Top 3 Picks for Up and Coming RE Markets
There are 3 key metrics that Alexander Felice lays out in his most recent article for determining the Top 3 RE picks for up and coming markets.
- State growth: Picking to invest in states that re-invest in themselves is important. The more investment a state puts into growing its economy and its communities, the more likely your real estate investment is to pay off.
- Job diversity: Invest in markets with a wide breath of jobs. If there are only one or two major employers in the city, that can cause big problems for the real estate market when those employers hit a lull. Look for an array of employers and diversity in industry.
- Population growth: If more people are moving into a city, that means more opportunity for the real estate market. This is probably the simplest metric to gauge an up and coming market.
Here are the Top 3 markets to keep an eye on.
Underpriced housing with a rapidly growing population makes Nashville an ideal place to invest in. At Latchel, we've seen massive amounts of investment flowing to Nashville and Memphis.
The recent change in tax law and marijuana legalization will make Las Vegas a growing market in the next few years. Surrounding areas like Henderson will also see growth in their housing market.
A large population at 3M people with growing opportunities for work, Tampa is an ideal place to invest in real estate. The only big risk factor - hurricanes.
Yardi Matrix has tracked widespread rent concessions in every market they analyze. Additionally, apartment vacancy rates have risen above 5% across all 133 markets that they track. Are these numbers signaling a growing problem in the rental industry?
The risk with growing concessions in markets is that renters become accustomed to concessions and with that expectation, it becomes more and more difficult to fill communities. They've become most common in new developments that need to rapidly fill hundreds of apartments. Once a building has reached stability, concessions become less common. Still, the higher the percentage of units offering concessions, the more strain it puts on the rental market in the area.
Will OKC See A RE Boom Off Medical Marijuana?
Legalization of medical marijuana may be a hot topic in many states, but real estate investors know that legalization can create a boom in warehouse space. Read the local news story of OKC's anticipated real estate boom here.