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By the Numbers: Survey Shows Best Investment Markets Q3

Numbers between the second and third-quarters of the year lend an in depth look at the real estate markets to invest in now. According to a recent survey from ""HomeVestors of America, Inc."":http://www.homevestors.com/ and ""Local Market Monitor, Inc."":http://www.localmarketmonitor.com/, now is the time to buy in some of the nation's most compromised areas.


The HomeVestors-Local Market Monitor series evaluates the best regions around the U.S. in which to buy rental property, and the results, while not surprising, give investors and real estate professionals valuable forecasts for the approaching quarter. The latest data reveals that around 14 percent of single-family residential properties are maintained as rental products, and the company's survey seeks to demonstrate the key locations yielding a high risk-return premium, calculating the top 20 investment cities in the country.

The top 10 cities making the list for the third-quarter include Las Vegas, Nevada; Detroit, Michigan; Orlando, Florida; Warren, Michigan; Fort Lauderdale, Florida; Bakersfield, California; Tampa-St. Petersburg, Florida; Phoenix, Arizona; Stockton, California; and West Palm Beach, Florida. All of the metro areas highlighted by the HomeVestor-Local Market results boast a risk-return premium of more than 2 percent above the national average, based on a 5.4 percent U.S. average during the third-quarter.

Las Vegas and Detroit have exceptionally high numbers, with a 5 percent and 4.3 percent besting of the national average respectively. Rounding out the top 20 listing are Atlanta, Georgia; Bradenton-Sarasota, Florida; Rochester, New York;


Forth Worth, Texas; Dallas, Texas; Syracuse, New York; Jacksonville, Florida; Fresno, California; Tuscon, Arizona, and Memphis, Tennessee. Each of the cities in the lower half of HomeVestor's peak 20 have a risk-return premium that falls 1.4 percent or more above the country's average.

Ingo Winzer, president and founder of Local Market Monitor, Inc., said of the new statistics, ""A sharper than expected fall in recent home prices, which are down almost 5 percent in the last year, has led us to lower expectations for future prices. ├âÔÇÜ├é┬áAt the same time, however, higher inflation and slow but steady job growth should boost future rents. ├âÔÇÜ├é┬áThe desirability of investing in rental properties is therefore positive. ├âÔÇÜ├é┬áIn fact, the national average risk-return premium has ticked up ever so slightly from 5.3 percent to 5.4 percent since last quarter. The future relative returns for large markets suggest that Las Vegas and Detroit are still very risky, highly speculative markets that could have a big payoff only if the local economy rebounds faster than we expect. ├âÔÇÜ├é┬áSafer but still advantageous markets include Dallas, Fort Worth and Atlanta. ├âÔÇÜ├é┬áThe most interesting markets are in Florida and Arizona, where home prices have still not bottomed out but rents will eventually be supported by renewed population growth; investors in these markets must take a long-term view but will be rewarded if they can tolerate high vacancies for a few years.""

Elaborating on Winzer's statements, HomeVestors' co-president David Hicks commented, ""What we're seeing in the marketplace reinforces the results of the latest ranking. ├âÔÇÜ├é┬áOur franchises in West Palm Beach, Atlanta, Phoenix, Dallas, Fort Worth and Tucson all report a marked increase in investor interest in rental property opportunities. ├âÔÇÜ├é┬áInvestors are recognizing the potential for homes in these markets to produce above-average financial returns."" ├âÔÇÜ├é┬á

The HomeVestors-Local Market Monitor ""Best Markets to Invest in Rental Property"" data is released quarterly, and a lengthier top 100 investment market list is available online. Dallas-based HomeVestors has been in business since 1996 and is the first real estate franchise investment company in the U.S.; Local Market Monitor offers real esate forecasting, specializing in market valuation, long-term risk, and investment perspective.

About Author: Abby Gregory


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