If your goal is to diversify your investment portfolio, real estate can be a good option. According to most studies conducted by the Federal Reserve Bank of San Francisco, property has historically been the finest long-term investment in the contemporary age.

But certain places are better choices than others for real estate investment, both in terms of the purchase price of the investment property and the likelihood that you will be able to rent the home out at a profit. Zillow, a well-known real estate marketplace company, and the U.S. Census data were used to come up with a list of the top real estate markets in the United States for 2022.

This year, everything ought to start to quiet down. So if you’ve been putting off buying, now might be the perfect year. Here are the top 15 cities that real estate experts think are fantastic places to buy property this year, regardless of whether you’re a first-time homebuyer or an experienced homeowner looking for your next investment property.

Let’s get to it!

15. Independence, Missouri

• Home value: $165,893  
• Home value appreciation: 68% 
• Effective property tax rate: 1.33% 
• Rent to home value ratio: 6.25% 
• Rental vacancy rate: 4.90% 
• Rent to income ratio: 21.60%

On the 15th spot is the satellite city of Kansas — Independence, Missouri. The city is an excellent choice for real estate investors due to its low home prices, high home value appreciation, and low rental vacancy rate. Independence, the largest suburb on the Missouri side of Kansas City, has a population of approximately 123,000 people.

14. Columbus, Ohio

• Home value: $213,755 
• Home value appreciation: 68% 
• Effective property tax rate: 1.81% 
• Rent to home value ratio: 5.39% 
• Rental vacancy rate: 5.00% 
• Rent to income ratio: 3.20%

Columbus, OH, is Ohio’s capital and largest city, and it ranks 14th on our list of the best cities for real estate investing. Columbus, with its low cost of living and diverse population, is an appealing destination for young families, and its home values and low rent-to-income ratio make it a great destination for real estate investors as well.

13. Pine Hills, Florida

• Home value: $222,782 
• Home value appreciation: 97% 
• Effective property tax rate: 0.78% 
• Rent to home value ratio: 5.59% 
• Rental vacancy rate: 4.10% 
• Rent to income ratio: 54.60%

Pine Hills, FL, a suburb in Orange County, west of Orlando, ranked 13 on the list of best cities for real estate investment. This city, which has a population of 90,000 people in a 1.1 million-person metropolitan area, is known for being ethnically diverse in the region and is undergoing an exciting revitalization effort. Pine Hills is an appealing location for real estate investors due to its nearly 100% home price appreciation rate and low property taxes.

12. Philadelphia, Pennsylvania 

• Home value: $225,336 
• Home value appreciation: 57% 
• Effective property tax rate: 0.98% 
• Rent to home value ratio: 5.55% 
• Rental vacancy rate: 6.10% 
• Rent to income ratio: 2.10%

Philadelphia, PA, has been known not just as the “City of Brotherly Love” but also a real estate investor’s dream, ranking 12 on our list of top cities to invest in real estate. Philadelphia ticks all the boxes for a great market to invest in, with low property taxes, attractive home values, and a good rate of appreciation.

11. Buffalo, New York

• Home value: $195,767 
• Home value appreciation: 87% 
• Effective property tax rate: 1.58% 
• Rent to home value ratio: 4.76% 
• Rental vacancy rate: 4.10% 
• Rent to income ratio: 8.40%

Buffalo, NY, the second-largest city in New York, ranks 11th on our list of best cities for real estate investment. Buffalo is an excellent choice for real estate investors due to its low home values, high rate of appreciation, and a large pool of potential renters.

10. Phoenix, Arizona

• Home value: $369,661 
• Home value appreciation: 81% 
• Effective property tax rate: 0.61% 
• Rent to home value ratio: 3.42% 
• Rental vacancy rate: 5.40% 
• Rent to income ratio: 2.20%

Phoenix, Arizona, is ranked 10th on our list. Phoenix, known to be the fifth-largest city in the US, has one of the fastest-growing economies in the country, as well as a strong — and growing — housing market, not to mention population growth. With an 81% home price appreciation rate, it is an excellent choice for real estate investors.

9. Palm Bay, Florida

• Home value: $242,535 
• Home value appreciation: 64% 
• Effective property tax rate: 0.71% 
• Rent to home value ratio: 5.24% 
• Rental vacancy rate: 4.00% 
• Rent to income ratio: 33.00%

Number 9 on our list of the best cities to invest in real estate is Palm Bay, FL. About 120,000 people live in Palm Bay, which is the biggest city in Brevard County. The city is part of the “Space Coast,” and its economy has many different sectors, such as aerospace and defense. Real estate investors like it a lot because there aren’t many empty apartments.

8. Lehigh Acres, FL

• Home value: $236,569 
• Home value appreciation: 66% 
• Effective property tax rate: 0.75% 
• Rent to home value ratio: 5.55% 
• Rental vacancy rate: 3.50% 
• Rent to income ratio: 38.60%

At number eight is Lehigh Acres, FL, a suburb of Fort Myers with a lot of new residents. Lehigh Acres is an excellent place for real estate investors because it has a very low rate of empty rental units and home prices that are about average for the area.

7. Colorado Springs, Colorado

• Home value: $427,896 
• Home value appreciation: 77% 
• Effective property tax rate: 0.45% 
• Rent to home value ratio: 3.17% 
• Rental vacancy rate: 3.50% 
• Rent to income ratio: 7.50%

Number 7 on the list is Colorado Springs, CO. People are moving there from Denver and other states because it has clean air, mild weather, and high quality of life. The city has just under 500,000 people living in it, and its economy is made up of many different things, like tech companies and defense contractors. 

Even though the average home price is almost $428,000, Colorado Springs is an excellent place for real estate investors because home prices go up quickly, and there aren’t many empty rentals.

6. Cleveland, OH

• Home value: $96,455 
• Home value appreciation: 97% 
• Effective property tax rate: 2.08% 
• Rent to home value ratio: 8.95% 
• Rental vacancy rate: 6.70% 
• Rent to income ratio: 5.10%

Sixth on our list of the best places to invest in real estate is Cleveland, Ohio. Its population is just over 370 thousand, but more than 2 million people live in the larger metropolitan area. The technology industry is growing in the city, especially in health technology. In 2021, the state created the Cleveland Innovation District to give more money to health research jobs. 

Cleveland is an excellent place for real estate investors because the average home is worth less than $100,000, and its value has gone up by almost 100% over the past five years.

5. Birmingham, Alabama

• Home value: $90,047 
• Home value appreciation: 69% 
• Effective property tax rate: 0.80% 
• Rent to home value ratio: 11.15% 
• Rental vacancy rate: 9.40% 
• Rent to income ratio: 11.10%

Birmingham, AL, is number five on our list of the best places to invest in real estate. The city has a little more than 207,000 people living in it, but 1.2 million people live in the larger metropolitan area. Birmingham used to be a manufacturing hub in the South, but now it is one of the biggest banking hubs in the United States. Its downtown has been renovated over the past few years as the city embraces its new nickname, “the diverse city.” Birmingham is an excellent place for real estate investors and investment properties because it has meager home prices and a high rent-to-home-value ratio.

4. Pueblo, Colorado

• Home value: $263,343 
• Home value appreciation: 80% 
• Effective property tax rate: 0.63% 
• Rent to home value ratio: 3.64% 
• Rental vacancy rate: 3.10% 
• Rent to income ratio: 21.70%

The fourth one on our list of the best cities to buy real estate is Pueblo, Colorado. Nearly 112,000 people live in the city, making it the ninth-largest in Colorado. The first steel mill that gets most of its power from the sun is located in Pueblo, Colorado. 

Along the Arkansas River, the city has a busy Riverwalk, and the Creative Corridor has galleries, museums, and public spaces. Every year, the Colorado State Fair is held in Pueblo. With an 80% rate of home value growth, Pueblo is a great place to invest in real estate.

3. Spring Hill, FL

• Home value: $243,145 
• Home value appreciation: 85% 
• Effective property tax rate: 0.82% 
• Rent to home value ratio: 5.28% 
• Rental vacancy rate: 3.10% 
• Rent to income ratio: 30.50%

Spring Hill, FL, in Hernando County, is the third best place to invest in real estate. It is only 40 miles from Tampa. Spring Hill is a busy suburb with a population of just under 100,000. It is an unincorporated area that is part of the metro area that includes Tampa, St. Petersburg, and Clearwater. 

People like it because it is affordable and in the middle of everything. With home values under $250,000 and home value growth of 85%, Spring Hill is an excellent place for a real estate investor to get started.

2. Detroit, Michigan

• Home value: $58,213 
• Home value appreciation: 103% 
• Effective property tax rate: 2.90% 
• Rent to home value ratio: 16.99% 
• Rental vacancy rate: 5.10% 
• Rent to income ratio: 3.70%

The second best place to invest in real estate in 2022 is Detroit, Michigan. Detroit is the largest city in Michigan. There are just under 640,000 people living there, but there are 4.3 million people living in the metropolitan area. Even though “Motor City” has lost a lot of people since 1950, it is still the center of the U.S. auto industry. In 2013, Detroit was the biggest city in the U.S. to file for bankruptcy.

 It was able to get out of bankruptcy in 2014, and in the years since, it has become known for its revival. Apart from the “Big Three” American automakers, Quicken Loans, Ally Financial, and DTE Energy are all based in Detroit. With its low home prices and high rate of home value appreciation, Detroit is a great place to buy an investment property and get in on the ground floor of this exciting American success story.

1. Youngstown, Ohio

• Home value: $42,867 
• Home value appreciation: 77% 
• Effective property tax rate: 1.54% 
• Rent to home value ratio: 18.53% 
• Rental vacancy rate: 3.20% 
• Rent to income ratio: 28.50%

Youngstown, Ohio, which is the largest city in Mahoning County, is the best place to buy property in 2022. It’s a small city with just over 60,000 people, but it’s part of a larger metro area that includes Warren and Boardman and has a population of just over 540,000. Both Cleveland and Pittsburgh are only an hour’s drive away. 

Youngstown was once a steel town, but it has been coming back to life in recent years, with the opening of the Youngstown Business Incubator and more people moving there. The city’s super-low home prices, high rate of appreciation, and low rental vacancy rate all make it easy and quick for even first-time investors to get into the market and start making money back.