Worth investing in properties in states with high property tax?

3 Replies

Is there a downside to buying investment properties for cash flow in states with high property tax (e.g. Texas, where the property tax is 2.64%)? Does it even make sense to invest in RE in Texas or should I not even bother and just invest my money in stocks or something else?

@Bryan Tasumi simple answer is - if the numbers work out on the particular property.  

I'm not familiar with Texas market but I bet rental rates consider the costs, including property taxes.   Many other property owners make it work there so I'm sure you can if you find the right deal.

Looks like you're in Hayward... got a commercial property there.  Any reason why you're not looking in your own backyard?

Yes it is worth it if your particular purchasevpencils out to cash flow. For those that live and invest in TX, they gave the advantage of the higher property taxes directly offset by no state income tax. For those living outside TX but investing there, while you nay have higher property taxes, some or all if that is typically offset by other items being less expensive or rents being higher to cover the added costs.

In my opinion, real estate, no matter where it is, is a much better investment vehicle than stocks.

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