60 Facts & Statistics About Online Reviews

Hand ticking the 5 yellow stars options on black background for an online review

Many businesses don’t concern themselves with online reviews, but these comments are an integral part of your overall success. This article looks at 60 unique facts and statistics showcasing why online reviews should be paramount in every business’s growth strategy.

Top 10 Online Review Statistics

  • Only 5% to 10% of consumers write reviews
  • 89% of consumers are ‘highly’ or ‘fairly’ likely to use a business that responds to all of its online reviews
  • Only 7% of consumers say they’re ‘not at all’ suspicious of reviews on Facebook
  • 34% of consumers only leave positive reviews
  • 7% of consumers only leave negative reviews
  • 85% of all reviews come from only four review sites
  • Customers don’t trust companies with ratings below 4 stars
  • 98% of people read online reviews for local businesses
  • Businesses that claim free listings on multiple review sites make 36% more revenue
  • 90% of customers read online reviews before visiting a business

Online Reviews and Their Impact on Businesses

Whether you like it or not, online reviews are the first thing customers want to see before ever visiting your store. No matter how amazing your website or physical location may be, individuals won’t even bother walking through the door if they don’t like the rating they see.

Low scores mean fewer customers, leading to diminishing sales and abysmal revenue numbers. Those with stellar reviews are prone to new customers based on a rating alone. Businesses maintaining ratings of 4 stars or more see significantly higher revenue numbers and customer retention.

Reviews also provide insight into the consumer’s mind. Any venture taking the time to read such feedback can see what shoppers enjoy and the areas they dislike. Addressing concerns while focusing on the good can have a considerable impact.

How Important Are Online Reviews?

Now more than ever, customers are looking to the internet for feedback before making decisions regarding a purchase. Nearly the entire population reads online reviews before buying products and services.

What those reviews say has a monumental impact on how customers react to your business. They’re more likely to trust businesses with online reviews than those who don’t due to an increased risk of the unknown.

Reviews speak volumes and carry just as much weight as a personal recommendation from a close friend. Conversely, negative feedback is enough to scare off all but the most stubborn customers from shopping at your store. It’s clear that online reviews have the power to make or break your company, especially if you’re just starting your business.

60 Facts & Statistics about Online Reviews

1. Only 5% to 10% of consumers write reviews (USA Today)

Of all consumers to make a purchase from your store, only 5% to 10% will take the time to write a review. What’s shocking is that even this low number still accounts for $400 billion in online sales revenue! Businesses encouraging more customers to review products will have more influence on other shoppers and the potential to generate even more revenue.

2. 89% of consumers are ‘highly’ or ‘fairly’ likely to use a business that responds to all of its online reviews (Brightlocal)

Reviews in this day and age are not a one-way street. Customers like to hear from business owners even more than they like posting reviews about whatever product or service you’re providing.

With review sites allowing businesses to respond to reviews, what you say can have a huge bearing on future revenue. Responding to all your online reviews, as challenging as that may be, helps you appear engaged and in tune with shoppers.

3. Only 7% of consumers say they’re ‘not at all’ suspicious of reviews on Facebook (Brightlocal)

Facebook tends to get a bad rap when it comes to sellers. Its Marketplace is plagued with scammers and fake businesses using unscrupulous methods to make a buck. In the eyes of many, this translates to business reviews as well.

Only 7% of consumers don’t think twice about the reviews they see on the site. The vast majority need something more than positive notes to trust what you’re peddling. When allowing reviews on Facebook, make sure to keep your page up to date with information and imagery showing people you’re the real deal.

4. 34% of consumers only leave positive reviews (Brightlocal)

Perhaps the best type of consumer, this 34% wedge believes the old adage that it’s better to say nothing than speak negatively of someone or your business. Good products or experiences go on record, but one-third of people won’t leave a bad review even if they receive the wrong item from you three times in a row.

5. 7% of consumers only leave negative reviews (Brightlocal)

On the contrary, some people are just never happy. No matter how fast the shipping, how stellar the client support, or how amazing the product, 7% of consumers will never leave a positive review. Fail to meet expectations, and you just might end up with that scathing one-star review.

6. 85% of all reviews come from only four review sites (Reviewtrackers)

It may seem overwhelming to stay on top of reviews scattered all over the internet, but it’s not as bad as you think. As of the summer of 2022, four sites make up 85% of all reviews posted online.

Google sees the vast majority with 73%, and Yelp follows with 6%. Both TripAdvisor and Facebook tie in with 3% of total reviews. Businesses with limited bandwidth should focus on these four sites, responding to reviews and listening to customer concerns. A high rating on these sites can do wonders in client generation and sales.

7. Customers don’t trust companies with ratings below 4 stars (Reviewtrackers)

This interesting statistic is precisely why it’s important to monitor and address customer reviews. The moment your review score on a site drops below four stars, customers lose faith in all facets of your business.

Following customer chatter can help you pinpoint issues as they arise and not after your review score has taken a heavy blow. Customer relationship management services can offer an additional view into shoppers’ minds to stay on the pulse of what makes them happy. Read more about the best CRM software.

8. 98% of people read online reviews for local businesses (Brightlocal)

Even if you have a brick-and-mortar location in your town, potential customers look online for dirt on your store before ever stepping foot inside. An incredible 98% of people get their initial reaction to your business from postings about you on the internet.

It doesn’t matter if you perform internet sales or wish to have an online presence at all. You still need to read what the world says about your venture and do everything in your power to keep that rating high.

9. Businesses that claim free listings on multiple review sites make 36% more revenue (Womply)

We know that Google brings in far more reviews than any other review site, but that doesn’t mean the buck should stop there. Businesses taking the time to claim listings on multiple sites make on average 36% more revenue than those that don’t. What’s more, you can focus on free listings and still reap the benefits. 

10. 90% of customers read online reviews before visiting a business (Invesp)

Whether your store is online or in-person, 90% of customers are now reading your reviews before paying you a visit. Only 10% of people will try out a building or site without scrutinizing it first, and this small number won’t keep the lights on.

Online reviews are now THE go-to place for gathering information on the kind of business you are before deciding to shop with you. This goes above and beyond personal recommendations and all the marketing campaigns you can come up with.

11. Yelp sees 26,380 new reviews posted every minute (Invesp)

Yelp is the second most popular review site after Google, but business owners should not underestimate its significance. It sees a staggering 26,380 new reviews every single minute about your business and the competition.

With so many customers using Yelp to post reviews, your team should check the webpage frequently for pertinent mentions. Not only can you get leverage into what others are doing, but it’s also possible to assess what customers think about you.

12. 69.7% of people consult Google for local business reviews (AgilityPR)

A majority of business reviews end up on Google, so it’s only natural that customers migrate there to read the latest on local companies. Google makes reviews overt when searching for website information or an address, and scary ratings can turn potential clients away in a hurry.

39% of people check Facebook and 25% view Yelp, either apart from or in tandem with a Google search. Google is still the top dog, but don’t rule out the impact other review pages can also have on your appeal to customers.

13. Google removed 130 million fake reviews in 2019 and 2020 (AgilityPR)

In 2019 and during the early onset of the pandemic, Google cracked down on fake reviews polluting its system. The resulting purge removed over 130 million counterfeit comments left to falsely boost or tear down a company’s credibility. Already a multi-billion dollar problem, many fear things will only get worse.

Google is well-known for its algorithms and anti-deception tactics, but no one can locate every rotten egg. As a business owner, make the most of credible reviews through client interaction and tackling concerns. This way, a few fake reviews stand out like a sore thumb and won’t water down your rating much anyway.

14. 62% of consumers are more likely to purchase if they see photos and videos of other customers (Findstack)

Feedback from other customers is paramount in putting the shopper in the shoes of a current client. Pictures and videos are worth a thousand words, as consumers gravitate more toward reviews they can visualize.

The extra media also gives an additional layer of credibility to a review and your business as a whole. If you have the means, make it as easy as possible for customers to upload images or videos to a review so they have more incentive to do so.

15. Only 9% of customers would consider engaging with a business that has an average star rating of 1 or 2 stars (Findstack)

No one is perfect, and there’s a decent chance you’ll receive some negative reviews during your time running a business. The important thing is to react appropriately and resolve any issues that may lead to additional dings.

Once you’ve reached the 1 or 2-star mark, only 9% of all customers will even consider doing business with you. The road to recovery would be slow if there’s any hope of salvation.

16. Businesses that have 200 or more reviews have twice as much revenue compared to others (Findstack)

It can be slow-going for new businesses, and would-be shoppers are leery about purchasing from a site with only a handful of reviews. Although reviews are a primary driver of customers to your site, the right marketing tools can get the ball rolling.

After reaching that 200 review mark, businesses see on average twice as much revenue as sites with lower counts. This magic number is the turning point where customers believe you’ve proven yourself and are worthy of their business. Of course, make sure these reviews lean strongly on the positive side.

17. 73% of consumers don’t even consider reviews if they were not written during the past month (Statuslabs)

Last month’s news is ancient history. Nearly three-quarters of consumers will sort by “Most Recent” and ignore anything over a month out. Shoppers want to make sure you’re keeping up your A-game, and there’s no slip in service or quality. Teams change, and products change, but your company still has to live up to expectations.

18. 71% of people are willing to submit satisfactory reviews if it’s easy to do so (ServiceDirect)

Customers aren’t afraid to share their opinions about your product or service; they just don’t want to be inconvenienced along the way. The vast majority of individuals will submit a positive review if you provide an easy access point. After a customer makes a purchase, follow-up communication can be a great way to keep clients engaged while providing a one-click review opportunity. 

19. TripAdvisor has over one billion reviews (TripAdvisor)

TripAdvisor is currently the world’s largest travel guidance platform on the web. It stands out from other sites by allowing individuals to share reviews on locations and experiences around the world.

Voyagers heading to all corners of the globe use the site for advice and feedback from those who have walked the path before. In early 2022, the company reached a significant milestone with over one billion reviews.

20. 41% of travelers have avoided a destination over fears it may be a tourist trap (BreakingTravelNews)

Online chatter about travel hotspots has a significant impact on those making trip plans. 41% of individuals researching online have chosen to avoid a location completely over feedback from other travelers. Even if you’re not in the travel business, such a statistic shows the power online reviews have on others.

21. People spend up to 49% more money at businesses that reply to reviews (Womply)

Customers look more favorably on businesses that take the time to reply to online reviews. Companies choosing to respond on review sites bring in up to 49% higher than those without such interactions. Such a statistic highlights the need for review monitoring, and even hiring additional staff to cover the role can produce a massive return on investment.

22. 75% of businesses don’t respond to any of their reviews (Womply)

Missing out on customer interaction through online reviews hurts businesses two-fold. As mentioned above, there’s a massive oversight in potential revenue that comes with companies taking the time to reply to online reviews. Customers are much more likely to shop at your store or site in the first place if they see an acknowledgment from your team.

As hard as it is to imagine, 75% of businesses are losing out by not responding to any of their online reviews.

23. Businesses with 4 to 4.5-star ratings earn the most revenue (Womply)

It makes sense to think companies holding 5-star ratings are the best, but statistics show this isn’t the case. While there’s no doubt that low-rated businesses turn away potential shoppers, flawless reviews have the same effect. As it turns out, a perfect rating appears fake in people’s eyes, leading them to browse elsewhere.

Businesses sitting somewhere between 4 and 4.5 stars actually bring in the most revenue on average. Customers see that, despite your imperfections, you’re still able to provide what they’re looking for.

24. Businesses average 82.5 total reviews across all review sites (Womply)

Even with so many free listing sites, businesses only average a total of 82.5 reviews across all of them. We learned earlier that revenue spikes considerably after 200 reviews in the tank, so most businesses are leaving money on the ground.

These companies likely aren’t providing easily-accessible opportunities for buyers to voice their opinions. Zendesk is a software package capable of handling follow-up emails with clients asking for feedback in the form of a review.

25. Businesses with more than 9 reviews in the last 90 days earn 52% more than average (Womply)

Your shoppers aren’t looking for hundreds of reviews per week, per month, or even per year. People like to zero in on what your company is doing at the moment and want to hear about it from more than one person. Still, generating just nine reviews over the last 90 days of business can earn 52% more in sales than those with less customer feedback.

26. 19% of the reviews the average business receives are negative (Womply)

In the grand scheme of things, you’re going to have to deal with the occasional bad review. However, how often should you expect to see one?

The average business tallies a negative review about once in every five postings. That may seem like a lot, but it still keeps your rating just above the 4-star mark. Above-average companies end up with ratings closer to 4.5 stars and are even more desirable to shoppers.

27. Positive review rates in the United States are highest in Maine and Vermont (Womply)

As more business move online, products can reach new parts of the country. Buyers from New England come across as the happiest, with Maine and Vermont leaving roughly 85% positive reviews each. New Hampshire rounds out the top five in the same category.

Nevada brings up the end of the list but still broadcasts a 77.7% positive review rate. People genuinely are willing to post positive reviews from coast to coast if you facilitate the process.

28. Customers read restaurant reviews more than any other business type (Brightlocal)

No industry leans on reviews as heavily as restaurants do. Would-be customers flock to the internet for diner feedback more than any other business type. Every undercooked steak, long wait, or rude staff member could go into the books as a deterrent for future business. 

29. Only 48% of consumers would consider using a business with fewer than 4 stars (Brightlocal)

The 4-star rating stands at the precipice of a large cliff your business does not want to venture off of. Although customers look highly toward anything between 4 and 4.5 stars, interaction drops drastically once you reach 3.9.

It’s up to you as a business owner to steer your vehicle away from the 3.9 mark and stay in the public’s good graces. Customer relationship management tools help keep your team engaged with consumer needs so you have a clear direction moving forward.

30. People use mobile internet browsers more than any other method for reading reviews (Brightlocal)

We’re always on the go in this day and age and rarely have time to sit in front of the PC to read reviews. Instead, we spend the most time looking at reviews on a mobile internet browser than anywhere else.

Many businesses forget about the unique formatting requirements mobile devices need to see and read the information clearly. While you can’t control what Google does, you can drive people toward Google in a mobile-friendly way. It’s also worth noting that internet browsers see more use than apps.

31. 92% of users will use a local business if it has at least a 4-star rating (Invesp)

If you can keep your local business above a 4-star rating, you’ve already won over 90% of the people in your community. It doesn’t matter if your business is next door. People still head online to make a decision about you before stopping by in person. It’s imperative to stay up to date with your online reviews, even if your company doesn’t do a lick of digital business. 

32. The majority of customers read 2-6 reviews before trusting a business (Invesp)

The best review imaginable isn’t going to cut it if you don’t have others saying the same thing. It doesn’t take long for the average consumer to flip through online reviews, and most people need to see two to six good ones before putting trust in you. While that seems like a steep ask, it also helps customers weed out fake negative postings that don’t accurately reflect your business.

33. Average reviews are only 200 characters (Reviewtrackers)

Over the past ten years, Google and Facebook have trended toward shorter customer reviews. On average, customers type out 200 to-the-point characters when sharing about their business. This is no more than a few sentences with specifics about their experience.

Yelp and TripAdvisor still feature higher review counts, with an average closer to 600.

34. 53% of customers expect businesses to respond to negative reviews within a week (Reviewtrackers)

Responding to reviews is already a huge feather in a business’s cap, but it goes one step further. When customers post a negative review about your company, half of the people expect an explanation within the first seven days. Missing the mark here can give the impression you don’t have a solution to the problem and might scare other customers off.

35. 67% of people believe fake reviews are a problem (NearMedia)

People have learned not to believe everything they hear on the internet, and this holds especially true when it comes to online reviews. Two-thirds of people believe fake postings are a problem and weigh this factor when reading about your business.

Although review sites like Google take great lengths to remove fake reviews, it doesn’t have the means to catch them all. What’s worse, 33% of the population don’t yet consider fake reviews to be significant when casting judgments on your site.

There may not be a way to stop fake reviews from targeting you, but these cheap imitations tend to disappear in a sea of credible, positive feedback. Don’t expect these satisfactory reviews to shop up on their own. Reach out and incentivize customers to share their experiences.

36. 57% of consumers need at least a 4-star rating before they choose to use a business (Brightlocal)

Online businesses are numerous, and consumers will likely browse reviews before picking out the best one to shop at. 57% of people will turn away from any business with less than our stars as an overall rating.

While an exciting web design and a cool name are crucial, don’t forget to invest in the customer experience, reading feedback, and handling concerns that may pull your rating into no man’s land.

37. 80% of 18-30-year-olds have written online reviews (Brightlocal)

18 to 30-year-olds grew up in a digital age and have the best handle on how the system works. 80% of those in this category are already familiar with the online review process and have written at least one. This is a great demographic to target when asking for business reviews.

When using HubSpot’s customer relationship tools, filter your existing list of contacts by this age range and prompt them for those reviews when you follow up after a sale.

38. Only 41% of consumers over 55 have written a review (Brightlocal)

Unlike the younger demographic, those growing up before the age of personal computers have a much smaller digital footprint. Of those 55 and older, only 41% have ever written any type of review. It stands to reason that they read fewer reviews as well.

When marketing, it’s understandable to hone in on younger generations for the most feedback. However, there’s still a considerable number of those in the 55 and up crowd willing to contribute to your site if you give them a chance.

39. 22% of consumers will not buy after reading just one negative review (WebsiteBuilder)

Negative reviews can bear a heavy burden on your business, whether justified or not. One in five consumers will walk away after reading just one negative review posted about your company. When you break down the math, that could be upwards of 30 customers.

While probably an unfair course of action, the loss of customers spells fewer sales and revenue. To make matters worse, only 40% will stay with you after uncovering three negative reviews. It’s possible to avoid all negative reviews, but your response to them and the number of positive reviews you get will help compensate.

40. Consumers trust peer reviews 12 times more than manufacturer descriptions (Econsultancy)

Big-box stores like Amazon have tainted the consumer perception of a good product description for the worse. Customers translate this way of thinking to all websites and will be wary of descriptions listed about their own goods.

Luckily, consumers trust the information in peer reviews 12 times more than anything you have to say. Encouraging consumers to post product details, experiences, and pictures can be incredible selling points on top of a flattering score.

41. 27% of people will only trust reviews if they believe they are authentic (WebsiteBuilder)

Our society is not as trusting as it once was, and many individuals are skeptical of information found on internet sites and online reviews. Upwards of one-quarter of the population will only trust reviews if you’ve gone to enough lengths to show credibility. In their eyes, anything looking suspect isn’t worth considering.

42. Only 33% of travelers posted a travel-related review (WebsiteBuilder)

Many people love the joys of travel, but apparently, we don’t like posting about our trips. After returning to the grind, only 33% of travelers return to share a travel-related review on a site, restaurant, or experience they had while on the road.

There’s a huge opportunity here for travel businesses or those with heavy tourist traffic to collect customer information and follow up down the line. A boost in reviews can easily spell additional clients and increased revenue.

43. 84% of people trust online health reviews as much as a personal recommendation (Inc)

Word of mouth has primarily been the go-to for health-related services and information, but the trend appears to be changing. 84% of people now trust online health reviews just as much as a recommendation from a family member or colleague. This means people are just as willing to choose a doctor from internet listings as call up someone they trust for a suggestion.

Considering the impact of review ratings, businesses in the health industry would be wise to invest in tools designed to improve the overall customer experience.

44. 77% of patients use online reviews as the very first step in finding a doctor (WebsiteBuilder)

After trying to self-diagnose, people are now turning to online reviews as the first step in locating a doctor. Before checking with friends and family, 77% of people jump online to gather information about who has the highest marks in the area.

As we’ve learned earlier, individuals are especially cautious of any business below a 4-star rating. Whether you’re a clinical manager or a doctor, it’s imperative to give patients a reason to say good things about your practice.

45. 81% of females would not visit a restaurant with cleanliness issues in reviews (WebsiteBuilder)

Some say cleanliness is next to godliness, and female review seekers tend to agree. No matter your overall rating, 81% of women would avoid visiting a restaurant if your online reviews mention cleanliness issues.

One can only speculate how dirty a restaurant must be to deter potential customers. A single bad review may be enough for some, but more likely these female diners balk at patterns in reviews from multiple sources. It’s worth noting that these individuals won’t even bother entering your restaurant to see if the claims are actually valid.

46. 76% of individuals research a company online before considering a job opportunity (WebsiteBuilder)

Your online rating speaks to more than just potential customers. Over three-quarters of job seekers will go online and read about your business before applying. Without a doubt, this research will include customer experiences and what current and past employees have to say about your work environment.

Online review sites make it easy for anyone to voice their opinion, good or bad, about a job at your company. Since these go-getters are likely the people you want to hire, it’s important to ensure those reviews accurately reflect conditions at your company.

47. 60% of job seekers would not apply to a company with a one-star rating (WebsiteBuilder)

In line with the previous statistic, 60% of those looking for employment won’t even bother applying to a company with a one-star rating. Having bad review scores can affect your bottom line and your ability to keep or hire new staff to keep your business running.

48. Approximately 99% of restaurants are hidden when Yelp users sort by “Highest Rated” or “Most Reviewed” (WebsiteBuilder)

Yelp is one of the most highly used review sites on the web. With so many reviews, people often filter searches to hone in on precisely what they’re looking for. Unfortunately for a majority of businesses, using the “Highest Rated” or “Most Reviewed” filters hides over 99% of available options.

In a sea of restaurants, it’s a constant battle to stay high enough to be one of the lucky few. Even if you live in a small town, customers gravitate toward restaurants at the top of Yelp’s list and tend to ignore those down below.

49. 57% of consumers using social media in stores are reading online reviews (WebsiteBuilder)

Those customers wandering around your store with their phones out may not be giving you the cold shoulder. Approximately 57% of consumers on social media in-store are actually reading online reviews. They’re checking out what others have to say about your business and are interested in hearing about which products or services are creating the biggest buzz.

50. It takes 12 positive reviews to cancel out the nasty side effects of just one negative review (Online Reputation Management)

We don’t always deserve those negative reviews, but they are inevitable. The damage from just one can be long-lasting, depending on how quickly your business can settle the score. It takes 12 positive reviews to cancel out the impact of that one-star punch in the gut.

While your rating may recover quickly, customers want to see enough positive reviews to know you’ve addressed the problem at hand. Even if it was just a bad day, you need to show customers it’s a non-issue to restore trust. This means reading all your reviews, positive and negative, to hear the voice of your customers.

Promoting opportunities for clients to review your business will help those positive remarks to come in that much faster.

51. TripAdvisor had 26 million reviews submitted in 2020 alone (TripAdvisor)

In case you still doubt the power of online feedback, consider that TripAdvisor received 26 million reviews in the near 2020 alone. With many places in a complete shutdown, people weren’t even traveling that much then! Consumers are reading and writing reviews more than ever, and the role this plays in your bottom line is huge.

52. Accommodation reviews average 688 characters in length (TripAdvisor)

Travelers really go all out when it comes to the places they stay. The average accommodation review is a thorough 688 characters in length.

In truth, this number comes from TripAdvisor’s commitment to excellence. 100% of the site’s reviews must be in long form with a snippet and rating to meet high-quality standards.

53. Businesses replying to reviews at least 25% of the time have an average of 35% more revenue (Womply)

It really does pay to read and respond to reviews customers leave on the internet. Replying to even a quarter of the reviews you receive across various sites brings in on average 35% more revenue.

The moment consumers see you’re engaged, they become much more willing to spend time on your site or physical location. Of course, the way you present yourself speaks volumes about how would-be customers perceive your store.

54. 72% of consumers will take action only after reading a positive review (Invesp)

An overwhelming majority of consumers won’t give you the time of day until they’ve read a positive review about your business. While this may not seem like too challenging a feat, those individuals need to find reviews for your store among an ever-increasing pool of assessments on similar companies.

The more opportunities you provide clients to review you, the more positive findings exist for others to locate. Frequent reviews will also help keep you in the spotlight on all the big review sites.

55. A one-star increase on Yelp leads to a 5-9% boost in revenue on average (Invesp)

If your company’s star rating isn’t where you want it to be, take action to give that score a boost. Moving up one star on Yelp leads to revenue increases averaging 5%to 9%.

The best ways to improve your score are by addressing the most common customer concerns that bring in lower-than-ideal reviews. At the same time, stay connected with customers and encourage them to leave positive but honest feedback.

56. Star rating is the most important review factor (Brightlocal)

Your overall star rating still leads the way as the most important factor potential customers use in making judgments about your business. With the rise of fake reviews, legitimacy comes in as a close second. Rounding out the top three is how recent the reviews for your company are.

57. 73% of consumers say written reviews make more of an impression than star/number ratings (FanandFuel)

Customers still look at star ratings first when deciding which businesses to consider. Once you’ve passed that test, shoppers look to the written word for the final say.

What other customers have to say about your store resonates the loudest in the minds of most consumers. In fact, 73% feel that written reviews make more of an impression than your star rating.

58. 94% of consumers say a bad review has convinced them to avoid a business (Reviewtrackers)

Nearly all consumers have come across at least one review so bad that they decided to avoid the business entirely. Whether the review was right on the nose or completely from the left field, the effect can still be the same.

You don’t have to remain silent in the matter. As long as you remain tactful, you can (and should) address negative reviews with proof against the claim or a plan for resolving your issues.

59. Customers who have a bad experience are twice to three times more likely to write an angry review than customers who had a great experience are to post a happy review (Online Reputation Management)

We all have those days where one bad experience just sours all the good we experience before or after. When upset, we also tend to be looser with our tongues or fingers in the case of a scathing review. As a result, customers are doubly likely to write a bad review over a poor encounter than those having an amazing time.

For business owners, you need to go above and beyond to flesh out positive reviews from shoppers after these types of experiences. Not only will the positives help cancel out that one bad review, but customers also look for this exact type of feedback when deciding where to shop.

60. The Federal Trade Commission cited more than 700 businesses for deceptive endorsements in 2021 (FTC)

The FTC is as tired of fake reviews as we are and are cracking down on companies with detective advertising. Over 700 businesses last year alone received citations for misrepresenting an endorser in some way, shape, or form. The list includes many well-known companies now under careful watch and major financial penalties should they attempt to deceive customers again.

Bottom Line

Whether you’re a fan of online reviews or not, there’s no getting away from the impact they have on your business. Positive reviews have the power to bring in new customers and additional sales, whereas negative reviews can sink a business in no time flat.

As a business owner, it’s imperative to know what people are saying about your company. You can discover problems you didn’t know existed and show the voice of your customers matters. Employing methods to promote review generation from your shoppers is key for boosting ratings and staying ahead of the competition.

The 10 Best (& Worst) States to Buy Investment Property in 2023

Two businesspeople shaking hands on an investment property deal

Rental properties are a great way to earn income either full-time or on the side. However, some states are better than others regarding returns on these types of investments. This article looks at the 10 best states to buy investment property this year (and the worst states for real estate).

1. South Carolina

South Carolina

One of the original 13 colonies, South Carolina is full of old-world charm and whimsy. You’ll find plenty of coastlines and history alongside a warm climate. Sprinkled within are cities such as Charleston and Columbia. These locations offer great universities, plenty of hospitality, and some of the lowest crime rates in the country.

At 0.57%, South Carolina has some of the lowest property taxes as well. With homes averaging $170,000, costs are only about three-quarters what you’d pay in other parts of the country. This is still true despite a 1% increase in the last few years. Median household income comes in at $54,800.

Approximately 30% of South Carolinians rent homes and on average pay $922 per month. The state’s population is increasing at a rate of 1.27% per year. This is just under the 1.43% employment growth across all occupations.

2. Idaho

Best states to buy investment property - Idaho

Known as the Gem State, Idaho is a gem to live in. Even if potatoes aren’t appealing, there are plenty of other reasons Idaho is desirable. There are state parks everywhere and less than two million people throughout. Crime rates are also some of the lowest in the nation, even in bigger cities like Boise.

Looking at the numbers, Idaho’s median household income nearly crosses $59,000. This value shifts upwards by over 8% each year. The state has a booming economy with one of the best employment rankings in the United States.

Property values see a steady rise, moving from $230,000 to over $250,000 in just a year’s time. Renters typically pay $900 for lodging and make up 28.4% of the total population. It’s clear homes are being rented and sold, as the population steadily increases by 2% year over year. Moreover, it’s also the best state for real estate in the U.S.

3. North Carolina

Best states to buy investment property - North Carolina

North Carolina looks to impress with a nice mix of beachfront and mountains. There’s an abundance of things to do outdoors, and the weather cooperates for most of the year. Colleges and universities are some of the best in the country, right alongside healthcare options. Residents never have to go far to find good food or southern hospitality.

The state boasts a thriving job market, especially in top cities like Charlotte and Raleigh. Fortune 500 companies litter the cities, drawing in top talent. Even so, median property values across the state come in at $183,200, significantly lower than the national average. Median household income is closer to the standard at $56,600. Both numbers are increasing nearly 7% per year.

Property taxes are near the country’s midpoint of 0.90%. Residents have to deal with a fixed 5.25% for better or worse. 34.7% of the state’s population are renters, costing them on average $1,234 per month. This number is over 20% higher than it was in just 2021.

4. Florida

States to Buy Investment Property - Florida

Florida boasts an extra month of sunshine compared to the national average each year, explaining its well-earned nickname. The desirable climate brings young and older people looking for work or the ideal retirement lifestyle. As a popular vacation spot, even travelers like to take advantage of rental properties. It doesn’t hurt that Florida is one of the few states not charging any income tax for residents.

The state’s population sees consistent growth, increasing around 1% each year. The median property value sits at $245,000 and is on track to increase year after year. This fits well with the state’s median of $59,227, which jumped roughly 6%. Average rent at present lies somewhere in the $1,200 range. One and two-bedroom homes have gone up 38% since 2021.

Approximately 34% of Florida residents rent a home or apartment, slightly higher than the national average. Employment opportunities saw a 2.5% growth to help draw people in. Florida’s biggest downfall is property taxes, landing in the $3k range.

5. Tennessee

States to Buy Investment Property - Tennessee

Tennessee is beautifully split between the Great Smoky Mountains and stunning flatland. The music scene in Nashville is second to none, and many other cities rise to the challenge as great places to live. It features top-notch hospitals and stellar schools and universities to draw in families. The location also makes for temperate weather during all four seasons.

Taxes are a draw here, with 0.71% property taxes and no income tax to speak of. Median household income is lower than other parts of the country, coming in at around $54,800. It nearly matches the 8% property value growth from last year. Those looking to buy homes should expect to pay an average of $191,500.

One-third of the state’s population are renters, paying on average $910 per month. Tennessee has an above-average job growth rate, seeing a 4.14% change from 2021. Its population is increasing steadily, up just under 1% year over year.

6. Colorado

Colorado

Colorado is another state with breathtaking outdoor landscapes. Best known for skiing, potential renters will also find sand dunes, rock formations, and water. With cities like Denver and Colorado Springs, it’s not difficult to find the best of both worlds. 

The state draws in people with its tax benefits, with a 4.55% flat income tax and 0.51% property tax rate. The state is full of economic opportunities, toted by some to be the best in the country. The result is a median household income of $77,000 that crushes the national average. This is offset slightly by property values hanging out around $394,000. The success keeps the poverty level below 10%.

Colorado has more renters than most others, with 34.1% of people choosing not to buy. Rent is higher here as well at approximately $1,700 per month. This excitement brings in new families, with the population rising by over 1% each year.

7. Arizona

States to Buy Investment Property - Arizona

Nestled in the dry southwestern part of the United States, Arizona doesn’t see much seasonal change. Cities like Phoenix score over 300 days of sunshine, and winters rarely dip below 70°. The state’s 7 million people are spread out over 113,000 square miles, providing more stress-free living.

Arizona has a healthy job market as well, falling into the top ten states for employment in the Union. Median household incomes come in at $61,529, near the national average. This number is up nearly 5% from last year. Property values are rising slowly throughout the state, averaging at $255,900.

At 0.66%, property taxes are lower than average. However, income taxes can range anywhere from 2.59% to 8%, depending on the income bracket. 34.7% of residents choose to rent instead of buy, paying around $1,100 per month. This value is up an impressive 32% from last year.

8. California

Best states for buying investment property - California

Making up a large chunk of our Pacific coast, California offers an abundance of amazing beaches and incredible city life. The state pulls in vacation-goers year-round, creating opportunities for short-term rental income in every season. Its cutting-edge technology, vibrant food, and movie scene give people plenty of reasons to stay.

California does have a high cost of living, with median home values soaring above the $530,000 mark. With household incomes averaging $78,600, over 45% of residents rent instead of buy. Rent looks to be over $1,600 per month. The state only loses out to Hawaii in rental costs. While the population isn’t increasing, California nearly leads the nation in job growth.

Property taxes in California aren’t as bad as one might think, sitting at 0.76%. On the other hand, income taxes for residents can range from 1% to 13.3% depending on how much a family brings in.

9. Indiana

Best states for buying investment property - Indiana

The only Midwest state to make the list, Indiana has a reason to be here. It has job opportunities across many markets, from farming to healthcare and everything in between. Nestled in the crossroads of America, Indiana’s ideal location allows residents to see what the rest of the country has to offer.

Indiana’s super low cost of living makes it one of the cheapest states to live in. This even holds true in the capital of Indianapolis. Property taxes are a bit lower than other parts of the country, but the state does well with fixed 3.23% income tax rates. Median property values increase roughly 6% each year and are quite low at $148,900.

As budget-friendly as Indiana is, median household incomes are $58,200, not far from the national average. 30.7% of the population are renters, paying on average $920 each time rent is due.

10. Texas

Best states to buy investment property - Texas

From high school to the professional level, the Lone Star state draws communities together through its sporting events. It’s well-known for its schools and beautiful weather to catch events in. Being so large, Texas has a diverse culture and just as many unique things to see and do. To sweeten the pot, Texas residents don’t have to pay a dime on income tax.

Texas has an impressive economy, boasting the world’s ninth-highest above even Canada and South Korea. Employment grows at a rate of 3% each year. Households bring in an average of $63,800 per year, on par with the rest of the nation. This number has grown 5.6% in the last year alone. This ties back to a population rising by 300,000 people from January to January.

The state’s largest thorn is property tax. At 1.8%, these are some of the highest in the country. Nearly 40% of residents rent homes, though, paying an average of $1,340 per month. Property values are lower than expected, with a median value of $200,400.

10 Worst States to Buy Investment Property

Not every state offers good opportunities for making money from investment properties. Below are 10 states it’s best to avoid if you’re planning to buy investment property.

41. Illinois

Illinois has one of the highest property tax rates in the country. In addition, the state saw its 8th straight year of population decline as people look for better job opportunities and more affordable housing.

42. South Dakota

High property taxes are just one of South Dakota’s issues. The state has seen a decline in employment over the last few years, and rent prices have fallen considerably as well.

43. New York

New York saw home values drop in 2021, harming rental prices for investors. The state also sees high property taxes that further reduce returns. 

44. West Virginia

West Virginia has a poor state infrastructure, with low scores in bridges, dams, roads, and water. There’s little opportunity for job growth, and healthcare and education aren’t any better. The state is also one of the poorest.

45. Michigan

Despite being a center for automotive growth, Michigan sees some of the lowest job growth rates of any state. Its major hubs are riddled with crime and residents are leaving to pursue opportunities elsewhere.

46. Wisconsin

Wisconsin has some of the highest property taxes of any other state. Business opportunities are stagnant, and a low rent to house cost ratio means significant time before seeing any return on investment.

47. Mississippi

Mississippi sees the lowest median household income in the nation, helping to account for an over 20% poverty rate. Property values are low, and rentals have little opportunity to make money.

48. New Mexico

New Mexico doesn’t sit well with those looking for quality of life. The state struggles with crime, poverty, and low education standards. In addition, it has one of the worst economies in the country that’s not bringing people in.

49. Hawaii

Hawaii’s cost of living is the highest in the nation, with a median household income that can’t keep up. There also aren’t many job opportunities on the islands, and access is limited.

50. Louisiana

Louisiana ranks dead last in job growth in the entire country. The state also scores low in healthcare and education. It takes the top spot for both crime and poverty, beating out other states by a considerable margin.

How We Ranked the Best & Worst States to Buy Investment Property

The success of investment properties hinges on several factors from state to state. 

We carefully considered reasons that serve to bring new individuals and families to a state. These factors include employment opportunities, quality of life, and overall cost of living. Similarly, we thought about how landscapes and cities tend to draw people into certain locations.

It was also important to look into factors that speak to an investor’s bottom line. Things like property taxes, housing rates, and cost of rent all affect how much a renter can generate each month. We made sure these numbers look to increase year after year for long-term sustainable income.

Bottom Line on the Best States for Buy Investment Property

The best states to buy investment property exude all the features potential renters look for work and leisure. Employment opportunities must abound to draw people in, and cost of living and quality of life must be sufficient to keep them from leaving. The states that made our list check these boxes while laying the groundwork to continue doing so for years to come.

10 Best States for Starting a Business – Where to Launch Your Startup 

U.S. map showing the worst and best states for starting a business

According to the US Bureau of Labor Statistics, around 47 million people quit their jobs in 2021. Then, roughly 5.4 million new business applications were filed, a 53% increase from 2019. If you’re thinking about joining this entrepreneurial club, several crucial decisions lie ahead. Below are the best states for starting your business. 

U.S. map showing the worst and best states for starting a business

The Best States for Starting a Small Business in 2023

Different states use different attributes and statistics to sell themselves as the most business-friendly state. However, we used a wide-ranging and all-inclusive set of factors to level the playing field. We’ve considered several federal and state government reports, independent studies, and responses from real business owners from all over the US to evaluate the best states to launch a startup.

The 10 best states for starting a business in 2023: 

  1. Texas – Best Overall
  2. Utah – Best for Business Financing
  3. Montana – Best for Business-friendly Policies
  4. Georgia – Best for Cost of Labor
  5. Florida – Best State for Starting a Business for Tax Purposes
  6. California – Best for Innovation
  7. Oklahoma – Best for Cost of Doing Business
  8. Idaho – Best for Real Estate
  9. North Carolina – Best for Starting an LLC
  10. Delaware – Best for Privacy Protection

1. Texas – Best Overall State to Start a Business

The Lone Star State ranks as the best state for starting a business for its business-friendly performance on all fronts. Texas has seen tremendous economic growth in recent years. An increasing number of new entrepreneurs are emerging in the state every month with an average of 400+ Texans opening a business every day. 

It boasts one of the most favorable business climates in the country with no personal or corporate state income taxes. This makes it one of the best states for starting a business for tax purposes. Since Texas is the second-largest state by population, it has no shortage of labor. A large number of cities and universities also guarantee a young and skilled workforce.  

Texas has one of the highest business survival rates in the US, a low risk of natural disasters, and a well-developed infrastructure to facilitate business growth. When it comes to drawbacks, starting a business in Texas has only one. The cost of running a business here is higher than in some other states. 

2. Utah – Best State to Start a Business for Business Financing

Utah is the second-best state to register your business with a fast-growing working population and a well-developed economy. The Beehive State has a healthy supply of labor, a supportive regulatory environment, and easily accessible business financing. This is why it enjoys the second-highest growth in the number of small businesses. It was also ranked the No.1 state for entrepreneurs in 2020.

Utah is the best state to get money to start your business with plenty of venture capital available. When it comes to fiscal matters, the state is known for its small-business-friendly tax environment. Its individual and corporate income tax rates sit at 4.95% which is relatively lower than most other states. 

Just like Texas, Utah isn’t the most affordable when it comes to the cost of labor and the overall cost of doing business. Still, it has excellent consumer spending and its five-year business survival rate of almost 50% speaks for itself.

3. Montana – Best State to Start a Business for Business-Friendly Policies

Also known as the Treasure State, Montana welcomes small businesses with startup-friendly policies, zero state sales tax, and a very good five-year business survival rate of 53.4%. It enjoys a fast-growing economy, reasonable labor costs, and safety from climate disasters.

The 6.75% corporate income tax rate isn’t the best, but it’s not too bad either. Montana doesn’t enjoy as much consumer spending as Texas or Utah, but spending is on the rise. Despite all that, the Big Sky Country’s relaxed regulatory environment and inexpensive property make it the third-best state for starting a business. 

4. Georgia – Best State to Start a Business for Cost of Labor

Well-developed infrastructure, a strong economy, and a skilled workforce are the strongest selling points for Georgia, the Empire State of the South. The state government strives to help businesses grow and finance small businesses with ease.

It has one of the highest levels of venture capital available which makes it a great place to go if your startup needs financing. Georgia has easier payroll laws with one of the lowest state minimum hourly wage rates. The Peach state’s individual and corporate income tax rates sit at 5.75% and have a low cost of living, making it a great place to start a business. 

5. Florida –  Best State for Starting a Business for Tax Purposes

Home to four of the most small business-friendly cities in the country, Jacksonville, Orlando, Fort Lauderdale, and West Palm Beach, Florida is fast becoming an SMB heaven. It has no state income tax for individuals and only a reasonable 5.5% corporate income tax rate. Not just that, low rates on some other types of state taxes make it the best state for starting a business for tax purposes. 

The rate of new entrepreneurs has steadily risen in recent years, but it’s hard to achieve sustainable growth in Florida. The Sunshine State’s five-year has a 49.5% business survival rate which means more than half of new SMBs will not make it here. 

Plus, it has a higher risk of natural disasters. Despite the drawbacks, Florida is still a pretty good option with low labor costs and easy access to capital. 

6. California – Best State to Start a Business for Innovation

Home to Silicon Valley, California is at the forefront of technological innovation. Apart from 53 Fortune 500 companies being based in the state, California is great for small businesses too with the second-highest number of new businesses formed. 

The Golden State leads in innovation and availability of capital and has a highly skilled workforce. But starting a business in California has its downsides. The cost of doing business here is one of the highest in the country. The corporate tax rate is also very high at 8.84%. 

7. Oklahoma – Best State to Start a Business for Cost of Doing Business

Oklahoma has the third-highest business survival rate in the US. Almost 82% of all new businesses survive the first year and almost 50% survive five years. With the lowest cost of doing business in the country, Oklahoma is an excellent option if you want to start a business with limited resources. 

The Sooner State has plenty of venture capital available and a relatively longer average workweek which makes it one of the hardest working states in the US. Its weaknesses like a less skilled workforce and lower consumer spending bring it down to no.7 on our list of best states for starting a business.

8. Idaho – Best State to Start a Business for Real Estate

Also crowned as the best state for real estate, Idaho has one of the strongest state economies and most business-friendly policies in the country. It’s a great place to start if your business infrastructure needs a safe physical environment. With a very low risk of natural disasters, the Gem State has vast untapped potential that can act as a booster for your new business.

Idaho is one of the fastest-growing states and offers a healthy supply of skilled labor, good infrastructure, and the regulatory environment isn’t too strict. When it comes to taxes, both personal and corporate income tax rates are 6.93%. The cost of doing business is also a bit higher, placing Idaho toward the lower end of our list. 

9. North Carolina – Best State for Starting an LLC

One of the best states to buy investment property, North Carolina has a robust economy, a strong workforce, and plenty of venture capital. Compared to other states on this list, North Carolina may seem an uninteresting choice. But several factors combine to make it a very practical state to start a business. 

Apart from low business costs, plenty of labor, and relaxed compliance requirements, NC’s strongest selling point is the ease of starting an LLC in the state. At 2.5%, the state’s corporate income tax rate is one of the lowest in the country. The individual income tax rate, however, is not as low sitting at 5.25%.

10. Delaware – Best State to Start a Business for Privacy Protection

Technically, Delaware isn’t the most small-business-friendly state. However, many new entrepreneurs prefer registering their business here for a range of reasons. First, the state of Delaware doesn’t require LLCs to provide member names and addresses in their public filings. 

Filing an LLC here makes sure your information stays private. This is also why many businesses prefer getting a Delaware-based registered agent service

The First State also offers asset protection from lawsuits. It doesn’t have any sales tax, however, the corporate and individual income tax rates are pretty high at 8.7% and 6.6%, respectively. Apart from a strong state economy, Delaware doesn’t have much to offer. It still can be your top choice if you prioritize privacy and asset protection. 

5 Worst States for Starting a Business

While we’re at it, we might as well discuss the worst states for starting a business in 2023, and why. We used the same set of factors to evaluate the worst states for doing business as we did for the best ones. 

46. New York – High Costs of Living

New York has one of the highest costs of living not just in the US, but in the world. The state is also known for its high taxes with an individual income tax rate of 8.82% and a corporate rate of 6.5%. 

Of course, the high costs of living also translate into the high costs of doing business in the Empire State. Starting a business in New York will cost you dearly, but there’s a silver lining because with high risk comes high reward. 

47. Vermont – Aging Workforce

Vermont has very high tax rates with corporate and individual tax rates at 8.5% and 8.75%, respectively. Plus, finding financing in this state is like finding a needle in a haystack. Vermont suffers from a labor problem as the state has an increasingly aging workforce. 

All in all, launching a startup in Vermont is a long shot. But you still have a chance at success as almost half of all new businesses survive five years in this state. 

48. New Jersey – Worst State for Tax Purposes

With numerous higher education institutions based in New Jersey, its workforce has great potential. However, the tax rates in this state are even higher than in its neighboring state of NY. It has an individual tax rate of 10.75% and corporate at 9%. The cost of doing business is very high too as the highly skilled workforce demands high compensation to afford a living in the Garden State.

49. Hawaii – High Cost of Doing Business

Hawaii is beautiful, but it’s not a great place to start a business. The Aloha State has seen the highest one-year business failure rate with 25.4% of businesses not making it past 12 months. Coming across skilled labor is difficult as the remote island state lacks educational facilities. 

Though the cost of labor is reasonable, acquiring raw materials and other costs associated with running a business touch the sky. Tax rates are also unreasonably higher than most other states. We would only recommend running a business here if it’s in the tourism industry or something that your area absolutely needs. 

50. Rhode Island – Worst Overall

Rhode Island is the worst state to start a business. It has the oldest infrastructure in the country, expensive real estate, high labor wages, and a poor economy. The cost of living, and proportionately the cost of doing business is also very high in the Ocean State.

Less than half of all new businesses survive the first five years in Rhode Island. As the smallest state with a population of just over a million, the supply of labor is diminishing. It also faces diminishing consumer spending, making it a bad choice for starting a new business. 

How We Ranked the Best & Worst States for Starting a Business

Ranking states on their suitability for starting a new business involves several factors varying in weightage. Before we get to them, it’s important to mention that different entrepreneurs have different preferences. While you might prioritize a low cost of labor, another business owner would prefer privacy protection or cheap real estate.

The ultimate decision on where to establish your business depends on what you find important. That said, here’s the list of factors we looked at while evaluating the best and worst states for starting a small business. 

  • Tax rates: The taxes you pay directly impact the profitability of your business. Higher individual and income tax rates make it difficult to reinvest and grow your business.
  • Business survival rate: Statistics speak for themselves. This simple percentage gives a rough estimate of how likely a new business is to succeed in a state. 
  • Workforce: A young and skilled workforce is crucial to the business environment in a state. A growing workforce also results in lower costs of labor.
  • Regulatory environment: Each state’s policies determine how it welcomes new businesses to open their doors. While some states go easy on small businesses, some make it unnecessarily difficult to set up shop.
  • Cost of doing business: Business costs are the single most important factor when it comes to business profitability. A business that can’t cover its expenses is likely to fail soon after launching.
  • Risk of natural disasters: Last but not least, you always want to consider how safe your investment is in the face of unexpected events. Climate change has put the United States at a higher risk of natural disasters, and some states are more disaster-prone than others.

Bottom Line on the Best States for Starting a Business

We rank Texas, Utah, and Montana as the top three best states for starting a business. Rhode Island is on the other extreme end of the spectrum as the worst state to launch your startup. 

We considered several factors while preparing this guide. We studied federal and state government reports, independent studies, and responses from real business owners to acquire information. However, your ultimate decision on where to start your business depends on what you find the most important factor.

15 Best States For Real Estate (and 5 Worst States)

US map

Whether you want to purchase a home for your family or invest in a commercial or residential property that will appreciate, you must know the best states for real estate. Each state has different growth rates, property prices, and property taxes. Here is a comprehensive list of the best states for real estate in 2023.

1. Idaho

Best states for real estate: Idaho

Idaho is nestled into the northwestern part of the United States and is known for its immaculate natural landscapes and protected wilderness. The total real estate appreciation rate for the last two years is 47.64%. Over the past decade, Idaho has seen a real estate appreciation rate of 162.85%. 

This wildly high appreciation rate is driven by increased demand for real estate in Idaho. With the cost of living 2% lower than the national average and a low mortgage rate of 2.9%, more people are looking at Idaho as a place to move their family or invest in real estate.

Growth has been incredibly phenomenal in these states:

  • Harrison
  • Cataldo
  • Marsing
  • Athol
  • Island Park

Here is a comprehensive list of Idaho real estate statistics:

  • Median home value: $408,004
  • Average market rent: $1,447 per month
  • Occupied housing: 88.1%
  • Number of homes and apartments: 649,299
  • Job growth: 3.25%
  • Population growth: 2.9%

2. Arizona

Arizona

Arizona sits in the southwestern region of the United States and borders California on its west. Arizona’s total real estate appreciation has been 40.29% over the past two years and 27.99% over the past 12 months. As such, Arizona has realized some of the highest real estate appreciation rates in the United States.

Although the cost of living in Arizona is similar to the national average, Arizona features a low mortgage rate. This is why Arizona is one of the most lucrative markets for real estate investors. Furthermore, Arizona experienced the third-fastest recovery in the nation of jobs lost from the pandemic. Forecasters expect over 700,000 new jobs to be added before 2030.

The job growth is an excellent indicator of a growing real estate market because the new workers will need a place to live. The state of Arizona also has exceedingly landlord-friendly jobs. A few cities in Arizona doing better than the state’s average include Chandler, Oro Valley, Gilbert, Tucson, and Flagstaff.

Here is a list of relevant Arizona real estate statistics:

  • Median home value: $365,573
  • Average market rent: $1,919 per month
  • Occupied housing: 86.9%
  • Number of homes and apartments: 2,643,430
  • Job growth: 3.1%
  • Population growth: 1.5%

3. Maine

Maine

Maine, which sits on the northeastern corner of the United States, has also seen high real estate growth rates. Over the past two years, Maine’s real estate appreciation rate was 30.98%, and 20.59% over the past 12 months. Although Maine has a lower median income level than the national average, it has a lower cost of living and a low mortgage rate of 2.9%.

Many people from New England and elsewhere around the country choose to retire in Maine. Furthermore, real estate investors see Maine as a great opportunity to buy lower-priced property in a great market with the ability to charge above-average rent rates. As a result, Aroostook and Washington counties have seen the highest growth recently. 

Let’s look at Maine’s real estate statistics:

  • Median home value: $279,001
  • Average market rent: $1,393 per month
  • Occupied housing: 76.3%
  • Number of homes and apartments: 569,551
  • Job growth: 2.0%
  • Population growth: 1.1%

4. Utah

Utah

Similar to Idaho, Utah is a state known for its wildlife and natural parks. The total real estate appreciation rate over the last two years in Utah was 39.25%. Over the past decade, real estate has appreciated 134.63%. 

Utah’s above-average median income leads this high growth. As an above-average earning income state with low mortgage rates, Utah is bound to be an attractive destination for real estate investors and new homeowners. The highest growth Utah cities include Park City, Vineyard, Montezuma Creek, Salt Lake City, and South Salt Lake.

Relevant Utah real estate statistics include:

  • Median home value: $479,111
  • Average market rent: $1,838 per month
  • Occupied housing: 90.4%
  • Number of homes and apartments: 1,003,345
  • Job growth: 3.6%
  • Population growth: 1.3%

5. Montana

Skyline of Montana

Montana is a landlocked state in the Northern part of the United States that shares 14 border crossings with Canada. Montana’s real estate appreciation rate has risen 34.68% over the past two years and 89.63% over the past decade.

This state features a low cost of living and low mortgage rates compared to the national average. Although the median household income of $72,100 is lower than the national average, Montana is exceptionally affordable to live in, which makes it attractive for new homeowners and real estate investors. 

Many people are leaving California and moving North to Montana because of the booming real estate market, affordable housing prices, and lower tax rates. There are also few regulations on landlords in Montana and no statewide rent control. The top highest appreciating Montana cities since 2000 are Jordan, Sidney, Fairview, and Scobey.

A few key Montana real estate statistics include

  • Median home value: $372,863
  • Average market rent: $1,268 per month
  • Occupied housing: 84.7%
  • Number of homes and apartments: 436,048
  • Job growth: 3.4%
  • Population growth: 1.7%

6. Washington 

Skyline of Washington

Washington is located in the northwestern corner of the United States and has seen a massive real estate boom over the past two decades. The real estate appreciation rate over the last two years is 21.03%. Additionally, the real estate appreciation rate has been 223.40% over the past two decades.

Washington residents have access to more affordable healthcare and utility rates. However, the overall cost of living in Washington is higher than the national average. Nevertheless, the cost of living is mitigated by a higher median income of $91,600. Along with low mortgage rates, Washington is one of the best states for real estate. 

Furthermore, Washington is one of the eight states with no state income tax. Although the pandemic heavily impacted Washington, the employment outlook is looking much better.

  • Median home value: $524,077
  • Average market rent: $2,009 per month
  • Occupied housing: 92.2%
  • Number of homes and apartments:2,905,822
  • Job growth: 3.5%
  • Population growth: 1.27%

7. New Hampshire 

Skyline of New Hampshire

Located in the New England region of the United States, New Hampshire is one of the best states for real estate. New Hampshire has seen a 28.82% real estate appreciation rate in the past two years and 51.59% real estate growth in the past five years. 

The cost of living in New Hampshire is slightly higher than the national average, but so is the median household income at $98,000 compared to the national average of $79,000. In addition, new Hampshire residents enjoy no state sales, income, or capital gains tax. These features have led to record-high prices for single-family homes as more people work from home.

  • Median home value: $382,761
  • Average market rent: $1,862 per month
  • Occupied housing: 84.4%
  • Number of homes and apartments: 539,116
  • Job growth: 2.6%
  • Population growth: 0.1%

8. Tennessee

Tennessee

Tennessee is another great state for real estate as people are migrating to its best cities. Nashville and the four surrounding cities expect to see a 50% increase in population before 2024. Over the long-term, 500,00 people are expected to move to the region by 2040. 

This inbound migration causes a spike in Tenneessee’s housing market. As a result, the real estate appreciation rate over the past two years was 31.38%, and 22.47% over the past 12 months.

Although the median income of Tennessee is lower than the national average, an average house in Tennessee costs about $162,500 less than the national average.

With low mortgage rates as well, Tennessee is one of the best states for real estate.

  • Median home value: $245,290
  • Average market rent: $1,393 per month
  • Occupied housing: 88.1%
  • Number of homes and apartments: 2,639,455
  • Job growth: 1.8%
  • Population growth: 1.21%

9. Rhode Island

Best states for real estate: Rhode Island

Rhode Island sits in the southeastern region of the United States and faces a booming real estate market from out-of-state investors and people looking to buy multi-family dwellings.

The real estate appreciation rate over the past two years was 27.82% in Rhode Island. Furthermore, the real estate market has grown 49.40% over the past five years. Rhode Island has a higher than average median income rate of $88,000 to account for the higher cost of living in the State. Rhode Island’s mortgage rate also sits low at 2.9%

  • Median home value: $279,001
  • Average market rent: $1,393 per month
  • Occupied housing: 76.3%
  • Number of homes and apartments: 569,551
  • Job growth: 2.0%
  • Population growth: 1.1%

10. Oregon

Waterfall in Oregon

Known for its natural beauty and attractions, Oregon is situated under Washington in the northwestern corner of the United States. The real estate appreciation rate over the past two years was 28.26%, and 116.57% over the past ten years. 

Oregon’s evolving tech industry, nicknamed the Silicon Forest, has brought numerous growth benefits to the state. As such, higher-income individuals are migrating to Oregon and purchasing above-average priced homes. As a result, Oregon’s median income is slightly higher than the national average at $81,200.

  • Median home value: $473,064
  • Average market rent: $1,763 per month
  • Occupied housing: 91.8%
  • Number of homes and apartments: 569,551
  • Job growth: 1.6%
  • Population growth: 0.89%

11. Ohio

Ohio

Ohio is one of the best states for real estate because its median home value is significantly lower than the national average. Although the median income value is also lower, Ohio residents get access to a low cost of living and low mortgage rates.

The real estate appreciation rate in Ohio was 23.57% over the past two years and 44.66% over the past five years. These conditions create an ideal environment for those looking to purchase residential or commercial properties in the United States.

  • Median home value: $199,717
  • Average market rent: $1,132 per month
  • Occupied housing: 90.4%
  • Number of homes and apartments: 4,717,226
  • Job growth: 0.6%
  • Population growth: 1.5%

12. Indiana

Indiana

Located in the heart of the United States, Indiana is another beautiful state for real estate. Over the past two years, Indiana’s real estate appreciation rate was 25.14%, and 47.28% over the last five years.

Furthermore, Indiana’s median home value is lower than the national average. For this reason, you can find an affordable property and see impressive gains as Indiana’s real estate market continues to grow. The best Indiana cities for real estate include Indianapolis, Topeka, Shoals, and Montgomery.

  • Median home value: $198,288
  • Average market rent: $1,144 per month
  • Occupied housing: 80.6%
  • Number of homes and apartments: 2,602,770
  • Job growth: 2.9%
  • Population growth: 0.61%

13. Connecticut

Skyline at Connecticut

For more wealthier individuals, Connecticut is one of the best states for real estate. The median income in Connecticut is above $100,000, which is much higher than the national average. Since the cost of living in Connecticut is only slightly higher than the United States average, Connecticut is an excellent place to look for real estate.

Connecticut’s real estate appreciation rate was 23.68% over the past two years and 16.10% over the past 12 months. 

  • Median home value: $349,539
  • Average market rent: $1,815 per month
  • Occupied housing: 90.1%
  • Number of homes and apartments: 1,385,437
  • Job growth: 3.3%
  • Population growth: 0.5%

14. South Dakota

South Dakota

Located in the northern region of the United States, South Dakota is a landlocked state with plenty of real estate opportunities. South Dakota’s real estate appreciation rate was 25.34% over the past two years and 18.55% over the last 12 months.

With a low cost of living, median home value, and mortgage rates, South Dakota’s real estate market is a hidden gem in the United States.

  • Median home value: $236,975
  • Average market rent: $1,079 per month
  • Occupied housing: 87.7%
  • Number of homes and apartments: 347,878
  • Job growth: 1.02%
  • Population growth: 1.17%

15. Florida

Florida

Florida has a population of 22 million and is the eighth most densely populated state in the country. It is also one of the United States’ most popular retirement and vacation destinations. However, buying a property in Florida is still affordable.

The cost of living in Florida is 2% cheaper than the national average but the typical home price is $6,000 more expensive than the national average. Florida has seen sky-high real estate appreciation rates with 33.64% growth in the last two years and 24.47% growth in the past 12 months.

Florida’s relaxed pandemic restrictions caused an influx of new homeowners and real estate investors as the rest of the country was locked down.

  • Median home value: $331,461
  • Average market rent: $1,972 per month
  • Occupied housing: 82.9%
  • Number of homes and apartments: 7,931,313
  • Job growth: 5.6%
  • Population growth: 1.0%

Worst 5 States for Real Estate

As a real estate investor, it’s also essential to understand which states are the worst for real estate. Although the overall housing market in the United States is doing well, and we’re optimistic for the future, there are a few states to avoid. The worst states have high taxes, low employment growth, and low population growth.

1. New York

New York has strict rent-control policies for investors in certain cities and doesn’t have investor-friendly laws. Furthermore, the median home value in New York is $1,276,314. This is exponentially higher than the average median home value in the United States.

The sales tax rate for New York is 8.9% which is higher than the national average of 7.3%. As such, New York residents deal with a higher cost of living than other parts of the country. 

  • Median home value: $557,428
  • Average market rent: $2,255 per month
  • Occupied housing: 88.7%
  • Number of homes and apartments: 7,417,224
  • Job growth: 1.01%
  • Population growth: 0.43%

2. New Jersey

New Jersey is also a suboptimal state to purchase real estate in. The most significant factor hurting the New Jersey real estate market is the state’s property taxes of 2.38%. New Jersey also has an above-average median home value and a lower-than-average real estate appreciation rate.

The real estate appreciation rate was 22.80% over the past two years and only 43.73% over the past five years. 

  • Median home value: $435,725
  • Average market rent: $2,289 per month
  • Occupied housing: 90.2%
  • Number of homes and apartments: 3,272,054
  • Job growth: 1.01%
  • Population growth: 0.52%

3. California

Although California boasts the largest population in the United States, it’s also one of the worst states for real estate. This is because of California’s high property prices and mortgage rates. With such high home prices in California, renting is often cheaper than outright buying a home.

California also isn’t seeing an increase in new jobs. Unfortunately, this lack of economic growth, paired with outrageously high tax rates and strict landlord regulations, means California isn’t the best state for real estate. 

  • Median home value: $699,876
  • Average market rent: $2,651 per month
  • Occupied housing: 92.2%
  • Number of homes and apartments: 13,103,114
  • Job growth: 1.2%
  • Population growth: 0.31%

4. Illinois

Illinois was hit hardest by the 2018 market crash and was one of the states that took the longest to recover. Chicago is the biggest city in Chicago and has one of the highest homicide rates in the entire country. This high level of crime brings risk to investors and ultimately lowers property value. 

The real estate appreciation rate over the past two years was only 15.67%, and 11.29% over the last 12 months.

  • Median home value: $279,001
  • Average market rent: $1,517 per month
  • Occupied housing: 90.9%
  • Number of homes and apartments: 4,884,061
  • Job growth: 4.66%
  • Population growth: -0.17%

5. Michigan

Michigan is another one of the worst states for real estate. This state was heavily impacted when motor companies moved out of Detroit. As a result, the entire Michigan economy felt the effects of the move. Michigan doesn’t have the brightest outlook for a diversity of jobs.

  • Median home value: $217,059
  • Average market rent: $1,262 per month
  • Occupied housing: 86.3%
  • Number of homes and apartments: 3,980,408
  • Job growth: 1.0%
  • Population growth: 1.31%

How We Ranked the Best & Worst States for Real Estate

For this list of the best 15 states for real estate, we used real estate appreciation rates as our key metric. We sourced the data about real estate appreciation rates, median home value, occupied housing, and the number of homes and apartments from NeighborhoodScout.

Furthermore, we found the cost of living data from BestPlaces and mortgage rates from USBank. We used real estate appreciation rates as our primary metric because historical appreciation in market values is a good indicator of what’s to come in the future. Furthermore, growth in property prices signals employment gains and population growth. 

High population growth and employment gains indicate a healthy economy and a high influx of migrators starting new jobs. As a result, markets that have seen growth in the past are likely to trend higher. 

Bottom Line on the Best States for Real Estate

The best states for real estate offer a great quality of life for residential homeowners and an excellent return on investment if you choose to sell in the future. There are many booming real estate markets across the United States, so you should be able to find one that fits your exact needs.