In the blog post, we present some of the best real estate investment strategies for 2024, based on the current and expected market conditions. If you are a real estate investor, you know that the Federal Reserve’s interest rate decisions can have a significant impact on investment decisions and your returns. The Fed’s interest rate moves affect the cost and availability of credit for home buyers and investors, the demand and supply of properties, and the overall health and outlook of the economy.

In 2023, the Fed raised the federal funds rate three times, from 4.25% to 5.25%, in response to the strong economic growth, low unemployment, and rising inflation. However, in 2024, the Fed is expected to cut the federal funds rate three times, to 4.25%, in response to the slowing economic growth, softening labor market, and easing inflation. The Fed’s interest rate outlook for 2024 is based on its projections of the economic growth, inflation, and unemployment, as well as its assessment of the risks and uncertainties for the economy.

Here are 3 of the best real estate investment strategies to consider for your portfolio in 2024.

One of the best markets to buy and hold properties in 2024 is Buffalo, NY. According to Zillow, the online real estate platform, Buffalo is the nation’s hottest housing market in 2024. This may come as a surprise to some, but not to those who have been following the city’s remarkable transformation in recent years. Buffalo offers a unique blend of affordability, economic growth, and community vitality, making it an attractive destination for home buyers and investors. The typical home value in Buffalo stands at $248,445, with a mortgage payment of just $1,792 for a 5% down payment, and a modest average rent of $1,257. The city has seen a surge in job  creation, especially in the fields of health care, education, and technology. The city has also invested in improving its infrastructure, public transportation, and cultural amenities, making it more livable and attractive. Buffalo’s housing market is buoyed by this employment surge, ensuring a steady influx of new residents eager to call this city home. Learn more about the Buffalo market in our blog post.

Fix and Flip

Another popular and profitable real estate investment strategy is to fix and flip properties for a quick profit. This strategy involves buying properties that are undervalued, distressed, or in need of repairs, renovating them, and selling them for a higher price. Fixing and flipping properties is a good strategy for 2024, as the Fed’s interest rate cuts will increase the availability and affordability of credit for home buyers and investors. This will create more opportunities to find and finance properties that have a high potential for appreciation, as well as more buyers who are willing and able to purchase them.

One of the best markets to fix and flip properties in 2024 is Toledo, OH. Toledo tops the list of the hottest housing markets of 2024, according to Realtor.com. Toledo has undergone a remarkable transformation in recent years, offering a low cost of living, a high quality of life, and a diverse range of job opportunities. The median home price in Toledo is $200,000, which is more than 50% lower than the national median. The city also has a forecasted price growth of 8.3% and a sales growth of 14% in 2024, making it an ideal place to buy, renovate, and sell properties for a profit. Learn more about the Toledo market in our blog post. Check out our 5-step beginner’s guide for how to flip a house in this post. 

Short-Term Rental

A third and emerging real estate investment strategy is to buy short-term rental properties for a regular income. This strategy involves renting out properties for a short period of time, usually from a few days to a few weeks, to travelers, tourists, or business people, using platforms such as Airbnb, VRBO, or Booking.com. Short-term rental properties is a viable strategy for 2024, as the Fed’s interest rate cuts will stimulate the travel and tourism industry, which has been severely affected by the COVID-19 pandemic. This will increase the demand and prices for short-term rental properties, especially in markets that offer a variety of attractions, activities, and amenities for visitors.

One of the best markets for short-term rental properties in 2024 is Orlando, FL. According to Airbnb, the online short-term rental platform, Orlando is the most popular destination in the U.S. for 2024, based on the number of bookings and searches. Orlando is the ultimate vacation destination, offering a plethora of entertainment options, such as theme parks, water parks, golf courses, shopping malls, and restaurants. Orlando also hosts many conventions, events, and festivals, attracting millions of visitors every year. The average nightly rate for short-term rental properties in Orlando is $150, with a projected growth of 10% in 2024. The city has a huge supply of properties that are suitable for short-term rental, as well as a flexible and favorable regulatory environment for hosts.

Conclusion

The Fed’s interest rate moves and outlook for 2024 have a significant impact on the real estate market and your returns as an investor. In 2024, the Fed is expected to cut the federal funds rate three times, to 4.25%, in response to the slowing economic growth, softening labor market, and easing inflation. This will lower the borrowing costs and increase the affordability for home buyers and investors, boosting the demand and prices of properties. As a real estate investor, you can profit from the Fed’s interest rate moves in 2024 by using one or more of the following strategies: buy and hold, fix and flip, or short-term rental. These strategies will allow you to take advantage of the current and expected market conditions and generate attractive returns in 2024.