If you’re thinking about buying real estate as a way to make extra income, there are certain places that are more favorable to buy over others.
Buying smaller, multi-family buildings is often more affordable than larger apartment complexes, and you can also earn from more than one tenant at one time.
There are certain cities that are more favorable to buy rental income-producing properties, and these five smaller cities are where your real estate investment can go the farthest.
Where are the 5 best cities to buy a rental income-producing property?
1. Cleveland, Ohio
You can buy a duplex for around $175,000 – $190,000, and there is a strong demand for rentals thanks to employers in the area such as the Cleveland Clinic, according to Norada Real Estate. Property taxes are reasonable, but some homes may have higher maintenance costs.
2. Detroit, Michigan
The average price of a duplex in Detroit ranges between $150,000 – $200,000, and there is a strong rental market due to jobs in the automotive industry and manufacturing sectors, according to Norada Real Estate.
However, because Detroit is a volatile market, it is advised to focus on specific neighborhoods that are either stable or growing.
3. Indianapolis, Indiana
According to Norada Real Estate, you can buy a duplex in Indianapolis for $200,000 – $250,000. The area has a diverse, growing economy with good infrastructure and the state has landlord-favorable policies.
4. Memphis, Tennessee
You can find a duplex for sale between $150,000 – $200,000, and rental demand is high because many people in Memphis rent rather than own, according to Norada Real Estate. Key industries include music, tourism, healthcare and logistics.
Tennessee also has no state income tax, so you can keep more rental income that you make.
5. Columbus, Ohio
Columbus’ market for a duplex varies, but there is strong demand for a rental market because Ohio’s flagship university, the Ohio State University, is located in Columbus.
Columbus is also the seat of the state government, and is home to a growing tech sector.
According to Norada Real Estate, “the city is experiencing steady population growth,” which means rental demand will only increase.
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