Investing in real estate is more complicated than investing in stocks. However, some rich investors prefer real estate because of the high potential for profit.
Property can be purchased in a variety of ways. You can click here and become a landlord or purchase a property to renovate and resell. You can also invest in a real estate investment trust or a real estate investment group, which are two alternative options for investing without having to deal with tenants or walls.
Check out this list of the top 10 states from a GoBankingRates analysis to see where you may make the most money with your real estate dollar.
The personal finance website used Zillow data for its calculations, which included the average list price of a property in each state’s three main real estate markets, as well as the one-year growth in median home values in those markets. The Tax Foundation provided GOBankingRates with local purchasing power parity based on the value of $100 in each state.
1. The state of Indiana
Indiana has a lot going for it as a real estate investment destination: low average property prices, strong local purchasing power, and strong house value appreciation. In a recent ranking, Indiana’s low cost of living received top honors.
Mississippi is number two.
Mississippi boasts the lowest cost of living in the US and gives you the most bang for your buck. The average home price in Mississippi’s three largest real estate areas, Jackson, Gulfport, and Hattiesburg, is $191,633. According to GOBankingRates, the national median is $275,000 dollars.
3. The state of Idaho
Idaho is high on the list because of its low pricing and strong year-over-year growth in housing values. Home values grew 13.5 percent, 15.6 percent, and 8.6 percent in Boise, Coeur d’Alene, and Idaho Falls, respectively. Rental rates are rising, which is good news for property owners, especially in the Boise area, where rents jumped to $1,400 in September 2018 from $1,150 in September 2016.
4. The state of Alabama
Alabama’s low cost of living also places it among the most affordable states. However, local purchasing power is comparable to that of Mississippi, with $100 equating to $115.47 in Alabama. Gulf Shores, a top vacation destination according to a recent study, is also located in the state.
Missouri is number five.
Tennessee is number six.
The state’s three largest real estate areas, Nashville, Memphis, and Knoxville, had an average home price of $251,133, with property values up 9.1% from a year earlier, one of the greatest gains in the research. In Tennessee, the cost of living is relatively low.
Arkansas is ranked number seven.
Arkansas’ economy, like that of many other Southern states, has been improving. The state’s population is just over 3 million people, according to the most recent Census Bureau data. According to the Bureau of Economic Analysis, its GDP increased by 8.3 percent over the last three years, from the second quarter of 2015 to 2018.
8. The state of Ohio
Ohio has demonstrated that it can diversify its economy in the face of dwindling industries. Cincinnati, Cleveland, and Columbus are the main real estate markets, with affordable prices and strong house value growth. The cost of living is lower than in the rest of the country.
Michigan is number nine.
In 2008-09, the car industry’s decline was a severe blow to Michigan’s economy. Since then, the state has been compelled to diversify its economy, which has resulted in some progress. Grand Rapids, which has long been a manufacturing city, today has a more evenly distributed workforce in manufacturing, health care and social assistance, retail, and education.
Georgia is number ten.
Some Southern states have recently experienced economic growth, and Georgia was recently ranked No. 7 on CNBC’s Top States for Business list. The cost of living is modest, and the workforce is well-educated. Home values have risen 8.8% in a year as a result of the state’s prosperity. Meanwhile, potential investment property owners can still find reasonable homes to buy and rent out, particularly in cities like Atlanta, where average rent rates have risen from $1,180 in September 2015 to $1,725 in September 2018, according to Zillow.