5 Best Places To Invest In Real Estate In 2022
5 Best Places To Invest In Real Estate In 2022
Real estate has always been a good buy for anyone looking for a profitable long-term investment. The best places to invest in real estate should have excellent growth and rental prospects, and investor-friendly tax regime. Also, consider the living costs and other factors that attract customers to the location.
We have combed several market surveys and expert reviews and crunched up the numbers to give you five of the best places to invest in real estate in 2022.
Daytona Beach area, Florida
Year-round sunshine, excellent population growth rate, and favorable economic prospects make Florida home to some of the hottest properties in America. The world-famous Daytona Beach area in Florida is one of the best places to invest in real estate. We are not picking favorites. Here are some facts and numbers that make the area a hot investment spot.
- At $215,448, the median home value in Daytona is affordable.
- In the last year, Daytona beach home values grew by a staggering 24.6%.
- The average rent stands at about $ 1,285 for an 894 sq. ft. apartment. Home occupancy rates are also reasonable - the average rental vacancy rate is 7.3%.
- The effective property tax rate is 0.89% which is lower than the national average. Plus, the property tax regime allows for several exemptions. You could qualify for these discounts and use them to lower your tax bill. Moreover, Florida is among the top 5 states with the best tax regimes. Residents of Florida are not required to pay a state income tax!
- The cost of living in Daytona Beach is 6% lower than the national average.
Among the fantastic communities in Nova, Arlington stands out as a prime pick for real estate investment. Arlington county is considered the second most significant city in the Washington DC area. It is home to some of the most sought-after properties in the country. Here are some of the figures and facts that would make any real estate investor choose properties in Nova.
- The median home value is $789,115. Although this may seem to be on the higher end, it is lower than what you will find in many hot spots on the East coast.
- In the last year, the average home values have gone up by 3.1% in areas like Arlington to 9.3% in locations like Fairfax.
- The average rental rate in Arlington is $2,334. This has been stable over the last couple of years but generally on an upward curve.
- Rental vacancy rates dipped to 5% from 7%. But in the fourth quarter of 2021, the rate went up to 7.3%. Although high, it is still within investor-friendly levels.
- At $1.00 - $1.14 per $100 of assessed value property rates are reasonable.
- Although the cost of living in areas like Alexandria and Arlington is higher than the national average, residents are top-income earners. The median household income is $120, 071.00
- Other pockets of NV are also performing well. Homes in Woodbridge were priced at an average of $395K last month, up 9.7% compared to last year.
Colorado Springs, Colorado
The pandemic affected lifestyles significantly. More people are working from home, and the demand in big cities has waned. The clean air and mild weather in Colorado Springs make it a top choice for families.
At an average home value of $434,231, the home prices are still within the comfortable ranges. But if you think otherwise, perhaps the 29.01% average home value appreciation rate could change your mind.
- The average rent rate is $1,458. The rental vacancy rate recently dropped to 4.4% - one of the tightest real estate markets.
- At 0.49%, Colorado has the third-lowest effective property tax rate in the country.
- The cost of living in Colorado is also 6% lower than the national average, making the location an attractive spot for people looking to cut down but enjoy a high quality of life.
Buffalo, New York
Buffalo is the second-largest city in New York State. Surprisingly, real estate in Buffalo, NY, comes at affordable prices. As an investor, you also tap into an endless pool of prospective renters from the hordes of dreamers looking to make it in the Big Apple.
- The average home value is $195, 478 and the home value appreciation rate at 22.7% is super attractive.
- Rent in Buffalo is also affordable at $1,132 on average.
- In 2020 vacancy rate was at 6.4%. Experts predict that it will reduce further.
- The effective property tax rates are also attractive to investors. The local authorities will take 0.75%.
- The cost of living in Buffalo is 6% below the national average and significantly lower than neighboring locations like Manhattan in NYC. Buffalo is perfect for migrants looking to set base in New York.
We’ve already mentioned one great location in Colorado, but there is another to consider investing in as well: Denver. Denver has the biggest population in the state, and the region continues to grow year after year with people flocking to this wonderful state.
- The average home price in Denver is $580,000, representing an 18% year-over-year growth in 2021.
- Though home prices spiked in Denver during 2020 and 2021 as they did nationwide, earlier trends show prices have been consistently rising since as early as 2016. This indicates that your ROI will be strong.
- Denver’s employment market is anchored by many government and health facilities, and unemployment rates are unlikely to get much higher than the national rate. This is good for rental investors, as there will always be tenants looking for rentals.
- Denver has a consistently high percentage of renters when compared to homeowners, giving investment properties a strong foothold.
- Colorado at large, including Denver, has a very low effective property tax rate. Denver’s come in around 0.74%, lower than the national average.
Last on our list is Fresno in California. The value of homes in Fresno is relatively low, and the appreciation rate is attractive. If you are eyeing the west coast, the following facts and figures will convince you:
- According to Zillow, the median home value is $339,594, and the appreciation rate is at an impressive 23.0%
- The average rent is about $1,354 for an apartment about 900 sq. ft. The rental vacancy rate is at a healthy 4.5%.
- Effective property tax rates are 0.73% - significantly lower than the national average and attractive for investors.
- Although the cost of living in Fresno is 6% higher than the national average, the average income of $50,432 is healthy enough to cater to the higher living costs.
Photo by Avi Waxman on Unsplash
Here's the bottom line
Ultimately the best place to invest in real estate in 2022 is the place where you can afford to purchase and get a healthy ROI within reasonable timelines. Make sure you discuss your options extensively with an experienced realtor and financial advisor before making your move. Each of these locations offers some of the best conditions to invest in real estate.