Real estate, long considered a cornerstone of wealth creation, is experiencing a transformative era. Driven by shifting demographics, robust job markets, and a desire for stable, inflation-hedging assets, investors are keenly eyeing opportunities beyond traditional hubs. For those looking to build lasting portfolios, the best cities to buy real estate today are increasingly found in dynamic "18-hour cities" - mid-sized metros offering a compelling blend of affordability, growth, and quality of life. These urban centers, often overlooked in favor of sprawling 24-hour metropolises, present significant potential for savvy investors seeking long-term value and income.
The Evolving Landscape of Real Estate Investment
The current real estate market is characterized by robust demand, fueled by several interconnected factors. Strong demographic trends, including population growth and evolving household formations, underpin the need for diverse housing options. Alongside this, significant job growth in various sectors continues to attract new residents to promising urban centers. Furthermore, in an inflationary environment, many investors are increasingly seeking stable asset classes that can effectively hedge against rising costs, making real estate a highly attractive option.
A key driver of this evolving landscape is the widespread adoption of remote work. Thanks to technological advancements, the traditional necessity of residing in densely populated, high-cost metropolitan areas has diminished. This shift empowers individuals and families to seek out locations offering more space, safer communities, and a lower cost of living, without sacrificing career opportunities. (Pew Research Center, 2023) This phenomenon has sparked significant intracity and inter-state migration, with populations flowing from traditional 24-hour cities to more accessible, less congested locales.
For investors, this means a strategic re-evaluation of where potential profits lie. While iconic cities like New York, Los Angeles, and Washington D.C. remain important, their high prices and traffic congestion are pushing many to explore alternatives. The search for undervalued real estate in areas poised for substantial growth has become a central theme for savvy investors.
Identifying Premier Investment States and Cities
To truly identify the best cities to buy real estate, a multi-faceted approach is essential. Our initial analysis considers state-level attractiveness based on migration trends and property valuations, providing a foundational understanding of where populations and capital are moving. States like South Carolina, Vermont, South Dakota, and Tennessee have consistently ranked high in this assessment, reflecting favorable conditions for long-term real estate investment.
This internal ranking is then cross-referenced with insights from leading industry institutions. The Urban Land Institute (ULI), a respected commercial real estate organization, provides comprehensive reports on emerging trends and top real estate prospects. Their analysis for 2020 and beyond highlighted a significant trend: eight of their top ten markets for overall real estate prospects are secondary metros, often referred to as "18-hour cities." These are cities that are vibrant and active during business hours and into the evening but might not operate at a 24/7 pace like global megacities.
Crucially, eight of ULI's top ten markets also align with our own top 15 best states for real estate investment. This strong correlation between independent analyses underscores a consensus on where the most promising opportunities lie. The convergence of migration patterns, valuation trends, and expert market sentiment points definitively towards these dynamic secondary markets as prime targets for real estate portfolios.
ULI's Top Five Cities for Real Estate Prospects
Based on ULI's comprehensive survey, these five cities stand out as leading prospects for real estate investment, each offering unique strengths and growth trajectories. (Urban Land Institute, 2020)
Austin, Texas
Austin consistently ranks as a top choice for real estate investors, and for good reason. The city boasts a deep talent pool, fueled by its vibrant culture, high quality of life, and the absence of state income tax. These factors contribute to reasonably priced real estate and a strong commitment to business expansion. Austin has experienced the highest projected population growth rate among the 80 markets analyzed by ULI for the coming five years.
Massive development projects underscore Austin's growth trajectory. Apple's $1 billion North Austin campus, a major transit-oriented development near Lady Bird Lake, and Google's aggressive expansion are just a few examples. The city also benefits from the new Dell Medical School at the University of Texas and an ongoing airport expansion. Despite a recent correction in real estate prices after a rapid appreciation in 2020-2021, its long-term outlook remains incredibly strong. The presence of major tech companies like Tesla's Gigafactory further cements Austin's position as an economic powerhouse (Texas Economic Development, 2023).
Raleigh/Durham, North Carolina
Ranked number two overall by ULI, the Raleigh/Durham market has attracted impressive investment, particularly in its suburban office and multifamily sectors. This area is a hub of intellectual capital, thanks to a concentration of esteemed educational institutions including Duke University, the University of North Carolina, and North Carolina State University.
The region is also home to Research Triangle Park (RTP), a burgeoning technology mecca with over 89,000 tech jobs. With tech accounting for 10.9 percent of its employment base, Raleigh/Durham ranks third nationally in tech industry share, behind only Silicon Valley and San Francisco. Recent initiatives, such as the expansion of the BioLabs at RTP, are further solidifying its position as a leader in biotech innovation (North Carolina Biotechnology Center, 2024).
Nashville, Tennessee
As Tennessee consistently ranks as a top state for real estate investment, Nashville emerges as its premier city prospect. The local sentiment is overwhelmingly positive, with strong expectations for continued investment and development. Major corporate relocations and expansions, including Alliance Bernstein's headquarters, an Amazon operations center, and the growth of Smile Direct Club, have brought some 8,000 new jobs to the city.
However, investors should be mindful of increasing housing supply in Nashville, a trend also seen in other fast-growing cities like Austin and Dallas. The critical factor for sustained appreciation lies in whether demand continues to outpace this new supply. Nashville's vibrant culture, beyond its music scene, including a rapidly expanding culinary landscape, also acts as a significant draw for new residents and businesses.
Charlotte, North Carolina
Charlotte has seen a significant climb in ULI's rankings, moving from ninth to fourth, driven by its success in attracting technology and manufacturing firms. For over two decades, the city has been a vital banking sector hub, notably as the headquarters of Bank of America, providing a stable economic foundation.
Despite having just 0.8 percent of the U.S. population, Charlotte captured 1.2 percent of the nation's real estate investment from 2016 to 2018, increasing to 1.5 percent in the first half of 2019. This disproportionate share of investment highlights its appeal and growth potential, making it a key contender among the best cities to buy real estate in the Southeast.
Orlando, Florida
Orlando consistently captures a significant share of national investment volume, mirroring its 0.8 percent share of the U.S. population. ULI's survey highlighted Orlando for its strong overall real estate prospects, development opportunities, and anticipated investor demand. The city is projected to see a population increase of 71,000 over the next five years, making multifamily properties a particularly attractive "buy" for many investors.
The expansion of the rail link from Miami is expected to further boost robust tourism flows, while the city's diversification into healthcare technology and simulation industries provides a more resilient economic base (Orlando Economic Partnership, 2024). The added benefit of no state income tax further enhances its allure for both residents and businesses, contributing to its strong real estate fundamentals.
Additional Cities with Strong Real Estate Potential
Beyond ULI's top five, several other cities present intriguing opportunities for real estate investors looking for strong growth and value.
Milwaukee, Wisconsin
With a median home price around $131,000 (ULI rank #66), Milwaukee offers a compelling value proposition. Major developments, such as the $524 million Wisconsin Entertainment and Sports Center, home to the NBA's Milwaukee Bucks, have revitalized parts of the city. A modern streetcar, The Hop, further enhances downtown connectivity, connecting key business districts and attractions.
Milwaukee benefits from a lower cost of doing business compared to its neighbor, Chicago, attracting companies like Gold Standard Banking and Vonco Products. While its manufacturing employment (14.3% of the labor force) is nearly double the national average, ongoing population growth and strategic investments in infrastructure and cultural attractions, such as the continuous revitalization of its riverfront district, suggest a solid outlook for the city's real estate market (Milwaukee Downtown BID, 2023).
Columbus, Ohio
Columbus, with a median home price of approximately $171,000 (ULI rank #26), has experienced handsome population growth driven by positive net migration, particularly college-educated millennials moving downtown. This influx has resulted in a higher-than-average population of prime workers (ages 25-44) and a tight labor market with unemployment below 3.0%.
Unlike many Midwest cities, Columbus boasts a diversified economy with less exposure to manufacturing, cushioning it from automation-related job losses. A significant portion of its labor force (16%) is employed by the state government, providing economic stability. Expanding sectors include education, healthcare, professional services, and hospitality. Even with a boom in multifamily construction, vacancy rates remain low, indicating robust demand. The city's Smart Columbus initiative, focusing on intelligent transportation systems, further positions it for future economic growth (Smart Columbus, 2023).
Charleston, South Carolina
Charleston, a popular "18-hour city" with a median home price of $331,000 (ULI rank #19), is a standout due to its vibrant downtown, strong population, and consistent job growth. South Carolina's top ranking in our state analysis further solidifies Charleston's appeal. The city has seen record-high sales volumes in its commercial real estate sector, reflecting strong investor confidence.
Major employers like Boeing, Mercedes-Benz, and Volvo have established significant operations here, with Volvo's $1.1 billion factory poised to add thousands of jobs. The Port of Charleston is a major economic engine, driving manufacturing job growth and accommodating increased container volume through ongoing harbor deepening projects. Its unique blend of historic charm and economic dynamism continues to attract both residents and investment.
Kansas City, Missouri
Kansas City, with a median home price of $159,000 (ULI rank #47), offers a compelling real estate narrative. A surge in downtown activity, driven by higher-than-average population growth since 2015, is attributed to a lower cost of living and expanding job opportunities. The city's unemployment rate of 3.1% is consistently below the national average.
Economic incentives have successfully attracted major corporations, such as GEICO, which added 500 entry-level jobs to the Lenexa submarket. Biotech research is a massive presence, with healthcare IT giant Cerner Corporate rapidly expanding and projecting to employ over 16,000 people. Children's Research Institute is also growing its research arm, aiming for 3,000 researchers. While historically dependent on large employers, a recent spike in small business creation signals a healthier, more diversified market. Its central geographic location also makes it a crucial hub for the industrial sector, vital for national distributors and e-commerce logistics (Kansas City Area Development Council, 2024).
The Enduring Appeal of 18-Hour Cities
The evidence overwhelmingly points towards "18-hour cities" as the strategic choice for investors seeking the best cities to buy real estate in the current and future market. The multi-decade migration trend towards lower-cost, less-dense areas of the country is not a fleeting phenomenon but a fundamental shift in how Americans choose to live and work. These cities offer a unique combination of affordability, robust job growth, improving infrastructure, and a high quality of life that appeals to a broad demographic, from young professionals to families seeking more space.
For those currently residing in high-cost 24-hour cities, the ability to invest remotely in these burgeoning 18-hour markets has never been more accessible. For individuals already living within these dynamic metros, now is an opportune time to expand real estate holdings. Capital naturally flows to areas with the highest potential for profit and sustained growth. By focusing on these strategically positioned cities, investors can align their portfolios with powerful demographic and economic trends, securing long-term wealth and stability.
