The Midwest real estate market is known as one of the most affordable regions in the US. Many state markets within this region, like the Michigan housing market, are some of the top markets in 2019. To learn why the Michigan housing market fits this category and where to invest in this state, keep reading!
Related: The 5 Hottest Cities in the Midwest Real Estate Market in 2019
Michigan Housing Market: State-Level Data
There are many reasons why you should become a Michigan real estate investor. However, in order to understand these reasons, we need to go over the data of the Michigan housing market 2019. Where can you obtain access to such data? Here, at Mashvisor! Mashvisor’s real estate investment tools allow investors to analyze and search for investment properties in the housing market in Michigan.
To learn more about how Mashvisor will help you find the best Michigan real estate investments, click here!
In the meantime, here is Mashvisor’s data on the Michigan housing market.
Pricing
- Median Property Price: $282,033
- Price per Square Foot: $164
- Price-to-Rent Ratio: 17
Traditional Investing
- Rental Income: $1,359
- Cap Rate / Cash on Cash Return: 1.8%
Why You Should Invest in the Michigan Housing Market
As seen from Mashvisor’s data, there is a lot to gain when investing in rental properties in Michigan. Here are three reasons why investors should purchase a Michigan rental property.
Affordability
First and foremost, rental properties in Michigan are very affordable. As seen from Mashvisor’s data, the median price of a Michigan investment property is approximately $282,000. This is lower than the national median of $310,400. Michigan is also one of the top ten states with the lowest cost of living. This attracts people to the state, which can lead to increased rental demand. The affordability and low cost of living are two of the main highlights of the Michigan real estate market 2019.
Profitability
While the Michigan real estate market is notably inexpensive, it is also admirably profitable. According to Mashvisor, the average rental income and return on investment for the traditional rental strategy are $1,359 and 1.8%, respectively. These are only averages. With the right property search tools, investors can find long-term rentals that will generate above-average in these two metrics.
Related: How to Find a Profitable Investment Property for Sale: Our Guide
Real Estate Appreciation
Appreciation is another form of profitability when investing in the Michigan real estate market. According to NeighborhoodScout, the state has one of the highest appreciation rates in the country. During the last 12 months, properties in the state appreciated by 6.9 percent. Many of the best cities in Michigan have similar real estate appreciation rates. Speaking of which, what are the best cities in Michigan for traditional real estate investing?
The 4 Best Cities in the Michigan Housing Market
According to Mashvisor’s data, the best places to invest in real estate in Michigan are Belleville, Detroit, Manistique, and St. Helen.
Belleville
Pricing
- Median Property Price: $265,671
- Price per Square Foot: $141
- Price-to-Rent Ratio: 12
Traditional Investing
- Rental Income: $1,823
- Cap Rate / Cash on Cash Return: 3.9%
Ranked as one of the best places to live in Michigan, Belleville is also one of the best places to purchase a Michigan investment property. The city’s property price is slightly over the state’s median, but its traditional rental income and return on investment are well above average. As is typical of cities in the Michigan housing market, Belleville also has a high property appreciation rate. During the last 12 months, homes in the Belleville market appreciated by 5.43 percent. This is higher than half of all other cities and towns in the Michigan housing market.
Detroit
Pricing
- Median Property Price: $152,294
- Price per Square Foot: $103
- Price-to-Rent Ratio: 13
Traditional Investing
- Rental Income: $975
- Cap Rate / Cash on Cash Return: 4.5%
A list of the best cities in Michigan wouldn’t be complete without The Motor City. In many ways, the Detroit real estate market follows many of the real estate market trends of the state. The median property price in Detroit is about half that of the state median. The cost of living in Detroit is also 5.6 percent lower than the US average. It is also the 35th lowest in the nation. Rental demand is also high in the Detroit housing market, as over half of the city’s residents reside in rental properties. Real estate appreciation is also a key factor in Detroit. Detroit’s appreciation rate is higher than 60% of cities and towns in the state and 75% of cities and towns in the US as a whole.
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Related: Consider Investing in the Detroit Real Estate Market?
Manistique
Pricing
- Median Property Price: $161,682
- Price per Square Foot: $114
- Price-to-Rent Ratio: 13
Traditional Investing
- Rental Income: $1,041
- Cap Rate / Cash on Cash Return: 6.5%
Manistique is an archetype of the Michigan housing market. Like the other cities on this list, Michigan houses for sale in Manistique are relatively cheap and are less than the median Michigan house price. Manistique’s affordability is also exemplified by its cost of living. The city’s cost of living is 15.4 percent lower than the US average. Long-term rentals, particularly for families, are a popular niche in Manistique. This is because the city is ranked as one of the best places to live and retire in Michigan.
St. Helen
Pricing
- Median Property Price: $126,189
- Price per Square Foot: $86
- Price-to-Rent Ratio: 10
Traditional Investing
- Rental Income: $1,040
- Cap Rate / Cash on Cash Return: 7.6%
The housing market forecast in St. Helen is a bright one. As seen from the data above, it has the highest return on investment average in the Michigan housing market, at an astounding 7.6 percent. Affordability is another key factor of St. Helen’s market. St. Helen’s cost of living is 21.8% lower than the national average. The median property price of St. Helen is also over $100,000 less than the state median. The city is also phenomenal in terms of property appreciation. During the last 12 months, homes in the St. Helen housing market appreciated by a whopping 12 percent. This is higher than 90 percent of other cities and towns in Michigan and 96 percent of cities and towns in the US. The combination of these features makes St. Helen one of the best cities to buy rental property in 2019.
To sum it up in one sentence, the Michigan housing market is a top-tier state market because of affordability, rental income, appreciation, and demand. The state’s 2019 rental market is strong and will likely continue to be so into 2020.
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