According to a new report -- Emerging Trends in Real Estate 2018 - published this week by the ULI in partnership with PwC, smaller and secondary U.S. markets are the leading property investment themes running through this year's study, with Seattle taking the top spot this year, thanks to its job opportunities, diverse economy and young, educated workforce. 

 

In addition, Texas' dominant hold over the top 10 cities list over the past three years has begun to unwind with Austin (2017) down a position to number two and Dallas/Fort Worth (2016) now at number five on the list. Houston (2015) drops to 60, a fall attributed to the disruption in the energy industry.

 

Salt Lake City (#3) and Fort Lauderdale (#6) jumped into the top 10 for the first time in the study's history as investors look to replicate the level of success found in Denver and Miami with their competitive costs of living and high quality of life.  Salt Lake City is the smallest market ever to make the top 10.

 

Manhattan experienced the largest year-over-year negative move to number 46, due to the high cost of assets and over-saturation of construction in the area, with what many interviewed said were "too many cranes in the skyline."

 

The Top 10 Markets in Emerging Trends in Real Estate 2018:

 

1.     Seattle, WA

2.     Austin, TX

3.     Salt Lake City, UT

4.     Raleigh/Durham. NC

5.     Dallas/Ft. Worth, TX

6.     Fort Lauderdale, FL

7.     Los Angeles, CA

8.     San Jose, CA

9.     Nashville, TN

10.    Boston, MA

 

"The growing interest in smaller cities by real estate investors is influenced by their relative affordability, coupled with a concentration of young, skilled workers," says Mitch Roschelle, PwC Partner and Co-Publisher of the report.  "The diverse, robust economies of these smaller cities make them very desirable to investors."

 

"The trend of smaller markets displacing larger ones as investment hubs is setting a new course for urban development that is reshaping cities across the nation," said ULI Global Chief Executive Officer Patrick L. Phillips. "These cities are positioning themselves as highly competitive, in terms of livability, employment offerings, and recreational and cultural amenities.

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