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Top 10 markets to buy a rental property

In these metro areas, small real estate investors can expect to find great home deals and double-digit returns on their investment, according to RealtyTrac.

Ithaca, N.Y.

mom pop real estate ithaca new york
This 1,500-square-foot home in Cayuga Lake is on sale for $175,000.
  • Median home price: $180,000
  • Median rent: $1,604
  • Return on investment*: 10.7%

Cornell. Ithaca College. Finger Lakes School of Massage. This metro area is packed with colleges and other schools, making it a prime target for real estate investors looking for rental properties.

And while home prices aren't as cheap here as they are in other markets on this list, landlords can make up the difference by charging higher rents: the median rent here is $1,600, among the highest on RealtyTrac's list.

For further information: Trulia

Source: RealtyTrac and RentRange.
*Return on investment is also known as gross rental yield, which is the percentage of profit or loss from an investment that is calculated by dividing the annual gross rental income by the purchase price or market value of the property. Ratings were calculated by comparing gross median rents (the return on investment before accounting for taxes, maintenance fees and other costs) for three-bedroom homes to median home price. All of the markets were relatively strong economically, with unemployment rates below the national average.
  @CNNMoney - Last updated September 30 2013 07:32 AM ET

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