25 “hidden gem” real estate markets around the U.S.

New York /
Sep.September 26, 2013 10:26 AM

For investors looking to get into the real estate market, one factor should be considered above all others: location, location, location. RealtyTrac has combed the country to find 25 “hidden gem” markets — areas that are little-known, aren’t swarming with big institutional investors, and boast sizeable yields.

The firm based its study on a combination of five factors: median home value, unemployment, median rental value, institutional investor sales, and gross yield.

In the markets that made up the cream of the crop, institutional investor purchases accounted for 5% or less of all residential sales (the less competition from big players, the better, for average investors) in the three-month period ending in July, and the unemployment rate was 7.5% or lower.

“Buying single family homes as rentals still yields solid returns in many markets across the nation, but it is difficult for individual investors and even small-to medium-sized institutional investors to find reasonably priced inventory in markets dominated by the 800-pound gorillas in the single-family rental space,” said Daren Blomquist, vice president at RealtyTrac. “With this analysis, we’ve identified the top overlooked markets where single family rentals still make good financial sense but where there is little to no competition from the big players.”

25. Shelby County, Ala.: Gross yield for real estate investors is 9.1%.

Investor sales: 1.9%
Unemployment: 4.5%
Median home value: $157,000
Median rent value: $1194

Gross yield: 9.1%

24. Madison County, Ala.: Gross real estate investor yield totals 9.2%.

Investor sales: 4.3%
Unemployment: 6.0%
Median home value: $126,000
Median rent value: $961

Gross yield: 9.2%

23. Waukesha, Wisc.: Gross yield for real estate investors is 9.2%.

Investor sales: 1.0%
Unemployment: 6.3%
Median home value: $208,000
Median rent value: $1595

Gross yield: 9.2%

22. Newport News, Va.: Gross real estate investor yields total 9.2%.

Investor sales: 4.1%
Unemployment: 6.8%
Median home value: $167,000
Median rent value: $1286

Gross yield: 9.2%

21. Saint Charles County, MO: Gross real estate investor yields total 9.4%.

Investor sales: 3.8%
Unemployment: 6.1%
Median home value: $158,000
Median rent value: $1232

Gross yield: 9.4%

20. Washington County, Penn.: Gross yield for real estate investors totals 9.4%.

Investor sales: 1.8%
Unemployment: 7.3%
Median home value: $141,000
Median rent value: $1106

Gross yield: 9.4%

19. Litchfield County, Conn.: Gross yield for real estate investors is 9.4%.

Investor sales: 2.3%
Unemployment: 7.3%
Median home value: $228,000
Median rent value: $1790

Gross yield: 9.4%

18. Escambia County, Fla.: Gross real estate investor yield totals 9.4%.

Investor sales: 4.3%
Unemployment: 7.1%
Median home value: $116,000
Median rent value: $913

Gross yield: 9.4%

17. Santa Rosa County, Fla.: Gross real estate investor yield totals 9.5%.

Investor sales: 3.7%
Unemployment: 6.7%
Median home value: $145,000
Median rent value: $1153

Gross yield: 9.5%

16. Charles County, Md.: Gross real estate investor yield totals 9.5%.

Investor sales: 1.4%
Unemployment: 6.9%
Median home value: $219,000
Median rent value: $1742

Gross yield: 9.5%

15. Kent County, Mich.: Gross real estate investor yield totals 9.7%.

Investor sales: 2.9%
Unemployment: 6.9%
Median home value: $116,000
Median rent value: $936

Gross yield: 9.7%

14. Shawnee County, Kan.: Gross real estate investor yield totals 9.8%.

Investor sales: 4.7
Unemployment: 6.2%
Median home value: $106,000
Median rent value: $864

Gross yield: 9.8%

13. Lake County, Ohio: Gross real estate investor yield totals 9.8%.

Investor sales: 2.2%
Unemployment: 7.1%
Median home value: $127,000
Median rent value: $1036

Gross yield: 9.8%

12. Boon County, Mo.: Gross real estate investor yield totals 9.8%.

Investor sales: 3.5%
Unemployment: 5.3%
Median home value: $141,000
Median rent value: $1154

Gross yield: 9.8%

11. Summit County, Ohio: Gross real estate investor yield totals 9.8%.

Investor sales: 2.8%
Unemployment: 7.1%
Median home value: $107,000
Median rent value: $876

Gross yield: 9.8%

10. Allegheny County, Penn.: Gross real estate investor yield totals 9.8%.

Investor sales: 2.9%
Unemployment: 6.9%
Median home value: $126,000
Median rent value: $1034

Gross yield: 9.8%

9. Jefferson County, La.: Gross real estate investor yield totals 9.9%.

Investor sales: 3.0%
Unemployment: 7.3%
Median home value: $153,000
Median rent value: $1260

Gross yield: 9.9%

8. Schenectady, NY: Gross real estate investor yield totals 10%.

Median home value: $153,000
Median rent value: $1278
Investor sales: 2.2%
Unemployment: 6.9%

Gross yield: 10.0%

7. Alachua County, Fla.: Gross real estate investor yields total 10.1%.

Median home value: $139,000
Median rent value: $1175
Investor sales: 4.3%
Unemployment: 5.9%

Gross yield: 10.1%

6. Davidson County, Tenn.: Gross real estate investor yield totals 10.2%.

Median home value: $149,000
Median rent value: $1263
Investor sales: 5.3%
Unemployment: 7.1%

Gross yield: 10.2%

5. Monroe County, N.Y.: Gross real estate investor yield totals 10.3%.

Median home value: $121,000
Median rent value: $1,043
Investor sales: 2.5%
Unemployment: 7.0%

Gross yield: 10.3%

4. Austin-Round Rock, Texas: Gross real estate investor yields total 10.7%.

Median home value: $158,000
Median rent value: $1403
Investor sales: 4.7%
Unemployment: 5.7%

Gross yield: 10.7%

3. Canadian County, Okla.: Gross real estate investor yields total 10.8%.

Median home value: $131,000
Median rent value: $1176
Investor sales: 3.7%
Unemployment: 4.9%

Gross yield: 10.8%

2. Lubbock County, Texas: Gross real estate investor yield totals 11.8%.

Investor sales: 4.9%
Unemployment: 6.1%
Median home value: $111,000
Median rent value: $1,089

Gross yield: 11.8%

1. Wichita Falls, Texas: Gross real estate investor yield totals 13.4%.

Investor sales: 4.5%
Unemployment: 6.8%
Median home value: $84,000
Median rent value: $938

Gross yield: 13.4%


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