What are currently the hottest real estate markets?

[Jimmy L.]

Hi everyone, I just joined the BP community and am considering making my first investment. My question is - what are currently the hottest real estate markets in the US, and more importantly, how do you evaluate real estate markets as a whole?

I'm currently considering Houston, Dallas, Austin, Nashville, and Chicago (the former 4 because of the relatively low housing costs, and Chicago because I used to live there and am somewhat familiar w/ the neighborhoods). The TX areas have already appreciated quite significantly over the past couple of years - is there more room to grow? I'm looking for a set of criteria on which to evaluate the potential growth of a market. At the very least, I want to avoid property value decreases. My goal is to generate cashflow, and any added appreciate is a bonus. I'm comfortable investing ~$20-25K (so ~$100K property value assuming 20% down).