Are you wondering why you should choose Northwest Arkansas Real Estate as your next investment market?
Look no further! This market boasts reasonable entry prices with a lot of upside and profitability, low cost of living, great job growth and a business-friendly atmosphere.
However, before we get into the specifics of our beautiful area, let’s first look at the big picture of real estate investing at a national level.
As we send another year off to the history books and set our sites to 2016, it’s always good to check in with the experts in the industry, and decide if Northwest Arkansas real estate is still a solid investment choice. Since we strive to become industry experts, it’s always good to share with you the overall consensus from the reports from Emerging Trends in Real Estate. If you want to delve deeper than a blog post summary skewed to how this impacts the Northwest Arkansas real estate market, you can download the entire report here.
Most people understand that real estate follows a cyclical pattern. While you can never predict the future, most experts rely on things such as job growth, economic patterns, interest rates and housing supply and demand to determine when the next recession will hit.
So, what’s the general consensus for the 2016 real estate market?
By even conservative estimates, experts predict we will continue to see strong growth for the next two years.
This is great news for anyone looking to buy or sell a house!
Have you heard of the 18-hour city? It’s a hot avenue right now for people with big pockets looking for investments with a strong return. It’s actually a term to describe markets such as Fayetteville, Bentonville and Rogers.
To help with the definition, it may help to describe the two polar opposites: the 24-hour city and the 9-to-5 city.
The 24-hour cities are places like New York or Vegas, where you can sit down and have a pizza at 3 a.m. They are the cities that never sleep.
Then, you have the sleepy, small 9-to-5 towns, such as where I grew up. These towns almost completely shut down after dinner. If you get a 3 a.m. pizza craving, you’re out of luck!
The 18-hour cities are the happy medium of these two extremes. They still give the big-city feel with businesses open late and a vibrant nightlife, but they also shut down to reset. They appeal to both the millennial generation and baby boomers alike. They provide the urban lifestyle with a taste of downtime.
These markets are becoming very enticing to investors. They provide a wide range of buyers with a magic mix of both the urban and the rural, and they come with an affordable price tag in contrast to markets like New York and Los Altos, CA.
The real estate industry shows high potential investment returns by investing in this market. This is good news for Northwest Arkansas.
Fayetteville, Rogers and Bentonville are 18-hour cities that easily attract local, national and international attention. According the report by the Urban Land Institute, by the end of June 2015, total acquisition volume was up 24.6% year over year. While the pace may not be sustainable, investors are expected to have capital available for investments that are at least equal or greater than the 2015 numbers.
This means that secondary markets like Northwest Arkansas that provide great amenities at a lower cost of living compared with big-city expenses are poised for strong growth this next year.
It also doesn’t hurt that according to Forbes, the city of Fayetteville is #14 in job growth, #23 in best places for business and careers and #39 in best cost of doing business out of 200 cities analyzed.
In addition, Bentonville was ranked by Business Insider as one of the 15 Hottest Cities of the Future. With strong economic growth driven by Wal-Mart, Tyson, the University of Arkansas and JB Hunt Headquarters, the stability of the region will remain robust.
According to the Emerging Trends in Real Estate report, before the housing bubble burst, home ownership was at 70%. After the market correction, it has again been climbing and was sitting at 63.4% in the second quarter of 2015. The reasonable expectation, as the market continues to sort itself out, is for the home ownership rate to settle at a its 50-year average of 65%.
For now, this puts the advantage in the hands of the rental market, which continues to be strong in Northwest Arkansas. However, over the long haul, it means that the demand for home ownership will continue to increase.
If you’re interested in learning more about the Northwest Arkansas market, please feel free to contact our company. We would love to help create an investment portfolio that meets your specific needs.
Whether you’re an investor in rentals or selling at retail, there’s plenty of market share to go around! The real estate future looks bright!