A Fresh Look at an Old Question: Which Real Estate Markets are the Best?

Are you currently in a Tier 1, Tier 2 or Tier 3 market? Or perhaps a gateway city, a 16-hour city or a secondary market? Are you sure?  

Tier models rank metropolitan real estate markets based on their investment potential or growth characteristics. But different analysts use different methodologies and rank markets differently as a result. Adding to the potential for confusion, analysts often adopt different terminologies to describe markets and may create separate rankings for different property types or different audiences. 

In the NAIOP Research Foundation’s report, “A New Look at Market Tier and Ranking Systems,” Maria Sicola, Charles Warren, Ph.D., and Megan Weiner with CityStream Solutions, LLC, examined how analysts develop and use ranking systems and considered ways these systems could be improved.

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