Moving to the Dallas area next year - thoughts on multi-family

[Orlando Chavez]

Hello all. I am just starting to learn about real estate investing and trying to learn as much as I can about the Dallas market (and suburbs). I’ve heard it’s not as great compared to pre-pandemic but would like to get some thoughts from local investors, agents, lenders. I’ve sort of been looking on Zillow and Redfin for 2 to 4 units properties. Just running the numbers based on Zillow and Redfin prices, comparing rents to similar properties, and assuming I pay the asking price (no negotiations, 20% down), it looks like it’s hard to be profitable. My goal is good positive cash flow.  Again I am just getting started so I have lots to learn especially in a new market. Thanks for your feedback. 

[Kyle Mccaw]

@Orlando Chavez — welcome to the DFW market! You're right that cap rates on multi-family (especially 2–4 unit) properties aren't what they used to be pre-pandemic, but opportunity still exists with the right strategy.

A few thoughts from someone who's managed a large number of rentals in the Dallas area since 2002:

1. Cash flow is tight on MLS deals unless there's value-add upside. You'll rarely find good cash-on-cash returns without factoring in either under-market rents or poor condition properties needing rehab. Many of our clients built strong portfolios using hard money loans to acquire and rehab, then refi into DSCR or conventional financing.

2. Consider the suburbs too. Places like Garland, Mesquite, and parts of Fort Worth may offer better rent-to-price ratios than central Dallas. Some of our best landlord clients started there.

3. Make sure you’re factoring in full expenses — insurance, maintenance reserves, vacancy, management (even if you self-manage), and property taxes, which can climb fast in Texas. We’ve seen many DIY spreadsheets underestimate these and get burned.

4. Use professionals. Lenders like @Andrew Postell and insurance agents like @Cameron Moore at ProCo know what real estate investors need. You’ll save money (and stress) long term by doing it right.

5. Delayed gratification is your best friend. Most landlords struggle early on, but if you stick with it and use tax tools like the 1031 exchange, the long-term payoff is real.

Glad you’re doing your homework. That alone puts you ahead of most. Keep going and feel free to reach out to local investor meetups or networking groups — DFW has a strong investor community.