Manchester is home to the best residential real estate investment market in Connecticut.
The 06042 zip code in Manchester presents the greatest opportunity for the best real estate investments among the 1,688 individual real estate markets in Connecticut we evaluated. We looked at property values, population trends, and six other metrics for each market. We used that data to calculate each market's InvestScore.
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Data sources
Most of the data in this article comes from the Zillow Home Value Index and the U.S. Census American Community Survey.
We update our data when the original sources update their data, usually monthly. Sometimes we'll update data more frequently.
Clever also performs regular quality checks to identify outdated data, broken data connections, and other data issues that may arise.
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5 best places to invest in Connecticut
| Rank | City | InvestScore | Affordability | Property value appreciation |
|---|---|---|---|---|
| 1 | Manchester | 100 | 3.3 | 55% |
| 2 | Broad Brook | 99.6 | 3.3 | 60% |
| 3 | Hartford | 94.5 | 4.2 | 60% |
| 4 | Waterbury | 89.7 | 5.1 | 92% |
| 5 | Windsor | 89.7 | 3.4 | 54% |
🚨 This article is for informational purposes only. It isn't intended to convey financial or legal advice. We recommend you talk to a real estate agent or real estate attorney when buying a home in Connecticut.
1. Manchester
We've identified the 06042 zip code in Manchester as Connecticut's best real estate investment market. Here's why.
🔎 Key data about Manchester (06042)
| Data point | Value | Rank in state (of 1,688 markets) |
|---|---|---|
| InvestScore | 100 | Highest |
| Typical property value | $304,920[1] | 26th lowest |
| Five-year appreciation | 55%[2] | 56th highest |
| Household income | $91,892[3] | 120th highest |
| Affordability ratio | 3.3 | 25th most affordable |
| Five-year population growth | 2.2%[4] | 31st highest |
| Unemployment rate | 4.1%[5] | 4th lowest |
| Property taxes | $5,107[6] | 28th lowest |
| Educational attainment | 44%[7] | 83rd highest |
Manchester (zip code 06042) is the best residential real estate investment market in Connecticut. It has the 56th highest property value appreciation among markets we evaluated, with a 55% appreciation of the typical property over the last five years.
Manchester is the 25th most affordable market among the 1,688 Connecticut markets we evaluated, with an affordability ratio of 3.3.
2. Broad Brook
The 06016 zip code in Broad Brook is the runner-up spot for the best real estate investments in Connecticut.
🔎 Key data about Broad Brook (06016)
| Data point | Value | Rank in state (of 1,688 markets) |
|---|---|---|
| InvestScore | 99.6 | 2nd highest |
| Typical property value | $392,220[1] | 77th lowest |
| Five-year appreciation | 60%[2] | 27th highest |
| Household income | $120,399[3] | 62nd highest |
| Affordability ratio | 3.3 | 18th most affordable |
| Five-year population growth | 1.8%[4] | 34th highest |
| Unemployment rate | 4.1%[5] | 4th lowest |
| Property taxes | $5,795[6] | 59th lowest |
| Educational attainment | 47%[7] | 71st highest |
The 06016 zip code in Broad Brook features a typical property value of $392,220, the 77th lowest in the state.
Property values have appreciated 60% over the past five years, the 27th highest increase among evaluated markets in the state. Broad Brook homes have an affordability ratio of 3.3, the 18th most affordable in the state.
3. Hartford
The 06114 zip code in Hartford comes in at No. 3 in our ranking of the best residential real estate investment markets in Connecticut.
🔎 Key data about Hartford (06114)
| Data point | Value | Rank in state (of 1,688 markets) |
|---|---|---|
| InvestScore | 94.5 | 3rd highest |
| Typical property value | $217,284[1] | 3rd lowest |
| Five-year appreciation | 60%[2] | 24th highest |
| Household income | $52,110[3] | 165th highest |
| Affordability ratio | 4.2 | 103rd most affordable |
| Five-year population growth | 4.6%[4] | 10th highest |
| Unemployment rate | 4.1%[5] | 4th lowest |
| Property taxes | $4,585[6] | 14th lowest |
| Educational attainment | 15%[7] | 157th highest |
With a typical property value of $217,284, Hartford's 06114 zip code features the 3rd lowest property values in the state.
Hartford homes have an affordability ratio of 4.2, the 103rd most affordable among the markets we evaluated.
4. Waterbury
The 06704 zip code in Waterbury ranks No. 4 among Connecticut's residential real estate investment markets.
🔎 Key data about Waterbury (06704)
| Data point | Value | Rank in state (of 1,688 markets) |
|---|---|---|
| InvestScore | 89.7 | 4th highest |
| Typical property value | $249,890[1] | 6th lowest |
| Five-year appreciation | 92%[2] | highest |
| Household income | $48,718[3] | highest |
| Affordability ratio | 5.1 | 143rd most affordable |
| Five-year population growth | 3.4%[4] | 14th highest |
| Unemployment rate | 4.6%[5] | 5th lowest |
| Property taxes | $5,136[6] | 29th lowest |
| Educational attainment | 14%[7] | 159th highest |
Property values in Waterbury's 06704 zip code have seen the highest increase among evaluated markets in the state, with an appreciation of 92% over the past five years.
Waterbury's affordability ratio of 5.1 makes it the 143rd most affordable among the 1,688 markets we evaluated.
5. Windsor
The 06095 zip code in Windsor rounds out our top five residential real estate investment markets in Connecticut.
🔎 Key data about Windsor (06095)
| Data point | Value | Rank in state (of 1,688 markets) |
|---|---|---|
| InvestScore | 89.7 | 5th highest |
| Typical property value | $353,953[1] | 56th lowest |
| Five-year appreciation | 54%[2] | 69th highest |
| Household income | $105,322[3] | 69th highest |
| Affordability ratio | 3.4 | 28th most affordable |
| Five-year population growth | 1%[4] | 56th highest |
| Unemployment rate | 4.1%[5] | 4th lowest |
| Property taxes | $5,358[6] | 38th lowest |
| Educational attainment | 43%[7] | 89th highest |
Property values in Windsor's 06095 zip code rose 54% over the last five years, ranking the city 69th highest among evaluated markets in Connecticut.
Windsor homes have an affordability ratio of 3.4, the 28th most affordable among the markets we evaluated.
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Frequently asked questions
See our article Steps to Buying Your First Rental Property to learn the basics of real estate investing for beginners.
You'll learn the importance of setting goals, picking the right market, and more.
Cash investors often use what's called the 70% rule, which suggests they should pay around 70% of a house's after-repair value minus the cost of renovations.
By buying for about 70% of the after-repair value, they're positioning themselves to pay for repairs and other costs, and to lock in a profit.
The 70% rule isn’t a hard-and-fast formula, but a quick guideline investors use to evaluate potential deals.
Investing in residential real estate can be one of the best passive real estate investments in Connecticut.
Residential real estate offers accessible passive income and the potential to compound your original investment.
Renting out residential units is the top way to invest in real estate. House hacking also offers a great opportunity for passive real estate investment income.
How we rank residential real estate markets in Connecticut
To determine the best real estate investments in Connecticut we evaluated 1,688 markets on eight metrics, and then assigned an InvestScore based on a proprietary weighting framework. Each market corresponds to a specific zip code in Connecticut.
What is InvestScore?
InvestScore is a score on a scale of 0 (worst in state) to 100 (best in state) that estimates the residential real estate investment potential of a given market. It takes into account a suite of key data points for each city.
- Typical property value: This measures the typical home value in this zip code, according to the Zillow Home Value Index. It reflects the typical value for homes in the 35th to 65th percentile range, including all homes, with the numbers smoothed and seasonally adjusted. We prefer lower property values, which indicate both more room for growth and a greater ease of purchase.
- Property value appreciation: This measures how much property values have increased in the area over the past five years, according to the Zillow Home Value Index. We prefer a higher appreciation, as it indicates better returns on housing. However, past performance isn't indicative of future results.
- Median household income: This is the inflation-adjusted median household income in the zip code, according to U.S. Census American Community Survey data. We prefer a higher household income, as it indicates local residents have more income to spend on housing.
- Affordability ratio: This is the ratio of the typical home value to the median household income in the area. A lower ratio is better because it means more households can afford a home, which indicates higher demand.
- Population growth: This is how much the area's population has grown over the past five years, according to U.S. Census estimates. Higher is better, as it indicates residents are moving into the area at a rapid clip.
- Unemployment rate: This is the unemployment rate in the area, according to U.S. Census data. We prefer a lower rate, as it indicates the availability of steady employment in the area, meaning residents will find it much easier to afford homes.
- Property tax: This is the median real estate property tax paid in the area, according to U.S. Census estimates.
- Educational attainment: This is the percentage of residents in the area that have obtained a bachelor's degree or better, according to U.S. Census estimates. We prefer a higher rate because it indicates local residents who have higher earning potential and thus should be able to afford homes.
