Top 5 Places to Invest in Real Estate in Houston, TX 2022
Spring, Pasadena, and Friendswood are amongst the top places to purchase real estate investments in Houston Texas, based on income, projected growth and appreciation.
Identifying the best neighborhoods to invest in real estate requires data about population growth, income growth, home prices, and rental properties. We've collected that data and identified the top neighborhoods and zip codes in Houston for single-family property investors.
The top 5 zip codes for rental property investors in Houston include:
Good for investors looking for, proximity to downtown, passive income and price points under $225,000.
- Very quick commute: Hardy Toll Rd is a 25 minute drive to downtown Houston from 77373; I-45 is a major highway to Dallas, I-99 newest loop in Houston with a lot of growth.
- Stable employers: New Exxon Campus and recently relocated HP Headquarters are 10 minutes away.
- Low rental inventory: Only 1.5 months of rental inventory available — super hot rental market, with leasing times below one month.
- Family centric: Families looking to take advantage of the amenities of The Woodlands at an affordable price or rent, move to Spring. With quick access to downtown, they get the benefits of both The Woodlands and downtown.
Good for investors looking for passive income and rapid employment opportunity growth.
- High projected growth: Due to Pasadena's adjacency to the port. In fact, there is a $176.8 million project expanding beltway 8 in the Pasadena area to support this growth.
- Job stability: There's great job stability because the port is necessary no matter what industry is flourishing. The heart of Houston's growth is its major port.
- Stable employers: This zip code is located on the south east side of town where you can find major refineries like Shell, Chevron, and Valero, chemical plants, and the 50 mile long port of Houston.
- Affordable inventory: Sits at the inside of the loop with a median listing price under $200,000.
- Attracting younger families: Moving to Pasadena for the job opportunities in the Pasadena area.
Good for investors looking for lower risk and the possibility for passive cash-flow.
- Great price point: A+ Overall Niche Grade while still having a median listing price at just $254,900, which is incredibly hard to find.
- High household income: $106,287 median household income is incredibly high for the median home value.
- Great family-friendly attractions: Quick access to NASA's Space Center; 15 minute drive to Kemah boardwalk with food, roller-coasters, and carnival games; near Bay Brook area with malls, fine dining & restaurants, outside entertainment, and Lago Mar — the largest man-made lagoon.
Good for investors looking for affordable passive income property inside of the outer loop of an A- rated neighborhood, with plenty of upside.
- Low price point for great school: An A- graded school at a low median listing price of $235,000, 77040 is the only place you can get a school this good inside of the loop at that price point.
- Very desirable: Zoned to Cy-Fair school district, one of the most desired school districts in the Houston area.
Good for investors looking for appreciation over cash-flow and looking for a home that will attract families in the best or worst of economic times.
- Great schools: Zoned for the Klein ISD school district, one of the best school districts in the state. Homes in a school district this great will find a tenant in any market environment.
- High income: High median household income of $98,476.
- Affordable inventory: Median listing price of $254,000.
- Rapid growth: Rapidly growing area due to the recent development of 99.
Awning is an investor-focused brokerage enabled by a property search algorithm that sorts through thousands of deals to find the best ones for single-family real estate investors. We make money like a traditional buy-side agent and there is no cost to browse the properties or speak to an Awning Advisor.
Real Estate Statistics Houston, Texas
In Houston, the median:
- Rental Yield: 8.3%
- 3-Bedroom Listing Price: $242,450
- 3-Bedroom Rent: $1,670
- Household Income: $54,151
- Houston Population Growth: 3.12%
- Houston Income Growth: 9.58%
We use 3 bedroom homes as they are usually the most favorable for investors. Smaller homes tend to have tenants who move more frequently (since they're occupied less often by families with school age children) and larger homes are often unnecessarily large for most families, making it take longer to find tenants for them.
We only look at Houston area zip codes with populations over 10,000 people to remove outliers / zip codes with very limited inventory.
We included 145 zip codes that made up the Houston MSA from Harris, Liberty, Wharton, Galveston, Waller, Walker, Matagorda, and Brazoria Counties.
Legend & Data Sources
- Rental Yield: Annualized median 3 bedroom rent, from the last 6 months, divided by the median 3 bedroom listing price, from the last 6 months. (Source: Awning proprietary rent data + Awning analysis of Houston MLS data)
- Median Listing Price, 3 Bedroom: Median 3 bedroom listing price, from the last 6 months. (Source: Awning analysis of Houston MLS data)
- Median Rent, 3 Bedroom: Annualized median 3 bedroom rent, from the last 6 months. (Source: Awning proprietary rent data)
- Population: Number of individuals living in the zip code. (Source: US Census)
- Median Household Income: Median household income of the zip code. (Source: US Bureau of Labor Statistics)
- Projected Population Growth: Expected population growth of the zip code over the next 5 years. (Source: US Census)
- Projected Income Growth: Expected household income growth of the zip code over the next 5 years. (Source: US Bureau of Labor Statistics)
Awning is a platform that helps individuals find, buy, and manage the best single family rental homes on the market. Awning provides this service by analyzing every listing on the market to surface the best investment opportunities at any point in time and pairing its customers with expert real estate agents, known as Awning Advisors, who help customers through the process of identifying the best strategy & markets for them.
About this report
For this report, Awning has used its proprietary data to determine which Houston zip codes have the best yield for rental property investors. Awning brings additional color to the story with the help of Houston local Humberto Marquez, who is Awning's most expert Texas agent.