When investing in real estate, location plays an essential role. How much you’ll earn from it, and the appreciation value will highly depend on the market in that area. You must ensure the market dynamics are optimal enough so you can offset your mortgage, pay other expenses, and still earn enough profit.

Take into consideration the local dynamics that might affect your property in the future. You must know that no single location has stood out to be best as far as real estate investment is concerned. If this were the case, then every investor would flock to that place. The best location depends on what you want to achieve with your investment property as an individual. Take several factors into consideration when determining the best place to invest in real estate.

Read this article to see if you can answer this question and learn how to buy and investment property in the best location.

Choosing the Best Place to Invest in Real Estate

One rule of thumb to choosing the best place for your real estate investment is the place where you’ll get a high return on investment. You could be located anywhere globally, but if you’re a real estate investor, your goal will be the same as those of other investors.  The purpose of every real estate investor is to maximize returns.

For you to fulfill this goal, you have to consider the following features when choosing your location:

  • Choose a location with high rental occupancy. That means you must ensure there is not much housing stock vacant in the area. The rental homes must be in high demand.
  • High rental prices to offset your mortgage. You should be able to make enough money for your rental income so you pay off your mortgage as soon as possible.
  • Low tenant default rate. You won’t be making any profit if your tenants won’t pay you on time. Make sure you choose an area where tenants are less likely to miss on rent payments.

As you can see, there’s more than the eye can see when it comes to choosing a location for buying your first real estate investment. You have to carry out a lot of research and get your facts right before you proceed.

The following are some of the best places to consider when thinking of buying an investment property.

Dallas, Texas

If you’re looking for the best place to buy an investment property, Dallas makes the cut. The place boasts of a substantial availability of housing stock. The rental rates are high enough, which is relative to the housing price in the area.

The real estate market in Dallas gives investors a wide range of properties, and the only thing you have to do is find your tenants. Of course, you must know how to manage a rental property and other things that come with it, such as calculating security deposit deductions, drafting leasing contracts, and more.

Another reason that makes Dallas a perfect place for rental property investment is the fact that renting a home here is more affordable than buying. There’s a massive demand for rental units and a diverse economy. It’s estimated that up to 340 people move to Dallas every day, so you’ll never be short of potential tenants.

Tampa, Florida

If you live in Florida and you’re looking to invest in real estate, the ideal location for you will be Tampa. Tampa, FL, boasts of a population of up to 4 million. It makes one of the best tourist destinations in Florida.

Tampa one of the economically diverse regions with many development prospects qualifying it to be the hottest real estate market in the US. There’s a massive demand for single-family homes here, with the median home value going up to $251,287.

Properties in Tampa show potential for strong appreciation in the near future, thanks to the steady market growth. So, if you’re thinking of selling your property later, Tampa gives you the potential to make a good profit from it. You can never go wrong with your investment if you choose Tampa to be your rental location.

Phoenix, Arizona

Phoenix recorded considerable job market growth in the past years. This recent development featured the expansion of single-family homes, which is expected to continue increasing with the growing population. Phoenix is one of the places that recorded the top housing market in 2020 that not even the pandemic could bring it down.

While home prices in Phoenix are high, this has not deterred real estate investors from venturing into the market for its favorable living conditions. Other reasons to invest in Phoenix include affordable real estate. Incredible home values and a hot seller’s market makes Pheonix an incredible place for those looking to carry out real estate wholesaling or rental investing in general.

Columbus, Ohio

Columbus also makes it in the list of best cities to invest in real estate. If you invest in Columbus, you’ll have high chances of reaping high since homes here sell at a median price of $174,109. A household with an average income can afford the cost of buying a home in Columbus. The housing market has seen steady growth over the years because of the slow population growth.

If you’re going to invest in real estate in Columbus, you have to be careful with some neighborhoods that are more economically strained. However, there are still great neighborhoods like Near East Side, Franklinton, Downtown Columbus, Great View Heights, and other places to reap high if you invest in real estate.

Austin, Texas

Austin makes another great city to invest in real estate. The place has experienced an incredible housing market with doubling home values since 2010. Despite being the fourth largest city in the state, it still manages to compete pretty well in the housing market. Being a tech hub and a large metro area, investing in real estate here is a decision you’ll never regret.

The high-paying tech jobs continue to attract people to Austin, with the majority being the Millennials. This job growth has contributed to a significant buying force in 2021, and this trend is expected to continue for the coming years.

To reap higher, consider investing in neighborhoods close to amenities, hang-out spots, and shopping centers. You can never go wrong venturing into real estate in Austin, thanks to its strong economy.

Bottom Line

Real estate is one of the best investments you can venture into. If you’re going to invest in the rental market, you must ensure your chosen location experiences population growth and a thriving economy.

If you’re looking for an investment property in a location that matches your investment strategy, SimpleShowing has you covered with real estate agents in Texas, Florida, and Georgia. Our team is here to help you buy the best property for your investment and ensure you kick-start your investment journey.