8 Housing Markets We’d Place Big Bets on

Dave :

Hey everyone and welcome to the On the Market Market Madness Show in honor of the March Madness Tournament that is kicking off. Today. We are going to be looking at some great markets across the country that just happen to be aligned with a team that is participating in the basketball tournament. Joining me today as usual are Henry, Kathy and James. James, I know you’re riding pretty high off of UD DO’S football performance this year. Are you also a college basketball fan?

James:

I do watch some college basketball, but time constrains me to football. Only

Dave :

You’re that passionate about football that you can’t waste any time.

James:

I can’t waste time and I got to pick one. I am not the guy that watches every sport, but I do love some March Madness. Who doesn’t?

Dave :

Oh, it’s so fun. Well, Kathy, I would ask you if you’re a college basketball fan, but last time we had a sports show, you wore a jersey of a team that wasn’t even in the competition. So I’m guessing it’s similar with college basketball.

Kathy :

I got the colors right. Yeah, no, no, not really. In college I think I would’ve been into it.

Dave :

Well Henry, I was going to ask you if you like college basketball, but we’re taking too much time, so you just got to give me one word answer. Are you into it, yes or no? I’m into it in March, yes. Okay, great. Happy to have you on board. Alright, so for today’s show what we’re going to be doing is we actually researched all 68 markets that are participating and each one of us went and picked two markets that we like the most. So although this show is sort of extensively about basketball, we really are talking about real estate investing markets that we each really like and we’re going to go through and make a case for why we pick the markets that we did and then our beloved listeners can go and actually vote on which markets you think should make it to our own internal final four.

Dave :

And then we’re actually going to pick a winner. So if you listen to the show on the day that it comes out, which we hope you do, make sure to visit the BiggerPockets Instagram account where you’re going to be able to vote on one of the eight markets that James, Kathy, Henry and I propose. And in our research of these 68 markets, some of the things that we talked about and some of the things we researched are things we talk about all the time on the show like positive population growth, lower unemployment rates, rent, growth, affordability, price growth. So these are the sort of things, the criteria that each of us looked at. And we can tell you as we pitch each of our markets why we chose the combination of metrics and market characteristics that we did. Because obviously not every market is going to be perfect across all these different metrics and it’s up to each individual investor to sort of choose the right balance of data and metrics that are right for that. So with that, let’s get into our market madness rundown.

Dave :

So first up is me. I selected Lansing, Michigan, which is of course home to Michigan State, which I don’t know much about college sports, but it is definitely one of those universities that is good at every single sport. So good for them. I like Lansing one because when I googled it yesterday I found out it’s home to the world’s largest hairball. I don’t know about you guys. I always just Google what the weirdest thing about every market I look at is because I always am just curious. World’s largest what hairball. It was taken out of a cow’s stomach. I found out I went down a rabbit hole with this yesterday. Anyway, I really like this because I think in general people when they’re looking for markets, look at a lot of state level data that can be deceiving. You look at a state like Michigan where Lansing is and it is losing population and that is obviously not a good thing, but so is a state like Ohio, but within these states there are actually markets where a lot of the people in that state really want to live.

Dave :

And what attracts a lot of young people, it attracts a lot of jobs, it attracts a lot of government investment and if that is generally true of southern Michigan where Lansing is, and so you see that they actually have a growing population there. It’s not growing like crazy, but it is positive growth. It has a very low unemployment rate, well below the national average, and it’s actually a bigger city than I thought it was going to be. The metro area is 540,000 people because Michigan State is huge and it’s actually the seat of the government in Michigan, which if you know anything about that leads to really stable employment. There’s a lot of jobs that are really not tied to the business cycle even during recessions. These jobs tend to do pretty well. And then lastly, and perhaps most importantly why I like Lansing is because of affordability.

Dave :

If you listen to the show, I talk about this all the time, but my big hypothesis for the next few years is markets that are affordable are probably going to outperform the ones that are super expensive in terms of rent growth, in terms of, I don’t know necessarily in terms of appreciation, but I do think in terms of rent growth and Lansing super affordable. The median home price is just about $210,000, which is about half of what it is for the rest of the country. So that’s where I picked Lansing and you guys been there, know anything about it.

James:

I can say I’ve never been to Lansing and it is not on my agenda to go there,

Dave :

But I can tell you this one is not going to win the voting. I know that it’s not a sexy market. I know no one’s going to pick this, but I like the Midwest. I’m long on the Midwest and I like the cashflow opportunity.

James:

It depends on what you want to do as an investor and I think this is a great cashflow market. I mean, you’ve got a really low median home price. You’re seeing good rent growth, five and a half percent. It’s giving you good metrics all the way through to get just steady, steady cashflow. And I think if you are a more passive investor that wants to build out a portfolio and a steady growth, it’s probably a great market. My only thing is I’m an appreciation junkie and I like getting mass equity positions and 209,000, if it goes up 10%, it’s going to be a little bit less growth in that market. But if you want that steady cash flow is probably something you should look at.

Dave :

Alright, well let’s move on to our second market. Henry, what’d you pick?

Henry :

Yes, I’ve got Oklahoma City coming in here and I picked Oklahoma City. I am, well, let’s be real. I’m only located about three hours from Oklahoma City. So a little bit of a self-indulgence here because if I’m going to research a market, why not research one that I could actually invest in? So what I like about Oklahoma City is it gives you, it’s like an unsexy market, but in a little bit of a sexy way because you get a big city. So you get big city amenities, you have big city type jobs, but you get the price points of Midwest. So median home price is 226,000, but you’ve got a median rent of 1300, you’ve got rent growth of 3.98%. So it’s got great metrics and it’s got a great economy. If you look at the economy of Oklahoma City, you’ve got a great mixture of the type of jobs that aren’t going anywhere.

Henry :

Government jobs, military jobs, obviously higher education, healthcare, warehouse retail and restaurant space as well as aerospace and telecommunication. So if you think about companies like Integris Healthcare, Amazon is there, hobby Lobby’s there, mercy Hospital system, Sonic Foods, there’s just a plethora of jobs and that is always going to be good for people who want to move to that area if they’ve got work in industries that aren’t going anywhere. And population growth. I like markets like this because you get the safety net of a larger city, but you get the price points of a smaller city and so you can get cashflow, but because it’s a larger city, you can also get a little bit of appreciation. So I think these little niche markets where they’re in the Midwest in or around a big city, you can kind of get the best of both worlds. You’re not going to get amazing appreciation like in a Seattle, but you are going to get some good appreciation because it is a larger city that is growing economically year over year.

Dave :

I’m a big fan of Oklahoma City. This is a good choice.

Kathy :

I’m a thumbs up. I like Oklahoma City for cashflow. The growth appreciation’s not there. So I’m curious what James has to say about it. It

James:

Was just boring. I dunno, I’m a pass. I’m not a Midwest guy against Midwest. I know investors like it and I think it’s a great place to go in, but hard pass, too boring, too flat.

Dave :

I love it. I love that you don’t love it. I kind

Henry :

Of want boring in my long-term investment strategy. Same.

Dave :

Yeah, I’m with you. Well James, what’s more exciting to you? What did you pick?

James:

Tampa, Florida. Who doesn’t want to look at the white beaches in Tampa, Florida?

Dave :

Wait, what college is there?

James:

University of Southern Florida, it’s rocky. The bowl, Dave, it’s a good looking mascot. It looks like he does basketball champs and he also is dressed up like a Snuggie that my kids would be wearing to bed, but regardless past the mascot and go USF Tampa. The reason I picked Tampa is I’m a backyard investor. I like to live where I’m going to invest and Tampa is on the top of my list of where I could live. It’s got beautiful beaches, it’s got beautiful people. It is growing rapidly and Tampa’s been transforming a lot over the last five years. The unemployment rate’s at 3.1% population has been growing rapidly. Everyone wants to move to Florida even without raising insurance costs. We’re still seeing the population grow. It was steady last year at 2.21%, but my favorite thing about this market is it appreciates rapidly. I love to get the juice out of the deal. 2024 Tampa home prices were up 11.8% and the median home price is at 370,000. And this is why I like this better than the Midwest market. When your median home price is bigger, you get more juice out of the runway, 10% on 370,000 is a lot better than a $200,000 median home price. And so it creates those equity positions that you can trade later, but it’s just a great place to live. Beaches growth and the populations keep dumping in and I think if you’re growing that much, it has all the runway in the world.

Kathy :

Oh yeah, big fan, big fan of Tampa. Even though they may not win their basketball, they are winning. When it comes to investment, as far as I’m concerned, it’s great appreciation. We’ve been heavily invested there. We have a big development north of Tampa that’s done really well and it’s not slowing down. It is not slowing down at all. When people ask me where to invest, I’m like, definitely look in the area of Tampa.

Dave :

Yeah, it’s a great market. Seems like a really ideal place. So just picking the easy ones, James, so you don’t want to challenge yourself at all and try something a little bit different.

Henry :

I think what I like about this market though is the median home price is pretty good for a Florida market for a major metro and Florida plus your median rent is pretty solid as well. So I give James A. Little bit of credit here. It’s a fun city with good metrics. It’s not as good of a cashflow market as Oklahoma City, but I mean we all can’t be

James:

Winners. The cool thing about markets like Tampa is they’re really broad, they’re really big. And so the expensive markets where you can do higher end flips, you can go a little bit more affordable product and it’s a very versatile market and I like markets like that. You can put two different strategies in line at the same time. You can chase cashflow and get appreciation and make high returns. I like balance. I like the attempt at being able to get big hits.

Dave :

We hit our first three Market Madness markets. Woo, that’s a mouthful, but we do still have five more, so stick around after this break. Welcome back to on the Markets Market Madness shift. All right, well Kathy, did you take same approach or did you do something a little more off the beaten path?

Kathy :

My market is one that I know really well because we’ve been investing there and we’ve been promoting it at Real Wealth for years. So many people have built the retirement plans in this city and it is Cincinnati now before you hate on it because it’s in the Midwest. So there hasn’t typically been appreciation over the last few years. There really has been. It’s usually a cashflow market, but it just took off over the past few years, not this past year so much, but unemployment is at a low 2.9%, so amazing. There’s some pretty big employers there including Kroger’s and Proctor and Gamble, and of course the University of Cincinnati employs 15,000 people. So a big university, a young town population 2.2 million. And that meets my metrics. I want to be in a city that has more than a million people in it is that gives me a larger pool of renters.

Kathy :

So I like that the growth is 0.3 in the area. So not massive but not terrible. Median income, kind of high 75,000 rent growth, whopping 6%. You guys, that’s pretty good. There’s just not enough supply for demand. And the typical rental is around 1400 to 1500 per month. Typical home price around 2 50, 2 60 per month, 260,000. However, if I were to invest, I probably wouldn’t invest in the city. We look at the suburbs because you can get half that, you can get a much lower median home price and still get pretty good rents. So investing right in the city, it’s not going to cashflow as well. And that’s not as exciting in the Midwest, you’re probably not going to see growth, but right in the suburbs I would focus there. So I don’t know if that’s cheating, but that would be my strategy there. What do you guys think?

Dave :

I actually looked, I spent some time looking into Cincinnati and was considering it a couple of months ago and I passed, so I’m going to pass on the show too.

Henry :

So I actually researched several markets in Ohio before, but mostly around Cleveland. But it looks like the numbers are pretty decent here in Cincinnati as well because if you’ve got a median home price of two 50 and you’re bringing in 14 to $1,500 of rent every month, I mean that’s right off the MLS, that’s not too bad. If you can get a decent deal and kind of get below that, I think you can probably get some solid cashflow and if you’re getting more appreciation now that’s not too bad, not too bad.

Kathy :

It’s a good buy and hold market. But now we’ve got James not looking at the buy and hold and not looking at boring.

James:

I do buy and hold, but I like those big equity gains. Honestly, this market, it’s just not for me. It’s too boring. If I’m going to invest in cashflow, I’m going to go with an area that’s getting a little bit more population growth and a little bit more with sizzle behind it. It’s not for me, nothing against anybody who wants to invest there. If that’s your prerogative, it’s probably a great plan, not for me. And that appreciation juice. Hey,

Kathy :

If anyone’s from Cincinnati listening to this, I suggest you invite us out, we’ll go visit and you show us that it’s not boring. How’s that?

James:

I do like the Bengals. Alright, I’ll throw that out there.

Dave :

We should just do that. We should just go on a tour to invest in the most fun city. We’ll see where we have the most fun. We’ll go to 10 cities,

Henry :

Buy a house

Dave :

There wherever we have the best time, we will buy a house.

James:

It’s going to be Charleston.

Dave :

Alright, well we’re going into round two now and I will kick it off. And if you guys can’t tell, I’ve just picked markets that are obscure and probably people have never heard of. And I’m going to do that for my second one too, which is New Haven, Connecticut. And I chose this because people are always saying that you can’t invest in the Northeast and that’s just patently not true. And New Haven is a good example. It is the home of Yale University and it is in between where my parents live and my sisters live. So I go through New Haven a lot and I have to tell you it has phenomenal pizza. And as someone from New York, it is hard for me to admit that pizza can be really good outside of New York. But New Haven, Frank Pepe’s, modern of pizza, very good places where you should check out if you’re ever around there.

Dave :

But back to real estate, the thing I like about New Haven is that it is still a relatively affordable market in the Northeast. So a lot of markets in the Northeast Media home price or six, seven, 800,000 in New Haven, it is 343,000 and the appreciation is just dunking on every other market on this list right now with 11% appreciation last year. And it also had rent growth of 7%, which I also think is the best one on this list. And of course current performance, not always an indication of future performance, but I think there’s this thing going on. It’s kind of similar to what I like about Lansing where affordability is really important and sometimes people don’t want to leave the northeast and move to Michigan or to Oklahoma. They want to stay close to their family and so they look for affordable markets within the relative region where they live. And so I think there are multiple places actually in Connecticut that fit this bill and I like New Haven for that particular reason. Did

Henry :

You just slickly throw in a basketball verbiage in there with dunking on other markets? Real sly?

Dave :

It’s funny, I didn’t mean to, but afterward I was proud of it. If you could be proud of something you didn’t intend to do, which I am. Well I already know you’re all going to say no to this because no one likes investing in the Northeast, but I’m trying to be a contrarian

James:

Today. I’m in on this one. You

Dave :

Like that big equity growth, right?

James:

I like the big equity growth. I like it’s extra water. I have to be an extra water, but the quality living just good there and that’s what we’re seeing is that migration towards good quality. Living New Haven is the Ivy League of Good Times is what it’s known to be. Who doesn’t want to invest in somewhere where it’s all good times? But I like it. I like the equity growth, I like the quality living. I think it’s a win to investor.

Kathy :

Well, I don’t personally invest just because of the local food, so I would say if I did, I would probably, where’s their great food, new Orleans. I don’t

Dave :

Know. That’s true. Not the best investing market, but it’s like if you have to go there, you might as well invest somewhere like you enjoy being and you enjoy eating. And so New Haven maybe fits that bill for me. But yeah, I understand it’s not for everyone, but as someone who grew up in the Northeast, I think this is one of the markets in the region that could be a winner. Moving on to your second market, Henry, what are you choosing?

Henry :

For my second market, I chose Baton Rouge, Louisiana. I chose this market because I almost moved there out of college. And as I was researching that town back then, I was pleasantly surprised with what it had to offer. I enjoy the fact that again, you kind of get a big city feel without it being a huge major metropolis. You have a great unemployment rate, 3.3%, you’ve got positive population growth. And right now there is a trend of lots of people moving to Baton Rouge, Louisiana. There are lots of people from Los Angeles and Dallas particularly that are moving to Baton Rouge, Louisiana right now. And another thing that I love about this market is it’s another market with a very diverse economy. They have great petrochemicals companies, manufacturing, there’s a mix of healthcare, obviously education, why we’re sitting here talking about it, but it’s all surrounded in affordability.

Henry :

So the median home price there is 226,000 median rent’s a little lower than I’d like it to be with that price point at 1351. But that just means you can probably find a deal for less than that median and get decent cashflow with a little bit of appreciation. I would feel over time as people continue to migrate to the area, you’ve also got some local migration from areas like New Orleans moving to the Baton Rouge area. There are tons of great jobs, it’s a great cost of living and I think that people are starting to see Baton Rouge as a place they could live in the south.

Kathy :

It’s just too small a market for me. Like I said, it’s a population of 873,000. I just feel like it’s just not growing fast enough and there wouldn’t be enough out of a tenant pool for me.

Dave :

I like how everyone’s getting feisty now. Once we started saying, when we were like, I don’t like your marketing, I was like, I don’t like your marketing, your marketing,

Kathy :

You didn’t like mine, I don’t like yours.

James:

I think Louisiana is one of the coolest states there is to go visit. But the problem I have with it is the crime is just brutal and I think it’s going to prevent growth. And for me as an investor, I’m trying to stay out of areas where I’m seeing spikes in crime and issues. We have enough of that going on in my portfolio now in Seattle. Baton Rouge is one of the highest crime rates in America. I think that’s what’s going to slow down, appreciation, population growth. And until they get this kind of balanced out and figured out like New Orleans as well, I will go visit, but I’m going to put the money into the culture and the food and invest it elsewhere.

Dave :

See Kathy, well James wasn’t saying he was going to invest based on food. He just mentioned food and I was happy to hear it.

James:

So food is so good there. It is

Kathy :

Amazing. Well now I want to go. I have to go. We

Dave :

Still have two more markets on our market Madda show, so stay with us. You don’t want to miss these last two. Alright, well let’s move on to your second market. James, what do you

James:

Got? You want to talk about good food and a vibe. I picked Charleston. The Cougars are ranked number 13, they’re playing Alabama. And the second reason I picked Charleston was because they’re ranked number 13. That’s my lucky number. So I feel like we got a good vibe there. But Charleston is one of my favorite cities in all of America. And if you haven’t visited there you should because it is when you go there, it just has its own separate feeling and it’s attracting people to come there. It’s an old city with a lot of culture, great music, great food. Crime is pretty balanced around there. It’s a good quality of living. According to travel and leisure, it was ranked number one in the US for quality of living and travel. And I believe it because it’s just a great, great city. If you haven’t been there, you got to go. But their unemployment’s two and a half percent population smaller at 830,000. But that doesn’t mean that you can’t make money in a smaller population. That just means,

Dave :

Means Kathy’s going to vote against you is what it means.

James:

That just means there’s limited supply, limited people. That’s how you can crush a deal, Kathy. So these small markets, when it’s small, you have a better chance to hit. And so I don’t have a problem with the smallness of it just because of how cool it is, but the median income is at 78,000. So you got a good strong workforce there. Boeing’s there, it’s constantly growing and the median home price is at four 18 and so you can get some runway, especially when they got appreciation of over 9.3%. So it’s a great city, great place to live. Metrics are there. The economy’s there. I would buy there all day long and I would even live there. I consider living there nine months ago. I’m a hundred percent in Charleston and I actually might go buy there regardless.

Kathy :

See, this is really an important thing to notice is that we have different strategies. So you’re right, it probably would work for you for somebody who’s buying a house that needs repair, fixing it up and selling it right away, you’re probably not planning to hold there. But for me, investing out of state and trying to make the numbers work as a buy and hold it is just not for me. It’s too expensive for too small of a place, too small of a rental pool and it doesn’t work for me. But again, you just got to know your strategy before you go in and to know which basketball town is going to work for you.

James:

But Kathy, the rent growth was 6.9%. So we’re seeing rent growth. That’s true. Catch up with that pricing.

Henry :

That’s a good point. You do have to know your strategy. Dave, do you have any recommendations for people who are trying to figure out their strategy and all this?

Dave :

Well, if you want a giant book, why don’t you start with strategy. If you want to figure out what strategy is right for you, if you’re sitting here thinking all of these markets are so great, I just have to figure out which one would work in it, then check out that book. But actually I do totally agree with you, Kathy. Charleston seems like a great flipping market. It’s not for me, but if you were flipping like James is probably doing, I can see why you like it. Alright, Kathy, what is your last deal? And tell us so James can vote against it.

Kathy :

Well, mine is Greenville. Clemson University is a great college from what I understand and what I’ve heard and just fun fact, I don’t know where I was, but some psychic told me many years ago that Clemson was the place to invest. I didn’t listen, I didn’t go. But is that true? Yeah, this psychic came up to me and said, you should invest in Clemson, but I didn’t. So I must not believe in these things.

Dave :

Well, I mean mostly the show is about data and objective information, but if you want to start bringing psychic data into the show, you are more than welcome to down.

Kathy :

And the idea was that of course it’s university town, so maybe not that much psychicness in there because generally universities don’t pick up and leave. So it’s a solid employer, especially if it has a good reputation that Clemson has. Unemployment is really low at 2.9% population close to a million. I’m going to call it 1,000,950 8,000. So that still works for me. Almost 959 population growth, 1.9, the median income, 65,000, median home price, 282,000. So kind of lower considering its location in one of the fastest growing areas in the country. The southeast is growing so quickly and this little market is getting on the map. So I think it has a lot of opportunity even though appreciation hasn’t been that impressive, just 3% at this time. But I do see potential there. Rent growth has been almost 5%. That’s great. So a small market, probably not a lot of new supply coming on.

Kathy :

And like we talked about, in some cases, small markets can be good for that reason because there’s a need for housing and not a solution for that. And that could turn into appreciation in the future. So with that base of Clemson University in the Carolinas that are growing so quickly, because I have heard, again, not from a psychic, but from people that a lot of times people from the northeast want to move to warmer climates. They get to Florida and find out it’s just too hot or it’s not the climate they want. They call it a boomerang and they cut a boomerang back to the Carolinas where the temperatures are maybe a little more moderate and the prices perhaps lower than what we’re seeing in Florida. So I like this market.

Henry :

Yeah, so does coach Chad Carson.

Dave :

Yeah, that’s what I was going to say. I’m just going to say yes because Chad’s there and he’s a good investor.

Henry :

Yeah, Chad is a good investor.

Kathy :

I did not know that.

Henry :

I do like, I like the numbers on this one. I do. Median home price is solid at 2 82 plus your median rent’s 1524. That means you can get some good cashflow if you find a decent deal. You’ve got almost a million people and your average income is 60 5K. That means you’ve got people who have good jobs who can afford to rent these places. I mean, it’s a pretty on the surface of what you presented. I do like this market.

James:

I like this market too, Kath,

Kathy :

Wow,

Dave :

Look at us. Last one, we’re all coming back together.

James:

I picked Charleston because I like the music and the food and I had a great time there. But Greenville, I think it has runway because it’s one of the most visited places in the Carolinas with Asheville. Asheville’s. Median home price is substantially higher. It’s about a hundred thousand dollars higher than what it is in Greenville. And so I think it has some runway because Asheville kind of hit this bubble and it’s got the same vibe. I think it could definitely get the runway with, and anytime you’re an investor and you’re getting good core metrics already, lower purchase prices, you got 5% rent growth. And then if you get that population moving there, you could see a huge hit inside this market. So I’m sold on this one. I’d be right in there with you, Kathy.

Kathy :

The second could have been right,

Dave :

Should we move to Greenville? All of us on the market, real world house in real,

Kathy :

You could probably buy a pretty nice house for twice the median. Spend a whopping 500, get yourself a mansion.

Henry :

We should all buy Chad’s first Quadplex he bought there and live in that and make it a reality show.

Dave :

We each have our own unit. It’s like house hacking together, communal house hacking. If you guys don’t know who we’re talking about, it’s Chad Carson. He’s written two great books for BiggerPockets most recently called The Smile and Mighty Investor. It’s a great, really great book. One of my favorite real estate books I’ve read in the last year. Also just a great dude. So I think he actually played football at Clemson and then settled down there and started investing there. So if you don’t know him, great guy. So those are eight markets. You’ve heard a little bit about each market. You’ve heard our opinions on each of the eight markets. And remember, if you are listening to this, within about 24 hours or so of the show dropping, make sure to head over to the BiggerPockets Instagram account and vote on your favorite of these eight markets to proceed.

Dave :

I have very little hope that either of my markets are going to be making it past the first round, but let’s see, maybe people will surprise me and go with my contrarian views. Ken, Kathy, James, thank you all so much for doing all of this research and sharing with us your real estate knowledge because clearly our collective basketball knowledge is absolute garbage, but that’s not what we’re here for. We’re here to talk about real estate and y’all did a great job with that. Thank you all so much for listening. We’ll see you for the next episode On the Market.

Dave :

On The Market was created by me, Dave Meyer and Kaylin Bennett. The show is produced by Kaylin Bennett, with editing by Exodus Media. Copywriting is by Calico content, and we want to extend a big thank you to everyone at BiggerPockets for making this show possible.