Attracted by rapidly rising rents, affordable housing prices, and a large percentage of renters, real estate investors in the Memphis area have been purchasing single-family homes as soon as they hit the market in order to turn them into rental property.
Over 53% of homes in the city are occupied by renters, according to the most recent census, with median rents for 3-bedroom homes increasing by more than 30% year over year. As the economy in Memphis begins to recover, more residents and businesses will likely be drawn to this vibrant city along the shores of the Mississippi River.
We recently looked at neighborhoods in and around Memphis with great investment properties.
Key takeaways
- Median home values in Memphis increased by 21% year over year, while rents on 3-bedroom homes have grown by 34%.
- Metropolitan Memphis includes small towns located in Tennessee, Arkansas, and Mississippi.
- Neighborhoods like West Memphis and Walls have more renters than homeowners.
>>Explore Roofstock's Memphis investment properties.
Why invest in Memphis?
Memphis is a popular place, helping to make the area an ideal place for investing in rental property. Over the past 12 months, median rent for 3-bedroom homes in Memphis has soared by 34%, according to Zumper (Feb. 14, 2022).
Even though rent prices are rapidly rising, housing prices are still relatively affordable. The median value of a middle-price-tier home in the Memphis region is less than $140,000, even though prices increased by more than 21% year over year (Zillow through Jan. 31, 2022).
15 great areas in Memphis for investment properties
There are over 160 neighborhoods in the Memphis metropolitan area, with home prices ranging from $15,000 to over $3.8 million. Here are 15 areas in and around Memphis for investment properties, based on data from Niche.com, Realtor.com, and Redfin.
Germantown
Germantown is a suburb of Memphis, located east of the city along Poplar Avenue. The area is ranked as the best neighborhood in the Memphis area by Niche.com, and it has a sparse suburban feel:
- Population: 39,193
- Median sale price: $536,950
- Change in sales price (year over year): 32.3%
- Days on market: 32
- Median rent: $1,387
- Renter-occupied households: 14%
- Median household income: $118,163
- ZIP codes: 38120, 38125, 38183
Collierville
Suburban Collierville is just east of Germantown, along the Tennessee-Mississippi border. The area receives an A from Niche.com, has a rural feel, and is ranked as the second best neighborhood in the Memphis area:
- Population: 50,086
- Median sale price: $502,000
- Change in sales price (year over year): 19.5%
- Days on market: 36
- Median rent: $1,331
- Renter-occupied households: 21%
- Median household income: $113,996
- ZIP codes: 38017, 38027, 38125
Lakeland
The Lakeland suburb of Memphis is located a few minutes east of the city, along I-40. The area has a rural feel and receives strong ratings for housing and public schools:
- Population: 12,606
- Median sale price: $543,507
- Change in sales price (year over year): 37.6%
- Days on market: 26
- Median rent: $1,200
- Renter-occupied households: 12%
- Median household income: $103,074
- ZIP code: 38002
Hernando
Hernando is ranked as the best place to buy a house in the Memphis area, and it’s a popular suburb. Located south of Memphis, in the state of Mississippi, Hernando has a sparse suburban feel and receives high ratings for housing and public schools:
- Population: 15,942
- Median sale price: $323,900
- Change in sales price (year over year): 19.8%
- Days on market: 8
- Median rent: $1,039
- Renter-occupied households: 17%
- Median household income: $79,195
- ZIP codes: 38632, 38651
Olive Branch
Located near the popular suburbs of Southaven and Hernando, Olive Branch is a few minutes from Memphis, along State Route 78. Olive Branch is located just across the border in Mississippi, has a rural feel, and is one of the most affordable places for home buyers in the Memphis area:
- Population: 37,461
- Median sale price: $290,000
- Change in sales price (year over year): 7.4%
- Days on market: 6
- Median rent: $1,164
- Renter-occupied households: 21%
- Median household income: $74,680
- ZIP code: 38063
Southaven
Southaven is ranked as one of the best places to live in the Memphis area. Located just across the border in Mississippi, Southaven has a sparse suburban feel and a good percentage of renters:
- Population: 54,152
- Median sale price: $252,500
- Change in sales price (year over year): 10.8%
- Days on market: 6
- Median rent: $1,056
- Renter-occupied households: 33%
- Median household income: $61,026
- ZIP codes: 38651, 38654, 38671, 38672
Horn Lake
Suburban Horn Lake is right next to Southaven. The area has a sparse suburban feel, receives good grades from Niche.com, and is home to a large percentage of renter-occupied households:
- Population: 27,080
- Median sale price: $167,000
- Change in sales price (year over year): 0.6%
- Days on market: 6
- Median rent: $1,033
- Renter-occupied households: 43%
- Median household income: $48,622
- ZIP codes: 38637, 38651
Bartlett
Bartlett is a popular suburb located a few minutes east of Memphis, along I-40. The neighborhood has a rural feel and receives good grades for housing, nightlife, and public schools:
- Population: 59,102
- Median sale price: $306,500
- Change in sales price (year over year): 13.6%
- Days on market: 32
- Median rent: $1,383
- Renter-occupied households: 15%
- Median household income: $84,688
- ZIP codes: 38002, 38029, 38135
Atoka
Suburban Atoka is located along Highway 51, a few minutes northeast of Memphis. The popular town is ranked as the best place to live in the county:
- Population: 9,241
- Median home value: $320,000
- Change in sales price (year over year): 39.8%
- Days on market: 36
- Median rent: $1,186
- Renter-occupied households: 18%
- Median household income: $91,687
- ZIP codes: 38004, 38071
Millington
Millington is located near the airport along Highway 51, a few minutes northeast of Memphis. The area has a dense suburban feel and a large percentage of renter-occupied households:
- Population: 10,645
- Median sale price: $250,000
- Change in sales price (year over year): 11.1%
- Days on market: 39
- Median rent: $939
- Renter-occupied households: 41%
- Median household income: $52,500
- ZIP codes: 38053, 38054, 38055, 38083
Marion
Marion is located west of Memphis, across the Mississippi River in the state of Arkansas. The suburb is ranked among the best places to live in the Memphis area, has a spare suburban feel, and has a large percentage of residents:
- Population: 12,404
- Median sale price: $130,000
- Change in sales price (year over year): -56.3%
- Days on market: 18
- Median rent: $859
- Renter-occupied households: 32%
- Median household income: $73,459
- ZIP code: 72364
Memphis
Memphis has a dense suburban feel and more renters than homeowners:
- Population: 651,932
- Median sale price: $190,000
- Change in sales price (year over year): 18.0%
- Days on market: 33
- Median rent: $901
- Renter-occupied households: 53%
- Median household income: $41,228
- ZIP codes: 37501, 38018, 38103
West Memphis
Located across the Mississippi River in Arkansas, West Memphis has a spare suburban feel and more renters than homeowners:
- Population: 24,823
- Median listing price: $130,000 (Realtor.com as of Jan. 2022)
- Change in sales price (year over year): Flat
- Days on market: No data
- Median rent: $707
- Renter-occupied households: 51%
- Median household income: $33,103
- ZIP codes: 72301, 72303, 72364, 72376
Piperton
Suburban Piperton is located east of Memphis along I-269, along the border with Mississippi. Niche.com ranks the small town as one of the best places in Tennessee to retire:
- Population: 2,142
- Median sale price: $625,000
- Change in sales price (year over year): 31.6%
- Days on market: 48
- Median rent: $885
- Renter-occupied households: 9%
- Median household income: $96,250
- ZIP codes: 38017, 38066
Walls
Walls receives good grades for housing, public schools, and nightlife. Located south of Memphis in Mississippi, the small town has a sparse suburban feel and more renters than homeowners:
- Population: 1,312
- Median sale price: $230,000
- Change in sales price (year over year): 35.3%
- Days on market: 5
- Median rent: $883
- Renter-occupied households: 62%
- Median household income: $48,990
- ZIP codes: 38641, 38680, 38686
>>Explore Roofstock's Memphis investment properties.
