The investor space for decent real estate that can be rented out is growing overcrowded in some markets.

This is feeding rumors of growing interest in market outside of the typical gateway arena. Investors are said to be working with consulting groups to eye up areas where the local economies are swiftly improving, such as Houston.

"Over the next several months in just a few MSA’s in Texas and Georgia, Blackhawk Consulting is planning to purchase over $100 million worth of single-family residential assets for a client inclusive of leased-up portfolios," said Jonathan Spinetto of Blackhawk, one of those firms that offers full services to real estate investors.

"Private Equity Funds are ravenous for rental properties at the moment and they are expanding outside the expected locations on the coasts," he added.

A survey conducted by data house Preqin asked more than 100 institution investors if they were interested in real estate-related funds. Results show that investor appetite for these funds has increased – 48% of investors interviewed in August 2012 are likely to commit to funds in the next 12 months, compared to only 36% of investors asked the same question in January 2012. So while investor interest is strong, it still has plenty of room to grow.

"Given that over half of investors surveyed in January 2012 stated that they were unlikely to consider a commitment to private real estate, current trends suggest that increasing investor appetite could lead to increasing momentum in the private real estate fundraising market," remarked Preqin analyst Farhaz Miah.

Spinetto said his firm feels also strong about a number of other MSAs that provide significant advantages over already saturated markets, such as Arizona and California.

He said hedge fund clients are listening and showing interest in being first to these atypical markets.

Blackhawk offers these firms the complete infrastructure from acquisition, to repair management to leasing — their services will be in strong demand.