Is Richardson TX a good STR, mid term or long term rental?

Question

I have a condo, 1 bedroom and 1.5 bathroom, 809 sqf. 1 floor with good size private back yard. I wonder what this property should be? STR, Mid term or Long term? Pls help

Justin Brickman · Answer

I would prefer to use it as a long term rental until it has enough appreciation to 1031 into an investment that will bring more cash flow - like an STR.

Bruce Lynn · Answer

Condos normally don't make good investments in Dallas area. The HOA dues just kill the returns. I've only seen about 5 buildings that typically work well as investment properties.

Typically STR is out. If your HOA doesn't prevent it now, then once you start they probably will change the bylaws to prevent it. You also have to look at city regulations for STR and see if they allow. Some do, some don't. Some want registration and taxes.

I haven't really seen MTR numbers work out in my opinion either. Lots of talk about this now, but when I look at the costs vs returns, then it doesn't look all that fun to me. You're paying utilities, HOA, furniture and all that for probably double the normal rent, but you have the huge risk of vacancy, which I would then think kills any bonus returns you're making. What if people rent for 3 months, then 1 month of vacancy? I really don't think you get back to back to back MTR rental with minimal vacancy. When I look at the forums like furnished finder, you see how for example travelling nurses are not interested in paying double the monthly rent, even if on the owner side it is certainly justified. I just tend to see lots of complaints that make them feel like they're getting taken advantage of, even if they are also on the receiving end of 3-4x the normal pay. Run the numbers and see if it works for you.

That leaves LTR probably.

Good luck and best wishes.

Patnaree Conrad · Answer

@Justin Brickman Thank you so much, and I feel I am not ready for STR or MTR as well. I dont think I have a good system yet. But eventually I would love to try. 🙂

Patnaree Conrad · Answer

@Bruce Lynn thank you so so much, I really appreciate it. That help alot 🙂

Patnaree Conrad · Answer

@Will Fraser thank you so much for an advice. My condo is 15 min from downtown Dallas, alot of restaurants, 10 min from University of Texas Dallas, and couple of big hospital!!!

Will Fraser · Answer

It really depends on which of the drivers of each segment of rentals is more present with your condo, and which segment has the best blue ocean dynamic present.

For example, if you are near a regional hospital and everyone is goo-goo-gah-gah over STRs in the area, mid-term is likely your cash cow. If you are near a university and everyone is mid-term. or long-terming it, then be THE game-day place and cash in off the STR revenue from folks who just can't miss the hoops, baseball diamond, or gridiron at the U.

Is Richardson TX a good STR, mid term or long term rental?

Is Richardson TX a good STR, mid term or long term rental?

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