To determine where home prices are expected to rise most in the next couple of years,  Forbes.com   looked at projections for housing starts from the National Association of Home Builders and job-growth projections from Moody’s Economy.com.

Forbes identified cities that are likely to be vibrant markets because jobs are increasing and the housing market wasn’t overbuilt during the boom.”The logic is pretty straightforward,” says Mark Zandi, chief economist at Moody’s Economy.com. “People will spend as much on housing as their income will allow them. House prices are very closely tied to household income over the long run when you look at business cycles.

According to Forbes, these are the 10 cities where home prices are most likely to rise:  Albuquerque, Charlotte, N.C.  San Antonio, Texas, Portland, Austin, Texas, Salt Lake City, Utah,  Colorado Springs, Colorado. Minneapolis, Atlanta, Oklahoma City

Source: Forbes.com, Matt Woolsey (08/25/2008)

This sounds great if you were to move there and buy your own home. However, if you are planing to invest in Real Estate in one of these attractive cities with hope for appreciation and good return on investment , by renting your property,  you should check who will live at your property. Can they afford to pay the rent? will they look after your property or trash it? If you have to vacate them and remodel the place every time you have a bad tenant you’ll end up loosing money.

Find a good property manager and be a part of decision making. If the applicants have judgments against them don’t rent your place to them, they will likely live in your place for free, and it will cost you a lot of aggravation and loss on income. It takes at least 2 months to evict the tenants, fix the place and rent it again. During that time you have to keep paying the mortgage, the insurance and taxes. Sometimes you have to hire a lawyer for about $200/hour.  As with every investment, it has it’s risks.