Knowing best states to invest in real estate can be tricky, with many variables to consider. Savvy investors must compare a wide range of potential investment opportunities to determine where they will achieve the most likely profits.
While no one has a crystal ball, some particular metrics can be used to forecast the likelihood of investment success.
Key Metrics to Consider When Investing
No matter what area you consider investing in, the principles of property investing remain the same. Of course, investors want to buy properties in areas that will return to most on their investment. So, how can this be predicted with any real accuracy?
The most important metrics to consider when investing in an area are:
- High demand for rental properties
- High average rental incomes
- Population growth
- Job growth
- Median home prices
- Cost of living
The first two speak for themselves, while population and job growth indicate a growing area to keep the demand for rental housing up.
The Best States to Invest in for 2022
Investors and property experts don’t always agree on exactly where the most prime investment opportunities lie. That said, based on the metrics above, here’s our pick of the top eight states to consider for 2022.
To collate this list, we’ve taken the most up-to-date information from official and reputable sources such as census.gov, worldpopulationreview.com, redfin.com, and apartmentguide.com.
Missouri
Median Property Price: $244,400
YoY median property price growth: 11.8%
Average 2-bedroom rental price: $1,235
Two-bedroom YoY growth: 3.27%
Population Growth: 0.2%
Job Growth: 1.01%
Cost of Living: 87.1
Many businesses and Fortune 500 companies call Missouri home, all supporting the growing economy the state enjoys, certainly. It is also an attractive state for first-time buyers with affordable housing options and solid growth across sales and rental values.
The cost of living in Missouri is one of the lowest in the nation, too.
Virginia
Median Property Price: $434,500
YoY median property price growth: 8.8%
Average 2-bedroom rental price: $2,120
Two-bedroom YoY growth: 16.86%
Population Growth: 0.01%
Job Growth: 1.01%
Cost of Living: 100.7
Named by Forbes as the best state for business, Virginia’s economy continues to grow, with a strong tech industry and solid job growth figures. Proximity to Washington D.C. remains a significant drawcard, with Northern Virginia suburbs offering many hotspots for investment.
North Carolina
Median Property Price: 359,600
YoY median property price growth: 18.8%
Average 2-bedroom rental price: $1,584
Two-bedroom YoY growth: 29.04%
Population Growth: -0.8%
Job Growth: 1.02%
Cost of Living: 94.9
Despite a slight population drop-off, North Carolina’s property affordability, solid job growth, and fantastic rental growth make it one for investors to consider. In addition, the state’s property and cost-of-living affordability, coupled with its mild weather, make it popular with millennials and a hotspot for investors.
Idaho
Median Property Price: $512,500
YoY median property price growth: 19.4%
Average 2-bedroom rental price: $1,429
Two-bedroom YoY growth: 21.72%
Population Growth: 3.4%
Job Growth: 1.03%
Cost of Living: 92.3
With a significant population increase, Idaho continues to show signs of ongoing growth in its technology-focused economy. Likewise, job growth figures are above average, property and rental growth are solid, and living costs remain under the national average. When thinking about the best state to invest real estate, Idaho often is looked past, but provides numerous opportunities.
Indiana
Median Property Price: 255,400
YoY median property price growth: 12.1%
Average 2-bedroom rental price: $1,208
Two-bedroom YoY growth: 7.15%
Population Growth: 0.3%
Job Growth: 1.01%
Cost of Living: 90
Indiana’s economy is stable and growing. Plus, the state offers attractive property values for investors, coupled with a healthy rental market and a growing job market.
Florida
Median Property Price: $401,500
YoY median property price growth: 23.1%
Average 2-bedroom rental price: $2,271
Two-bedroom YoY growth: 37.56%
Population Growth: 1.1%
Job Growth: 1.03%
Cost of Living: 97.9
The Sunshine State has long been a favorite with real estate investors, and for good reason. Florida continues to experience significant growth in property and rental values, with a growing job and population figures and a cost of living that remains under the national average. Its tax-friendly status is always a big drawcard, too when looking at the best state to invest in real estate.
Georgia
Median Property Price: $512,500
YoY median property price growth: 19.4%
Average 2-bedroom rental price: $1,666
Two-bedroom YoY growth: 29.34%
Population Growth: 0.8%
Job Growth: 1.02%
Cost of Living: 89.2
Property values have been shooting up in Georgia, but so too have the average rental yields, and the state is experiencing a population and job growth to support it. It’s also the 9th for the lowest cost of living out of all 52 states.
Texas
Median Property Price: $376,800
YoY median property price growth: 19.8%
Average 2-bedroom rental price: $1,448
Two-bedroom YoY growth: 10.94%
Population Growth: 1.3%
Job Growth: 1.03%
Cost of Living: 91.5
The economy of Texas is fueled by leading universities and colleges, a wide variety of industries, and a wealth of natural resources. In addition, the state’s strong population growth speaks volumes for potential investment opportunities.
Ohio
Median Property Price: $221,100
YoY median property price growth: 10.3%
Average 2-bedroom rental price: $1,213
Two-bedroom YoY growth: 9.06%
Population Growth: -0.2%
Job Growth: 1.00%
Cost of Living: 90.8
In addition to being home to some of the best colleges and universities in the country and with a strong economy, Ohio is a good bet for real estate investment. Although the population has dropped slightly, this is likely to be a temporary Covid-related pattern. Such affordable property prices, solid growth across sales and rentals, and a healthy job growth rate all signal promising investment opportunities.
Given its housing affordability, Ohio is particularly well suited for first-time investors. Many opportunities are to be found in major metro areas such as Columbus, Cincinnati, Cleveland, and Toledo.
Investing in Real Estate in Caribbean Countries
Furthermore, the best countries for investing in real estate and obtaining dual citizenship outside the US are the Caribbean countries, with various investment options. You can explore Caribbean citizenship by investment programs to secure alternative citizenship and obtain a second passport by purchasing real estate in the Caribbean.
Best Caribbean countries to invest in real estate:
- St. Kitts and Nevis
- Dominica
- Antigua and Barbuda
- St. Lucia
- Grenada
Final thoughts
Wherever you choose to invest, it’s essential to research metrics such as those used above. So, be sure to think ahead and do your research. No matter how ‘hot’ a market may seem, it must have economic statistics to back it up. Indeed, a growing economy is vital for sustainability, as renters will ultimately go where the jobs are. Also, keep in mind that markets ebb and flow constantly. What is hot today may not be next week. When looking at the best state to invest in real estate, it might be worth asking yourself if the decision is worth sitting on. Or, perhaps not. And if that’s the case, then go for it!
