Top 5 US Markets to Invest in Real Estate in 2021

Now that 2021 is well underway, the time has come to take your grand real estate investment ambitions and turn them into actions.

There’s no denying that it’s a strange time for the housing market — as a matter of fact, it’s hard to think of a single sector where things could be considered status quo. However, the changes and developments of the last year have resulted in a number of favorable conditions for folks looking to fix and flip houses.

With all of that in mind, we’ve laid out the trends and the locations we think real estate investors ought to keep an eye on during the coming year. Here are A&S Capital’s top five U.S. markets to invest in house flips for 2021:

Shifts in the market

The market for flipping houses looks quite different from how it did a year ago. People’s entire lives have changed, and as we’ve heard time and again, that’s meant a lot more of our time is being spent at home.

With more and more folks working from home and traveling less, the expectations of what people want out of their domiciles has been recalibrated in kind. For example, with pandemic restrictions and studies showing that it’s much riskier to spend time indoors, many are turning to nature and looking to surround their homes with scenic, safe greenery.

Likewise, many companies are sticking with the work from home policies first implemented at the start of the pandemic. As a result, many organizations aren’t renewing their office space leases. Besides leaving many buildings empty, this is expanding people’s options on where they’d like to live.

All of the above has resulted in a mass migration away from urban areas towards more suburban markets. The demand for single-family homes has risen considerably as many professions are looking to relocate their families to less congested spaces. People want more room to move around in, which means larger homes and ample opportunities for investors to turn a profit on fix and flip projects.

However, there are certain things to keep in mind when determining the best places to invest in…

What to take into consideration

It’s easy to read or hear about a booming real estate market and decide that’s the place to pour your efforts towards. But it’s crucial to take a number of considerations into account before making any firm commitments: Prior to reallocating your fix and flip resources, make sure to research an area’s:

  • Median household income
  • Home value
  • Median monthly housing costs
  • Average cost of full remodels

Housing markets with lots of hype are prone to cause something of a gold rush, resulting in a crowded market and more competition. That’s why it’s essential to take full account of the data on the ground and decide whether or not it fits within your plans and means.

By that same token, it’s also necessary to scope out how things look among sellers: How many realtors are in an area? Are they thriving? What’s the ratio between a property’s listing and its actual selling price? And how long does it take for houses in an area to be sold after going to market? Time is money, and you don’t want to pour all of your eggs into one basket only for them to slowly spoil.

A&S’ Top 5 Cities to invest in flipping for 2021

  1. Atlanta, GA — The perfect example of cities that mix suburban comforts with city living. Not only is Atlanta Georgia’s vibrant capital, it is also it’s financial center whose growing economy comes in 8th in the nation for GDP. Many Fortune 500 companies are headquartered there such as Coca-Cola, The Home Depot, and Delta Airlines. With an average of 300 people moving to Atlanta on a DAILY basis, it has one of the top rental markets in the country with a 3 year appreciation forecast of 9.3%. The expected population growth spurt will have people wanting to beat out the competition and purchase soon, if they’re looking to plan a future in this diverse city, especially young professionals.  
  2. Austin, Texas — It’s no secret that all the major tech cities are experiencing a mass exodus and it’s looking like Austin’s tech communities will reap the benefits of this. Recovering from the pandemic, Austin’s unemployment rates have been very promising going from 12.7% in April 2020 to 5.1% as of December 2020. Currently, Austin is very much a  seller's real estate market in the United States. You can get investment properties around the range of $200,000 to $250,000. There is also a scarcity of homes for sale, meaning the time is now to adapt to the demand.
  3. Charlotte, NC — Known as The Queen City, Charlotte, similar to Atlanta in urban-suburban feel, ranked one of the best places to live in 2019. There is a close split between renters vs owners at 47.03% renting and 52.07% owning, and lucky for the owners, Charlotte’s home values have gone up 5.3% over the past year. Charlotte is an eager market for investors right now especially if  you’re looking  to renovate and flip, buy to hold and rent, or invest in multi-family properties.
  4. Tampa, FL —Located in Florida’s sunny Gulf coast, Tampa’s cost of living is not only 5% lower than the national median, but it’s healthcare, education, and transportation facilities are also top notch. The median home price right now is $267,000 and with less than a 2 month turnaround on inventory on the housing market making it a hot seller’s market. The cherry on top? Home values have gone up 5.3% over the past year. As an investor you can  buy properties at low rates right now, turn them into entry level single family homes (big purchase demand right now) and sell them or rent them to grow your portfolio.
  5. Orlando, FL — Yes, you’re probably thinking how is Orlando smart to invest in if it’s the theme park capital of the U.S.  You’re not totally wrong, unemployment skyrocketed to a whopping 21.1% in May 2020 but as of December 2020 it’s come down to 6.9%. Additionally,  Orlando is not defined by tourism alone, it’s finance and manufacturing sectors are going strong. The smartest investment at the moment is to increase your cash flow by acquiring a single family home and renting it. Currently, 64% of Orlando residents rent. Orlando’s property taxes and insurance are also one of the lowest in the state for a city, and Florida does not have state income tax. Give it a little more time for the vaccine to settle and the tourism to kick into high gear and you’ll have a solid return on your property investment.