I've done quite a bit of research, reading, and networking in regards to my first purchase. I was originally leaning towards Las Vegas but have now decided it will be Texas or possibly Oklahoma. I am looking for some input from investors in these states and any information or experiences would be appreciated.
I am looking for a rental property, I will spend between around 115k-125k max, 3br/2ba (Not looking to do much rehab). My criteria is a property with a decent cash flow and hopefully consistent appreciation. I have been researching and hearing great things about the Dallas Fort Worth area. Any investors have anymore areas specifically?
Also, I will most likely be making a trip out to the area in a couple months to do my in person research on the different areas/neighborhoods and view the different properties. Anybody with realtors who may be willing to show me around in Dallas Fort Worth or OKC when I make the trip? Thanks in advance for your input.
You should speak with @Jon Klaus he is a very knowledgeable investor in the area and a friend of mine. He should be able to point you in the right direction.
You mentioned cash flow with appreciation, keep in mind you rebasing for everything and often times, good cash flow will not come with good appreciation and vice versa. Also, buying at around $120k will require you to be getting somewhere both of $1800 monthly in rent if you plan on having long term cash flow. That will be a stretch in TX this is a very competitive market right now with rents and occupancies at their peaks (or close to peaks) so you need to search hard and find a great deal to obtain the cash flow. Another option would be to go for multi family, you will find you will have better cash flow opportunities there, but don't expect a lot of appreciation.
@Will Barnard is correct about sacrificing appreciation for cash flow.
At that price point, with very little rehab, I would look at Southwest Arlington (Martin High School area, if you can get Ditto or Little Road Elementary even better), the mid-cities area (Hurst-Euless-Bedford), Northern Tarrant County (North Richland Hills, Keller) and East Richardson (Berkner HS). Those areas are desirable as rentals with families, because of the strong schools, but they aren't the best of the best, which gives you a better shot of staying within your price point.
I love meeting out-of-state investors from CA! :) Welcome. I live in LA and have always only bought out-of-state myself.
Dallas is amazing. Really low on inventory, but great when you can get something. Houston is another one. OKC, while I don't know official information on that one like I do the TX cities, I would imagine it could be good for cash flow although probably not as strong as Dallas or Houston for appreciation (Dallas being the growth king of those two).
The common theme of low inventory makes it a great time to be building in Texas too. So if you can't find a deal, build one!
Fort Worth-Arlington area is great for rentals, still undervalued, with strong rents.
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I'm also very seriously looking to buy and invest in RE in Dallas or Houston and maybe Austin.
I'm currently reviewing a 4 Plex in Dallas as an owner/occupant so I can get the best loan and also set myself up so I have a home of my own when I move back to the US from Dubai.
I would like to get some help on the property I'm looking at, the Dallas/Houston market, and realtors/lenders in those cities. Is there a specific area on the forum for this or can I get help here on this tread?
I like Fort Worth and certain parts of Houston.
I own a lot of SF in Dallas Fort Worth, and it's a great market. I stopped buying a few years back, because the deals were harder to get, but still own everything.
Make sure you factor in property taxes (2.5% - 3.5%), and have an idea how much rents will increase over the years. Property taxes float, and are based on your assessed value. So as your property increases, so do the taxes. Just something to keep in mind.
Be sure you are protesting your taxes yearly...you can get the taxes lowered typically based on comps in the area. A friend of mine protests hers yearly and keeps her appraised values low. The taxes are a hit directly to your cash flow, so it's worth it to protest them yearly. And since you're out of state, I would maybe look into a service. There are services that will protest them for you, obviously for a fee, but it may be worth it if you have a large inventory.
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Hi Justin. I would definitely look into Houston. There are so many out of state companies coming into Houston and build their headquarters here. Exxon is currently building their massive headquarter in Houston, they will bring 50 thousand plus employees with them. I see the Houston market keep on going up and up everyday. All these oil companies are coming in which makes Houston housing market so hot. As an investor like you, i'd recommend Houston as a great place to buy and hold. Another plus about investing in Houston because the population continues to grow and the inventory is low, and that creates a supply and demand. Texas is like Michigan back in the days. Michigan used to be a booming state with all the big auto companies and good jobs. The housing market was booming back then when all the big auto companies were there, especially in Detorit. After the big auto companies left and outsourced their work to overseas the housing market turned into a nightmare. What i am saying is that Houston is like Detroit back in the days. The big oil companies are coming here and the housing market are going to continue to go up, which makes Houston a great place to buy a property and let it sit for appreciation. Also, the real estate in Houston is still quite affordable, and i predict the housing market in Houston will continue to grow for the next 20 years as long as the big oil companies are not moving overseas. Good luck investing Justin :)
@Arvin Daeizadeh you can post in the Marketplace if you want people to reply with properties or offers of services. Otherwise you can post in the Local Real Estate Networking and Recommendations forum for advice about what areas to consider.
Please, folks, no advertising in this thread.
Thanks Jon, I will do that. What about getting opinions on a specific property that I am looking to buy in Texas? Will the places on the forum you mentioned work?
guess i was edited out. lets try this again, be happy to sit down and talk with you about okc any time you are around. I think there are good things happening here. even if you want a feel for what rents are and how the rental market is progressing here.
Thanks for the insight regarding Houston. I've been looking at many different areas and really like what I see in The Woodlands area. Seems like this area really has a lot of the characteristics I'm looking for in a rental investment neighborhood. Let me know what you think? Also, do you have any agents you suggest who would be willing to show me some of these properties when I make the trip out in October to check out the different areas? Thanks again.
When you mentioned The Woodlands I assume you mean to include Spring. FYI, the city of Woodlands itself is quite small and super competitive in term of acquiring a property. We offered a good amount above listing price in the area a few times and got beat by cash offer much above listing price. Spring is very big and depended on what area you are looking at. Some could be very good and some might not be. I would look for Kline ISD instead of Spring ISD.
DFW is extremely low on inventory and very competitive right now. Properties on the MLS are going for higher than the asking price in many cases. I've bid on a few in the past couple of months and was always outbid by someone willing to pay way too much for a rental. If I were you I would be looking at alternate means of acquisition, and also looking at the Mid-Cities (between Dallas and Ft Worth.....Irving, Arlington, etc)
You are welcome to hit me up when you get here if you want to go to a REIA meeting and maybe talk to some of the other investors in the area.
I have invested in Spring and The Woodlands for several years. I love the area for appreciation as well as cash flow. I will be buying strictly in The Woodlands from this point on specifically for the characteristics you mentioned. Finding a "deal" has become a bit more challenging, as the demand is always high.... but that also makes a rental property more valuable. I think of The Woodlands like waterfront property .... buyers/renters are willing to pay a premium for the amenities
Woodland is a great area. A lot of new commercial buildings are being built there. Woodland high school is top notch. The homes there has a lot of cure appeal.
I can help you out since i am near the woodlands area. Send me an email when you are coming here so we can go see some houses together.
I think the Exxon move will relocate approximately 10,000 employees .... not 50K
I personally think Spring is on the up. Although there are some schools that are not up to par, but Spring in general is an up and coming area. You'll see a lot of new construction going up 45 north. This is just my opinion. I believe if you get a rental property in a decent neighborhood within Spring ISD, the value of your property will increase when Exxon completes its headquarter there ,because there will be a lot more money going to Spring ISD from Exxon, and the employees from Exxon will demand Spring ISD to improve as they will be sending their kids to go there. When the schools start to improve, the value of your houses will improve. All of this will take place by next year so if you want to buy and hold, Spring and Woodland are the areas to consider right now. Good luck investing Nate! :)
You might be right, but i'm pretty sure they will hire a bunch out of the universities in Houston to work for them. These new hires will probably want to live where they can get to work easily and that's going to make the properties in Spring that much more valuable.
I totally agree with you on appreciation. I just don't see 115-125k can get any properties in The Woodlands. Unless I am missing something, the lowest I have seen are about 150k+.
When you mentioned Spring ISD, do you men east of 45? Honestly, I haven't check the area very much. I might have to check it out. Thanks!
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