Written by Emila Smith
Despite the unprecedented conditions of the global Coronavirus pandemic, the US real estate market managed to thrive, and this resilient stability has many investors making plans to enter the market in 2021.
Based on the Emerging Trends in Real Estate 2021: US and Canada report published by Price Waterhouse Cooper (PWC), we have compiled a list of the best states to invest in. In this report, many market factors, including the effects of Covid-19, were analyzed in order to determine the top overall states for real estate prospects.
Here are six of the top states to consider investing in 2021, including some key market statistics.
Austin, Texas
One of the key strengths that Austin had over the threat of the pandemic towards its property market is that, economically, it has no considerable dependance upon its hospitality and leisure industries. Austin enjoys a robust and diverse economy, despite the state of Texas having an unemployment rate of 6.9% as at March 2021.
The PWC report considers the housing market in Austin to be a “Boom Market”, with property values appreciating and a consistently high demand. That said, properties have remained relatively affordable, leading to in-migration from areas such as California, and renter populations are high at 56%.
- Median property price – $631,959
- Cash-on-cash return – 1.6%
- Real estate appreciation forecast for 2021 – 7.7%
Durham/Raleigh, North Carolina
With a promising unemployment rate of 5.7%, PWC labels Durham/Raleigh as a “Magnet City” – a city that both people and businesses have chosen to migrate to during the pandemic. The area’s culture and way of life, as well as the job opportunities have continued to attract new residents.
It also boasts a relatively affordable real estate market, with renter populations at 51% for Raleigh and 53% for Durham. According to expert opinion within the report, the Durham/Raleigh market has been ranked #3 regarding general economic health.
Raleigh:
- Median property price – $477,440
- Cash-on-cash return – 2.2%
- Real estate appreciation forecast for 2021 – 7%
Durham:
- Median property price – $377,133
- Cash-on-cash return – 2.5%
- Real estate appreciation forecast for 2021 – 6.9%
Charlotte, North Carolina
Another strong market from the state of North Carolina is the Charlotte property market. Also labelled as a “New Boomtown,” this is another area that has experienced an influx of people migrating in despite the conditions of the pandemic.
As of March 2021, the unemployment rate is also at a promising 5.7%, so if you’re thinking about investing in real estate in Charlotte, the developing situation with the job market is one to watch. Charlotte’s renter population currently sits at 48%.
- Median property price – $435,448
- Cash-on-cash return – 2.4%
- Real estate appreciation forecast for 2021 – 7.7%
Nashville, Tennessee
The real estate market of Nashville has been called a “New Boomtown” in the report, as well as a “strong housing market.”
With a healthy unemployment rate of 4.9%, the city made the 4th spot for its general economic health, and has continued to draw in new residents during the pandemic, as well as attracting many smart, young workers. Nashville’s renter population stands at 48%.
- Median property price – $481,706
- Cash-on-cash return – 2.6%
- Real estate appreciation forecast for 2021 – 7.2%
Washington DC, Northern Virginia
Despite the Covid-19 trend that has seen Washington DC lose some of its popularity, Darren Robertson of Northern Virginia Real Estate believes it is a fleeting one. Although it has recently become an “out-migration market”, it is expected that Washington DC will continue to be an influential center.
It also boasts a very high renter population of 61%, and historically speaking, the capital city typically experiences a boost after an election year.
Northern Virginia real estate is generally poised for growth with an unemployment rate of 5.2% across the state and the ongoing promise of the Amazon Headquarters set to bolster economic growth for some time to come.
- Median property price – $711,007
- Cash-on-cash return – 2.8%
- Real estate appreciation forecast for 2021 – 6.3%
Boston, Massachusetts
Boston enjoys a diverse economy and is a leader across several sectors including education, biotech, finance and healthcare, so despite it witnessing some Covid-related out-migration, it’s set to make a healthy recovery.
Despite it being an expensive place to buy a home or do business, Boston is expected to experience growth in 2021 and continues to attract new residents thanks to its top universities and sector leaderships.
Boston’s housing prices keep the renter population at a high 67%, so if you can afford to invest in a Boston property, you can expect high demand and a temptingly low vacancy rate.
- Median property price – $1,040,905
- Cash-on-cash return – 1.6%
- Real estate appreciation forecast for 2021 – 6.9%
Amidst what is hopefully the final phase of the pandemic, there is surprisingly no U.S. housing market crash in sight, and 2021 is poised to be a great time to invest.
