20 ZIP Codes With the Highest Real Estate Returns

Your ZIP code is a pretty important piece of an address, especially when it comes to the real estate market. HomeUnion, an online real estate investment management firm, identified zip codes in 20 metros that maximize real estate returns while minimizing risk over a five-year horizon. They examined school quality and neighborhood attractiveness for single-family rentals over five years.

“HomeUnion Research Services looked at more than a dozen attributes that characterize a neighborhood including crime, schools, white-collar jobs, unemployment, homeownership, permitting activity, etc.,” said Steve Hovland, director of research for HomeUnion. “Based on those attributes, we forecast appreciation, vacancy and rent changes over the next five years.”

The study calculated Annualized Total Return, which includes HomeUnion’s projections for how much the value of single-family rentals will appreciate and how much cash flow they’re expected to generate. According to Hovland, HomeUnion’s model can determine the price and rent for every single-family home within a specific zip code and allow them to predict the price and rent in five years.

The Long Haul 

Americans are increasingly investing in real estate to reap the rewards, which makes investing in the right ZIP code crucial. To mitigate risk and earn the highest real estate returns, investors should focus assets that can maintain value even during downturns, Hovland said.

Remember, when it comes to real estate, ZIP codes aren’t the only numbers that matter. Without a good credit score, financing a real estate investment can be difficult and costly. See where you stand and check your credit score for free at Credit.com. Here are the top ZIP codes with the highest real estate returns.

20. 46280

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    Submarket: North Indianapolis

    Metro Area: Indianapolis

    Annualized Total Return: 5.4%

    19. 91602

    Submarket: North Hollywood, California

    Metro Area: Los Angeles

    Annualized Total Return: 5.4%

    18. 73003

    Submarket: Edmond, Oklahoma

    Metro Area: Oklahoma City

    Annualized Total Return: 5.4%

    17. 63043

    Submarket: Maryland Heights, Missouri

    Metro Area: St. Louis

    Annualized Total Return: 5.5%

    16. 85259

    Submarket:  North Scottsdale, Arizona

    Metro Area: Phoenix

    Annualized Total Return: 5.5%

    15. 77059

    Submarket: Clear Lake City, Texas

    Metro Area: Houston

    Annualized Total Return: 5.6%

    14. 75022

    Submarket:  Flower Mound, Texas

    Metro Area: Dallas

    Annualized Total Return: 5.6%

    13. 44023

    Submarket:  Chagrin Falls, Ohio

    Metro Area: Cleveland

    Annualized Total Return: 5.6%

    12. 34677

    Submarket: Oldsmar, Florida

    Metro Area: Tampa

    Annualized Total Return: 5.7%

    11. 97224

    Submarket: King City, Oregon

    Metro Area: Portland, Oregon

    Annualized Total Return: 5.8%

    10. 30078

    Submarket: Snellville, Georgia

    Metro Area: Atlanta

    Annualized Total Return: 5.8%

    9. 45255

    Submarket:  Forestville/Cherry Grove, Ohio

    Metro Area: Cincinnati

    Annualized Total Return: 5.9%

    8. 60016

    Submarket: Des Plaines, Illinois

    Metro Area: Chicago

    Annualized Total Return: 6%

    7. 66223

    Submarket: Overland Park, Kansas

    Metro Area: Kansas City

    Annualized Total Return: 6.2%

    6. 37062

    Submarket: Fairview, Tennessee

    Metro Area: Nashville

    Annualized Total Return: 6.5%

    5. 33327

    Submarket: Weston, Florida

    Metro Area:  Fort Lauderdale, Florida

    Annualized Total Return: 6.6%

    4. 33158

    Submarket: Palmetto Bay, Florida

    Metro Area: Miami

    Annualized Total Return: 6.8%

    3. 48322

    Submarket: West Bloomfield Township, Michigan

    Metro Area: Detroit

    Annualized Total Return: 6.9%

    2. 19035

    Submarket: Gladwyne, Pennsylvania

    Metro Area: Philadelphia

    Annualized Total Return: 6.9%

    1. 33434

    Submarket: Hamptons at Boca Raton, Florida

    Metro Area: West Palm Beach

    Annualized Total Return: 8.1%

    Image: irina88w

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