If you’re a real estate investor, you might be wondering where the priciest properties are located (as well as where the “bargains” are). You might assume states with the priciest real estate in general would be at the top of the “most expensive” list. However, that wasn’t always the case for our real estate investor clients in 2020.
For a third year, we’ve compiled our Equity Trust Self-Directed Real Estate Market Report, which reveals how and where Equity Trust clients used their IRAs and other retirement accounts in the past year to invest in real estate with tax advantages.
After analyzing purchase prices of all clients’ real estate investments in 2020, it was surprising to see that some of the states associated with high property prices didn’t make the Top 10 list. In fact, in some cases, they fell on the Bottom 10 states list.
So, who made the list? The state with the highest median real estate purchase price in 2020: Hawaii at $337,000. Washington is in a distant second, with a median purchase price of $178,000.
Here’s the entire list of the top 10 expensive states for real estate in an Equity Trust IRA:
The overall median purchase price for all states in 2020 was $58,500, up from $55,000 in 2019.
In the case of many low-priced homes, clients see high profit potential. They may choose to make updates and rent the property to receive regular cash flow for their IRA, or they may flip it and sell it at a profit, which returns to their IRA for tax-free or tax-deferred growth. Plus, there are no capital gains taxes when a property is sold in an IRA.
Learn more: 2021 Real Estate Market Report
Get more valuable data about the 2020 U.S. real estate market, and how our clients are maximizing their IRA returns, in the Equity Trust 2021 Self-Directed Real Estate Market Report.
In this exclusive report, you’ll discover:
- Hottest real estate markets for out-of-state buyers
- Region-by-region breakdown of average and median purchase prices
- 13-year trending average real estate price
- How investing in the challenging circumstances of 2020 compared to previous years
- Whether investors prefer rehabs, rentals, or flips as their go-to strategy
- Much more
The report provides a snapshot of 2020 as well as data from the past decade to reveal a fuller picture of self-directed real estate investing trends to help you prepare for what’s to come.
Download the free report now