5 Reasons To Invest in Real Estate in Missouri in 2024

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Investing in real estate is an excellent strategy for earning supplemental income. If you’re considering starting your real estate investment career in Missouri, you’re in luck. The state of Missouri offers many advantages for real estate investors, and this article covers a few of them in detail.

Reason # 1 – The Midwest Is Booming

The Midwest, as a whole, continues to be a popular place to live, with Missouri being one of the top choices. Missouri’s population continues growing, adding 0.2% to its overall numbers from 2019-2020 alone. 

While the influx of new residents in Missouri isn’t as high as in other U.S. states, the state does typically experience consistent growth. 

This means that real estate investors in Missouri can expect ongoing growth, even when impulse buys and moves wear off for other, more popular states. People move to Missouri for a number of reasons, including new careers, college, or easy access to affordable housing. 

Missouri is also home to a few Fortune 500 companies, including Emerson Electric and Reinsurance Group of America, adding to its desirability.

Reason # 2 – Affordable Home Prices

Realtor.com lists the Midwest as one of the best real estate markets, whether you’re a homebuyer or an investor. With home prices reaching record levels, many home buyers are being priced out of the market. The Midwest continues to boast some of the country’s most affordable home prices. 

Paired with a good job market and easy access to large, metropolitan cities, the midwest, including Missouri, is one of the top places to invest.

Missouri is often considered one of the most affordable markets for investors. It’s one of the few states left in the country where it’s considerably less to purchase a home than rent, making it an excellent investment option for newer investors. 

Despite affordable home prices, Missouri has a high number of renters, many of whom are short-term or temporary employees. An almost 28% renter average makes Missouri a lucrative destination for real estate investors.

Affordable home prices may also mean that it’s easier to obtain funding for your investment property in Missouri. Debt service coverage ratio, or DSCR loans in Missouri, allow lenders to take out a loan based on the rental income of the property rather than their current income. 

This type of alternative lending can make investing in real estate in Missouri easier for self-employed investors.

Reason # 3 – A Diverse Range of Neighborhoods

Missouri is so diverse that investors have a diverse range of neighborhoods to choose from based on investment goals. Investors who want to invest in a single-family home will usually find success in family-oriented cities like Eureka and Fulton. 

Real estate investors looking to target business professionals may find success in condos in St. Louis or Kansas City. Missouri is also home to a few great colleges, making cities like Columbia and Kansas City ideal for multi-unit rental investments.

Missouri is also home to both big cities and rural communities, meaning investors can play to their strengths. Commercial real estate investments are also an opportunity in many of Missouri’s larger cities. A few of the top Missouri cities to consider for a commercial real estate investment include Joplin and Jefferson City.

Missouri residential neighborhood

Reason # 4 – Numerous Opportunity for Investment Incentives

Missouri also offers many incentives for real estate investors. For example, enhanced enterprise zones are available through the Missouri Department of Economic Development. Greater St. Louis also offers economic incentives to new business owners willing to invest a certain amount of funds into the area. 

Many cities within Missouri are also a part of Congress’s Opportunity Zones incentives, which encourage investments in low-income communities.

Available incentives to qualified Missouri investors may include tax breaks, funding grants, zoning changes, or reduced fees. Investing in one of these eligible zones allows investors to control costs while helping out the local community. 

Employing members of eligible Missouri communities can earn investors even more incentives, which can be an excellent way to maximize your profits.

Reason # 5 – Excellent School Ratings

Many cities within Missouri also have excellent school ratings. Good school ratings are often a criterion for families when choosing where they want to live. If you’re able to find an affordable property in an area with a highly-rated school district, you shouldn’t ever have a problem finding tenants. 

A few of the top-rated schools in Missouri include Lincoln College Prep and the Ewing Marion Kauffman High School.

A booming Midwest, affordable home prices, and diverse neighborhoods are just a few of the reasons to consider investing in real estate in Missouri. Missouri is also an excellent real estate investment opportunity for newer investors since the potential risk is low and the reward potential is high. 

Missouri investors also have many lending options, with DSCR being one of the best alternative loans.