PricewaterhouseCoopers, one of the “Big Four’’ professional service firms in the world, has recently released its annual real estate trends report for 2020. Its research results provide real estate investors looking to expand their portfolios in 2020 a clear picture of attractive US markets with strong growth potential.
The breakdown of cities in the report ranked in order by investment prospects includes:
- Dallas/Ft. Worth
- Los Angeles
One can easily see how Austin ranked number one on the list. It has the fastest population growth in the US, tacking on 61,000 residents in 2019, and is projected to be the fastest-growing American city over the past five years. Millennials in particular are flocking to Austin due to its robust economy, projected to continue growing at 3.5% a year. It’s low cost of living and doing business, as well as its “hipster” culture are also main factors. Austin boasts top growing live/work/play areas known as “hipsturbia” that offer conveniently located big city amenities like restaurants and entertainment with the feel of the suburbs. Millennials looking to raise families find these combo city/burb areas attractive, and this is one of the variables behind the trend to relocate to mid-sized Austin from bigger 24-hour cities.
All of this lends itself to an increase in demand for housing and commercial building projects. Development is skyrocketing and is driving investment capital into the city. Apple just broke ground on its $1 billion campus with plans to employ 5,000 people, and Dell Medical School just opened up at the U of Texas.
Recent population growth in other viable 18-hour cities topping the list with moderately priced housing reflects a healthy diverse economy that attracts educated professionals looking for job opportunities. Raleigh/Durham, number two on the list, is known for its hefty tech and educational sectors, whereas Nashville has an Amazon operations center and other major big-name employers that generate real estate activity. On top of that, North Carolina and Tennessee, have low taxes that make living there attractive. The mood remains strong in 2020 for property investment and development activity in these 2nd and 3rd ranking cities.
All of the cities listed in the PWC report would be worth your time and effort to explore if you are looking to invest in property for short- and long-term cash generation. However, for investors not in these highly desirable areas looking to stay local, keep in mind that plenty of real estate growth opportunities can definitely be found in your backyard as long as you go into the field and look for them.