.2 percent to $317,500 for Condo/Town homes.
• Average Sales Price increased 12 percent to $436,056 for Single Family homes and 10.9 percent to $329,972 for Condo/Town homes.
• Days on Market increased 8.3 percent for Single Family homes and 15 percent for Condo/Town homes.
• Months Supply of Inventory decreased 10 percent for Single Family homes and 23.1 percent for Condo/Town homes.

Richmond VA Real Estate Market Forecast 2022 & 2023

What are the Richmond real estate market predictions for 2022 and 2023? Virginia Beach is the biggest city in the state. It is followed by Norfolk on the shores of the Chesapeake. These large, dense housing markets attract attention, but it is Richmond, Virginia you should be thinking of. Yet few do beyond memorizing their state capitals. Richmond is home to roughly a quarter-million people.

The Richmond VA real estate market is several times larger than this. If you include the suburbs around it, the Richmond housing market contains nearly one and a half million people. This makes the Richmond area the third-largest metropolitan area in the state of Virginia. Richmond has a mixture of owner-occupied and renter-occupied housing. Single-family detached homes are the single most common housing type in Richmond, accounting for 48.72% of the city's housing units.

Other types of housing that are prevalent in Richmond include large apartment complexes, duplexes, and a few row houses. According to Zillow, a leading real estate marketplace, the typical value of homes in the Richmond metro is $337,047. Richmond metro home values have gone up 13.2% over the last twelve months.

According to NeighborhoodScout's data, appreciation rates for homes in Richmond have been tracking above average for the last ten years. The cumulative appreciation rate over the ten years has been 88.39%, which equates to an annual average appreciation rate of 6.54%. During the latest twelve months, Richmond's appreciation rate has been 14.67%, and in the latest quarter, it's been 1.78%, which annualizes to a rate of 7.29%.

Here is a short and crisp housing market forecast for Richmond City, Chesterfield, Hanover, and Henrico Counties — all of which are part of the Richmond Metro Area Housing Market. Housing inventory remains scarce. The supply and demand dynamics will likely push prices north again over the next 12 months.

• Richmond Metro home values have gone up 13.2% over the past year.
• Zillow predicts that Richmond Metro home values will rise by 0.8% between Aug 2022 to Aug 2023.
• Richmond City home values have gone up 14.1% over the past year.
• Chesterfield County home values have gone up 14.5% over the past year.
• Hanover County home values have gone up 9.6% over the past year.
• Henrico County home values have gone up 12.2% over the past year.

Richmond Real Estate Investment Overview

Many real estate investors have asked themselves if buying a property in Richmond is a good investment? You need to drill deeper into local trends if you want to know what the market holds for the year ahead. We have already discussed the Richmond housing market forecast for answers on why to put resources into this market. Although, this article alone is not a comprehensive source to make a final investment decision for Richmond we have collected some data for those who are keen to invest in Richmond real estate in 2023.

Being the capital of Virginia is not reason enough to make a real estate investment. However, being a capital city results makes it a good housing market to invest in. For example, government employment for better or for worse is relatively high in state capitals. That creates a large number of good-paying jobs, raising property values.

You see the same thing on a grander scale in the wealthy suburbs around Washington, D.C. Being the state capital and the central transportation hub for the region resulted in it being a center of commerce and trade. This led to many law firms and banks having their headquarters here. That is aside from the hospitals and educational institutions in the area. This contributed to the average salary hovering around 50,000 dollars a year. In 2017, Richmond made multiple lists of the best places to retire in the United States as well as top places to live.

Points in favor of the Richmond VA real estate market included its intellectual and creative life, affordability, and quality of healthcare. This has led to a spate of new construction for active adult communities. Investing in Richmond real estate will fetch you good returns in the long term as the home prices in Richmond have been trending up year-over-year. Let’s take a look at the number of positive things going on in the Richmond real estate market which can help investors who are keen to buy an investment property in this city.

Richmond's Large Student Market For Rentals

The Richmond VA real estate market is perfect for those who want to cater to the student market. It is incredibly diverse. The Virginia Commonwealth University campus is home to roughly 30,000 students. That’s aside from the University of Richmond satellite campus. Virginia Union University hosts nearly two thousand college students.

Small private schools like Virginia College and Fortis College host just a few hundred students. There are Baptist, Presbyterian, and several other seminaries in the city, as well. You could find a Richmond real estate investment property near any of these campuses (or in easy reach of several) and rent it out to a steady stream of students.

The main reason you would buy a Richmond real estate investment property is for the rental income. However, the more important factor is the return on the investment. In this regard, the Richmond housing market shines. The median rental rate is roughly 1300 dollars a month for an apartment.

Rental rates are increasing year-over-year due to demand. This will result in continued increases in rents for the foreseeable future. If the economy were to decline (due to unforeseen things like this pandemic), the fact that there are so many students in the area will bolster rental rates in the Richmond real estate market.

Current Rental Market Trends: Before the pandemic, the average rent for an apartment in Richmond was growing at 6% annually (source: RENTCafe). The average size for a Richmond, VA apartment is 862 square feet, but this number varies greatly depending on unit type. Studio apartments are the smallest and most affordable. Around 55% of the households in Richmond, VA are renter-occupied while 44% are owner-occupied.

As of September 19, 2022, the average rent for an apartment in Richmond, VA is $1,366 which is a 28% increase from last year. Over the past month, the average rent for a studio apartment in Richmond increased by 2% to $1,365. The average rent for a 1-bedroom apartment increased by 1% to $1,366, and the average rent for a 2-bedroom apartment increased by 3% to $1,575.

• Two-bedroom apartment rents average $1,575 (a 19% increase from last year).
• Three-bedroom apartment rents average $1,899 (an 8% increase from last year).
• Four-bedroom apartment rents average $2,100 (a 2% increase from last year).

Top Neighborhoods include Jackson Ward, Westover Hills, Manchester, The North Side, Three Corners, and Oregon Hill.

The Tourist Market Boosts Short-Term Rentals

Yes, Richmond, Virginia has a tourist market. More than seven million people a year pass through. They may be visiting one of the oldest cities in the United States to tour the Revolutionary era or Civil War sights. Others attend weddings and graduations in the area. The city is considering becoming more friendly to short-term rentals, something that has been illegal.

Short-term rentals have been illegal under local law, but under the new ordinance, property owners can list with sites like Airbnb if they pay an annual $300 permitting fee. That fee would go toward a 3rd-party monitoring program. The city is also requiring short-term rental operators to live in the home for 185 days each year.

Certificate of Zoning Compliance (CZC) for Short-term Rental (Short-Term Rental Permit) is to be obtained on a biennial basis.  The ordinance to permit short-term rentals was adopted by City Council on June 22, 2020. The effective date of the ordinance is July 1, 2020.

The Relative Landlord-Friendly Regulations

The Richmond housing market is quite landlord-friendly. There is no limit on late fees as long as they are written into the lease. Written leases aren’t required unless for more than 12 months. There is no notice of entry law in the state. The only area where Virginia falls short is the long, complex eviction process. The average Richmond real estate investment property owner offsets this by having a large security deposit and thorough background checks. Security deposits are typically limited to two months’ rent. You can charge an application deposit on top of the security deposit.

Growing Economy

Unemployment in the Richmond area hovers around three percent, half a point or so below the national average. More importantly, the area has seen better than average job growth over the past few years. In 2017, they were among the top 25 metro areas with the fastest job growth. Future job growth is expected to be 35 percent over the next ten years, several percentage points higher than the national average.

This will contribute to steady population growth as college graduates find jobs in the area and end up raising their families here. Virginia’s economy has benefitted in recent years from increased federal government spending as well as improvements in its business climate. CNBC named Virginia the top state for doing business in 2019, a point driven home by Amazon’s selection of Northern Virginia for its HQ2 in November 2018.

Richmond’s ties to Northern Virginia are strengthening, helping Virginia’s capital city attract a wide range of new business development. Growth along the coast has been more modest but rising defense spending is finally providing a boost to the Norfolk area. Charlottesville and Harrisonburg are also hot spots.

Richmond has crafted a 1.5 billion dollar redevelopment plan for the area around Richmond Coliseum. Large sections of downtown will be renovated and redeveloped to include new condos, retail and commercial space. It will be home to a new transit building, arena, and mixed-use developments. This will increase the value of all properties in the Richmond housing market in and around downtown.

Conclusion

The Richmond Metro Area is historic, but it is already a modern city embracing smart growth and development. It is a stable housing market that offers good returns without massive regulation or heavy taxes.

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 has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Richmond.

Consult with one of the investment counselors who can help build you a custom portfolio of Richmond turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Richmond

Not just limited to Richmond or Virginia but you can also invest in some of the best real estate markets in 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 and structuring complete Richmond turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

Some of this article's information came from referenced websites. Norada Real Estate Investments provides no express or implied claims, warranties, or guarantees that the material is accurate, reliable, or current. All information should be validated using the below references. Norada Real Estate Investments does not predict the future US housing market. This article educated investors on Richmond real estate. Buying a rental property needs research, planning, and budgeting. Not all investments are good. Always do research and consult a real estate investment counselor.

References

Market Data, Reports & Forecasts
https://rarealtors.com/housingreports/
https://www.zillow.com/Richmond-va/home-values
https://www.redfin.com/city/17149/VA/Richmond/housing-market
https://www.redfin.com/state/Virginia/housing-market
https://www.neighborhoodscout.com/va/richmond/real-estate
https://www.realtor.com/realestateandhomes-search/Richmond_VA/overview/

Student Market & Rental Trends
https://en.wikipedia.org/wiki/Richmond,_Virginia#Demographics
https://www.collegesimply.com/colleges-near/virginia/richmond
https://www.rentjungle.com/average-rent-in-richmond-va-rent-trends
https://www.rentcafe.com/average-rent-market-trends/us/va/richmond/

Landlord friendly
https://www.avvo.com/legal-answers/va-landlord-tenant-law-question-377594.html
https://www.avail.co/education/laws/virginia-landlord-tenant-law

Economy
https://wtvr.com/2017/08/25/the-25-metro-areas-with-the-fastest-job-growth
https://www.bestplaces.net/economy/city/virginia/richmond
https://www08.wellsfargomedia.com/assets/pdf/commercial/insights/economics/regional-reports/va-economic-outlook-20200310.pdf

Redevelopment
https://www.richmond.com/news/local/city-of-richmond/update-stoney-to-introduce-now–billion-richmond-coliseum-redevelopment/article_3c6d3b83-8c21-5f19-ab73-995b2f57e6a5.html
https://www.wric.com/news/local-news/richmond/how-richmond-plans-to-pay-for-the-navy-hill-redevelopment-project

This article has been updated to reflect recent changes in the Minneapolis real estate market due to the coronavirus pandemic. We'll be discussing the housing market trends for the Twin Cities Metro Area in 2022. Our focus for real estate investment would be the Minneapolis housing market—the entire twin city metro area—and we shall also share the top reasons to invest in this region.

Minneapolis–Saint Paul is a major metropolitan area and is commonly known as the Twin Cities after its two largest cities—Minneapolis and Saint Paul. They’re separated by the Mississippi River. The waterfront is home to many cultural landmarks and coveted waterfront real estate. The Twin Cities housing market remains strong, with the median price reaching $375,000 in July 2022, a 7.1 percent increase from last year, according to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®.

<<<READ: Minnesota Housing Market: Prices & Forecast>>>

The ongoing inventory shortage is primarily to blame, though the housing inventory in July increased by 13.3 as compared to last year. The housing supply is now 1.7 months, which is still a sign of a strong seller's market. Given a chronically undersupplied market with strong demand, home prices are expected to rise further, albeit at a slower pace due to rising mortgage rates.

Buyers spend approximately $205 per square foot on average. The Twin Cities currently has less than seven weeks' worth of inventory, whereas a balanced market has four to six months' worth. However, over a decade of underbuilding has resulted in fierce competition for the majority of listings.

Despite lower inventory levels, there are signs that supply is beginning to stabilize as the inventory of homes for sale is up 13.9% from last July. Sellers sold 20.2 percent fewer homes than in July of last year. The declines are due in part to the exceptional strength of the 2021 market and also a reaction to rising mortgage rates.

Minneapolis–Saint Paul Housing Market Trends (Describes Twin Cities)

Here are the most recent housing statistics in Minneapolis–St. Paul–Bloomington MN-WI metropolitan area. The area is commonly known as the Twin Cities after its two largest cities, Minneapolis, the most populous city in the state, and its neighbor to the east, Saint Paul, the state capital. With a strong economy and low mortgage rates, buyer activity was very strong last year. Supply and demand continued to favor sellers leading to a rise in prices.

In the 16-County metro area surrounding the Twin Cities, where the housing market has been particularly hot, the number of closed sales fell 20.2 percent to 5,442 in July 2022 as compared to last year. The source of this report is the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®.

• In July 2022, the number of new listings in the Twin Cities decreased by 17 percent to 6,845.
• The number of days on the market increased by 15.8% to 22 days.
• Price Per Square Foot increased 5.8% to $205.
• The median sales price increased 7.1% to $375,000.
• The average sales price increased 7.4% to $434,254.
• Months Supply of Inventory increased by 13.3% to 1.7 months.

Minneapolis Housing Market Trends (Describes City's Housing Stats)

The median list price of homes in Minneapolis, MN was $325K in August 2022, trending up 4.9% year-over-year, according to Realtor.com The median sale price was $340K. The Sale-to-List Price Ratio is 100%, which means that on average, homes in Minneapolis, MN sold for approximately the asking price in August. Minneapolis is a seller's market, which means the total sales-to-total listings ratio is above 0.2. It also means that more people are looking to buy than there are homes available.

Below is the latest report of the Minneapolis Housing Market which compares the Minneapolis housing metrics from July 2022 with July 2021.

• In July 2022, the number of new listings in Minneapolis decreased by 22.1 percent.
• The number of days on the market increased by 11.1% to 30 days.
• Price Per Square Foot increased 0.3% to $239.
• The median sales price increased 2.6% to $330,000.
• The average sales price increased 3.2% to $396,617.
• Months Supply of Inventory decreased by 4.8% to 2.0 months.

Saint Paul Housing Market Trends (Describes City's Housing Stats)

According to Redfin, a real estate company, the St. Paul housing market is very competitive. Many homes get multiple offers, some with waived contingencies. The average homes sell for about 2% above the list price and go pending in around 14 days. Hot listings on the market can sell for about 7% above the list price and go pending in around 7 days.

In July 2022, St. Paul home prices were up 7.4% compared to last year, selling for a median price of $290K. On average, homes in St. Paul sell after 15 days on the market compared to 12 days last year. There were 377 homes sold in July this year, down from 478 last year.

Below is the latest report of the “St. Paul Housing Market” released by the Minneapolis Area REALTORS®. The report compares the St. Paul housing metrics from July 2022 with July 2021.

• In July 2022, the number of new listings in St. Paul decreased by 23.7 percent.
• The number of days on the market increased by 4.5% to 23 days.
• Price Per Square Foot increased 2.8% to $204.
• The median sales price increased 5.8% to $285,500.
• The average sales price increased 6.3% to $329,562.
• Months Supply of Inventory remained the same at 1.6 months.

Minneapolis Metro Area Housing Market Forecast 2022 & 2023

The Minneapolis housing market is shaping up to continue the trend of the last few years as one of the hottest markets in the United States. It is also one of the hottest real estate markets for investing in rental properties. What are the Minneapolis real estate market predictions for 2022 & 2023? Let us look at the price trends recorded by Zillow over the past few years. Since the last decade (Sept 2012), the typical home value in the Minneapolis-St. Paul-Bloomington Metro has appreciated by about 100.7% (Zillow Home Value Index).

Minneapolis metro area home values have gone up by 9.4% over the past year alone. There exists a limited supply of homes in Minneapolis, 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 month’s 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.

• The typical home value of homes in Minneapolis-St. Paul-Bloomington Metro is $377,399, up 9.4% over the past year.
• The Minneapolis Metro housing market forecast ending with July 2033 is positive.
• Despite the market cooling off, Zillow predicts that Minneapolis MSA home values may grow by 0.6% by July 2023.
• If this forecast is correct, Minneapolis Metro home prices will be higher in the 2nd Quarter of 2023 than they were in the 2nd Quarter of 2022.
• Minneapolis (city) home values have gone up 3.9% over the past year ($342,239 as of July 2022).
• Saint Paul's home values have gone up 6.6% over the past year ($292,905 as of July 2022).
• Bloomington home values have gone up 7.4% over the past year ($364,100 as of July 2022).

The real estate activity continues to slow down in the Twin Cities region in this peak home-buying season. Supply is growing during the worst inventory shortage in decades. Median Sales Price is still higher than last year. Days on market are down marginally compared to 2021. In a balanced real estate market, it would take about five to six months for the supply to dwindle to zero.

In terms of months of supply, Minneapolis, or the entire twin cities housing market can become a buyer’s real estate market if the supply increases to more than five months of inventory. In any case, that isn't going to happen, at least not in the next twelve months. This region (and entire Minnesota state) is very much skewed to sellers due to a persistent imbalance in supply and demand. Thus, the housing inventory continues to be constrained.

The mortgage rates have been increasing in 2022. If buyer demand continues to ease, we could see a positive influence on the low inventory of the Twin Cities region while at the same time seeing a negative impact on sales. Also, if listings linger on the market for longer, buyers have a special edge in negotiating sales prices.

As a result, buyers who enter the market at this should have more options than usual when it comes to choosing a property. So they should take advantage of scooping up their favorite deals which otherwise are taken away by seasoned investors in the bidding wars. Whether you’re looking to buy or sell, timing your local market is an important part of real estate investment.

Minneapolis Real Estate Investment: Is It A Good Place For Investment?

Now that you know where Minneapolis is, you probably want to know why we’re recommending it to real estate investors. Is Minneapolis a Good Place Real Estate Investment? You need to drill deeper into local trends if you want to know what the market holds for the year ahead. We have already discussed the Minneapolis housing market forecast for answers on why to put resources into this market.

Let’s talk a bit about Minneapolis and the surrounding metro area before we discuss what lies ahead for investors and homebuyers. With a population of roughly 3.5 million, Minneapolis is the 16th largest metropolis in the United States. This city by the water is known for great cultural organizations that draw a diverse array of residents interested in the performing arts, theatre, music, and writing. Six Fortune 500 companies make their headquarters within the city limits of Minneapolis including Target and Pepsi Americas.

Minneapolis by itself is home to more than four hundred thousand people, making it the largest city in the state of Minnesota and the larger of the Twin Cities. The Twin Cities metro area includes more than three and a half million people, making it the sixteenth largest metro area in the U.S. and the third largest in the Midwest. But unlike much of the Rust Belt, Minneapolis is going strong. This is but one reason to take another look at the Minneapolis housing market.

If you are a home buyer or an investor in the Twin Cities real estate market, you'd know that it has a track record of being one of the best long-term real estate investments in the U.S. over the last ten years or so. In fact, in the Midwest United States, the Minneapolis housing market ranks highest when it comes to a positive market outlook. Inventory is a significant problem throughout Minnesota. The twin city metro area is a strong seller's market due to a persistent shortage of housing supply.

Minneapolis has a mixture of owner-occupied and renter-occupied housing. One or two-bedroom single-family detached homes are the single most common housing type in Minneapolis, according to Neighborhoodscout.com. Other types of housing that are prevalent in Minneapolis include large apartment complexes or high-rise apartments ( 39.84%), duplexes, homes converted to apartments or other small apartment buildings ( 13.14%), and a few row houses and other attached homes ( 3.90%).

Single-family detached homes account for roughly 42.25% of Minneapolis's housing units. At the national level, single-family rental homes have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single-family rental units. With 2020 being, theoretically, in the middle of a boom, there are still 4 years for residential construction to surge. Most likely, a housing shortage will remain in 2020, keeping home prices high.

In 2016 Minneapolis had moved into the top 20 emerging real estate markets in the country. It is one of the best places in the Midwest U.S. to invest in real estate. Minneapolis real estate has appreciated 86.27% over the last ten years, which is an average annual home appreciation rate of 6.42%, according to NeighborhoodScout.com. This puts Minneapolis in the top 30% nationally for real estate appreciation.

Looking at just the latest twelve months, Minneapolis real estate appreciation rate has been at 9.36%, which is lower than appreciation rates in most communities in America. The home prices in the Minneapolis housing market will be on an upswing all through 2022. In the latest quarter, NeighborhoodScout's data show that house appreciation rates in Minneapolis were at 0.70%, which equates to an annual appreciation rate of 2.82%. Let’s take a look at the number of positive things going on in the Minneapolis real estate market which can help investors who are keen to buy an investment property in this city.

Minneapolis' Strong Job Market

We touched on the strong Minneapolis job market. The Twin Cities job market has been revived by a wave of jobs in the life sciences, biotechnology, and medicine. This has helped to give workers in Minneapolis an average annual salary of six thousand dollars higher than the national average. The city even made a “The Ladders” list for cities with the most $100,000 plus jobs.

That fuels the demand for Minneapolis rental properties at the more expensive end of the market. Yet their location on the Mississippi River and other transit routes contribute to a diverse job ecosystem, where employers like 3G and General Mills maintain manufacturing and food processing hubs. People move here from across Minnesota in search of work, since their unemployment rate is consistently one full percentage point lower than the national average.

Minneapolis' Strong Demand for Housing

Housing markets can be large and declining – Detroit being a shining example, Minneapolis is notable for being a growing city, driving demand for properties in the Minneapolis real estate market. The population growth is driven by both migrations to the area by those seeking jobs and demographic momentum. This is why the Minneapolis housing market is expected to see home price appreciation this year despite the ongoing pandemic.

The month's supply of housing inventory in Minneapolis, the twin cities region, and the entire state of Minnesota is very tight. This entire region is a strong seller's real estate market. One of the defining features of older Rust Belt cities is that they’ve been heavily built up for decades. In the case of the Minneapolis housing market, geography and existing construction constrain the new housing supply.

They can’t build on water or build out in the direction of St. Paul. The city already has suburbs, but people don’t want to move too far out from the urban core where most jobs exist. This forces builders to tear down old buildings to bring new, denser development to the Minneapolis housing market. That is more expensive than building new homes on the farmland. All of this constrains new construction. It also explains why many houisng experts think home prices will rise in the next twelve months.

The Minneapolis Rental Market is Growing

The median sales price in Minneapolis is around $305,000 as of June 2020. It means you can buy several properties in the Minneapolis housing market for the cost of one home in a “hot” market like San Francisco or Los Angeles. The median rental price in Minneapolis is roughly $1,800. This is higher than the Minneapolis metro area rental rate of $1700. Given the appreciation seen in the Minneapolis real estate market, we can expect rental rates to increase faster than the rate of inflation because new construction isn’t going to meet demand.

The Minneapolis real estate market is affordable compared to several booming rental markets across the country. However, the fact remains that the rental market in Minneapolis is growing. Many would-be homebuyers cannot afford to buy their first home, so they have to rent. Students who stay to work compete with economic migrants and the children of locals.

Compounding the matter are the Millennials who watched parents lose homes in the 2007 housing bust and choose to rent though they could afford a home. This explains why the share of the people that rent is growing. 55% of the households in Minneapolis, MN are renter-occupied while 44% are owner-occupied. And this trend will fuel demand for Minneapolis rental properties for years to come. More than 50% of the apartments can be rented for $1,500 or less.

Current Rental Statistics: As of September 12, 2022, the average rent for a 1-bedroom apartment in Minneapolis, MN is $1,215. This is a 2% increase compared to the previous year. Over the past month, the average rent for a studio apartment in Minneapolis remained flat. The average rent for a 1-bedroom apartment decreased by -2% to $1,215, and the average rent for a 2-bedroom apartment decreased by -1% to $1,700.

• The average rent for a 2-bedroom apartment in Minneapolis, MN is currently $1,700, a 0% increase compared to the previous year.
• The average rent for a 3-bedroom apartment in Minneapolis, MN is currently $1,950, a 3% increase compared to the previous year.
• The average rent for a 4-bedroom apartment in Minneapolis, MN is currently $2,400, a 9% increase compared to the previous year.

According to RENTCafé,  the average size for a Minneapolis, MN apartment is 786 square feet, but this number varies greatly depending on unit type, with cheap and luxury alternatives for houses and apartments alike. Studio apartments are the smallest and most affordable, 1-bedroom apartments are closer to the average, while 2-bedroom apartments and 3-bedroom apartments offer more generous square footage.

The Zumper Minneapolis Metro Area Report analyzed active listings last month across 4 metro cities to show the most and least expensive cities and cities with the fastest growing rents. The Minnesota one bedroom median rent was $1,179 last month. Maple Grove was the most expensive city with one bedrooms priced at $1,510 while St Paul was the most affordable city with one bedroom priced at $1,050.

The best place to buy rental property is about finding growing markets. Cities like Maplewood, St. Paul, and Roseville are good for investors looking to get started with rental property ownership at an affordable price. These cities look good for rental property investment this year as rents are growing over there. These trends provide a macro look at the growing rental demand.

Each real estate market has its own unique supply-demand dynamics with unique neighborhoods that present opportunities for investors. Here are the best areas to invest in a rental property in the Minneapolis Metro Area in 2022. Most of these places have the same things in common, including rising rents and increasing property values.

The Fastest Growing Cities For Rents in Minneapolis Metro Area (Y/Y%)

• Maple Grove had the fastest growing rent, up 11% since this time last year.

The Fastest Growing Cities For Rents in Minneapolis Metro Area (M/M%)

• Minneapolis rent increased 3.3% last month, making it the fastest growing.
• St. Louis Park was second with rent climbing 1.8%.

The Massive Student Market

Any university creates an excellent opportunity for real estate investors. Every college brings in a large number of students who will need to rent a property close to the university. The rent students pay is based on demand for the school, not the state of the local economy. For investors targeting this niche, Minneapolis rental properties are a great addition to your investment portfolio because of the diverse opportunities this market provides. Because of the university, there are lots of students and activities and venues that specifically cater to the student population.

There are many colleges in Minneapolis itself. The University of Minnesota campuses in the area are some of the largest public university campuses in the US. Augsburg College hosts more than three thousand students. Smaller arts and technical colleges dot the town. Because so many colleges are in the middle of the city, downtown Minneapolis rental properties could be advertised to students at several schools. Then, if the local college of arts and design closes, you don’t have to worry about who else may rent the units.

The University area is very popular with young people and provides not only great nightlife and entertainment but plenty of parks and recreational facilities to enjoy during the day. Housing, from houses for rent to apartments and condos are affordable and near inexpensive restaurants, bars, cafes, and bookstores.

The Landlord-Friendliness of Minneapolis

Many states in the Midwest are more tenant-friendly than landlord-friendly. The Minneapolis housing market, though, is more landlord-friendly. There are limits on late fees, and interest is required on deposits. However, no rental license is required by the state, and there isn’t a grace period set in stone for late rental payments. You can protect your income from Minneapolis rental properties by evicting tenants not only for nonpayment of rent but committing illegal acts on the premises, staying after the lease has ended, and breaching the lease. Just make sure the lease agreement says what actions constitute a breach of lease for which they could be evicted.

The (Relatively) Low Taxes in Minnesota

Houses in Minnesota face an average 1.19% property tax rate. This is very close to the national average of 1.21%. Wisconsin’s tax rate is in this same range, but their higher average property values mean they pay far more in property taxes than those in the cheaper Minneapolis real estate market. Minnesota’s reputation as a high tax state is driven by its higher sin taxes on alcohol and cigarettes and higher than the average sales tax rate. Neither of these affects most real estate investors. Its income taxes are thirteenth highs in the U.S., but it is a bargain compared to states like Illinois. Then again, Illinois has the second-highest property taxes in the country.

The Upward Long-Term Trajectory

Both Wisconsin and Minnesota are seeing growth while much of the Rust Belt deteriorates. However, Minnesota’s policies have led to faster job growth, wage growth, and population growth than Wisconsin. Yet the state has continued to rank well in rankings for quality of life. That makes the Minneapolis real estate market a better deal than the property is theoretically more business-friendly Wisconsin.

Maybe, you have done a bit of real estate investing in Minneapolis or the twin cities region 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. Should you consider Minneapolis real estate investment?

Minneapolis offers an ideal mix of a strong job market, affordable real estate, a large rental market, and a limited housing supply. These factors will drive up property values and rental rates growing at a healthy clip for years. The entire twin cities region is a great place to invest in real estate.

Good cash flow from Minneapolis 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 the best investment property in Minneapolis in a growing neighborhood would be key to your success.

When looking for real estate investment opportunities in Minneapolis or anywhere in the country, the generally accepted standard is to purchase a property that will give you a modest but minimum of 1% profit on your investment. An example would be: at $120,000 mortgage or investment cost, $1200 per month rental. That would be the ideal equation for example. Even with rent increases, buying a $500,000 investment property in Minneapolis is not going to get you $5000 per month on rent.

When looking for the best real estate investments in Minneapolis, you should focus on neighborhoods with relatively high population density and employment growth. Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable.

The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. A cheaper neighborhood in Minneapolis might not be the best place to live in. A cheaper neighborhood should be determined by these factors – Overall Cost Of Living, Rent To Income Ratio, and Median Home Value To Income Ratio. It depends on how much you are looking to spend and if you are wanting smaller investment properties or larger deals in Class A neighborhoods.

There are about 699 schools in Minneapolis—231 elementary schools, 176 middle schools, 202 high schools, and 90 private & charter schools. The Minneapolis school system offers a wide range of school choices, from charter schools to great public schools, to those specializing in STEM education. There are 264 neighborhoods in Minneapolis.

Some of the best or popular neighborhoods in Minneapolis are Calhoun-Isles, Camden, Northeast Park, Powderhorn, and Downtown East. Camden is located in the north corner of the city, on the east bank of the Mississippi, is composed of several small neighborhoods. It is one of Minneapolis' most diverse neighborhoods.

There's a great mix of middle and working-class families and housing is rated as affordable.   Northeast Park is becoming popular with young people, provides affordable housing options for every budget. The area has a variety of residential areas, industrial areas and old mills, historic churches, established and new retail areas.

Here are the top neighborhoods in Minneapolis having the highest real estate appreciation rates since 2000—List by Neigborhoodscout.com.

1. Downtown East
2. Central Minneapolis East
3. Ventura Village
4. Elliot Park South
5. Lyn-Lake
6. Powderhorn Northwest
7. Powderhorn West
8. Bryant
9. Powderhorn North
10. Phillips

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 has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Minneapolis and the Twin Cities region.

Consult with one of the investment counselors who can help build you a custom portfolio of Minneapolis turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Minneapolis.

Not just limited to Minneapolis or Twin Cities of Minnesota but you can also invest in some of the best real estate markets in 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 and structuring complete Minneapolis turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

Let us know other than the Twin Cities region which housing markets you consider best for real estate investing!

Remember, caveat emptor still applies when buying a property anywhere. Some of 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 Reports & Forecasts
https://www.mplsrealtor.com/
http://maar.stats.10kresearch.com/reports/lmu
https://www.mnrealtor.com/buyers-sellers/marketreports
https://www.zillow.com/Minneapolis-mn/home-values
https://www.littlebighomes.com/real-estate-minneapolis.html
https://www.realtor.com/realestateandhomes-search/Minneapolis_MN/overview
https://www.neighborhoodscout.com/mn/minneapolis/real-estate

Foreclosures
http://maar.stats.10kresearch.com/docs/fss/2020-06/x/report?src=page
https://www.realtytrac.com/statsandtrends/mn/hennepin-county/minneapolis

Job Growth
https://realestate.usnews.com/places/minnesota/minneapolis-st-paul/jobs
https://www.theladders.com/career-advice/these-are-the-15-cities-with-the-most-100k-jobs-in-december-2018
https://www.jsonline.com/story/news/politics/2018/05/08/its-liberal-minnesota-vs-gop-wisconsin-study-economic-growth/590813002

Rental market | Landlord friendly
https://www.collegesimply.com/colleges-near/minnesota/minneapolis
https://www.avail.co/education/laws/minnesota-landlord-tenant-law
https://www.landlordology.com/10-cities-to-buy-rental-property
https://www.minnpost.com/economy/2018/02/why-it-s-extremely-difficult-buy-first-home-minnesota-right-now
https://www.minnpost.com/metro/2019/03/a-majority-of-minneapolis-households-now-rent-their-homes

Low Taxes
https://smartasset.com/taxes/minnesota-property-tax-calculator
https://www.usatoday.com/story/money/taxes/2018/04/06/states-highest-and-lowest-taxes-3-6/48294400