Involved In Real Estate · Irving, TX · Member since 2012 · 49 posts · 4 votes
13y
Hey Erik Drentlaw I know we kind of touched on this subject via message but from those I've spoken with Tarrant County is currently your best bet for getting the right value on multifamily properties. North Dallas prices are just too high right now.
Landlord · Dallas, TX · Member since 2012 · 505 posts · 34 votes
13y
Originally posted by Ronnie Boyd:
I currently do mailers to inheritance and probate leads(in SC not TX) and I think that has great potential in that market.
Let me tell you from experience. Probate here in DFW is CARPET bombed with mailers. Very often I show up at probate houses and there is a pile of mail on the table with literally 50+ other we buy houses post cards.
I only closed on 3 wholesale properties last year, and that was with multiple mailings to the same probate house through the year. Probates are not a "niche" in dallas-fort worth anymore. A big reason is the lists are easily accessible from a bunch of RE investment services.
They can be a decent supplement to your regular deal pipeline though.
Landlord · Dallas, TX · Member since 2012 · 505 posts · 34 votes
13y
Erik Drentlaw Probates are a mixed bag. Like I said the competition is super high even if you mail them regularly. Alot of people claim probates is a niche market that i read here on BP, not the case here every investor and their mother mails probates.
Even when you mail them regularly every couple months, when its time for them to call, there are probably at least 15-20 other investors doing the same thing you do (mailing them regularly). So better hope they dont call your competition first. With a little bit of luck hopefully they pick you first, or sometimes the competition doesnt answer their phone fast enough and you can set the appointment.
Then even if you book the appointment, since this is super competitive, you are probably going to go against at least 5 other investors. The result is everyone bids up the property, the margins shrink, and everyone loses.
I am working with some wholesalers. Good ones that actually source deals from motivated sellers, not ones that negotiate a small discount or just mark up from the MLS.
ALso to clarify in my original post I purchased and closed on 3 probates last year, i didnt wholesale them, sorry for the confusion.
Rehabber · Keller, TX · Member since 2013 · 137 posts · 20 votes
13y
I agree with Ryan Enos, Fort Worth is the best place for rental properties. 1% properties are fairly easy to come by via the mls even ;-)
I have a 2400 sq. ft property under contract that I'm buying for $123k, needs about $20k in rehab, and will rent for over $1500 per month. It's an REO property too!
SFR Investor · Dallas, TX · Member since 2011 · 604 posts · 243 votes
13y
I'm in the Dallas area, and you can forget getting great deals, there some some ok deals, but as the saying goes, there are more people wanting to buy then wanting to sell.
You can get a 1% deal, but i don't know how in the world you have any cash flow with $1,500,in rent with $143k in the house,,,taxes along would run about $300 a month and a decent reserve for maintenance and figuring in vacancy, etc,,,
Real Estate Investor · Richardson, TX · Member since 2012 · 113 posts · 27 votes
13y
Andy Collins Using the 50% rules 1500 turns to 750 - principal and interest equals $40!! But I think I do better than 50% because I manage myself. Hopefully the leverage will help my overall investment too.
SFR Investor · Dallas, TX · Member since 2011 · 604 posts · 243 votes
13y
Samantha, I can't find any 70% deals right now, but yes, that what I'd love to find, with ARV of just over $100k,
I buy properties with ARV's around $100k-$110k, but normally get them for about 80% between purchase and rehab. I haven't bought anything in about a year because I can't find those deals right now,,the cheaper houses can still cash flow, and I'm considering buying a couple and seeing what they are like (ARV around $60k)
,,I found a deal recently on a house in an area I love that should have an ARV of about $160k,,but even at a good deal for today, it was a horrible investment, so I had to leave it alone.
Landlord · Dallas, TX · Member since 2012 · 505 posts · 34 votes
13y
Thanks for your clarification Andy. So I guess since the deals are hard to find right now you would consider a 75% ARV minus repairs to be a great deal and a 70% ARV minus repairs exceptional, while 80% minus repairs is "fair". Does this sound about right to you?
This has been my experience so far as well. I try to get 70% when I can but like you its just very hard to do in this market.
SFR Investor · Dallas, TX · Member since 2011 · 604 posts · 243 votes
13y
@Samantha M. yes, that sounds about right, but in the $100k ARV range I'm finding it tough to find 80% deals.
I try to stay in within 10 miles of my house, I avoid any neighborhoods that have a lot of rentals (which is sort of funny), etc.
I'm having to look outside of my preferred neighborhoods/school areas (not school districts, but say in Mesquite, there are certain schools that renters prefer, so I really prefer to buy in the areas that qualify for those schools.
Erik Drentlaw yes, that's the idea anyway, I haven't actually gotten myself to "pull the trigger" on any of those deals,,I try to follow my business model closely, and this is something that doesn't "fit"
Landlord · Dallas, TX · Member since 2012 · 505 posts · 34 votes
13y
Andy Collins Understood Andy. Out of curiosity how are you mainly trying to source your deals? The MLS, wholesalers, your own marketing?
The best deals that I get are typically ones that I can source myself or from individual wholesalers that deal with motivated sellers. That seems to be the best way to get them at 70% ARV minus repairs in this market.
Lender · Greater LA/Orange County area, CA · Member since 2012 · 3k+ posts · 3k+ votes
13y
While I understand the OP concerns Dallas SFR opportunities, I want to make a point about probate deals. Most probates are NOT discounted in many areas where demand is high. Probate, by itself, is not necessarily a catalyst or trigger that causes sellers to want to discount.
The bigger picture is that when a given local market is cold, few investors have the courage to buy. This is when private seller carry-back financing becomes easier to get. Couple that with a probate sale and a year or two elapsed time and you have a recipe for major back end discounts.
Most fix-n-flip people have never heard of the back end because they've focused so much on making a few coins on the front end. If you are able to step back a bit a see the evergreen aspects of how properties at purchased are initially useful then a burden by owners as they advance in years, you may pick up on the big picture opportunity and not be part if the crowd of buyers clawing their way to find a deal today when the markets so hot.