Webster City is home to the best residential real estate investment market in Iowa.
The 50595 zip code in Webster City presents the greatest opportunity for the best real estate investments among the 4,220 individual real estate markets in Iowa 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Clever also performs regular quality checks to identify outdated data, broken data connections, and other data issues that may arise.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 Iowa
| Rank | City | InvestScore | Affordability | Property value appreciation |
|---|---|---|---|---|
| 1 | Webster City | 100 | 2.1 | 39% |
| 2 | Albia | 98.3 | 2.2 | 38% |
| 3 | Shenandoah | 92.7 | 2.1 | 36% |
| 4 | Evansdale | 90.1 | 2.4 | 35% |
| 5 | Ottumwa | 87.7 | 1.8 | 34% |
🚨 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 Iowa.
1. Webster City
We've identified the 50595 zip code in Webster City as Iowa's best real estate investment market. Here's why.
🔎 Key data about Webster City (50595)
| Data point | Value | Rank in state (of 4,220 markets) |
|---|---|---|
| InvestScore | 100 | Highest |
| Typical property value | $143,438[1] | 16th lowest |
| Five-year appreciation | 39%[2] | 16th highest |
| Household income | $69,167[3] | 86th highest |
| Affordability ratio | 2.1 | 9th most affordable |
| Five-year population growth | 1.3%[4] | 50th highest |
| Unemployment rate | 2.2%[5] | lowest |
| Property taxes | $1,970[6] | 14th lowest |
| Educational attainment | 23%[7] | 84th highest |
Webster City (zip code 50595) is the best residential real estate investment market in Iowa. It has the 16th highest property value appreciation among markets we evaluated, with a 39% appreciation of the typical property over the last five years.
Webster City is the 9th most affordable market among the 4,220 Iowa markets we evaluated, with an affordability ratio of 2.1.
2. Albia
The 52531 zip code in Albia is the runner-up spot for the best real estate investments in Iowa.
🔎 Key data about Albia (52531)
| Data point | Value | Rank in state (of 4,220 markets) |
|---|---|---|
| InvestScore | 98.3 | 2nd highest |
| Typical property value | $163,118[1] | 30th lowest |
| Five-year appreciation | 38%[2] | 20th highest |
| Household income | $73,896[3] | 70th highest |
| Affordability ratio | 2.2 | 13th most affordable |
| Five-year population growth | 2.6%[4] | 26th highest |
| Unemployment rate | 2.2%[5] | lowest |
| Property taxes | $2,197[6] | 25th lowest |
| Educational attainment | 23%[7] | 85th highest |
The 52531 zip code in Albia features a typical property value of $163,118, the 30th lowest in the state.
Property values have appreciated 38% over the past five years, the 20th highest increase among evaluated markets in the state. Albia homes have an affordability ratio of 2.2, the 13th most affordable in the state.
3. Shenandoah
The 51601 zip code in Shenandoah comes in at No. 3 in our ranking of the best residential real estate investment markets in Iowa.
🔎 Key data about Shenandoah (51601)
| Data point | Value | Rank in state (of 4,220 markets) |
|---|---|---|
| InvestScore | 92.7 | 3rd highest |
| Typical property value | $133,476[1] | 13th lowest |
| Five-year appreciation | 36%[2] | 27th highest |
| Household income | $62,143[3] | 113th highest |
| Affordability ratio | 2.1 | 12th most affordable |
| Five-year population growth | 1.2%[4] | 57th highest |
| Unemployment rate | 2.2%[5] | lowest |
| Property taxes | $1,787[6] | 8th lowest |
| Educational attainment | 19%[7] | 104th highest |
With a typical property value of $133,476, Shenandoah's 51601 zip code features the 13th lowest property values in the state.
Shenandoah homes have an affordability ratio of 2.1, the 12th most affordable among the markets we evaluated.
4. Evansdale
The 50707 zip code in Evansdale ranks No. 4 among Iowa's residential real estate investment markets.
🔎 Key data about Evansdale (50707)
| Data point | Value | Rank in state (of 4,220 markets) |
|---|---|---|
| InvestScore | 90.1 | 4th highest |
| Typical property value | $152,357[1] | 23rd lowest |
| Five-year appreciation | 35%[2] | 36th highest |
| Household income | $63,441[3] | 36th highest |
| Affordability ratio | 2.4 | 23rd most affordable |
| Five-year population growth | 5.1%[4] | 8th highest |
| Unemployment rate | 3.6%[5] | 7th lowest |
| Property taxes | $1,989[6] | 15th lowest |
| Educational attainment | 13%[7] | 122nd highest |
Property values in Evansdale's 50707 zip code have seen the 36th highest increase among evaluated markets in the state, with an appreciation of 35% over the past five years.
Evansdale's affordability ratio of 2.4 makes it the 23rd most affordable among the 4,220 markets we evaluated.
5. Ottumwa
The 52501 zip code in Ottumwa rounds out our top five residential real estate investment markets in Iowa.
🔎 Key data about Ottumwa (52501)
| Data point | Value | Rank in state (of 4,220 markets) |
|---|---|---|
| InvestScore | 87.7 | 5th highest |
| Typical property value | $116,930[1] | 6th lowest |
| Five-year appreciation | 34%[2] | 42nd highest |
| Household income | $63,426[3] | 42nd highest |
| Affordability ratio | 1.8 | 4th most affordable |
| Five-year population growth | 0.1%[4] | 88th highest |
| Unemployment rate | 2.2%[5] | lowest |
| Property taxes | $2,042[6] | 21st lowest |
| Educational attainment | 21%[7] | 100th highest |
Property values in Ottumwa's 52501 zip code rose 34% over the last five years, ranking the city 42nd highest among evaluated markets in Iowa.
Ottumwa homes have an affordability ratio of 1.8, the 4th 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 Iowa.
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 Iowa
To determine the best real estate investments in Iowa we evaluated 4,220 markets on eight metrics, and then assigned an InvestScore based on a proprietary weighting framework. Each market corresponds to a specific zip code in Iowa.
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.
