OwnAmerica CEO Gregory Rand has identified the top 25 residential real estate investment markets using the firm's proprietary methodology, based on time-tested metrics and local expertise on the ground in each community. Selection of winning investment markets is driven by a dynamic algorithm based on four distinct informational categories.
Housing demand fundamentals:
Population growth, migration patterns, employment strength, cost of living, quality of life, future rental demand and responsible governance. Markets emerge as winners in this category based on evidence that people are drawn to the market for reasons that are demonstrable and sustainable for the long term. Population growth = housing demand, which supports strength in both rents and values.
Home price performance:
Markets are chosen not for their near-term appreciation or perceived discount, but for their predictability based on how they performed over the past fifteen years or longer. This longer-term time table was chosen to include three key periods of time:
1. Late 1990s: uneventful period where a trend line can be established under calm conditions;
2. 2000s: volatile "stress test" period the housing bubble and correction;
3. The early stages of the recovery that have taken place since 2010.
Markets with stable and unshakeable appreciation rank higher. Markets that have demonstrated the greatest volatility, and therefore, unpredictability, fall lower on the list.
Locally verified net yield:
Certified field operatives conduct due diligence on single family assets in a variety of geographic segments for each market analyzed. An underwriting standard is applied to all markets uniformly to establish a baseline yield that each market provides as “face value” (good condition at market value and rent). It is our assertion that any yield data that is not locally verified as to condition, price and rent potential is not of institutional quality.
Economic Development:
Major economic development trends are tracked to find those cities that have captured opportunities, effected turnarounds, and/or have some other wild card benefit that compels OwnAmerica to elevate its rank.
While this is a ranking of winning cities, it also represents an ideal mix of markets that are best aggregated together. Geographic mix offers diversity or opportunity and risk. This list of winners represents a balanced portfolio of American cities that OwnAmerica believes will provide the highest long-term returns with the lowest risk.
Rank, MSA, Index
1. Charleston, 26.70
2. Houston, 26.42
3. San Antonio, 26.32
4. Corpus Christi, 25.74
5. Austin, 25.44
6. Raleigh, 25.25
7. Cincinnati, 24.82
8. Dallas, 24.33
9. Knoxville, 23.45
10. Charlotte, 23.42
11. Denver, 23.25
12. Nashville, 22.50
13. Wilmington, N.C., 21.53
14. Gainesville, Fla., 21.20
15. Jacksonville, Fla., 20.88
16. Winston-Salem, N.C., 20.59
17. Pittsburgh, 20.50
18. Orlando, 20.16
19. Indianapolis, 19.25
20. Baltimore, 19.05
21.Memphis, 17.97
22. Dayton, 17.89
23. Atlanta. 17.68
24. Chicago, 15.95
25.Cleveland, 15.83
For more information, visit www.OwnAmerica.com.
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