Real estate investors know there’s a holy trifecta among the best real estate markets: Florida, Texas, and California. These states, along with New York City, consistently rank high in sales, but there’s a problem: market saturation makes it difficult to break into the field, especially for those just getting involved in real estate.
In any form of investing, you must think long-term, so consider options beyond today’s hottest markets and look at those showing promise for years to come. These states – one for each region of the United States – may not make this year’s list of hottest markets, but economic and demographic indicators show that they are on the upswing. Buying in these states allows you to strike before other investors and make a tidy profit down the line.
One of the northernmost states, beautiful Maine is known chiefly for outdoor adventures and its cold, unforgiving climate, but it’s become a trendy option for remote workers who want peace and tranquility. In 2022, Maine was the most moved-to state; in fact, all 16 counties in the Pine Tree State had population growth, which is rare in many other markets. Cumberland County in the state’s southeast has had the most significant influx, growing at an annual rate of 7.6%. This is a shocking increase, as even the fastest-growing states are often only slightly above 1%.
Given that it’s one of the least populated states in the US, there’s a housing crunch – something you can capitalize on as a real estate investor.
Sunny Arizona may not have the explosive expansion of nearby Texas, but it’s a mighty contender due in no small part to its large community of immigrants from Latin America. By 2030, it is expected to be the 10th most populous state; in July 2021 alone, it added over 90,000 new residents, or over 250 per day. A welcoming business climate also ensures that newbie investors will find their stock flying off the shelves, so to speak.
South Carolina has had amazing growth: two of its metropolitan areas are currently included in the country’s ten fastest-growing real estate markets, as identified by the National Association of Realtors. Part of this is because of its growing tech and finance sector, which forms a business corridor between South Carolina and North Carolina. Great academic institutions, excellent public schools, and a well-diversified economy encourage residents to stay and raise a family here.
As this market is a bit hotter than the others on this list, you must act fast while prices remain low. A DSCR loan for South Carolina lets you get approved quickly and add numerous properties to your portfolio without waiting for the long and convoluted conventional loan process. Mortgage rates are expected to rise soon as the Federal Reserve works to combat inflation, so every day counts regarding investments.
Overlooked Ohio has only had a 0.2% population increase over the past few years, but short-term vacation rentals and retail real estate will soon take off significantly throughout this state.
In the north, strong government investment in tourism has helped to expand downtowns and create a more welcoming environment for those passing by: most of the major cities, including Cleveland, have large-scale renovations slated for their downtowns. Down south, though, cities are already gearing up to enjoy a huge influx of tourists due to the Hopewell Mound Complex being named a UNESCO World Heritage Site. This decision almost immediately boosts tourism even in the sleepiest regions, and all those tourists will need food, shelter, and fun trinkets to bring home.
You’d be stunned to see this state, a transitional region between the Pacific Northwest and the Rocky Mountains, on a list of the most promising markets, but it’s true. Idaho has had some intense population growth over recent years for much the same reason as Maine: remote workers from Oregon, California, and Washington want a more affordable cost of living and a small-town feel.
The state has a very low crime rate, making it ideal for raising a family, and there are plenty of recreational activities for active hikers and bikers from places like Colorado who are fleeing high prices. While many people think that Idaho is only for potatoes, there’s so much more here: the region has a very strong and diversified economy, with technology, agriculture, and manufacturing being some of the main contributors.
While it’s easy to get starry-eyed at the prestige of larger markets, such as Austin or San Francisco, picking winning real estate investments means thinking beyond today and into the future of a region. These five areas, while mostly overlooked by current trends, show great promise – and their low costs mean they’re excellent opportunities for younger investors who want to build their portfolios without incurring major debts.