Most experts agree that the days of flipping properties are over.  With weak demand, slow sales and high inventory in most US markets, the question real estate investors are asking is, “Where do I invest now?“

As always, there are markets around the country where homes are affordable, the underlying economy is strong, and appreciation is imminent.  These are the markets you should consider looking at for your next long-term real estate investment.

Norada Real Estate Investments tracks the economic conditions and real estate trends of the top markets across the country.  Because of the dynamic nature of real estate market conditions, we continually monitor and rank the top markets to make it easier for you as an investor to concentrate on the areas that will give you the best opportunity for success.

The following is a list of the best metropolitan areas for real estate investing based on affordability, forecasts for price appreciation and job growth, and recent price fluctuations.  These areas are ideal for savvy investors seeking decent price appreciation and competitive property prices.
 

Austin-Round Rock, TX
Median home price: $186,600
Affordability (median home price / median family income): 2.7
Forecast 2-year change in home prices (Q1 2007 to 2009): 5.4%
Forecast 5-year employment growth (2006 to 2011): 3.59%
 
Baton Rouge, LA
Median home price: $174,700
Affordability: 3.1
Forecast 2-year change in home prices: 7.7%
Forecast 5-yr .employment growth: 1.48%
 
Birmingham-Hoover, AL
Median home price: $164,900
Affordability: 2.9
Forecast 2-year change in home prices: 9.2%
Forecast 5-year employment growth: 1.6%
 
Corpus Christi, TX
Median home price: $130,000
Affordability: 2.7
Forecast 2-year change in home price: 10.3%
Forecast 5-year employment growth: 1.66%
 
Durham, NC
Median home price: $180,100
Affordability: 2.9
Forecast 2-year change in home price: 6.1%
Forecast 5-year employment growth: 2.12%
 
Gulfport-Biloxi Area, MS
Median home price: $154,200
Affordability: 3.3
Forecast 2-year change in home prices: 10.8%
Forecast 5-year employment growth: 1.79%
 
Houston-Sugar Land-Baytown, TX
Median home price: $154,900
Affordability: 2.5
Forecast 2-year change in home price: 6.4%
Forecast 5-year employment growth: 2.65%
 
Mobile, AL
Median home price: $140,400
Affordability: 2.8
Forecast 2-year change in home price: 8.1%
Forecast 5-year employment growth: 4.56%
 
Montgomery, AL
Median home price: $150,100
Affordability: 2.7
Forecast 2-year change in home price: 7.8%
Forecast 5-year employment growth: 2.19%
 
San Antonio, TX
Median home price: $154,300
Affordability: 2.9
Forecast 2-year change in home price: 6.4%
Forecast 5-year employment growth: 2.97%

Methodology:  For the best metros, we took the metropolitan statistical areas with affordability ratios under 3.6 (3.6 is the national average affordability ratio, based on median home price/median family income, with lower numbers meaning greater affordability). Next, we made sure that the projected change in home price from the first quarter of 2007 to the first quarter of 2009 was more than 5% (the national forecast is for a decline of 7.7%). Finally, we eliminated those places with 5-year projected employment growth under 1% (the national average forecast). source