These U.S. cities are flooded with affordable housing under $300,000

As U.S. median home prices move toward half a million dollars As mortgage rates climbed back above 7%, homebuyers and investors alike were priced out of the market. Although you can still buy a home in some cities in the Midwest and South $100,000they tend to be the exception rather than the norm.

Despite the housing shortage, it is reported that real estate agent networkyou can purchase quality homes in quality neighborhoods for under $300,000 in multiple markets.

The seven cities identified are:

1. Birmingham (Alabama)
2. Buffalo, New York
3. cleveland ohio
4. Detroit, MI
5. pittsburgh pennsylvania
6. Rochester, New York
7. st louis missouri

As rents rise and mortgage approvals tighten, these affordable homes may still struggle to break even. interest rate– Even using traditional down payment 20% – so buy with cash or a large down payment and then refinance when interest rates come down.

However, buying now and capitalizing on the rising price cycle will put you ahead of the buying frenzy when interest rates eventually come down. Also worth considering is Buy A primary residence in these affordable cities to keep your debt to income ratio It will go down when investing here for the long term.

Below are three identified markets.

Birmingham (Alabama)

Birmingham’s median home price will increase 4% annually to reach $290,000 in March 2024. Rose 27.6% Year by year.

A completely remodeled, detached, 1,700-square-foot single-family ranch home in Birmingham with three bedrooms, two bathrooms and a garage is currently on the market for $290,000.

The University of Alabama is the city’s mainstay, with 23,000 employees. It also has a strong automotive manufacturing presence (Honda and Mercedes have factories here) as well as financial and health care industries that have traditionally tended to stay. There are also flourishing short term rental Market data shows the number of listings has doubled in the past 12 months Air DNA.

“I realized that Birmingham has one of the best real estate markets in the country, both from a returns perspective and from a barrier to entry perspective,” investor Stephen Yoon told business insider 2022. a lot of In the community, you can buy a three-bedroom, one-bathroom home for less than $100,000.

Since then, Birmingham has become one of the fastest-appreciating cities in the South. In March 2024, the median listing price was $179,900, up 20% from the same period last year. According to statistics, the median home sales price is $225,000 real estate agent network. The city has a low unemployment rate 3.1% As of February 2024, the national proportion is 3.8%, of which 54% City According to tenant occupancy cafe for rent, So there is a large tenant pool.

In recent years, Alabama has been one of the sleeping giants of the South from a real estate investment perspective. However, with a relatively low purchase price, it’s a great place to invest once all other metrics fall into place. be considered.

Buffalo, New York

Buffalo has been a model of economic recovery. This snowy, industrial city in western New York state on the border with Canada has benefited from a decade of city initiatives that have poured billions of dollars into parks, public art programs and apartment towers. 2020 census data shows population growth first time in 70 years.

The city’s metro median is $270,000, up nearly 10% last year, with inventory increasing 4.2%. For this price, you can purchase a fully renovated 1,444 square foot single-family home with 3 bedrooms and 1.5 bathrooms, and comes with a two-car garage. Healthcare, banking, auto parts manufacturing and retail grocery are the area’s largest employers, while the University at Buffalo (SUNY) employs nearly 6,000 people.

Digital rents have doubled in the past few years, with some tenants seeing rent increases of 30%. Cafe for rent Ranks Buffalo as one of the 20 most competitive small rental markets in the country. According to data, 57% of Buffalo households are renters Cafe for rentAlthough competition for housing is fierce, it’s still a great place to invest.

cleveland ohio

cleveland Recently placed A global (or at least American) focus. The Women’s NCAA Final Four will be held on Sunday, April 7; the next day, the city becomes a prime location to view the solar eclipse. No wonder Mayor Justin Bieber FerventlyAs out-of-towners flocked to the city, “I saw dollar signs, dollar signs, dollar signs everywhere.”

Those two things are a fitting pivot point for Cleveland’s economic turnaround. Greater Cleveland (Cleveland-Akron Combined Statistical Area) 3.7 million people and a $220 billion economy. It is the largest region in Ohio and the third largest region in the Midwest, exist Top 20 in the United States

The region is home to more than 110,000 university students and generates $3.7 billion in annual research funding. drug One of Cleveland Clinic’s leading employers in research, biotechnology, medical technology and healthcare. Other industries include advanced manufacturing, legal, aerospace, banking, insurance, technology, education, and polymers and materials.

The metro median is a very affordable $227,000, rising 8.4% annually. This price will buy you a fully renovated three-bedroom, 2.5 bathroom, 1,628-square-foot home with a two-car garage.

The rent is increase rapidly In recent years, single-family homes in the greater Cleveland area grew by 6.5% and in the metropolitan area by 9.4% between March 2023 and 2024, meaning rents exceeded inflation. according to Cafe for rent Data shows that 59% of households rent in Cleveland, making it another major rental market.

final thoughts

The remaining four markets have one thing in common: they were formerly depressed industrial cities that have successfully reinvented themselves through technology, medicine, finance, energy, and food and beverage. They are both relatively small cities with a decades-long history of low-cost housing.

Government incentives and investments transformed these cities. CHIPS Act of 2022 Approximately $280 billion has been injected into the U.S. economy through grants, tax breaks and research incentives, bringing critical technologies such as semiconductors to the United States. There are many beneficiaries of this money lie in In the Midwest, there are small cities with land to build technology parks.

“One of the benefits of bringing big companies back to the Midwest is that it helps take seriously some of the crises in terms of geopolitical tensions, climate change, or potential supply chain disruptions,” said Annelies Goger, a fellow at the Brookings Institution. protector. “This will help us have more capacity at home to overcome such shocks in the future.”

For the better part of a decade, the Midwest has been redevelopment into tech towns. indeed, 18,000 Backed by venture capital and talent, new startups are arriving in the region, establishing themselves in the heartland and triggering the first population growth in years.

The lesson for real estate investors is to focus on tech and healthcare funding—see where labs and factories are being built, and where future-focused businesses are sprouting. When this happens at the same time as a once run-down industrial city, you get a perfect storm of investment: low housing costs, good local infrastructure supported by universities and hospitals, and massive stimulus packages to attract new residents .

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