13 Real Estate Hot Spots You Won't Want to Miss Next Year

Sure cities throughout the US are rising as financial powerhouses, creating excellent circumstances for actual property traders.

I’ve revealed two earlier articles on cities with rising tech hubs and excessive revenue will increase, each of which are extremely correlated with worth appreciation. Simply check out the connection between revenue and worth progress for the highest 100 metropolitan areas:

Now, for the third installment on this collection, I’ve determined to filter and rank every metropolis’s financial system as a complete, beneath the idea that the stronger a metropolis’s financial system is, the extra seemingly wages will rise, and with them, actual property costs.

I’ve analyzed the information, crunched the numbers, and recognized 13 cities with the strongest economies that needs to be ripe with funding alternatives. Learn on to find the place you need to be trying subsequent to maximise your returns in 2024.

How I Calculated the Prime 13 Cities

First, I downloaded employment and wage information from the Bureau of Labor Statistics (BLS). I additionally included inhabitants information from the U.S. Census Bureau. Lastly, I retrieved GDP-per-MSA information from the Bureau of Financial Evaluation (BEA).

Subsequent, I calculated one- and five-year progress for inhabitants, whole employment, and wages for every market. I additionally used the inhabitants information to assist create GDP-per-capita information for every metropolis.

Then, I filtered out all cities that had inhabitants, employment, or wage decline over the previous yr. Probably the most sturdy economies shouldn’t be declining in any of those metrics.

I additionally solely stored metros the place the five-year wage and employment progress had been larger than the nationwide median (along with higher-than-median GDP per capita). I assumed this was a great gauge of common financial progress.

Lastly, I needed to rank the remaining metros by job progress. So I created a “related employment progress” index that ranked five-year share employment progress whereas nonetheless maintaining measurement under consideration (a ten% improve for a metropolis with 1 million jobs is extra spectacular than a ten% improve for a metropolis with solely 50,000 jobs, however together with solely absolute progress into an index has its personal issues).

Notice: As a result of I used some college-level information science to create the related employment progress index, I’ll spare you the main points. However be happy to remark should you’d like me to elucidate how I derived it.

After filtering, I was left with 13 U.S. cities with the very best financial metrics, ranked by related employment progress. For those who don’t see your favourite metro within the checklist, it’s seemingly as a result of it both had less-than-stellar employment progress or had an revenue decline over the previous yr. Many metros did.

The Outcomes

Now, let’s bounce into the outcomes, going from the least relative employment progress to the very best.

13. Allentown-Bethlehem-Easton, PA-NJ

The Allentown, Pennsylvania MSA has undergone a renaissance prior to now few many years, from a failing metal manufacturing city within the Eighties to a rising hub for established companies and startups alike. Allentown’s financial system is presently supported by distribution, monetary companies, and healthcare jobs and stays in shut driving proximity to Philadelphia (about one hour) and New York Metropolis (about two hours).

Key financial indicators:

Common Wage in 2024: $56,910.88
5-Yr Compound Wage Development: 4.8%
Whole Employment in 2024: 400,600
5-Yr Compound Employment Development: 1.19%
Unemployment Charge in 2024: 4.1%
GDP Per Capita as of 2022*: $53,539.79

*Probably the most present GDP and inhabitants numbers are from 2022.

Affordability indicators:

Median Worth in 2024: $336,043.87
5-Yr Compound Worth Development: 9.26%
Median Hire in 2024: $1,796.08
5-Yr Compound Hire Development: 7.35%
Hire-Worth Ratio: 0.53%

12. Columbia, SC

The Columbia, South Carolina MSA is supported by the College of South Carolina, Fort Jackson, and healthcare and manufacturing corporations. It’s additionally the second-most inexpensive market on this checklist (simply behind Oklahoma Metropolis), with comparatively excessive costs and hire progress.

Key financial indicators:

Common Wage in 2024: $52,590.72
5-Yr Compound Wage Development: 4.47%
Whole Employment in 2024: 434,900
5-Yr Compound Employment Development: 1.63%
Unemployment Charge in 2024: 4.7%
GDP Per Capita as of 2022: $53,718.41

Affordability indicators:

Median Worth in 2024: $252,535.39
5-Yr Compound Worth Development: 9.16%
Median Hire in 2024: $1,563.14
5-Yr Compound Hire Development: 7.53%
Hire-Worth Ratio: 0.62%

11. Colorado Springs, CO

The Colorado Springs, Colorado MSA is supported by army, skilled companies, distribution, healthcare, and tech jobs. I believe Colorado Springs is an instance of a gentle market that continues to indicate wholesome progress.

Key financial indicators:

Common Wage in 2024: $61,301.24
5-Yr Compound Wage Development: 3.92%
Whole Employment in 2024: 336,600
5-Yr Compound Employment Development: 2.21%
Unemployment Charge in 2024: 4.4%
GDP Per Capita as of 2022: $53,998.04

Affordability indicators:

Median Worth in 2024: $464,485.54
5-Yr Compound Worth Development: 7.3%
Median Hire in 2024: $1,904.88
5-Yr Compound Hire Development: 6.12%
Hire-Worth Ratio: 0.41%

10. Greenville-Anderson-Greer, SC

The Greenville, South Carolina MSA is supported by distribution, skilled companies, and manufacturing jobs. It’s seen sturdy employment progress, significantly within the blue-collar and monetary sectors.

Key financial indicators:

Common Wage in 2024: $58,228.04
5-Yr Compound Wage Development: 5.1%
Whole Employment in 2024: 467,200
5-Yr Compound Employment Development: 1.61%
Unemployment Charge in 2024: 4.7%
GDP Per Capita as of 2022: $50,607.38

Affordability indicators:

Median Worth in 2024: $299,935.17
5-Yr Compound Worth Development: 9.23%
Median Hire in 2024: $1,566.16
5-Yr Compound Hire Development: 6.54%
Hire-Worth Ratio: 0.52%

9. Cincinnati, OH–KY–IN

The Cincinnati MSA is supported by healthcare, monetary companies, and logistics jobs. However I believe Columbus has the higher financial system of the 2 Ohio metros due to its increased employment and wage progress. Preserve studying previous Fayetteville, Arkansas, to see Columbus’ metrics.

Key financial indicators:

Common Wage in 2024: $57,448.04
5-Yr Compound Wage Development: 4.21%
Whole Employment in 2024: 1,166,200
5-Yr Compound Employment Development: 0.8%
Unemployment Charge in 2024: 4.7%
GDP Per Capita as of 2022: $69,222.47

Affordability indicators:

Median Worth in 2024: $288,937.75
5-Yr Compound Worth Development: 8.61%
Median Hire in 2024: $1,546.9
5-Yr Compound Hire Development: 7.15%
Hire-Worth Ratio: 0.54%

8. Fayetteville–Springdale–Rogers, AR

The Fayetteville, Arkansas MSA, generally known as Northwest Arkansas, has an financial ecosystem supported by Walmart, Tyson Meals, J.B. Hunt Transport Companies, and all the person distributors that service these corporations, comprising a wholesome, rising financial system. With sturdy job and wage progress, low unemployment, and appreciating costs, this market stays one in all my prime picks.

Key financial indicators:

Common Wage in 2024: $54,845.96
5-Yr Compound Wage Development: 6.21%
Whole Employment in 2024: 311,900
5-Yr Compound Employment Development: 3.24%
Unemployment Charge in 2024: 3.0%
GDP Per Capita as of 2022: $56,074.19

Affordability indicators:

Median Worth in 2024: $342,107.28
5-Yr Compound Worth Development: 10.86%
Median Hire in 2024: $1,612.96
5-Yr Compound Hire Development: 7.51%
Hire-Worth Ratio: 0.47%

7. Columbus, OH

The Columbus, Ohio, MSA financial system is extremely numerous and supported by authorities, finance, healthcare, manufacturing, and tech jobs, and has seen sturdy wage progress prior to now few years. If the property taxes had been a bit decrease, this would possibly’ve been my favourite market. At a state common of 1.59%, I imagine there are a number of higher metros for actual property traders. However should you don’t thoughts that, this market has wonderful fundamentals.

Key financial indicators:

Common Wage in 2024: $55,651.44
5-Yr Compound Wage Development: 4.99%
Whole Employment in 2024: 1,168,600
5-Yr Compound Employment Development: 0.9%
Unemployment Charge in 2024: 4.5%
GDP Per Capita as of 2022: $66,834.95

Affordability indicators:

Median Worth in 2024: $316,666.35
5-Yr Compound Worth Development: 8.92%
Median Hire in 2024: $1,568.42
5-Yr Compound Hire Development: 6.3%
Hire-Worth Ratio: 0.5%

6. Oklahoma Metropolis, OK

The Oklahoma Metropolis MSA has a rising variety of skilled companies, healthcare, and authorities jobs supporting the financial system. Nevertheless, OKC sits within the coronary heart of Twister Alley, which drives up dwelling insurance coverage charges. In response to Bankrate.com, “the typical annual value of dwelling insurance coverage is $4,846 for a coverage with a $300,000 dwelling restrict, which is 113% greater than the nationwide common value of $2,285.” I’d choose to not spend money on a metropolis recognized for its excessive incidence of property-damaging climate occasions.

Key financial indicators:

Common Wage in 2024: $56,676.88
5-Yr Compound Wage Development: 3.92%
Whole Employment in 2024: 706,200
5-Yr Compound Employment Development: 1.56%
Unemployment Charge in 2024: 3.5%
GDP Per Capita as of 2022: $52,153.23

Affordability indicators:

Median Worth in 2024: $237,117.57
5-Yr Compound Worth Development: 7.96%
Median Hire in 2024: $1,365.59
5-Yr Compound Hire Development: 5.66%
Hire-Worth Ratio: 0.58%

5. Boise, ID

Boise, Idaho, has seen a giant improve in employment through the years. Whereas unlikely to develop on the identical fee it did through the pandemic, the town ought to proceed to see wholesome job progress for the foreseeable future. This is a strong marketplace for any investor who can afford it.

Key financial indicators:

Common Wage in 2024: $56,876.56
5-Yr Compound Wage Development: 6.74%
Whole Employment in 2024: 408,100
5-Yr Compound Employment Development: 3.42%
Unemployment Charge in 2024: 3.7%
GDP Per Capita as of 2022: $51,952.8

Affordability indicators:

Median Worth in 2024: $480,564.72
5-Yr Compound Worth Development: 9.94%
Median Hire in 2024: $1,835.37
5-Yr Compound Hire Development: 7.47%
Hire-Worth Ratio: 0.38%

4. San Antonio–New Braunfels, TX

San Antonio, Texas, provides many army, healthcare, {and professional} companies jobs. The realm stays comparatively inexpensive and has strong employment progress. The one factor I don’t choose is the excessive property taxes (a state common of 1.68%, even increased than Ohio’s).

Key financial indicators:

Common Wage in 2024: $53,292.2
5-Yr Compound Wage Development: 3.74%
Whole Employment in 2024: 1,178,000
5-Yr Compound Employment Development: 1.82%
Unemployment Charge in 2024: 4.0%
GDP Per Capita as of 2022: $52,860.79

Affordability indicators:

Median Worth in 2024: $288,944.75
5-Yr Compound Worth Development: 6.65%
Median Hire in 2024: $1,505.12
5-Yr Compound Hire Development: 4.29%
Hire-Worth Ratio: 0.52%

3. Raleigh-Cary, NC

Raleigh, North Carolina, has seen progress in healthcare, pharmaceutical, and know-how employment through the years, and it doesn’t appear like it’s stopping anytime quickly. STEM progress drives appreciation, and the rising variety of STEM jobs will seemingly have a optimistic impression on worth appreciation all through the metro space within the coming years. This is presently one in all my favourite markets as a result of its sturdy fundamentals, and I can’t advocate it sufficient.

Key financial indicators:

Common Wage in 2024: $59,586.28
5-Yr Compound Wage Development: 3.73%
Whole Employment in 2024: 748,600
5-Yr Compound Employment Development: 3.14%
Unemployment Charge in 2024: 3.8%
GDP Per Capita as of 2022: $70,178.38

Affordability indicators:

Median Worth in 2024: $447,526.11
5-Yr Compound Worth Development: 9.35%
Median Hire in 2024: $1,797.17
5-Yr Compound Hire Development: 5.91%
Hire-Worth Ratio: 0.4%

2. Tampa-St. Petersburg-Clearwater, FL

The Tampa, Florida, MSA has skilled regular progress within the healthcare, finance, insurance coverage, and know-how sectors. General, it’s a great market with strong fundamentals and a various financial system. Nevertheless, insurance coverage costs are more likely to proceed rising, as many properties are in danger from excessive climate occasions. Personally, I’ll be skipping this market.

Key financial indicators:

Common Wage in 2024: $57,930.6
5-Yr Compound Wage Development: 3.96%
Whole Employment in 2024: 1,548,700
5-Yr Compound Employment Development: 2.48%
Unemployment Charge in 2024: 3.8%
GDP Per Capita as of 2022: $57,049.28

Affordability indicators:

Median Worth in 2024: $382,195.19
5-Yr Compound Worth Development: 11.03%
Median Hire in 2024: $2,125.23
5-Yr Compound Hire Development: 8.88%
Hire-Worth Ratio: 0.56%

1. Phoenix–Mesa–Chandler, AZ

Powered by the nation’s largest nuclear facility (Palo Verde Producing Station) and containing the most important public college in the US (ASU), it ought to come as no shock that Phoenix is a booming metropolis. What is shocking is how a lot the town grew relative to its already-large measurement. The financial system is diversified, ever-growing, and one of many strongest within the nation. I additionally grew up right here and have seen its huge progress firsthand.

However does this progress have a draw back? New-build developments might decelerate—the Rio Verde Foothills neighborhood exterior of Scottsdale had just lately skilled a disaster when it misplaced its water provide (don’t fear, it’s again—simply with a a lot increased utility value to residents).

Will Phoenix’s progress spur extra water provide crises like this? Possibly, perhaps not. However it might restrict the speed of suburban sprawl, which can drive up costs in present houses as demand for housing continues. For those who can afford it, now could also be a perfect time to enter this market.

Key financial indicators:

Common Wage in 2024: $63,566.88
5-Yr Compound Wage Development: 4.41%
Whole Employment in 2024: 2,413,300
5-Yr Compound Employment Development: 2.58%
Unemployment Charge in 2024: 3.9%
GDP Per Capita as of 2022: $61,450.29

Affordability indicators:

Median Worth in 2024: $459,067.25
5-Yr Compound Worth Development: 10.16%
Median Hire in 2024: $1,884.26
5-Yr Compound Hire Development: 7.61%
Hire-Worth Ratio: 0.41%

Last Ideas

There’s no such factor as the proper financial system. Nevertheless, every of those 13 cities noticed wage, job, and inhabitants progress (and GDP per capita) larger than the nationwide median over a five-year interval, which may make them wonderful markets to your subsequent funding.

Personally, after I chosen my market, I used the BiggerPockets Deal Finder to assist me discover properties that match my funding standards. It is likely to be useful for you as nicely.

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