Charlotte, North Carolina cityscape.

Best Cities To Invest In Real Estate For 2023

10-Minute Read
Published on January 18, 2022
Share:

Is your 2023 goal to invest in real estate for the first time? Or maybe you're a seasoned investor looking for your next big opportunity. No matter your level of experience or expertise, it’s important to know where the best cities to invest in real estate are and why they’re recommended.

Why Buy An Investment Property?

Let’s start with defining what an investment property is. Simply put, an investment property is real estate you purchase with the goal of generating income. You buy an investment property – whether it's a single-family home, condo building or apartment property – because you want to earn a return on your investment (ROI).

This is different from buying a primary residence due to the motivations that drive your criteria. When it comes to the home you live in, purchasing decisions can often be based on emotions or family dynamics. Your personal wants and needs often dictate what type of home you purchase to live in.

When you buy a house as an investment, emotion and personal preference shouldn't come into play. Instead, it’s a numbers game. Each decision should be driven by how much money you can make off of the property.

You can do this either by renting out the property and collecting rents from your tenants or by selling your property after its value appreciates. You can invest as a single investor or with a group of investors. There are many ways to invest in real estate with income properties, but all avenues lead to the same end – creating as much ROI as possible.

How Do You Find Real Estate Investment Opportunities?

In the past, real estate investment opportunities have been limited to a small percentage of people with the right access. Now, with internet search platforms, you can find investment properties everywhere.

This includes big cities, small towns, affluent neighborhoods, up-and-coming neighborhoods and everything in between. You might even find an investment property in neighborhoods that are listed as opportunity zones – those that have been identified as low-income areas. Investors can receive tax breaks when they invest their money into opportunity zones. This is meant to attract investment to neighborhoods in need. If you buy before that neighborhood becomes a hot market, you might nab a home for a low price that will sell at a much higher figure once you’re ready to unload it.

So, how do you find the right investment properties that will help you get the best ROI? Here are just a few of the many ways:

  • Choosing a REALTOR® or real estate agent to work with can help you zone in on real estate that fits your budget and other specifications.
  • Talking to a local wholesaler, who directly markets to potential sellers and negotiates the right to purchase each seller's property.
  • Checking a multiple listing service (MLS), an online, home-selling database used by real estate brokers and agents to list and find local homes for sale.
  • Use Rocket HomesSM to review listings and housing market trends for the area you’re interested in.

Want to skip over the research and go straight to where the best places to invest in for 2023 are? We got you.

View Your Refinancing Options

See expert-recommended refinance options and customize them to fit your budget.

Start Your Refinance Online

Where To Invest In Real Estate: Top 10 Best Places To Buy An Investment Property In 2023

Finding the right place to invest in real estate starts with evaluating your investment goals. Are you interested in collecting monthly rent checks? Or are you more concerned with watching your investment property increase in value over time? It’s different for everyone. There are a number of ways to look at housing market indicators before investing, depending on your goals.

Here, we’ll cover the following four metrics, using data from the December 2022 Rocket Homes housing market report for each city.

  1. Median sold price: This represents the middle of the home prices in an area based on homes sold in the last 12 months. That means that half the houses in the area sold for less than this amount and half sold for more. Having an estimate of what you might need to spend to acquire an investment property in any given area is the first step in seeing if it might be a good city for you to consider.
  2. Home value appreciation: This is the percentage of increase in median home value over the last year. Any good investor wants a good idea of how the value of their investment will increase over time before jumping in.
  3. Average sale time: This is the average time a home sat on the market before selling. This is a good indicator of buyer demand. If homes are sitting longer, that means you are competing with less other potential buyers. It also means you might be able to make offers under asking price. If average sale time is low, you might end up in bidding wars and paying over asking price.
  4. Average sale time trend: This indicates how the average sale time has changed over the last year.

1. Charlotte, North Carolina

Charlotte, nicknamed the "Queen City," ranks among the best cities in the United States for businesses and careers. Charlotte is home to more than 10 Fortune 1000 companies, including Bank of America, Lowe's and Wachovia Corp., and features numerous institutions of higher learning, cultural centers and health care facilities.

Let’s take a look at the stats:

  • Median sold price: $389,844
  • Home value appreciation: +15.3%
  • Average sale time: 35 days
  • Average sale time trend: +109.4%

With home values rising year or over year at a high clip and the average sale time increasing, now is a good time to invest in Charlotte. Your investment will likely increase in value substantially and you may be able to get a good deal with properties sitting on the market longer compared to last year. Ready to learn more? Check out Charlotte real estate listings and the Charlotte trends report.

2. Detroit, Michigan

Home to many businesses (like Rocket Mortgage®) and attractions, Detroit offers a vibrant nightlife and a plethora of opportunities for young professionals. Major professional sports teams, a rich history – and present-day offerings – of musical entertainment and a growing younger population are just a few of the many reasons to live in Detroit.

Let’s take a look at the stats:

  • Median sold price: $81,413
  • Home value appreciation: +12.8%
  • Average sale time: 52 days
  • Average sale time trend: +8.2%

If you’re starting with a small bankroll, Detroit is a great place to start investing, as it has a low median home price. In addition, you’re likely going to be able to find good value, as 62% of homes in Detroit sold below asking price in December 2022. Ready to learn more? Check out Detroit real estate listings and the Detroit trends report pages.

3. Cleveland, Ohio

Cleveland is similar to Detroit in many ways, especially when it comes to home price and city center look and feel. Home to the Guardians, Cavs and Browns, this midwestern city on the shores of Lake Erie offers plenty of sports entertainment combined with picturesque waterfront views. These and other attractions make Cleveland a great place to invest in real estate in 2023.

Let’s take a look at the stats:

  • Median sold price: $119,987
  • Home value appreciation: +4.4%
  • Average sale time: 45 days
  • Average sale time trend: -19.3%

With a pretty reasonable minimal investment, you can start shopping for real estate in Cleveland. In addition, the average sale time is pretty high, so you might be able to find some properties sitting on the market with owners ready to sell at a reduced price. Ready to learn more? Check out Cleveland real estate listings and the Cleveland trends report.

4. Orlando, Florida

Orlando boasts more than a dozen different theme parks (including Walt Disney World) so to say they are a tourism-based economy would be a massive understatement. What does that mean for investment properties? Well, it means the short-term rental market is on fire year-round.

Let’s take a look at the stats:

  • Median sold price: $319,450
  • Home value appreciation: +8.3%
  • Average sale time: 44 days
  • Average sale time trend: +59.8%

The price point to purchase in Orlando is a bit high compared to the other cities we’ve covered, but with a steady influx of transient tourism, you’ll have no problem finding renters for your investment property. Ready to learn more? Check out Orlando real estate listings and the Orlando trends report.

5. Phoenix, Arizona

The "Valley of the Sun" offers year-round warmth, beautiful vistas, historical sights, plenty of entertainment and nightlife and a growing number of business opportunities. As more people seek to move to this warm-weather city, both Phoenix’s housing values and apartment rents have been growing rapidly.

Let’s take a look at the stats:

  • Median sold price: $439,748
  • Home value appreciation: +15.8%
  • Average sale time: 63 days
  • Average sale time trend: +91.4%

Phoenix can be pricey, but the appreciation rate is very high. This means that if you can afford to purchase real estate in Phoenix, the value of that property is likely to increase substantially year after year. Ready to learn more? Check out Phoenix real estate listings and the Phoenix trends report.

6. Atlanta, Georgia

One of the fastest-growing cities in the United States, Atlanta is known for its rich history, many tourist attractions and notable residents, like Nobel Peace Prize recipients, Martin Luther king Jr. and President Jimmy Carter.

Let’s take a look at the stats to find out why Atlanta might be the right place for you next real estate investment:

  • Median sold price: $397,991
  • Home value appreciation: +10.3%
  • Average sale time: 38 days
  • Average sale time trend: +24.5%

As evidenced by the low average sale time, Atlanta is a real estate market that is on fire. If you can get your hand on a property before it’s snatched up by someone else, be grateful. The influx of potential renters as well as solid property appreciation will leave you feeling happy about your investment. Ready to learn more? Check out Atlanta real estate listings and the Atlanta trends report.

7. Houston, Texas

Known for space exploration, the need for plenty of air conditioning, international energy and petroleum exploration – not to mention being home to more than 2.3 million people – the Houston area has a lot going for it. This makes it an attractive rental property investment location.

Let’s take a look at the stats:

  • Median sold price: $335,963
  • Home value appreciation: +5.1%
  • Average sale time: 40 days
  • Average sale time trend: +5.7%

Its home prices, combined with its bustling business scene, make Houston an obvious location for real estate investors. Ready to learn more? Check out Houston real estate listings and the Houston trends report.

8. Minneapolis, Minnesota

If you're familiar with the Midwest, you already know that the region is dotted with relatively affordable single-family rental homes and small multifamily buildings, which makes this part of the country a smart choice for real estate investors. Minneapolis is a great example of what Midwest markets have to offer investors.

Let’s take a look at the stats:

  • Median sold price: $323,469
  • Home value appreciation: +2.5%
  • Average sale time: 43 days
  • Average sale time trend: +7.9%

Property appreciation in Minneapolis is only at 2.5%, so if you’re looking at increased value over time this might not be the best market. However, if you’re looking at rental income as your primary goal, this city offers a large pool of potential tenants. Ready to learn more? Check out Minneapolis real estate listings and the Minneapolis trends report.

9. Salt Lake City, Utah

Salt Lake City's rich culture, historical sites and natural landmarks – especially that famously salty lake and the mountains surrounding the city – draw both tourists and new residents to the area.

Let’s take a look at the stats:

  • Median sold price: $570,000
  • Home value appreciation: -0.9%
  • Average sale time: 79 Days
  • Average sale time trend: +23.4%

Home prices are relatively high, but there are a lot of perks to investing in the Salt Lake City real estate market, including Utah's upward-trending job growth, low unemployment rate and low state and local taxes. Ready to learn more? Check out Salt Lake City real estate listings and the Salt Lake City trends report.

10. Indianapolis, Indiana

Major-league sports franchises, highly ranked museums, universities, shops, restaurants and family-friendly activities for those with young children are just a few of the reasons Indianapolis is a strong real estate market to invest in.

Let’s take a look at the stats:

  • Median sold price: $235,004
  • Home value appreciation: +11.9%
  • Average sale time: 28 Days
  • Average sale time trend: +53.6%

The Indianapolis housing market attracts many out-of-state investors because of its low housing prices compared to many other areas in the country, like the east and west coasts. These lower prices mean that investors don’t need their properties to appreciate as much as they do in higher-cost markets. Ready to learn more? Check out Indianapolis real estate listings and the Indianapolis trends report.

Best Cities To Invest In Real Estate: At A Glance

City

Median Sold Price

Home Value Appreciation

Average Sale Time

Average Sale Time Trend

Charlotte, NC

$389,844

+15.3%

35 days

+109.4%

Detroit, MI

$81,413

+12.8%

52 days

+8.2%

Cleveland, OH

$119,987

+4.4%

45 days

-19.3%

Orlando, FL

$319,450

+8.3%

44 days

+59.8%

Phoenix, AZ

$439,748

+15.8%

63 days

+91.4%

Atlanta, GA

$397,991

+10.3%

38 days

+24.5%

Houston, TX

$335,963

+5.1%

40 days

+5.7%

Minneapolis, MN

$323,469

+2.5%

43 days

+7.9%

Salt Lake City, UT

$570,000

-0.9%

 

79 days

+23.4%

Indianapolis, IN

$235,004

+11.9%

28 days

+53.6%

The Bottom Line

Cities with strong housing markets and investment potential are spread across the country, so no matter where you want to invest, there are plenty of opportunities. Use the information you’ve found here and continue to research on your own to find the best real estate investment opportunities for your individual needs. When you're ready to buy, start your mortgage application online.

Get approved to refinance.

See expert-recommended refinance options to customize them to fit your budget.

Start My Application

Carey Chesney

Carey Chesney brings a wealth of residential and commercial real estate experience to readers as a Realtor® and as a former Marketing Executive in the fields of Health Care, Finance and Wellness. Carey received his Bachelor's in English at University of Wisconsin-Madison he received his Masters in Integrated Marketing & Communications at Eastern Michigan University.