Yes, reading quarterly research and data on foreclosures, how many houses have sold, and their selling prices can be helpful. But keep in mind that you’re getting a story about what happened already. As a real estate investor, you need to be more forward-thinking than that.

When deciding whether to buy investment property or not, you need to stay ahead of the competition. The best places to purchase a rental property aren’t just places that have low property values and high rental rates. They’re also places that have a lot of landlord-friendly protections, a strong economic base, and high growth potential.

The Top 5 Best Places to Buy Rental Property in 2023

While you can find solid investment opportunities in virtually any market with the right real estate investor lead generation system, we found that the following five states are among the best for buy-and-hold investors in 2023. You’ll find an overview of what makes each of these five states attractive to residents and why you should pay attention to them.

Here are our top picks:


Texas—currently home to almost 28 million people—also holds the nation’s record for the largest annual growth in population since 2010, according to the U.S. Census Bureau. And several news outlets, like U.S. News & World Report, regularly rank the Lone Star State among the top 10 fastest growing states across the board based on migration numbers, job growth, and the cost of housing.

That’s because Texas isn’t just about oil and gas anymore. Tech companies and manufacturing facilities, for example, are moving in and paying well. And immigrants from Latin America and Asia—two of the fastest growing segments of homebuyers in the nation—have noticed. For real estate investors, this points to an opportunity to meet the growing demand for affordable housing that several cities like Dallas-Fort Worth and Austin are experiencing. So, let’s take a look at those two markets and why buying rental property there could be your next move.


There are more reasons to buy rental property in the Dallas-Fort Worth area than you can shake a stick at. First, the area accounts for a disproportionately large percentage of financial sector jobs in the region and is home to several thousand company headquarters—many of which are Fortune 500 companies. With such a large concentration of employment opportunities, Dallas-Fort Worth has seen a surge in population growth like no other metro area in the U.S.

Median home sales prices are also up, thanks in large part to the growing demand for housing, but still remain below pre-crash numbers. Of course, that’s expected to change quickly as more companies like Toyota move to the area and bring thousands of their employees with them. Local franchisees are already seeing a tightening on available housing, which will only drive home prices further north.

The influx of new residents, the projected rise in the cost of buying a home, and the forthcoming inventory squeeze will necessarily push people into rentals. So, if you’re interested in making passive income from real estate investing, Dallas-Fort Worth looks like a hot place to do it.

Market Climate Keeps getting better
Demographics Melting pot potential
Liveability Bustling downtown, exciting nightlife, friendly neighborhoods
Economic Outlook Busting at the seams


As with all real estate, Michigan’s market is subject to outside influences such as the economic outlook, potential recessions, and rising interest rates. But Michigan has the benefit of having lovely houses (and a strong renter’s market) with low average prices. According to Zillow, the average home price in Michigan was $237,000 in 2022, an increase of over 10% year-over-year. But despite those increases, it’s one of the most affordable real estate communities within the country.

When purchasing in Michigan, consider that the location matters. You can get cheap rentals in the Detroit area, but you can also get luxury properties just a stone’s throw away. When you look for rentals, look for areas that have a lot of jobs—a strong economic backing will be essential.


Don’t shy away from Detroit. Housing prices continue to increase and, by and large, the issues with too-high property taxes have been resolved. As people start to move back into this growing city, rental rates are rising. Detroit is, of course, a huge region comprising many neighborhoods from ultra-wealthy gated communities to more rundown neighborhoods. Consequently, there are a lot of options in this market, and it’s one of the few in which you can purchase a sub-$100,000 family home in cash. Consider Detroit for fix-and-flips in addition to rentals.

Market Climate Low-priced and high-yield
Demographics Extremely diverse
Liveability Exceptional growth
Economic Outlook Slow but steady


California is the most populated state in the U.S. and home to 28 national parks, Disneyland, Alcatraz, and the Entertainment Capital of the World. And with low unemployment, solid job growth, and access to surfing, hiking, movie studios, and tech conglomerates (just to name a few more attractions), the people keep coming. And while the steady increase of immigrants has been a boon to the economy, it’s also created a housing shortage.

Since median home sale prices have skyrocketed, thanks to the rise in demand, many new residents have been pushed to rentals. While this creates opportunity for owning rental properties, it also does make the market a little more costly. You’ll need to find the right lender for the best ROI.

Many investors are counting on appreciation to make investments worthwhile, but it’s important to keep in mind that because California real estate prices are skyrocketing, the housing market in some areas could take a serious dip. To avoid going bust with the potential bubble, it’s probably safer to look for multi-family units in areas just off the beaten path, like Inglewood.


This relatively small city located in the South Bay region of Los Angeles County was on very few investors’ radars just a couple of years ago. In fact, historically, it’s an economically-depressed area with high crime and dilapidated housing. But there are dramatic changes underway that could shift the landscape of this southwestern town into one worth investing in.

Most notably, Inglewood is now home to the SoFi stadium—a collaboration with the owner of the Los Angeles Rams. This development brought in a performing arts venue, several hundred hotel rooms, office and retail space, public parks, and hundreds of modern residences. This mixed-use facility has created thousands of jobs and given the local economy a much-needed boost.

Moving forward, Inglewood is likely to attract more SoCal residents looking for good-paying jobs. And they’ll need housing. This provides an opportunity for investors to fill that gap by buying and renovating property that can be rented at an affordable cost to tenants and still produce a decent return.

Market Climate Growing exponentially
Demographics Diverse with an influx of skilled workers
Liveability Dramatically increasing shopping and amenities
Economic Outlook Changing for the better—and fast!


Ohio is home to an exceptionally low cost of living, which is why it’s so attractive to landlords looking to acquire a large inventory of real estate properties in a small amount of time. Like Michigan, Ohio gives you the rare opportunity to purchase sub-$100,000 properties. It’s also an extremely landlord-friendly state. Because the property values are so low, you can target some of the state’s major cities, such as Columbus.

As of 2022, Ohio’s average property values hover around $190,000, which is significantly less (around $200,000 less) than the average property in the United States. Focus on finding properties that will bring long-term cash flow and equity via markets with higher-than-average rents and strong economies.


Columbus real estate is currently in a seller’s market, with property values increasing by $25,000 year-over-year from 2021 to 2022. But a lot of this growth can be attributed to a broadening and deepening of the market; people are moving to cheaper locations due to remote work and enhanced accessibility.

Columbus has a lot to offer in terms of economy, night life, and general liveability. So it’s not surprising that people are moving out of expensive states and into more affordable ones. The rental market remains strong, although buyers may want to get in fast before they’re priced out. Columbus also has highly skilled workers within its economy; it is home to the largest private research and development foundation: the Battelle Memorial Institute.

Market Climate Growing very quickly
Demographics Diverse and working
Liveability A significant number of amenities
Economic Outlook Swiftly growing


Although home sales in Indiana decreased year-over-year by 12% in 2022, it may actually present some opportunities for the right investor. Indiana is a very hot rental market due to its landlord-friendly laws and low cost of entry. High interest rates may have scared some investors away, but those who are interested in purchasing a long-term investment see Indiana as a tremendous opportunity.

Indiana’s median sales price was $160,000 as of 2022, substantially lower than nearly any other state. It’s this low price that lets people get into a large housing inventory quickly, if they want to purchase properties ranging from $50,000 to $80,000. Of course, those aren’t going to be turn-key rentals, but they may be worthwhile opportunities for fix-and-rents or fix-and-flips.


Sitting at $245,000 for the average single-family home, Indianapolis is a little more costly than the rest of Indiana. While house prices increase, sales continue to decrease. People are hesitant to enter the market due to high rates and turbulent economic signals. Still, that means home price growth has slowed its acceleration and there may be even more purchasing opportunities as a result.

Like Columbus, people move to Indianapolis to experience city or suburban life without a high cost of living. Indianapolis may be one of the more expensive cities in Indiana, but it’s still significantly lower cost than virtually any other state. Indianapolis has long been an economic stronghold in the area and is likely to continue being one. Its unique markets include auto racing and amateur sports.

Market Climate Growing (albeit slower)
Demographics Diverse, bustling, and highly-employed
Liveability Everything from historic sites to shopping
Economic Outlook Fast growth and a strong foundation

The Single Best Place for Finding Deals on Rental Property

Whether you’re already investing in one of these areas or deliberating a move into a new region, our hope is that this real estate market overview will give you some idea of the direction you may want to head toward. Of course, there is never a guarantee of future investment performance whenever you buy rental property. And our analysis—or anyone else’s for that matter—shouldn’t be viewed as such. We hope you’ve found this helpful solely as a tool and possible resource for helping you make a more informed decision about the best places to buy rental property in 2023.

If you’d like to increase your odds of finding the best places to buy rental property, contact us about becoming an independently owned and operated HomeVestors® franchisee anytime. Whether you invest in one of the five states above or in any of the states where we have a presence, we’ve got the nationally-known and trusted “We Buy Ugly Houses®” marketing campaign for effective lead generation to back you up. Go online anytime to request more information, or simply give us a call.

Each franchise office is independently owned and operated.


"*" indicates required fields

This field is for validation purposes and should be left unchanged.