Successful real estate investors look for investment properties to yield them the highest return on investment. Consequently, as more people are investing in real estate today, many housing markets continue to emerge to cater to the needs of the citizens. The New Orleans real estate market has become one of the best performer markets attracting investors from places from all over the nation.
Although the city has undergone many damages due to Hurricane Katrina, it has proved to improve over the course of the past ten years. People did, indeed, flee, and homes were vacant for some time, yet the city’s efforts to revive it have shown to be successful.
Today, our team at Mashvisor is glad to disseminate information regarding the New Orleans real estate market. First, we explain the current status of the city overall as well as its economy, and then we go on to explore trends within its real estate market. Lastly, we will explore top neighborhoods for the best investment opportunities. Read to explore and pave your way into finding the best investment property.
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Hurricane Katrina and Its Aftermath
Ten years have passed since Hurricane Katrina and the horrendous turbulence it has brought about. After the Hurricane flooded almost 80% of the city, New Orleans shows to have recovered today. The New Orleans real estate market, in particularly, depicted the highest rate of recovery. Home values have gone up by 43% since the Hurricane, while real estate properties priced above $1 million have increased in value by about 33% since 2013. While many of the homes remained vacant after Hurricane Katrina as people fled the city, demand today is outpacing supply. More people trust New Orleans and are finding the New Orleans real estate market a good housing market for investment opportunities.
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The New Orleans Economy
The aftermath of Hurricane Katrina left a toll on the city and its growth in many sectors. Post the Hurricane, employment deteriorated, New Orleans real estate market declined, and standards of living consequently greatly decreased. New Orleans took an oath to strengthen and bring its economy back on its feet, and it could not have done it better. Today, New Orleans is home to young ambitious entrepreneurs and millennials looking for jobs within its tech, tourism, and environmental sectors. Last year, New Orleans enjoyed a job growth rate of 2%, which is just above the national average. For a city that has long been recovering from horrendous damages, a 2% increase is significant and indicative of the economy’s resilience.
Property Inventory and Affordability of Homes
The New Orleans real estate market has certainly recovered over the years. While homes remained vacant after Hurricane Katrina, today more people are buying homes, and demand is finally catching up with supply. In addition, new construction has slowed; single-family housing permits decreased 3.5% from last year. The slow in construction, according to real estate market analysis, has certainly limited supply, therefore allowing demand to catch up with the property inventory. The overall effect is that home prices have become more affordable. The average listing price for single-family homes in the New Orleans real estate market hovers around $260,000.
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The affordability of home prices along with the low property taxes have boosted New Orleans real estate. Today, the New Orleans real estate market serves as one of the more attractive locations for families looking for affordable housing. If you are looking to find an investment property for young families that is yet affordable, New Orleans real estate is your destination as a real estate investor.
Top Neighborhoods in the New Orleans Real Estate Market
Having explored New Orleans’ current status as far as the economy, property inventory, and affordability of housing, we hope you have grasped a better vision of the city. Below we suggest the three top neighborhoods in New Orleans that you should invest in today.
French Quarter
- Median Home Value: $500,000
- Median Rent: $1,200/month
Also known as the Vieux Carré, French Quarter is the oldest section of the city of New Orleans. Often called the Crown Jewel of New Orleans, French Quarter has a mix of old and modern architecture. The neighborhood is, moreover, home to many modern boutiques, antique stores, and old restaurants. French Quarter is an ideal location for real estate investors who want to buy a rental property in close proximity to Downtown and job opportunities. The neighborhood does, though, have a higher median home value than its surrounding areas. The high home prices have consequently urged 56% of the population to rent their homes, which is good news for prospective real estate investors and landlords. If you’re looking for an investment property in a lively and luxurious neighborhood, then French Quarter is right for you. If you are looking to rent out using Airbnb, French Quarter also shows good prospects.
Bywater
- Median Home Value: $250,000
- Median Rent: $1,000/month
Bywater is a hip town located within the Bywater District Area. The neighborhood certainly enjoys a bohemian vibe with its multicolored street murals. The area houses plenty of outdoor cafes, hip restaurants, and peculiar boutiques. People move to Bywater for its hip vibe and environmentally friendly atmosphere. About 56% of the population rents their homes, although homes are more affordable in Bywater than in other surrounding neighborhoods. If you are looking to invest in a neighborhood that enjoys an enabling environment and one that offers affordable housing, definitely select Bywater.
The Warehouse District
- Median Home Value: $240,000
- Median Rent: $1,200/month
The name derives from the neighborhood’s brick warehouses that the officials transformed into creative restaurants, eccentric coffee shops, and boutiques. Also known as the Arts District, the Warehouse District has a welcoming atmosphere for art, design, and entertainment. Moreover, the neighborhood is diverse and houses many high-end apartments, condos, and shops making it very attractive for many real estate investors.
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Ten years following Hurricane Katrina, New Orleans has evolved into a top-performing city. Its job market and population are slowly growing, and home prices are starting to reach pre-Hurricane values. Whether its Warehouse District, Bywater, or French Quarter, investing in New Orleans real estate is a smart decision. We recommend that you look into New Orleans real estate today, if you desire to find an investment property that is affordable and profit generating before prices rise even further.
For more information on the New Orleans real estate market, visit Mashvisor.