Americans Hate These 4 Cities — but That Might Make Them Hidden Gems for Buyers
Written by
Martin Dasko
Edited by
Jenna Klaverweiden
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According to a recent YouGov survey, Nashville, Tennessee, is the favorite city of Americans, based on the ratings of the 50 most populous cities in the country. On the opposite side of the spectrum is Detroit, which has the lowest net favorability of the 50 cities. While Detroit was the most unfavorable city with a net favorability of -17, it was followed by Oakland, California (-7), Bakersfield, California (-5) and Fresno, California (-1). But just because they’re unpopular doesn’t mean they’re necessarily bad for homebuyers.
GOBankingRates spoke with real estate experts to determine what could make these unfavorable cities potentially hidden gems for homebuyers.
Detroit
More Americans held an unfavorable view of the city than a favorable one (46% vs. 29%). Sain Rhodes, a real estate expert and customer success manager at Clever Offers, noted that Detroit’s previous reputation is what makes it a gem in hiding for savvy homebuyers.
According to Redfin data, the median sale price of a home in Detroit is $114,500, which means that home prices are still below the national average, offering first-time buyers or investors an honest chance to get in early in a city being revitalized.
“There are massive opportunities for someone looking to buy and restore older homes, especially in neighborhoods like Corktown and Brush Park. And with major businesses like Ford and General Motors still heavily investing in the region, the employment market and infrastructure are on the rise, which can turn into solid long-term appreciation,” Rhodes said.
According to Jacob Naig, a Des Moines-based real estate expert, agent and investor with We Buy Houses in Des Moines, after over a decade of investing, that perception and possibility rarely travel in parallel. “Many of these so-called ‘awful’ cities are, in fact, the very markets where savvy buyers and investors should be focusing,” he said.
He pointed out that everyone knows Detroit for its fall from grace, but those days have been over for a while. Now you can purchase a home at a lower price to enter the market as a first-timer.
Oakland
“While it’s oftentimes dwarfed by San Francisco and struggles with public perception of safety, Oakland really does offer an affordable gateway to the Bay Area real estate market,” Rhodes said.
Rhodes pointed out that the city itself boasts a vibrant cultural and artistic history, stunning views, and easy access to San Francisco.
Naig noted that Oakland might not get the shine of its neighbor, San Francisco, but it’s much more affordable, while providing access to a similar culture and energy. It reminds him of some of the markets in the Midwest, like Des Moines, since they were long forgotten until young families and creatives started reviving the community.
As more companies in the tech space adopt remote work, people will likely gravitate toward locations like Oakland, where they can enjoy urban amenities at a more moderate pace and lower costs than San Francisco proper.
Bakersfield
Rhodes said Bakersfield is one of the few places throughout all of California where middle-class buyers can still afford a single-family home. “It’s heavily dependent on agriculture and energy, and while that may not be thrilling to everyone, it does provide stable employment in those sectors,” Rhodes said.
With a median listing sale price of $425,000, per Redfin, this unfavorable location is much more affordable. Bakersfield is also located just couple of hours’ drive from Los Angeles and the Sierra Nevada, providing plenty of lifestyle options for families or retirees who require more space for their dollar.
Fresno
Naig pointed out that Fresno and Bakersfield are often viewed as just farmland, but this actually works in their favor. He found that the combination of heavy agriculture and a wave of migration out of Southern California has made this a hidden gem, with people trading in $800,000 mortgages in Los Angeles for cheaper homes with cleaner air.
Based on Redfin data, the median sale price of a home in Fresno was around $420,000.
Investing In an Unfavorable City
Naig pointed out that the mainstream narrative often lags three to five years behind actual events on the ground. This gap can create an opening if you’re looking to get into the real estate market. You could purchase a property in one of these markets and learn along the way about real estate investing.
Adam Hamilton, a real estate expert and CEO of REI Hub, pointed out that favorable cities are often out of budget for most people and that unfavorable locations can be hidden gems. “Even if you don’t want to live in those areas long-term, you could potentially look into buying a property for investing purposes only, turning it into a rental that you then use to grow your own wealth so that you can afford to live in a city you find more favorable,” he said.
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