Trying to figure out the best city for an investor to put their money, time, and energy in can be difficult. There are a lot of variables to look at before making such a large decision such as vacancy rates, occupancy rates, construction within that area, and even what types of markets are available within that city.
Boston is home to some of the world’s best colleges, hospitals, and workforces. The city has much success due to these factors. Most investors invest their money because the market in Boston has remained relatively low-volume as far as tenant turnover goes. The vacancy in Boston is only a meager 4.0 percent. With Boston being an older city, it oddly attracts a younger demographic for renters.
Salt Lake City, UT
Salt Lake City seems to call educated professionals who want to balance their ambitions in a thriving economy. The finance and insurance markets have grown in Salt Lake City by nearly four times the national average. This helps the labor force expand. In fact, since the great recession in 2008, the labor force has expanded 10.0 percent. Vacancy rates in Salt Lake City are below 4.0 percent making this city an investor’s dream.
Seattle has proven itself to be a leader for urban apartment performance through the nation. The rent growth has hit the 7 percent mark annually. The downtown job base continues to grow at a rapid pace. With ongoing construction, buildings keep going up providing more opportunity for multi-family investing.
Raleigh and Durham, NC
Raleigh and Durham are positioned just so that their markets are able to absorb newly constructed units. Add in the fact that there are three major universities, Duke University, the University of North Carolina-Chapel Hill and North Carolina State University, and you’ve got a boom for investors to look at when deciding where to place their money. North Carolina has a low cost of living which turns out an enduring population growth.
A central hub for the government, non-profit, and legal sectors, Washington, D.C. offers up just as much push for investors as the tech, financial, and health sectors do in any other city. The younger generation, millennials, are drawn to the city, especially Georgetown, DuPont Circle, Logan Circle, and West End. Because millennials have a more transient nature, where the come and go for a short period of time before going forward with more education or a new job, there is a constant opportunity here for investors. Add that to the high demand for real estate in Washington, D.C. and an occupancy rate of 95%, an investor is able to safely invest with less worry and risk than in other cities.
There are plenty of cities in this country that would fare well for an investor as far as multi-family buildings go but, these five have proven to be the most effective in regards to a return on investment, lower risk, and higher demand for multi-family residency.