April 2017   Volume 43, Number 4      


Top U.S. Markets for Buying and Selling Real Estate

As often happens during economic cycles, the dynamics of real estate markets in the U.S. have changed once again. Investors who look to buy homes at low prices and sell them at the top of the market have already missed the boat and are now facing increased competition.

These days, finding the best markets to invest in has become more challenging. Many investors are instead opting for a “buy and hold” rather than “buy and sell” business model. Across the country, real estate investors in hot markets are facing higher initial purchase prices, a much tighter inventory of properties and increased competition from large institutional investors.

Late last year, Attom Data Solutions released its findings after analyzing 473 counties with populations of 100,000 or more for the first seven months of 2016 in order to uncover the markets that had the highest potential return on investment for buy-and-hold investors.

In addition to potential returns on investment, Attom reported on five factors that can influence an investor’s analysis of a market: homeownership rates, wage growth, a high population of millennials and the level of competition from institutional investors.

With many market factors influencing them, investors should think of themselves not only as investors, but as landlords so they have the opportunity to generate respectable profits from their investments.

“Given shifting attitudes toward homeownership that are showing up in stubbornly low homeownership rates and our data showing more than 18 million non-owner occupied single family homes — one in every four single-family homes — these single family rental investors will be an important and likely growing force in the real estate market for years to come,” says Daren Blomquist, senior vice president of Attom Data Solutions.

The following locations are the top ten counties for the best annual gross rental yield and lowest investment property vacancy rate during the first seven months of 2016, as reported by Attom Data Solutions.

  1. Monroe County, Penn.: 16 percent rental yield, 0.4 percent vacancy rate
  2. Hernando County, Fla.: 14.3 percent rental yield, 2.1 percent vacancy rate
  3. Lackawanna County, Penn.: 12.1 percent rental yield, 2.1 percent vacancy rate
  4. Westmoreland County, Penn.: 11.8 percent rental yield, 2.8 percent vacancy rate
  5. Davidson County, N.C.: 11.8 percent rental yield, 2.6 percent vacancy rate
  6. Marion County, Fla.: 11.7 percent rental yield, 1.9 percent vacancy rate
  7. Wicomico County, Md.: 11.7 rental yield, 2.1 percent vacancy rate
  8. Randolph County, N.C.: 11.1 percent rental yield, 2.7 percent vacancy rate
  9. Ulster County, N.Y.: 11 percent rental yield, 2.1 percent vacancy rate
  10. El Paso County, Texas: 11 percent rental yield, 1.9 percent vacancy rate

Nationwide, Attom also reports that 2.7 percent of all single-family homes sold during the first seven months of 2016 were purchased by institutional investors. Institutional investors are defined as entities that purchase at least ten properties in a calendar year. This translates to a 29 percent increase from the same period in 2015, marking an increase after two consecutive yearly declines in institutional investor activity.

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In this issue:

Top U.S. Markets for Buying and Selling Real Estate

Big Institutions Sell off Commercial Real Estate

Fed Chair Says Rising Real Estate Prices Put Small Banks at Risk

Iowa Realtor Warns Agents about Email Scam

Mortgage Delinquencies Spike among Some Homeowners

Next-Generational Homes Are the Latest Real Estate Trend

Silicon Valley Is the Top U.S. Real Estate Market

Top Three Legal Issues Facing Brokers

Trump Cut Causes FHA Applications to Decline by 3.2 Percent

Real Estate Agents: Stop Commoditizing Your Services


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