Best Cities for a New Construction Loan

New Construction Loan

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Due to the fact that the national real estate industry was able to weather the coronavirus pandemic surprisingly well, there are countless investors that are starting to formulate their portfolio diversification plans for 2021. Deciding where to invest your hard-earned money can be a daunting task. That’s why we did the hard work for you and compiled a list of the top three cities primed for growth based on their unique economic and demographic composition. You can thank us later—just keep in mind that once you settle on the ideal location, the experts at Alpha Funding Partners are ready and willing to provide you with fast and flexible funding solutions.

1. Austin, Texas

A key factor enabling the Austin real estate market to thrive in spite of the lockdown is that its local economy is not entirely dependent on the tourist and hospitality sectors. As these professions took the biggest dip during COVID-19, economics that largely revolved around them are still floundering. Luckily, Austin has a uniquely diversified business composition as reflected by its low unemployment rate of 6.5% during the height of the pandemic—and that number will surely continue to drop in the coming months. There is an incessant demand for housing in the surrounding area and property values are appreciating exponentially. Despite the increased demand, real estate assets listed on the market have somehow remained relatively affordable, drawing a large number of transplants from the West Coast and beyond that are seeking more bang for their buck and an escape route from crowded, expensive urban areas. Here’s a closer look at the market stats that indicate Austin is an ideal spot to utilize a new construction loan from Alpha Funding:

  • Average Listing Price: $631,959
  • Price per Square Foot: $326
  • Traditional Rental Income: $2,036
  • Traditional Cash on Cash Return: 1.6%
  • Best Neighborhood to Invest In: West University
  • Projected Appreciation for 2021: 7.7%

2. Dallas/Fort Worth, Texas

Dallas is one of the few cites in the entire country that can offer an affordable environment for both residents and businesses alike. It also boasts a robust economy which serves as the corporate headquarters to an impressive number of established major corporations. These factors all point to a great employment outlook well into the future, as economists estimate that the Dallas/Fort Worth workforce is set to experience a 28% boost in job creation in the next five years. A well-rounded economic profile and an ever-expanding job market definitely make the Dallas/Fort Worth housing market a prime location to utilize a new construction loan. And for investors planning to enter the residential market should be excited to learn that the renter population is above the national average: 59% for the Dallas real estate market and 44% for the Fort Worth real estate market. Here’s a more in-depth breakdown of the dynamics of this promising location for aspiring investors:

Dallas Real Estate Market Statistics:

  • Average Listing Price: $490,477
  • Price per Square Foot: $227
  • Traditional Rental Income: $1,966
  • Traditional Cash on Cash Return: 1.9%
  • Best Neighborhood to Invest In: Reunion District
  • Projected Appreciation for 2021: 6.1%

Fort Worth Real Estate Market Statistics:

  • Average Listing Price: $324,337
  • Price per Square Foot: $152
  • Traditional Rental Income: $1,655
  • Traditional Cash on Cash Return: 2.7%
  • Best Neighborhood to Invest In: Village Creek
  • Projected Appreciation for 2021: 7.3%

3. Raleigh/Durham, North Carolina

Even before the craziness of the global pandemic, the Raleigh/Durham real estate market was widely regarded as one of the best-kept secrets of real estate markets around the country when it came to the potential for high return-on-investment and sustainable market growth for years to come. Fortunately, little has changed even in light of the uncertainty surrounding the lockdown. The city is ideally located in an area where both people and businesses have steadily been relocating to during the great coronavirus migration. The city’s diverse culture, amenities to accommodate virtually any taste, and the local job opportunities continue to draw in transplants from larger East Coast cities like New York. Another key factor that is drawing new residents is the overall affordability of properties listed on the market right now. The Raleigh/Durham economy is also surging, with an unemployment rate of 6.2% at the close of September last year. Compared to the national average of 7.9%, the area’s job market has emerged largely unscathed from the pandemic slump. Here’s a detailed analysis of the raw data supporting why a new construction loan is a smart move in this city:

Raleigh Real Estate Market Statistics:

  • Average Listing Price: $477,440
  • Price per Square Foot: $197
  • Traditional Rental Income: $1,485
  • Traditional Cash on Cash Return: 2.2%
  • Best Neighborhood to Invest In: Northeast Raleigh
  • Forecasted Real Estate Appreciation for 2021: 7%

Durham Real Estate Market Statistics:

  • Average Listing Price: $377,133
  • Price per Square Foot: $209
  • Traditional Rental Income: $1,413
  • Traditional Cash on Cash Return: 2.5%
  • Best Neighborhood to Invest In: Scarsdale Village
  • Forecasted Real Estate Appreciation for 2021: 6.9%

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