New Orleans has been one of America’s weakest real estate markets. But it’s bouncing back.
Photos by Steve Keighery at Home Buyer Louisiana; Mike Kline (notkalvin)/Getty Images (city right).
Remember the pandemic housing boom, when home prices went through the roof? New Orleans missed the boat. But that’s exactly why local investor Stephen Keighery at Home Buyer Louisiana is “bullish” about the Big Easy now.
Average home price: $241,895 (down 1.5% YoY, per Zillow)Homes that sell over list price: 12.3%Homes that sell under list price: 69.7%Average rent: $1,650/month
The pros: Keighery points to the money flowing into Louisiana, from energy and manufacturing to tech and port infrastructure. He thinks those long-term tailwinds aren’t reflected in property prices yet. “We’re still able to purchase properties at attractive prices with potential for appreciation over the coming years,” he says.
The cons: New Orleans has been one of the weakest markets in the country for price appreciation since 2020, and insurance, flooding, hurricanes, and an aging housing stock make investing here hard. But Keighery sees a silver lining: “We were one of the first markets to experience a downturn, and we could be one of the first to recover,” he says. “From what I’m seeing on the ground, the market appears to have bounced off the bottom, although I wouldn’t say we’re experiencing a boom just yet.”
His advice: New Orleans is ripe for the BRRRR approach: Buy undervalued properties, renovate, rent them out, refinance, and repeat. “You can still buy properties relatively cheaply, force appreciation through renovations, and generate cash flow from the rental income,” he explains. This is how Keighery landed a house in New Orleans East for $62,000, spent $45,000 on a rehab that added a fourth bedroom and a second bathroom, and leased it for $1,650 a month. After six months, the refinance appraisal came in at $179,000. “This one’s a keeper,” he says. Because he builds equity through renovations, he doesn’t need appreciation to make the numbers work, so any gain is “a very nice bonus.”
