By Alyssa Mammano
Earlier this year, Forbes released their full list of cities to invest in a primary residence or income property based on a survey by Local Market Monitor that tracks market trends in 300 major U.S. real estate markets. These markets are not necessarily conducive to flip houses, as the growth rates are projected for long-term development. Rather, these are the best cities to plant roots and purchase a primary residence with little risk, or purchase an income property with rental potential. Topping the list are several southern states, including our home state of Florida with two of its cities making the top ten. Another, perhaps surprising, top contender is Utah with several up-and-coming areas. Below we identify Forbes’ findings for the top ten cities to invest in housing this year.
Topping the charts as the number one recommended city to invest in housing this year is Orlando, Florida. Orlando has seen a population growth over the past three years of a remarkable 7.6 percent, most likely due to the job growth over the past two years at 7.1 percent. In the past year, homes have appreciated at a rate of 9 percent, which is an astounding return on long-term investment. In the next three years, experts project home prices to increase by 35 percent.
Located in central Florida and home to several major theme parks in the United States, Orlando is the 24th largest U.S. metropolitan area according to 2017 figures from the U.S. Census Bureau. In the year prior, Orlando drew an overwhelming 72 million tourists to its world-famous theme parks. Known as the “Theme Park Capital of the World,” Orlando is home to one of the busiest airports not only in the United States, but across the entire globe. Orlando is also a central hub for conventions and conferences, as the Orange County Convention Center is in the top two largest convention facilities in the United States. Additionally, the University of Central Florida is located in Orlando and has had the largest campus enrollment in the U.S. since 2015. Orlando growth has continued steadily since the 1980s, making the city a beautiful home, as well as a sound investment.
Provo and Orem, Utah
Anchoring this central metropolitan area are two Utah cities: Provo and Orem, which encompass Utah’s largest metropolitan area after Salt Lake City. In the past three years, the area has grown in population by 7.2 percent and in two years’ time, the job market has expanded by 6.7 percent. A growth rate of ten percent has been seen in the housing market over the past year, with a projected continued growth of 31 percent over the next three years.
This metropolitan area is no stranger to the top of Forbes lists, cited among the “Best Small and Medium-Size Cities for Jobs” in 2015 and coming in second among the “Best Places for Business and Careers” in 2013. In 2014 and 2012 respectively, Provo was named first in health and well-being and first for community optimism. The area is home to The Church of Jesus Christ of Latter-day Saints and its affiliations, which draw several patrons and it is also a key focus area for development in technology enveloping various billion-dollar entrepreneurial endeavors. In 2002, the site also hosted to the Winter Olympics.
The second Florida city to make the list is Jacksonville. On the east coast of north Florida, Jacksonville is the largest city by land area within the contiguous U.S. and is Florida’s most populous city. Over the past three years, its population has grown by 5.9 percent. The city has seen a job growth rate of 6.1 percent in the past two years and a home appreciation rate of eight percent in the past year. The housing market is predicted to remain strong and appreciate steadily by 20 percent in the next three years.
Residents in Jacksonville, Florida are largely comprised of military personnel due to its deepwater ports. Jacksonville is home to the United States’ third largest military presence nationwide. Vast improvements to the ports have been made in recent years, attracting the military and civilians alike and making the city a leading U.S. port for trade and distribution. Tourism also plays an important role in Jacksonville’s economy. Golfers frequently visit the area as the PGA Tour headquarters lies in close proximity in Ponte Vedra Beach, where the Players Championship is hosted annually.
Raleigh and Durham, North Carolina
Beautiful and historic, it comes as no surprise that Raleigh and Durham, North Carolina top this list. The area has seen a steady 4.9 percent growth rate in its population over the past three years due to a strong 5.8 percent employment growth rate, which has occurred within the past two years. Home prices have risen at an eight percent growth rate in the past year and are forecasted to continue the appreciation at a rate of 26 percent in the coming three years.
Raleigh is North Carolina’s second largest city after Charlotte. Together with Durham and Chapel Hill, the three cities comprise what is known as Research Triangle Park because of the three major universities that lie within their borders. Raleigh is home to North Carolina State University, Durham encompasses Duke University and Chapel Hill is where the University of North Carolina at Chapel Hill resides. The founding of Research Triangle Park in 1959 helped to pull the area out of depression after the Civil War by creating jobs in science and technology, ultimately establishing it as one of the fastest growing communities nationwide.
Ogden and Clearfield, Utah
The second metropolitan area in Utah to make the list is the Ogden, Clearfield region. Population in these cities has grown at a rate of 5.1 percent over the past three years. An Internal Revenue Service (IRS) regional facility contributes heavily to the area’s 5.7 percent job growth in the past two years. Home prices have also risen over the past year at a rate of ten percent and are projected to rise another 29 percent over the next three years.
This Utah residential area has also been rated by Forbes in the past as the 16th best place for business and careers in 2013, as well as the 6th best place to raise a family back in 2010. Ogden was actually the first place the Europeans permanently settled in Utah in 1846 and later became a major railway hub, which continues to drive production and merchandising to the city. Many business headquarters contribute to the corporate culture in Ogden including several government offices and banking services. Coupled with the formation of Hill Air Force Base in Clearfield, which caused the city’s expansion to boom during the 1940s, Ogden and Clearfield make a wonderful place to invest in housing and enjoy a family life.
Nashville, Davidson and Murfreesboro, Tennessee
Combined to create the Nashville, Davidson, Murfreesboro, Franklin, Tennessee Metropolitan Statistical Area (MSA) for official United States Census Bureau statistics, this MSA is the largest metropolitan area that Tennessee has to offer and is the 36th largest in the United States. The three-year population growth rate in this area is 6.1 percent, with a two-year job growth rate of 5.5 percent. The housing market is on the incline, as well. In the past year, home prices have appreciated by ten percent and the growth is projected to continue over the next three years at a rate of 27 percent.
As Tennessee’s capital, Nashville remains the most populous city within the state. It was strategically founded in 1779 with placement to become both a port and railroad hub, which have facilitated the city’s rapid and consistent growth. Nashville houses a plethora of diverse economy-boosting industries including several universities, religious organizations, healthcare, technology and music. Its housing market has been recognized before as the “hottest in the U.S.” by Freddie Mac realtors in 2017 and the year prior, Nashville’s economy was named the third fastest-growing in the U.S. by Headlight Data.
Atlanta, Sandy Springs and Marietta, Georgia
This metropolitan area has one of the top ten economies in the U.S. and is among the top 20 worldwide. It has the third most Fortune 500 companies headquartered within its bounds compared to all other states across the nation, which helps to drive its two-year job growth of 5.1 percent. In the past three years, the area’s population has grown by 4.9 percent in response to its economic growth. Homes have also appreciated by eight percent over the past year and are expected to continue to grow by 24 percent in the next three years.
Four notable Fortune 100 companies are headquartered in Atlanta, including Coca-Cola, Home Depot, UPS and Delta Air Lines. More than 75 percent of the Fortune 1000 list has a presence within the Atlanta region. Atlanta also encompasses a large banking occupancy, which includes a Federal Reserve System district headquarters. It was named the tenth most popular city for TV and film production by Cox Media Group and has gained notoriety for frequently being featured on the big screen.
Springfield, Missouri highway officials initiated the naming of a major east-west interstate that passes through the city, which has contributed greatly to its growth and lead the city to become known as the “Birthplace of Route 66.” With booming industries and an easy-going lifestyle, Springfield has seen a population growth rate of 2.3 percent over the past three years. The job market is expanding, as well. Employment has grown by 5.1 percent in the past two years, bringing a diverse workforce to the metropolitan area. Home values have also increased by a rate of five percent in the past year and experts project an appreciation rate of 14 percent in the coming three years.
The healthcare field accounts for about 18 percent of Springfield’s total employment, providing jobs to more than 30,000 residents. CoxHealth and Mercy, the two major health networks in Springfield, employ workers at area hospitals, clinics and specialty facilities. Expansion is currently underway for both entities totaling a whopping $375 million and will undoubtedly require a more robust workforce of healthcare professionals. Two Fortune 500 retailers are also headquartered in Springfield: Bass Pro Shops and O’Reilly Auto Parts. Together the two companies provide jobs to nearly 4,000 people.
Fort Worth and Arlington, Texas
Another popular Forbes list-topper, the Fort Worth and Arlington, Texas metropolitan division has undergone a three-year population growth rate of 5.6 percent. There has been an increase in jobs over the last two years at a five percent rate due to the expansion of major business enterprises into the area. All of this has also contributed to the rate of appreciation in the housing market at 11 percent in the last year. Looking to the future, homes are expected to continue appreciating at a 26 percent growth rate in the next three years.
Facebook, Amazon and Walmart, three of the world’s most notable brands, have purchased land and broken ground in the Fort Worth, Arlington area in recent years. Facebook invested in 150 acres to build a 750,000-square-foot data center at a cost of $1.2 billion. The resulting facility will bring 50 new jobs to the community. Amazon’s build site will soon become a 1.1 million-square-foot distribution center encompassing 68 acres of land. The project is expected to create more than 1,000 warehouse jobs once complete. Walmart is also building a distribution center that will span 788,000 square feet over 21.8 acres. At a construction cost of over $30 million, the new facility will create 400 new jobs.
Sacramento, Arden, Arcade and Roseville, California
Rounding out the top ten on Forbes’ list of the “Best Cities to Buy a Home” is the Sacramento, Arden, Arcade, Roseville, California metropolitan area. The capital city of California and its surrounding region has grown in population at a 3.7 percent rate in the last three years. The job market is also expanding at a two-year rate of 4.8 percent. Both the population and job growth have undoubtedly contributed to appreciation in the housing market at a ten percent growth rate in the past year alone. The growth is projected to continue. Experts predict that the housing market will continue to climb at a 33 percent growth rate over the next three years.
The city of Sacramento has recently voted to cut red tape involved in new housing construction to encourage the development of more affordable real estate. In the wake of such extreme home value increases, the city has seen a shortage of new housing. Reducing development fees to $0 will help to incentivize builders and residents alike to explore the idea of calling Sacramento home. The city is also looking to reinvigorate Old Sacramento Waterfront with innovative design ideas. The goal of the project is to transform the district and promote continued growth within city limits while still nodding to the historic ambiance. These initiatives and more look to incorporate forward-thinking objectives into the plans of a rapidly-growing city.
These nationwide cities have proven their dependability in the current economic climate and are considered to be favorable places to purchase housing and raise a family. Whether one is looking to plant roots at a primary residence or purchase an investment property for rental income, buyers always want to make a sound expenditure. While home values may or may not skyrocket in the coming years, each of these areas offer the likeliness of a solid return on investment with low risk and considerable reward.