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SHOW NOTES FOR EPISODE 088 – TOP 10 US POPULATION GROWTH CITIES
Buying properties in an emerging market is an excellent way to not only insure good cash flow and regularly increasing rents but it is also a great way to see significant equity growth in a relatively short period of time. In this episode, Bill looks at a 2016 study done by Penske Truck Rental that details where most of their US customers are moving. The reason this data is significant is because where populations are growing, jobs are growing and where jobs are growing so is the local economy — a prime candidate for “emerging market” status.
Why do I care about cities with significant population growth? I am always looking for promising new emerging markets to invest in real property. I look at a few key factors in a market to see if it has “emerging market” potential:
- Stable Industries
- Large businesses
- Service Industries
- New jobs
- An appealing lifestyle, lower cost of living
- High potential of renters vs. home owners
- State Capitals, Universities
- Big Box Retail, Shopping Hubs, Health Hubs
- Airport
- Infrastructure
- 100,000 + growing population
Here are a few reasons why population growth is important:
- Helps identify “Emerging Market” status
- A city with high population growth can also indicate a strong demand for housing and services
- People move to places where there are jobs
- Where there are jobs, there is a strong economy
With sites in the gateway markets selling for sky-high prices and potential yields seeming to shrink by the quarter, where should you build your next project? Following population growth is always a good idea, and a newly released study from Penske Truck Rental shows the cities where the most Americans have moved to in 2016. The study was put together by analyzing one-way moving truck reservations made through Penske’s website. Here are the results.
10. Charlotte
The city offers a pleasant climate, with average temperature at 59.8 degrees Fahrenheit, and relatively affordable apartment rents, at $1,169 a month. Median household income in Charlotte, North Carolina totals $54,836 a year, a little below the nationwide figure of $56,516 a year.
9. Houston
While Houston, whose business sector relies heavily on the oil industry, fell from the number seven spot it held in the ranking last year, it still came in as the ninth moving destination in the U.S. in 2016. Median apartment rent in the city is at $1,392 and the median household income totals $61,465 a year.
8. Las Vegas
Bright light city, meanwhile, has moved up a spot since 2015. In addition to an average temperature of 69.3 degrees Fahrenheit, Las Vegas boasts one of the most affordable median rents on the list, at $950 a month. The median household income in the city totals $51,552 a year.
7. Seattle
While Seattle’s apartment rents are some of the most expensive on the list, at a median of $2,133 a month, it also boasts one of the highest median household incomes, at $75,331 a year. It has also moved up in the ranking since 2015, to the number seven spot from number eight last year.
6. Orlando
The home of Disney World, Orlando attracts new residents with its warm climate, with an average temperature of 73.4 degrees Fahrenheit. Median apartment rent in the city is $1,322, while the median household income totals $51,077 a year.
5. Tampa/Sarasota
Another Florida stronghold, the Tampa/Sarasota area has median rents of $1,264 a month and median household incomes of $51,305 a year.
4. Denver
Like Seattle, Denver boasts a high median household income at $70,283 a year, but much more affordable apartment rents, at $1,577 a month. It is also one of the sunniest cities in the U.S., with roughly 300 days of sunshine a year. Perhaps as a result, Denver climbed up two spots in the rankings since 2015.
3. Phoenix
The median apartment rent in Phoenix is $1,055 a month and the median household income totals $55,547 a year.
2. Dallas/Fort Worth
Dallas/Fort Worth also climbed up two spots in the rankings since 2015, to number two. Median rents in the city are at $1,148 a month, while the median household income totals $60,410 a year.
1. Atlanta
Atlanta held on to its spot as the city the greatest number of Americans are moving to. The Southeastern city boasts a median household income of $60,219 a year and median apartment rent of $1,574 a month.
The Old Dawg’s REI Network is currently in the process of compiling our own 2017 Top 10 Real Estate Investment Markets list. Watch for that upcoming episode.
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