Houston/Southeast Texas area!

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Houston/Southeast Texas area!

Kaycie Gunn
New to Real Estate · Nederland Texas · Member since 2023 · 9 posts · 3 votes

Hey yall! I just turned my first house into a long-term rental and bought another home to reside in. Im looking to purchase my next rental within the next 6 months. What advice would you give me for my second rental? Im torn between BRRRing a long term locally in my area or investing a little more in a short term out of area(College Station, Austin, New Braunfel area). Do yall BRRRR your short terms or just buy mostly updated? So many questions flood my mind on which route to take next! My goal is to get as much cashflow coming in as possible within the next 2 years before entering motherhood. I Would also love to meet up with some investors in the Houston area as well to help find a great team of people to work with. Any and all advice would be greatly appreciated!

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Carla Gordon
Real Estate Agent · Houston, TX · Member since 2016 · 63 posts · 27 votes
2y

Hi Kaycie, I BRRRR'd a short term rental (triplex complex) in Houston. Would love to connect and I can share the details. It's very possible! Since I didn't have a lease in place, they used LTR income comps for the refi

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  • Morgan Gutierrez
    Wholesaler · Texas, USA · Member since 2022 · 139 posts · 40 votes
    2y

    I am in Houston area and would be happy to meet up and connect! 

    Congrats! That is very exciting!

    You could BRRRR a short term rental. Will you need conventional financing? That may limit the amount/type of repairs the property could need.

    College Station would provide you several different investing strategies depending on the property you purchased. 

    Austin seems to be a bit harder of a market to enter right now. 

    New Branfuels/San Marcos area could provide you with several strategies as well depending on the type of property. 

    You may want to consider how the properties would rent as long term rentals too and not soley base your decision on STR.

    Hope this was helpful!

    Morgan

    ‪(832) 953-4823‬

    0Reply
  • Kaycie Gunn
    OP
    New to Real Estate · Nederland Texas · Member since 2023 · 9 posts · 3 votes
    2y

    @Morgan Gutierrez Thank you so much!

    1Reply
  • Carla Gordon
    Real Estate Agent · Houston, TX · Member since 2016 · 63 posts · 27 votes
    2y

    Hi Kaycie, I BRRRR'd a short term rental (triplex complex) in Houston. Would love to connect and I can share the details. It's very possible! Since I didn't have a lease in place, they used LTR income comps for the refi

    1Reply
  • Shafi Noss
    Lender · Nationwide · Member since 2018 · 571 posts · 310 votes
    2y

    Congrats, lending is a much easier way to buildup cashflow. Consider looking into that if you are looking for ways to build up passive income for motherhood.

    1Reply
  • Kaycie Gunn
    OP
    New to Real Estate · Nederland Texas · Member since 2023 · 9 posts · 3 votes
    2y
    Quote from @Carla Gordon:

    Hi Kaycie, I BRRRR'd a short term rental (triplex complex) in Houston. Would love to connect and I can share the details. It's very possible! Since I didn't have a lease in place, they used LTR income comps for the refi

    Hi! Absolutely…would love to connect and pick your brain :) 
    0Reply
  • John WilliamsBusiness Member
    Property Manager · Clarksville, TN · Member since 2018 · 443 posts · 210 votes
    2y

    Have you considered investing out of state? We've seen a large influx of out of state investors in my market over the last couple of years ... and for good reason too!

    [email protected]931-272-3065
    Rent My Home - Property Management4.8211 Reviews
    WebsiteView Page
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  • V.G JasonPro Member
    Investor · Member since 2022 · 3k+ posts · 3k+ votes
    2y

    If you're looking for a short-term option for cash flow, don't invest in physical hard assets that'll require more than you want and deliver likely less without years in it. Go buy debt instead and get a return. 

    0Reply
  • Cameron TopePro Member
    Property Manager · Katy, TX · Member since 2015 · 1k+ posts · 1k+ votes
    2y

    Congrats on the long-term rental Kaycie!

    Maximizing for cash flow over the next two years will create a different strategy over maximizing cash flow over the next 10-20 years. 

    I'm not a fan of STRs as Houston is super saturated but they do create more short term cash flow. 

    If you're looking to maximize cash flow for the next 10-20 years buy a few solid properties in Katy, Cypress, Spring, etc. where there are great schools and affordable rents. 

    Best of luck!

    [email protected]832-770-7090
    0Reply
  • Kaycie Gunn
    OP
    New to Real Estate · Nederland Texas · Member since 2023 · 9 posts · 3 votes
    2y
    Quote from @John Williams:

    Have you considered investing out of state? We've seen a large influx of out of state investors in my market over the last couple of years ... and for good reason too!


     Hey! Yes I have def  considered but I would like to stay within a 4 hr radius right now since I'm very new to it, unless you can convince me otherwise. Any advice on managing out of state rentals and/or rehab projects?

    0Reply
  • Kaycie Gunn
    OP
    New to Real Estate · Nederland Texas · Member since 2023 · 9 posts · 3 votes
    2y
    Quote from @Cameron Tope:

    Congrats on the long-term rental Kaycie!

    Maximizing for cash flow over the next two years will create a different strategy over maximizing cash flow over the next 10-20 years. 

    I'm not a fan of STRs as Houston is super saturated but they do create more short term cash flow. 

    If you're looking to maximize cash flow for the next 10-20 years buy a few solid properties in Katy, Cypress, Spring, etc. where there are great schools and affordable rents. 

    Best of luck!


     Hi! Thank you so much..I LOVE those Houston areas. I will certainly look into those areas.

    1Reply
  • Kaycie Gunn
    OP
    New to Real Estate · Nederland Texas · Member since 2023 · 9 posts · 3 votes
    2y
    Quote from @V.G Jason:

    If you're looking for a short-term option for cash flow, don't invest in physical hard assets that'll require more than you want and deliver likely less without years in it. Go buy debt instead and get a return. 


     Hey there! what are you meaning by don't invest in physical assets and go buy debt instead? lol, sorry I feel lost!

    0Reply
  • V.G JasonPro Member
    Investor · Member since 2022 · 3k+ posts · 3k+ votes
    2y
    Quote from @Kaycie Gunn:
    Quote from @V.G Jason:

    If you're looking for a short-term option for cash flow, don't invest in physical hard assets that'll require more than you want and deliver likely less without years in it. Go buy debt instead and get a return. 


     Hey there! what are you meaning by don't invest in physical assets and go buy debt instead? lol, sorry I feel lost!


     So if I leverage to buy a house right now, I'm paying 7.25% on the note. Right?

    Rather than buy the house and assume the physical risk. Which is not the same as you just throwing a downpayment and letting the house do nothing, it means you'll actively manage it or manage the PM and house physical structures. This isn't something you want to do when you're having a kid in 2-3 years, just FYI.

    Why don't you buy the 7.25% note that I am paying on the house, so you make the 7.25% return truly passive?

    That's called buying the debt, not the asset. I recommend the asset over debt, but the asset is not passive. Nowhere near it. The debt will more than likely be if you are buying from a proper fund. 

    0Reply
  • Adam Bartling
    Lender · Rosenberg, TX · Member since 2022 · 287 posts · 130 votes
    2y

    Congrats!  I am on the SW side,  I would go after some pre forclosures just outside Harris cty.  

    Check out Meetup many REI groups

    1Reply
  • Daniel TanasaBusiness Member
    Realtor · Houston, TX · Member since 2019 · 351 posts · 174 votes
    2y

    Hey Kaycie,

    I am a big fan of BRRRR'ing a long term rental. It's been my strategy for my last 8 deals and if you don't need a lot of cashflow tomorrow, it can boost your buying capacity a lot and help you do 4 deals a year instead of 1. Short term rentals are definitely better for cashflow, but make sure you get big properties, with a pool maybe and make some nice theme out of it. It's pretty saturated for normal 3 bedroom properties in a lot of areas. Is probably safe to try to make sure you're having a second exit strategy to at least break even in case STR doesn't do as well as you would expect.

    I hope this helps. 

    Good luck in your investing. 

    1Reply
  • Gregory SchwartzBusiness Member
    Rental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
    2y

    hey @Kaycie Gunn I buy STR in College Station and have enjoyed converting small multifamily to Airbnbs. If that's something you'd be interested in we should chat :)

    [email protected]443-812-0357
    Schwartz Realty Group5118 Reviews
    WebsiteView Page
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  • Wale LawalBusiness Member
    Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
    2y

    @Kaycie Gunn

    Congratulations on converting your first home into a long-term rental and making progress in your real estate career! Here are some recommendations and considerations for your second rental, taking into account your cash flow and portfolio expansion goals:

    1. Define your investment criteria.
    2. Decide whether to use the BRRRR method for your next rental. BRRRR (Buy, Rehab, Rent, Refinance, Repeat) may be an effective capital recycling technique, but it needs a thorough awareness of the local market, remodelling costs, and financing options.
    3. Think about the advantages and disadvantages of investing locally vs outside of the area. Local investments may be easier to handle, but looking into other areas, such as College Station, Austin, or New Braunfels, might give diversity and perhaps greater returns.
    4. Be realistic with your deadlines. Real estate transactions can take time, so setting realistic expectations can help you handle the investing process more efficiently.
    5. Plan your investments with your future family planning in mind. Consider how your real estate activities will align with your goals as you enter motherhood.

    Remember, every investor's journey is unique. Tailor your approach to your specific goals, risk tolerance, and preferences. As you navigate these decisions, trust your research and seek guidance from experienced investors and professionals. 

    Good luck on your journey to building a successful rental portfolio!

    [email protected]832-776-9582Podcast Guest on Show #469
    NETWORTH BUILDERS5236 Reviews
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  • Aaron Gordy
    Real Estate Broker · Austin, TX · Member since 2012 · 1k+ posts · 1k+ votes
    2y

    @Kaycie Gunn Congrats! How about Crystal Beach? I know that is a popular destination and its easy to commute to from the golden triangle. It was popular spot to hang out when I was a kid back in the day and my grandfather did really well with renting it out as a holiday hang out. Not sure if the demand is still there but they lived large on two rentals in Port Arthur area and the Crystal Beach home. 

    0Reply
  • Account Closed
    New to Real Estate · TX · Member since 2023 · 27 posts · 29 votes
    2y

    hey, i invest in texas, would not mind connecting!

    0Reply
  • Jay ThomasPro Member
    Real Estate Agent · Houston, TX · Member since 2021 · 1k+ posts · 715 votes
    2y

    Hey, congrats on transforming your first home into a rental powerhouse!

    BRRRing locally can be a solid strategy if you're familiar with the area, especially if you can secure fixer-uppers with potential. The booming rental pool and hands-on property rehab offer control, though it comes with some sweat equity. The post-rehab cash flow, however, is worth it.Consider short-term rentals in hotspots like College Station, Austin, or New Braunfels for a different flavor. While lucrative, it's a more hands-on game with managing guests, turnovers, and potential higher costs. Finding the right property is critical in these competitive markets.As for BRRRing short-term rentals, it's doable but demands careful planning. Expect higher renovation costs for guest-friendly amenities, and managing them might be challenging with your upcoming motherhood journey.Here's my take:For control and long-term stability, stick with BRRRing locally. Seek motivated sellers, plan strategic rehabs, and build a robust portfolio of nearby cash-flowing rentals.If you're enticed by excitement and potentially higher returns, explore short-term out-of-town rentals. Research thoroughly, build a stellar property management team, and brace yourself for the extra hustle.Remember, your two-year cash flow goal is key. Short-term rentals may bring in more initially, but BRRR can expedite long-term wealth-building.Don't forget to network with local investors in Houston—it's a goldmine of insights and support for your real estate journey!

    [email protected]832-889-5607
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