Specifically designed for investors in rental property, the Investors Metro Analysis tells you how the local economy will affect demand for rentals, the sweet spot of rents in each local zip code — where the largest number of renters are found — and what types of investment are favored in each zip code.

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A   Risk and Return Ratings (High, Medium or Low). The Cash-on-Cash Expected Return is linked to our forecast of rents. The Equity Expected Return is linked to our forecast of home prices.

The Risk Rating is a summary of how much risk you must contend with, including the prospects for growth, rents and home prices. If the risk is High you must drive a hard bargain.

The INVESTMENT OPTIONS, LOCAL ECONOMY, and RISK sections discuss how key local elements affect investment decisions.

B   Chart of Home Price Increases. These are annual rates of increase, measured every quarter. They indicate the recent strength of demand for all housing, homes and rentals. Increases above 6 percent show strong demand, below 3 percent they show weak demand.

C   Chart of Job Increases. These are annual rates of increase, measured every quarter. Job growth usually is a good indicator of future demand for housing.

D   Chart of Home Prices. The blue bars show the annual history of actual home prices, the red dots show a comparison ‘income’ price – linked to local income. If actual prices are well above the ‘income’ price, the market is over-priced and may be in a boom and bust cycle.

E   Forecasts and NATIONAL Commentary. Average home price and monthly rent, the ratio of average home price to average annual rent, and our three-year home price and rent forecasts. The local situation is always affected by larger national developments.

F   Job Structure by Sector. Shows the percent of local jobs in major sectors to identify what drives the local economy. A large business services sector, for example, presents the possibility of good future growth. The healthcare, education and government sectors were financially stressed during the pandemic and likely will produce slower growth in the next few years.

G   Average Rent & Home Price. Annual increases that show how well average rents rise along with home prices, which often are more volatile.

H   Strategic Zip Code Analysis. For all local zip codes with a population over 5,000, the percent of renters, Best Rent Range, average monthly rent, average home price, the ratio of home price to the average annual rent, the growth of total local income in the last three years, Zip Tips, and the last two years of home price increases.

1. Total Local Income growth is a strong measure of support for rents and home prices. It’s a combination of population growth and income growth, both of which increase demand for housing. Zip codes with good growth are most favorable for investment in housing.
2. Price/Rent Ratio shows how much the owner and renter markets overlap, and therefore what type of investment is favored. In zip codes with a ratio over 21, fewer people can afford to rent a single-family home – apartments and subdividing are better bets. In zip codes with a ratio between 16 and 21, single-family rentals are the best option. In zip codes with a ratio below 16, upgrading a single-family home or apartment to a higher rent is a good opportunity.
3. Zip Tips identify zip codes with good Total Local Income growth and indicate the most favored type of investment based on the Price/Rent Ratio.
4. Best Rent Range shows the range of monthly rents paid by the bulk of current local renters. Properties with rents in this range will have the least trouble attracting renters, both now and in two years when the average tenant leaves.

Markets Available

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