Deciding to become a property owner is a major step. To get a good return on your investment, it’s important to do thorough research on the real estate market. One of the most crucial factors to consider is the location of your property investment. If you need guidance, here are the 10 best states to invest in real estate.
10 of the Best States to Invest in Real Estate
Location isn't the only consideration when deciding to invest in real estate. However, it can help you narrow down the places where there is a good chance of real estate profitability. If you're going to be a first-time property owner, here are some of the best states to invest in.
1. Indiana
2. Ohio
Ohio is also a promising place to invest in property. The median home cost is $140,700 with a 6.5% growth in the last 12 months. Compared to the U.S. average, the cost of living in Ohio is 17.4% lower. Columbus and Cincinnati are two of the best cities to invest in Ohio.
3. North Carolina
4. Tennessee
Tennessee offers a good return on investment for rental properties. The median home cost is $164,500 with an 8% growth in the last 12 months. Compared to the U.S. average, the cost of living in Tennessee is 12.4% lower. Nashville is one of the best cities to invest in Tennessee.
5. Missouri
Real estate investment in Missouri is also worthwhile. The median home cost is $159,500 with a 6.7% growth in the last 12 months. Compared to the U.S. average, the cost of living in Missouri is 14.1% lower. Springfield and Kansas City are some of the best cities to invest in Missouri.
6. Idaho
7. Georgia
Next on the list of the best states to invest in real estate is Georgia. The median home cost is $186,500 with a 9.1% growth in the last 12 months. Compared to the U.S. average, the cost of living in Georgia is 6.6% lower. Atlanta is one of the best cities to invest in Georgia.
8. Florida
9. Alabama
Alabama is another excellent place to buy real estate. The median home cost is $120,300 with a 6.9% growth in the last 12 months. Compared to the U.S. average, the cost of living in Alabama is 17.7% lower. Huntsville is one of the best cities to invest in Alabama.
10. Texas
Other Considerations When Investing in Real Estate
Property Taxes
Investors should consider the property tax rate of states when buying real estate. Alabama has the second-lowest property tax rate in the country at 0.37%, while Idaho has an effective property tax rate of 0.72%. Texas, on the other hand, has one of the highest property tax rates in the country at 1.62%.
Migration
Investors may also want to purchase real estate in states with high migration. Florida, Texas, North Carolina, Georgia, Tennessee, and Idaho have seen a high influx of people in the last year, resulting in greater housing demands.
Valuation
Considering the price-to-income ratio is important when deciding to purchase real estate in a particular state. Based on valuation, Texas, Tennessee, North Carolina, Florida, and Idaho are some of the best states to invest in real estate.
Money Magnets
Investing in states that act as money magnets also helps drive up home prices. Florida, Texas, North Carolina, and Tennessee are among the best money-magnet states.
Choose with Confidence
Jumping into real estate investment can be scary, but investing in states with the best real estate markets can provide a good return on investment. Consider the 10 best states to invest in real estate mentioned above. Once you've found the perfect property, feel free to browse our online directory of property management companies to help you manage your real estate investment.
Related Articles: