Investing in real estate has always been one of the best ways to increase your net worth. Real estate investment has a lot of options and strategies. To find the best strategy or type of investment , investors should have some factors in mind.
There are three main factors to know before investing in a real estate market.
- Job Growth
Investors should invest in markets with advanced job opportunities. The number of jobs in an area indicates economic growth in any area. The average salary is a good indicator too. If the average wages are high , it is a sign of a growing economy. The number of commercial buildings (such as offices and malls) also go up as the economy improves.
- Population Growth
Population growth is a really important factor when investing in an area. A real estate property will only bring in revenue when there is a good population willing to live in it. When job opportunities are expanding and the population is increasing , the demand for housing will also increase.
- Affordability
It is also important for an investor to consider the price to rent ratio of the market. The price to rent ratio indicates any market’s potential probability. The higher the ratio , the worse the market will be for real estate investment.
When a market possesses all three qualities – job growth, population growth and affordability – that market is good for real estate investment in terms of generating rental income as well as capital appreciation.
Here are some of the best real estate markets in the US to invest in.
CHICAGO
Chicago is an excellent market for real estate investment because of the population growth. The population growth indicates high demands for housing. The quality of life is affordable in Chicago as compared to similar sized cities. Chicago has a good job market in the major fields of hospitality and transport industries.
CLEVELAND
Cleveland is known to be the gold mine for real estate investors. It is one of the most diverse cities in the US. Cleveland is one of the best areas to live and work and has a service-based economy. Cleveland has a great job market in the fields of professional services, construction and hospitality. Real estate market in Cleveland is a strong rental market. It is an excellent market for new real estate investors.
The St. Louis
The St. Louis real estate market is excellent for low risk investment. House values in this market have consistently risen over the time. Variety of neighborhoods are available for investment from cheapest to most expensive.
San Antonio
San Antonio is one of the fastest growing real estate markets in the US. The population grew at an astonishing rate of 20% in the past decade. Home prices in San Antonio have increased at a rate of 10% annually for the past decade. San Antonio has become a den for short term real estate investments because of millions of tourists visiting every year.
There are a lot of other real estate markets also all over the world. Investors should do the research of the market and diversify the investment to achieve higher returns.