{"id":128663,"date":"2020-08-17T15:00:17","date_gmt":"2020-08-17T21:00:17","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=128663"},"modified":"2021-03-16T17:02:09","modified_gmt":"2021-03-16T23:02:09","slug":"best-zip-codes-real-estate","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/best-zip-codes-real-estate","title":{"rendered":"The Best Places to Buy Rental Property in 2020"},"content":{"rendered":"<p>When it comes to real estate, you&#8217;re doing yourself a disservice by focusing on the big picture. Investing is all about granularity. That&#8217;s why we focus on careful calculations (cash-on-cash return and cap rate and cash flow, oh my!)\u2014even when it comes to picking the best real estate markets for you. Once you&#8217;ve settled on a city, your work isn&#8217;t done. That&#8217;s why the team at <a href=\"https:\/\/www.biggerpockets.com\/bp-insights\" target=\"_blank\" rel=\"noopener noreferrer\">BPInsights<\/a> combed through our proprietary datasets to find the best ZIP codes for real estate investing in every state.<\/p>\n<p>Some things to keep in mind:<\/p>\n<ul>\n<li>For data accuracy, we limited our findings to markets with a minimum of 50 rent listings and 50 property sales per month.<\/li>\n<li>Some markets lag behind in reporting, so we don\u2019t have data for June or July yet. We omitted those markets from consideration.<\/li>\n<li>We didn\u2019t use one metric as the guiding light here. Instead, we looked at balance among three metrics:\n<ul>\n<li>Property appreciation<\/li>\n<li>Rent appreciation<\/li>\n<li>Rent-to-price ratio<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>Understand that the \u201ctop\u201d or \u201cbest\u201d ZIP code in any state is a subjective evaluation. This list is just BPInsight&#8217;s picks for the top ZIP code in each market. Your investing strategy might prioritize different criteria\u2014creating a completely different list.<\/p>\n<p>Here are some highlights.<\/p>\n<p><a href=\"https:\/\/www.biggerpockets.com\/guides\/real-estate-market-analysis?itm_source=ibl&amp;itm_medium=blogad&amp;itm_campaign=guide\" target=\"_blank\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-127146 size-full\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/05\/The-Beginner%E2%80%99s-Guide-to-Real-Estate-Market-Analysis.jpg\" srcset=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/05\/The-Beginner\u2019s-Guide-to-Real-Estate-Market-Analysis.jpg 706w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/05\/The-Beginner\u2019s-Guide-to-Real-Estate-Market-Analysis-300x53.jpg 300w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/05\/The-Beginner\u2019s-Guide-to-Real-Estate-Market-Analysis-702x125.jpg 702w\" alt=\"\" width=\"706\" height=\"125\" title=\"\"><\/a><\/p>\n<p><em>Before diving into real estate investing, make sure you understand how to compare markets and properties. Whether you\u2019re trying to decide between investing in Boise or Sacramento\u2014or you\u2019re just comparing two similar homes\u2014this guide will walk you through all the numbers you need to know. From calculating cash-on-cash return to running a comparative market analysis, the experts at BiggerPockets demonstrate the steps you need to follow and the statistics you must know with\u00a0<a href=\"https:\/\/www.biggerpockets.com\/guides\/real-estate-market-analysis?itm_source=ibl&amp;itm_medium=blogad&amp;itm_campaign=guide\" target=\"_blank\" rel=\"noopener noreferrer\">The Beginner\u2019s Guide to Real Estate Market Analysis<\/a>.<\/em><\/p>\n<h2>Casa Grande, Arizona: 85122<\/h2>\n<p><span style=\"font-weight: 400;\">This sleepy mid-sized town is less than an hour\u2019s drive south of Phoenix\u2014and a top real estate performer. Median sales have increased from $160,000 to $205,000 since 2017. That\u2019s impressive\u2014and doubly so when you look at rents. In the same time period, median rent has increased 22.7 percent, from $725 to $1,338. Overall, this Arizona town&#8217;s rent-to-price ratio is 0.65 percent.<\/span><\/p>\n<p><strong><em>Related: <\/em><\/strong><em><a href=\"https:\/\/www.biggerpockets.com\/blog\/7-emerging-trends-shaping-real-estate-markets-2020\" target=\"_blank\" rel=\"noopener noreferrer\">7 Emerging Trends Shaping Real Estate Markets in 2020<\/a><\/em><\/p>\n<h2>Manhattan, Kansas: 66502<\/h2>\n<p><span style=\"font-weight: 400;\">The college market can be a goldmine for savvy investors. Kansas\u2019s \u201cLittle Apple\u201d is home to Kansas State University, and while median sales prices may be slightly decreasing, the median rent has stayed relatively stable\u2014which could make this a great opportunity for a fabulous deal in the Flint Hills. Expect a rent-to-price ratio of 0.45 percent.<\/span><\/p>\n<h2>Baltimore, Maryland: 21211<\/h2>\n<p>Clinging to I-83, this little sliver of northern Baltimore includes a chunk of historic Druid Hill Park and is right next to the Maryland Zoo. Its 1.2 percent price-to-rent ratio\u2014driven by declining home prices and dramatically increasing rents\u2014is the highest on our list. Your potential tenants will have no shortage of cafes and boutiques, and the local light rail station heads directly downtown.<\/p>\n<h2>Portage, Michigan: 49024<\/h2>\n<p>This suburban enclave is tucked between Kalamazoo, Michigan, and a large game preserve\u2014making it ideal for outdoorsmen. Smart investors can find fantastic, cash-flowing deals here. While year-over-year property appreciation has hovered around 8 percent, year-over-year <em>rent<\/em> appreciation is a rock-solid 47 percent. That makes the rent-to-price ratio 0.75 percent. Not bad at all.<\/p>\n<p><strong><em>Related:<\/em><\/strong><em> <a href=\"https:\/\/www.biggerpockets.com\/blog\/real-estate-investing-hot-market-missing-out\" target=\"_blank\" rel=\"noopener noreferrer\">The No. 1 Most Overlooked Real Estate Market<\/a><\/em><\/p>\n<h2>Chattanooga, Tennessee: 37343<\/h2>\n<p>If you&#8217;re interested in exploring more rural investments, check out this sprawling ZIP along the Tennessee River. Here, you&#8217;re not far from Chattanooga, but potential tenants can still enjoy a quieter life. Year-over-year rent appreciation is a startling 64 percent\u2014with an average appreciation of 22.6 percent from 2017 to 2020\u2014so you can feel confident in your potential cash flow for years down the line.<\/p>\n<h2>Portland, Oregon: 97220<\/h2>\n<p><span style=\"font-weight: 400;\">Want to get in on the hot Portland market? This neighborhood in the city\u2019s northeast might be a good entry. In 2020, median sales were a modest (for the area) $360,000, with 9 percent year-over-year property appreciation and <\/span><span style=\"font-weight: 400;\">43<\/span><span style=\"font-weight: 400;\"> percent year-over-year rental appreciation. Easy-access natural areas\u2014not to mention a short trip to the airport\u2014can help attract buyers and renters.<\/span><\/p>\n<h2>Richmond, Virginia: 23224<\/h2>\n<p><span style=\"font-weight: 400;\">Located across the James River from downtown Richmond, this ZIP includes gentrifying Old Town Manchester. Easy river, trail, and city access make 23224 a hot spot for rental-minded investors. Rents have increased an average of 8.9 percent annually, and the area sports an impressive 48 percent year-over-year property appreciation. The result? A whopping 0.87 percent rent-to-price ratio.<\/span><\/p>\n<h2>Essex, Vermont: 05452<\/h2>\n<p><span style=\"font-weight: 400;\">Close to both Burlington and Lake Champlain, it\u2019s no surprise that Essex, Vermont, should attract investor interest. Median rents have increased from $1,400 to $1,600 since 2017, and the area is seeing a modest year-over-year property appreciation rate of 1 percent. Despite a year-over-year rent appreciation dip and rental depreciation, it still sports a 0.53 percent rent-to-price ratio.<\/span><\/p>\n<h2>Find the Best ZIP Code in\u00a0<em>Your<\/em> State<\/h2>\n<p>Want to see the <a href=\"https:\/\/www.biggerpockets.com\/insights\/articles\/top-zip-codes-state\" target=\"_blank\" rel=\"noopener noreferrer\">full list of top investing ZIP codes by state<\/a>? Become a <a href=\"https:\/\/www.biggerpockets.com\/membership-types\" target=\"_blank\" rel=\"noopener noreferrer\">BiggerPockets Pro Member<\/a> today for full access to BPInsight&#8217;s expert analysis and unique datasets. BPInsights gives you the information you need to find your next great deal and maximize your current investments\u2014including proprietary spreadsheets and our one-of-a-kind Rent Estimator tool.<\/p>\n<p><a href=\"https:\/\/www.biggerpockets.com\/calc?utm_source=blog\" target=\"_blank\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-117195\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/10\/Signup_3.jpg\" srcset=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/10\/Signup_3.jpg 728w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/10\/Signup_3-300x37.jpg 300w\" alt=\"\" width=\"728\" height=\"90\" title=\"\"><\/a><\/p>\n<p><em>Which ZIP codes are the best in YOUR state? Why?<\/em><\/p>\n<p><strong>Let us know in the comments below.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Interested in exploring new areas for your next investment? We&#8217;ve analyzed the best real estate markets by ZIP for every state. Start investing today.<\/p>\n","protected":false},"author":108611,"featured_media":128674,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[4252],"tags":[],"class_list":["post-128663","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-deal-analysis"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/128663","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/108611"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=128663"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/128663\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/128674"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=128663"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=128663"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=128663"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}