Data from the real estate sector proves that housing remains one of the most viable components of any investment portfolio. This is true whether one is an individual investor or a professional entrusted with a substantial real estate portfolio. Housing prices in the U.S. have recovered from the 2008 crash, and experts predict that this sector will remain stable even as inventory of available housing units remain tight, contributing to rising prices.
Search Foreclosures in the South
However, not all housing markets are created equal. Some markets will continue to plod along at a steady pace while others will dazzle with rising demand, higher prices, and faster turnovers. These hot markets include key parts of Texas, Florida, Georgia and Alabama. The factors driving these housing markets vary, but experts agree that job growth, population numbers, housing affordability, cost of living and quality of life considerations play a crucial role in boosting real estate market activity.
Texas Housing Market
Trends in the Lone Star State’s housing market indicate continued growth in terms of demand for housing, volume of property sold and increase in average home prices. Market dynamics vary from one metro area to another, but the following factors are common to Austin, Houston, Dallas, and San Antonio.
Job growth – The Texas Workforce Commission reported that employment expanded by 3 percent, which is twice the national growth rate of 1.6 percent while unemployment remained steady at 4.1 percent. To date, the state has added 350,000 jobs. Job growth has improved by 1.6 percent in Houston, 2.7 percent in Dallas/Fort Worth, 6 percent in San Antonio and 9 percent in the Austin metro area.1
Home Prices – Housing affordability is a key driver of in-migration. While prices have been on an uptick, in most of the state, the rate of increase has slowed down especially in the top-tier, giving prospective buyers a chance to identify opportunity niches. The average home price for Houston was $255,000. Dallas Fort-Worth home prices averaged out to $266,000 while San Antonio’s average out to $235,000.2
Inventory of homes under $200,000 – Economic growth is driving demand for housing, but inventory is tight at the lower end of the pricing spectrum. Inadequate supply of available housing units, especially when the DOM, or days on the market metric, indicates that transactions are moving quickly. The DOM for houses priced between $200,000 to $300,000 was 54 days.3
Population movement – This state is one of a few states that consistently records an increase in domestic migration. People move here because of the state’s advanced infrastructure, state-of-the-art health facilities, diverse jobs and the absence of a state tax. Over a three-year period, Houston’s population grew by 7 percent, Dallas expanded by 4 percent, San Antonio by 6 percent and Austin by 9 percent.4
Explore investment opportunities available in the Lone Star State at Auction.com.
Florida Housing Market
The Sunshine State continues to draw new residents due to the following factors:
- Pleasant weather year-round makes this state attractive for retirees and young families.
- Residents do not pay a state tax, which translates to hefty savings at tax time.
- Proximity to the theme parks in Orlando is a bonus.
- With a coastline of 1,350 miles, residents are within driving distance of a beach and other aquatic attractions.
The Sunshine State boasts of more than sunshine. It has a stable economy with very strong growth in the services sector due to robust tourism supported by increasing numbers of international and domestic visitors. Tourism accounts for the high demand for permanent and temporary housing, which in turn, drives growth in the construction, financial services, and retail industries.
Cities that are highly recommended for investment properties include:
Orlando
Orlando ranks among the top in many lists, including Top Investment Cities and Busiest Airports of the World, underlining the strength of its tourism sector. The median home price for Orlando is placed at $160,000. However, 64 percent of residents are renters, with the median rent at $1,000 monthly. This is one of the cities where investing in rental housing can yield significant and stable returns. Job growth in Orlando is 4.2 percent while unemployment is holding steady at 4.5 percent.5
Tampa
Tampa is not a tourist haven, but it is a hub for businesses involved in technology, health services, education, and financial sectors. The median home price is $174,000, and the median rent is $1,820 per month. Job growth is 2.1 percent while the unemployment rate at 4.6 percent is lower than the state’s number.6
Cape Coral
In the shadows of the City of Miami, Cape Coral is a quiet residential area close to many of the famous beaches and celebrity hang-outs. The median home price is $216,000, and rental rates average out to $1,400. The employment growth rate is placed at 2.44 percent.7
Find out how you can get in on the ground floor in Florida’s housing market by browsing the listings of available properties on Auction.com.
Georgia Housing Market
Forbes Magazine ranks Atlanta as one of the best cities for real estate investments. Job growth is higher than average and the real estate market isexpected to grow at a steady and sustainable rate. Experts recommend looking for properties in the Atlanta-Sandy Springs-Marietta metro area where the average home price is estimated at $235,000. This is an area that will see significant job growth at 5.1 percent for a two-year period. Atlanta is a major economic hub due to its central location.8 Several Fortune 500 companies have their corporate headquarters in Atlanta. These companies include Delta Airlines, Home Depot, United Parcel Service and Coca-Cola.
Find ways to expand your portfolio and profitability by browsing available listings for Georgia on Auction.com.
Alabama Housing Market
The statewide Housing Affordability Index for the Yellowhammer State was calculated at 184.3, which means that with a household income of $55,000 the family unit had 1.8 times the income needed to qualify for a mortgage based on median home prices for this area.9 Housing is affordable and available even in in-demand areas like Huntsville and Mobile.
The housing market in the state known as the Heart of Dixie will remain stable in the coming years due to solid business growth. The state boasts of a sprawling automotive manufacturing sector with Toyota-Mazda recently joining companies like Autocar and Mercedes that have had an established presence in the state for many years.
Huntsville is the fourth largest city, and it has a strong and diverse economic base with technology and defense companies driving growth. The top three universities in the state, A & M, Oakwood, and U of A, have campuses in Huntsville. Property taxes remain low compared to the rest of the region while rental rates are high, which bodes well for investors since 46 percent of residents are renters.10
Alabama beckons and investment opportunities are waiting to be discovered. Check out the listings of available properties at Auction.com.
Search Foreclosures in the South
Sources:
1 Texas Job Growth Beat Goes on
https://www.houstonchronicle.com/business/article/Texas-job-growth-beat-goes-on-12997270.php
2,3,4 Where To Invest in Real Estate in the Texas Housing Market 2018 | Mashvisor
https://www.mashvisor.com/blog/texas-housing-market-2018/
5 Florida Cities That Are Best For Real Estate Investing in 2018
https://landlordstips.com/real-estate-investing-in-florida
6,7 Is It a Good Time To Buy Property in Florida For Real Estate Investing? | Mashvisor
https://www.mashvisor.com/blog/buy-property-in-florida-real-estate-investing/
8 Atlanta Real Estate 2018: Why and Where To Invest | Mashvisor
https://www.mashvisor.com/blog/atlanta-real-estate-2018/
9 Real Data Analysis: How Affordable Is Housing in Alabama?
ACRE Research – https://alabamanewscenter.com/2018/02/06/real-data-analysis-comparing-median-sales-price-in-residential-real-estate-markets-across-alabama/
10 Best Buy Cities: Where To Invest in Rental Properties in 2018
https://www.homes.com/blog/2018/01/best-buy-cities-where-to-invest-in-rental-properties-in-2018/
