Want to invest in the Missouri real estate market in 2020? Then you should definitely consider the Kansas City real estate market! Kansas City, MO is an investment gem in the Midwest. Ranking in the top 50 for overall real estate prospects in the PwC’s Emerging Trends in Real Estate report, the Kansas City housing market 2020 is projected to be an excellent rental market. Keep reading to learn about the key trends of the Kansas City real estate market as well as where to invest next year for a good return on investment.
Related: Will Midwest Real Estate Make You Money in These Cities?
Kansas City Real Estate Market: Mashvisor’s Data
The first step in understanding the Kansas City real estate market trends for 2020 is to look at how it is performing. To do that, we’ll use Mashvisor’s data from its investment property calculator. If you’re interested in learning about Mashvisor’s investment property calculator, click here! For now, check out Mashvisor’s data on the Kansas City real estate market:
- Median Property Price: $258,800
- Price per Square Foot: $4,543
- Price-to-Rent Ratio: 17
- Traditional Rental Income: $1,290
- Traditional Cap Rate/Cash on Cash Return: 1.1%
- Airbnb Rental Income: $2,056
- Airbnb Cap Rate/Cash on Cash Return: 2.9%
- Airbnb Occupancy Rate: 55%
Kansas City Real Estate Trends for 2020
Investing in Kansas City real estate in 2020 is great and there are a number of reasons why. These reasons are best summarized in the following four real estate trends:
1. Both Traditional and Airbnb Rental Properties Will Be Profitable
The main goal of investing in real estate is to generate rental income and a good return on investment (ROI). Fortunately for a Kansas City real estate investor, profitability will be the norm for both traditional and Airbnb investment properties in 2020.
The traditional rental income and ROI averages of the Kansas City real estate market, as mentioned above, are in-line with the state’s averages. The data for the average Airbnb Kansas City real estate investment, however, is well above average. According to Mashvisor, the average Airbnb rental income of the Missouri real estate market is only $1,828.
It’s important to note that these are only averages. Investors can easily find more lucrative Kansas City rental properties in 2020.
2. Kansas City House Prices Will Be Affordable in 2020
The Kansas City real estate market shares one of the best features of the Midwest market: affordability. As mentioned, the city’s median property price is $258,800. This is about the same as the state’s average and well below the national median of $299,400. What’s even more impressive is the number of neighborhoods that are below the city median. Many of the best neighborhoods (listed below) in the city have property prices close to or under $100,000. With such inexpensive Kansas City house prices, investing in the city will be very accessible to real estate investors in 2020. This will be the case even though the market is classified as a seller’s market rather than a buyer’s market.
Related: 4 Ways to Find the Most Affordable Real Estate Investments
3. Kansas City Investment Properties Will Have a High Appreciation Rate
High rental income is not the only factor making the Kansas City real estate market profitable. The Kansas City housing market forecast also projects a high real estate appreciation rate. According to NeighborhoodScout, during the last 10 years, the Kansas City real estate market has been in the top 30% nationwide for appreciation. During the last year, local properties appreciated in value by 3.6%, according to Zillow. It’s expected that properties in the Kansas City real estate market 2020 will appreciate by 2.3%.
4. Airbnb Will Be Legal in the Kansas City Real Estate Market
We can now finally assure readers wondering “Is Airbnb legal in Kansas City?” Airbnb Kansas City short-term rentals are legal for 2020, for both owner and non-owner occupied properties. You can learn the full details of Kansas City Airbnb laws on the city’s website, but we will cover the essentials here.
For starters, short-term rentals are defined as those rented for a period of less than 30 consecutive days. All Airbnb Kansas City investment properties require registration. Registration varies based on owner or non-owner occupancy. As it pertains to taxes, Airbnb hosts must pay a state sales tax of 4.225% and a city sales tax of 8.85%.
Want to give Airbnb Kansas City real estate investing a try in 2020? Find a profitable Airbnb now.
Related: 20 Cities with No Airbnb Legal Issues in 2020
Best Neighborhoods in Kansas City: Traditional Real Estate Investing
Now that we discussed why you should invest in the Kansas City real estate market, we can talk about where to invest. According to Mashvisor, the best neighborhoods in Kansas City for traditional investing are:
Cunningham Ridge
- Median Property Price: $90,000
- Price per Square Foot: $50
- Price-to-Rent Ratio: 8
- Traditional Rental Income: $995
- Traditional Cap Rate / Cash on Cash Return: 5.0%
Independence Plaza
- Median Property Price: $114,250
- Price per Square Foot: $70
- Price-to-Rent Ratio: 10
- Traditional Rental Income: $993
- Traditional Cap Rate / Cash on Cash Return: 4.6%
North Town Fork Creek
- Median Property Price: $87,684
- Price per Square Foot: $53
- Price-to-Rent Ratio: 11
- Traditional Rental Income: $652
- Traditional Cap Rate / Cash on Cash Return: 2.6%
Stayton Meadows
- Median Property Price: $127,716
- Price per Square Foot: $90
- Price-to-Rent Ratio: 11
- Traditional Rental Income: $969
- Traditional Cap Rate / Cash on Cash Return: 2.5%
Squier Park
- Median Property Price: $119,967
- Price per Square Foot: $92
- Price-to-Rent Ratio: 9
- Traditional Rental Income: $1,070
- Traditional Cap Rate / Cash on Cash Return: 2.4%
Best Neighborhoods in Kansas City: Airbnb Real Estate Investing
What about Airbnb Kansas City? According to Mashvisor’s neighborhood data, the best neighborhoods for Airbnb are:
Cunningham Ridge
- Median Property Price: $90,000
- Price per Square Foot: $50
- Price-to-Rent Ratio: 8
- Airbnb Rental Income: $1,607
- Airbnb Cap Rate / Cash on Cash Return: 8.8%
- Airbnb Occupancy Rate: 50%
West Blue Township
- Median Property Price: $110,540
- Price per Square Foot: $82
- Price-to-Rent Ratio: 13
- Airbnb Rental Income: $2,152
- Airbnb Cap Rate / Cash on Cash Return: 8.3%
- Airbnb Occupancy Rate: 58%
Independence Plaza
- Median Property Price: $114,250
- Price per Square Foot: $70
- Price-to-Rent Ratio: 10
- Airbnb Rental Income: $1,694
- Airbnb Cap Rate / Cash on Cash Return: 8.2%
- Airbnb Occupancy Rate: 51%
Oak Park Northwest
- Median Property Price: $201,467
- Price per Square Foot: $46
- Price-to-Rent Ratio: 25
- Airbnb Rental Income: $1,479
- Airbnb Cap Rate / Cash on Cash Return: 8.1%
- Airbnb Occupancy Rate: 54%
Key Coalition
- Median Property Price: $99,948
- Price per Square Foot: $56
- Price-to-Rent Ratio: 14
- Airbnb Rental Income: $1,644
- Airbnb Cap Rate / Cash on Cash Return: 7.3%
- Airbnb Occupancy Rate: 54%
The Kansas City real estate market will be nothing short of a success for both traditional and Airbnb real estate investing in 2020. To find Kansas City houses for sale, get access to our real estate investment tools, sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.