There’s a the age old question everyone thinks about when they decide to move to a city in Iowa:
Should I buy a place or rent?
Well, we aren’t here today to solve that problem for you exactly. We are just assuming you’ll do the right thing and a buy a place 😉
And while we are happy to tell you the best place to live in Iowa, this analysis is going to tackle the question of the best place to buy a house as an investor. That is we are going to try and determine the up and coming cities in the Hawkeye State.
To do that we are going to look at places in Iowa that are growing faster than average, but where home prices are below average. In every day terms, the ‘deals’.
The best deal in Iowa at the moment? That would be Waterloo according to our analysis.
Here’s a look at the top ten places to buy a home in Iowa:
- Waterloo (Photos | Homes)
- Algona (Photos | Homes)
- Vinton (Photos | Homes)
- Mount Pleasant (Photos | Homes)
- Boone (Photos | Homes)
- Spencer (Homes)
- Council Bluffs (Photos | Homes)
- Storm Lake (Photos | Homes)
- Nevada (Photos | Homes)
- Muscatine (Photos | Homes)
The methodology that wen’t into this can be a bit complicated, so we’ll break it down for you in as much detail as we can below.
How do you determine the best places to buy a home in Iowa?
We were in real estate for almost five years and have been working on this site for another three. Suffice is to say, we’ve put a lot of thought into what goes into finding a good place to buy a home.
So all that thinking has come to this moment where we get to spell out how we’d approach finding an up-and-coming place to live in Iowa. Put differently, the analysis will try to find places in Iowa with undervalued homes relative to pent up demand.
To do that we looked at the most recent American Community Survey Census data for 2012-2016 and compared it to the previous vintage (2011-2015). Specifically, we used the following criteria:
- Y-o-Y Change In Population (People want to live here)
- Y-o-Y Change In Median Home Prices (People are willing to pay for it)
- Home Prices Relative To The State Average (It’s still kinda cheap)
We want places that are growing, have seen home prices increase in recent years, and are still ‘cheap’ for Iowa with the following caveats:
- Home prices had to be within 20% of the state average (Much lower than that and you get to some of the more dangerous places)
- Home prices increased in the last year, and
- Above 5,000 people (Bigger cities have more data points)
So of the 1,002 cities and towns in Iowa, only 13 places made it through our initial filters to even be considered.
We then ranked each place from 1 to 13 for the criteria mentioned above with 1 being the best for that criteria. We averaged the rankings to create a ‘best place to buy’ index with the place having the lowest index being the best.
Turns out that Waterloo is the best potential gem in the not-so-rough in the Hawkeye State.
Read on for more on these places.
Waterloo was originally known as Prairie Rapids Crossing. The town was established near two Meskwaki American tribal seasonal camps alongside the Cedar River. It was first settled in 1845 when George and Mary Melrose Hanna and their children arrived on the east bank of the Red Cedar River (now just called the Cedar River). They were followed by the Virden and Mullan families in 1846. Evidence of these earliest families can still be found in the street names Hanna Boulevard, Mullan Avenue and Virden Creek.|On December 8, 1845, the Iowa State Register and Waterloo Herald was the first newspaper published in Waterloo.
Algona was founded in 1854 and after the Algonquian word for ‘Algonquin waters’.
Vinton was founded in 1849. It was named for Hon. Plynn Vinton, a state legislator. The first railroad line was extended to Vinton in 1869, and it was incorporated as a city that same year.
Mount Pleasant was first incorporated as a town by European Americans in 1842, and again in 1851.
Coal mining played an important part in the early history of the Boone area. Local blacksmiths were already mining coal from the banks of Honey Creek south of what became Boone in 1849.
European Americans did not settle in what became Spencer until after the American Civil War; the first house was built in 1866, and the first store was opened in the area in 1869.
The first Council Bluff name (singular) was actually on the Nebraska side of the river at Fort Atkinson (Nebraska) about 20 miles northwest of the current Council Bluffs. It was named by Lewis and Clark for a bluff where they met with the Otoe tribe on August 2, 1804.
8. Storm Lake
Storm Lake was incorporated in 1873. The city of Storm Lake is named from the lake where it is said a trapper experienced a severe storm.
Nevada was platted in 1853. It was named after the Sierra Nevada mountains. A post office has been in operation in Nevada since 1854.
Muscatine began as a trading post founded by representatives of Colonel George Davenport in 1833. Muscatine was incorporated as Bloomington in 1839; the name was changed to reduce mail delivery confusion, as there were several Bloomingtons in the Midwest. Before that, Muscatine had also been known as ‘Newburg’ and ‘Casey’s Landing’.
There You Have It – The Best Places To Purchase A House In Iowa
There’s our analysis of the best places to buy a house in Iowa. And, to be clear, we aren’t necessarily saying these places are the best places to live, just that it looks like they might be in a couple of years based on the data.
In fact, every place in the following table meets our criteria, so even though it may not look super long, remember we started off with all 0 places in the state.
So if we’d could rent or buy in these cities, we’d definitely buy.
For more Iowa reading, check out:
Detailed List Of The Best Places To Buy A Home In Iowa