Real estate investors are always on the lookout for which neighborhoods will provide them with the highest return on their investment.
HomeUnion indicated ZIP codes in 20 major metros that maximize real estate returns while minimizing risk over the next five years. In the Houston area, the website identified the77059 ZIP code in Clear Lake City as the best option.
“As more Americans seek to diversify their investment portfolios into real estate, we have put together a list of the best zip codes in 20 markets for them to invest and hold over a five-year period or longer,” explains Steve Hovland, director of research for HomeUnion.
The online real estate investment management firm looked at the attractiveness of a neighborhood for investing in single-family rentals over five years as well as school quality. It also required that the market must have schools ranked in the 70th percentile.
Clear Lake City made the list for its 5.6 annualized total return (which includes a projected appreciation and cash flow) and 76.0 school rating.
“Typically, single-family rentals in areas with good schools have been attractive to long-term investors, though those areas have been more challenging to locate for remote investors in today’s heated housing market,” Hovland said.
|Zip Code||Submarket||Metro Area||Annualized Total Return||School Rating|
|33434||Hamptons at Boca Raton||West Palm Beach||8.1||87.9|
|48322||West Bloomfield Township||Detroit||6.9||74.4|
|66223||Overland Park||Kansas City||6.2||97.4|
|97224||King City||Portland, Ore.||5.8||81.9|
|77059||Clear Lake City||Houston||5.6||76.0|
|63043||Maryland Heights||St. Louis||5.5||71.9|
|91602||North Hollywood||Los Angeles||5.4||71.4|