Housing Market 2023: 5 Best Up-and-Coming Places To Buy Rental Properties

Even with housing affordability at 30-year lows, investing in real estate can still be a wise financial move. However, if you are buying as an investment right now, it’s important to be extra savvy about where you buy.

See: In Less Than a Decade, You Won’t Be Able To Afford Homes in These ZIP Codes
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While we typically think of highly populated city centers and areas with high rents as the best places to buy investment property, a new study from Arrived found that small to midsize cities actually give investors the best bang for their buck.

Here’s a look at the best up-and-coming places to buy rental properties, as identified by Arrived.

Houses and Riverfront of the Elizabeth River in Portsmouth, Virginia during dawn with magenta, purple, and pink clouds.

Hampton Roads, Virginia

  • Predicted inflation-adjusted GDP growth for 2023: 1.3%
  • Population: 1.8 million
  • Median home price: $335,000

Hampton Roads is a thriving hub for a number of industries, including defense, shipbuilding, healthcare and tourism. The metro area is home to the Norfolk Naval Shipyard in Portsmouth, the largest shipyard in North America, which employs more than 12,000 people. Thanks to its manageable cost of living and a stable influx of military personnel, Hampton Roads has a strong rental market.

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Charlotte, North Carolina, USA uptown skyline and park.

Charlotte, North Carolina

  • Predicted inflation-adjusted GDP growth for 2023: 3%
  • Population: 2.7 million
  • Median home price: $400,000

Charlotte is a hub for the financial industry, with companies like MetLife and Wells Fargo headquartered in the region, so it’s a popular city for young professionals. Average rents in the area are currently near $2,000.

Check Out: 15 Cheapest, Safest Places To Live in the US

Huntsville, Alabama, USA park and downtown cityscape at twilight.

Huntsville, Alabama

  • Predicted GDP for 2023: $30 billion
  • Population: 500,000
  • Median home price: $278,500, according to Zillow

Huntsville has become a hub for innovation, as it is home to sites that include the Army’s Redstone Arsenal and NASA’s Marshall Space Flight Center. An affordable cost of living and growing community make Huntsville an appealing city for real estate investors.

Knoxville, Tennessee, USA downtown at World's Fair Park.

Knoxville, Tennessee

  • Predicted inflation-adjusted GDP growth for 2023: 2.9%
  • Population: 890,000
  • Median home price: $330,000

Knoxville’s affordability and growing job market make it another great city for real estate investors to consider. Located in the foothills of the Great Smoky Mountains, the city offers attractive options for both nature-loving professionals and young families, so there should be no shortage of renters.

More: Grant Cardone Reveals 6 Cities He Would Buy Investment Property in Right Now (and Where He Would Avoid)

Indianapolis Indiana skyline at dusk

Indianapolis, Indiana

  • Predicted inflation-adjusted GDP growth for 2023: N/A
  • Population: 880,000, according to the U.S. Census Bureau
  • Median home price: $221,009, according to Zillow

Indianapolis has a diverse economy, anchored by the agriculture, biotechnology and manufacturing sectors. The city has also been working to expand its infrastructure through investments in airports and roads, creating jobs and boosting the economy. With a growing economy and population, it’s a great spot for real estate investors.

All data is sourced from Arrived, unless otherwise indicated, and is accurate as of Oct. 17, 2023.

More From GOBankingRates

This article originally appeared on GOBankingRates.com: Housing Market 2023: 5 Best Up-and-Coming Places To Buy Rental Properties

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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