Investors have to hunt harder for well-priced acquisitions these days but the best rents can be found in the nation’s top  for-sale markets, according to new quarterly data from HomeVestors and Local Market Monitor.

 “For the last few years, investors have been able to find real estate bargains they could turn into rental properties. That period is pretty much over – the inventory of foreclosed homes has been picked fairly clean, at least in the larger markets,” said Ingo Winzer, president and founder of Local Market Monitor. “You don’t need a bargain in order to make a good real estate investment. Demand for rentals continues to increase in many markets, while homeownership erodes. It’s strongest in those markets growing the fastest, which describes our Top 10 list.”

Topping the Best Markets Top 10 List is Denver, while Texas cities continue to dominate the list with Dallas (2), Houston (3), Austin (4) and San Antonio (7) representing the Lone Star State. Rounding out the Top 5 is Seattle.

“Job and population growth spurs great conditions for investing in single family rental properties,” notes David Hicks, HomeVestors co-president. “Places like Austin, whose population growth is triple the national average, continue to grow and create a bigger demand for real estate. The lack of foreclosure inventory may also explain the current record number of HomeVestorsfranchises.  Increasingly, independent investors are looking to HomeVestors’ We Buy Ugly Housestrademark to generate a consistent flow of motivated seller leads” explained Hicks.

Southern cities rounded out the list with Orlando (6), Charleston, South Carolina (8), Nashville (9) and Raleigh, North Carolina (10), respectively.

“There are still some bargains to be found in these cities, particularly in Orlando, Nashville and Raleigh. Charleston is the smallest market among our Top 10, but it’s ideal for attracting vacation renters and retirees,” explained HomeVestors co-president Ken Channell.  “Although home prices have increased moderately in many parts on the country, there are still smart opportunities for investing in real estate. The economy appears have stabilized and job and population growth make ideal conditions for investing.”

The Top 10 Best Markets List for real estate investing are:

Denver, CO

Dallas, TX

Houston, TX

Austin, TX

Seattle, WA

Orlando, FL

San Antonio, TX

Charleston, SC

Nashville, TN

Raleigh, NC

 

About the Quarterly Data

 The data identifies markets that will be good rental markets and where home prices are likely to increase at a good rate over the next few years. Criteria include markets where:

• The population has been growing at above-average rates (4% or better) with growth coming from people moving there in search of jobs;
• The current rate of job growth of 2% or better; and
• There is low unemployment, so that new jobs will be filled by people who move there, not by unemployed people who are already there.

Markets are excluded that have a small population because they don’t have stable economies.