New Investor advice in Texas

Rental Property Investor · Kansas City, KS · Member since 2015 · 45 posts · 29 votes

6y

@Leah Richards - you're personally located in one of the hottest and most sought after RE markets in the country/world. Option #1 seems like a slam dunk if you ask me. I live in KC now, but bought 3 properties in Austin in 2015/2016 on the outskirts in the $300-$400K price range...each appreciated $100K in value in a couple of years...and my total ROI returns were incredible (>100%). Really think doing a house hack where you use a primary residence loan on a Duplex (like @jordan moorehead recommended) is an outstanding move. If you need me to connect you with the RE agent I used to buy my 3 places - let me know. He is partially retired now because he made so much on Austin real estate himself, but he's a cool dude and he gets RE investing.

Rental Property Investor · Kansas City, KS · Member since 2015 · 45 posts · 29 votes

6y

Great job saving btw - $7K a month while living in Austin is killer.

OP

Rental Property Investor · Austin, TX · Member since 2020 · 7 posts · 2 votes

6y

@Jordan Moorhead thanks so much for the reply and advice, that's good to know! I saw you own many rentals in Louisville, KY but I can see how appreciation in Austin probably doesn't compare.

Because I plan to work part time once we have kids (hopefully 2ish yrs) we want to focus on cashflow to replace a bit of that income, you think that could still work within the Austin area?

Thanks again for taking the time to respond to my post :)

OP

Rental Property Investor · Austin, TX · Member since 2020 · 7 posts · 2 votes

6y

@Johnny Wolff Wow that's incredible! Thanks for sharing! Yea I can see that, in the 5 years we've been here we've seen the Austin market only continue to explode - which is why we wanted to hurry and buy a home initially, it's gotten to a point where the 4br $650k home we found in SW Austin seemed like a "deal" >_<

Also thanks for offering to share your agent's contact info, that would be fantastic!

[email protected]512-888-9122

Jordan MoorheadBusiness Member

Real Estate Agent · Austin, TX · Member since 2015 · 5k+ posts · 3k+ votes

6y

@Leah Richards if your only goal is cashflow and you don't care about cashing in on the awesome growth of Austin I don't think I'd recommend Austin. I've gotten greater overall returns with appreciation + cashflow. Cashflow is great and makes sure I don't lose the property but I don't only focus on it personally.

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Anastasia Papyan

Rental Property Investor · Austin, TX · Member since 2020 · 13 posts · 4 votes

6y

@Johnny Wolff could you please also share that RE agent in Austin? We are having a tough times to find a right property!

Eric James

Investor · Malakoff, TX · Member since 2017 · 2k+ posts · 2k+ votes

6y

I'm leery of counting on appreciation in TX. Yes, Austin has grown. But people may start rethinking and buying a bit further out for half the price (or less) and working remotely. There are seemingly endless (cheap) amounts of land in TX.

OP

Rental Property Investor · Austin, TX · Member since 2020 · 7 posts · 2 votes

6y

@Eric James yea, we've seen the property taxes are all around 3% in newer burbs outside of Austin...it was pretty shocking and it's what made us rethink even buying a home here, and just investing wherever it made most sense for cash flow - maybe Dallas or out of State...

Rob Lee

Real Estate Broker · Dallas, TX · Member since 2016 · 248 posts · 240 votes

6y

Have you considered investing in the DFW market? You will get more bang for your buck. Class A neighborhood SFH. Considering individual leases by the room.

John MorganPro Member

Rental Property Investor · Grand Prairie, TX · Member since 2018 · 2k+ posts · 2k+ votes

6y

Buy starter homes. That’s what I’m doing in the DFW area and their appreciation rate is the highest due to major demand for homes under 220k.

Danny Webber

Real Estate Broker · Austin, TX · Member since 2016 · 834 posts · 449 votes

6y

Look at 2-4 units and just live in one. That is still a form of house hacking. Also, look for unrestricted land with a house that you could throw a travel trailer on as an airbnb. Mobile home parks, land to develop/build 2-4 units on, etc...

I am not a fan of a high priced sfr as a rental later but to each his own. Also, new homes do make great rentals or resales typically due to cost/note vs rents without larger down payments. You also typically have to compete with builder inventory or newer homes when selling.

Alex Olson

Real Estate Broker · Kansas City Metro · Member since 2015 · 2k+ posts · 1k+ votes

6y

Originally posted by @Johnny Wolff:

@Leah Richards - you're personally located in one of the hottest and most sought after RE markets in the country/world. Option #1 seems like a slam dunk if you ask me. I live in KC now, but bought 3 properties in Austin in 2015/2016 on the outskirts in the $300-$400K price range...each appreciated $100K in value in a couple of years...and my total ROI returns were incredible (>100%). Really think doing a house hack where you use a primary residence loan on a Duplex (like @jordan moorehead recommended) is an outstanding move. If you need me to connect you with the RE agent I used to buy my 3 places - let me know. He is partially retired now because he made so much on Austin real estate himself, but he's a cool dude and he gets RE investing.

Where are your investments in KC now? What have you seen for appreciation here?

Paul B.

Rental Property Investor · Dallas, TX · Member since 2015 · 503 posts · 504 votes

6y

You might consider multi-family at your income level. If you can put away $7,000 a month you can afford to do multi-family, and there are many advantages over single family.

Ike ADIGWE

Rental Property Investor · Dallas, TX · Member since 2019 · 10 posts · 1 vote

6y

@Paul B.

Hi Paul,

I am a rookie real estate investor trying to go big. I have a rental SFH in Virginia and another in Frisco, TX. I am looking to sell the Virginia home and could potentially walk away with $400K. My plan is to use this money as a down payment to invest in blocks of apartments. I may be able to raise additional $100K if required. I am just confused on how to get started but currently reading Brandon Turner's the book on real estate investing. Do you have any advice you can offer to a rookie like me? Thank you.

Paul B.

Rental Property Investor · Dallas, TX · Member since 2015 · 503 posts · 504 votes

6y

Originally posted by @Ike ADIGWE:

@Paul B.

Hi Paul,

I am a rookie real estate investor trying to go big. I have a rental SFH in Virginia and another in Frisco, TX. I am looking to sell the Virginia home and could potentially walk away with $400K. My plan is to use this money as a down payment to invest in blocks of apartments. I may be able to raise additional $100K if required. I am just confused on how to get started but currently reading Brandon Turner's the book on real estate investing. Do you have any advice you can offer to a rookie like me? Thank you.

Check out Brad Sumrok....he has a weekend event coming up that you can attend virtually and is a good way to learn how to get started in multi-family. Even if you decide that program isn't for you, I do recommend getting a mentor of some type, someone who has already done what you want to do. Under normal times I'd suggest going to some multi-family meetups and meeting some investors in person. Obviously, things are different now. There are so many groups here in Texas, and some of them hold webinars since there aren't many live events right now. I can direct you to some Facebook groups and podcasts that could be helpful if you send me a message.

I think going into multi-family is the way to go when you have six figures in cash available to invest.

Andrew HoganPro Member

Rental Property Investor · Indianapolis, IN · Member since 2016 · 560 posts · 463 votes

6y

Hi Leah. As Paul mentioned, whether you plan to do so actively or passively, investing in multifamily will offer a greater risk-adjusted return and is much more scalable than other strategies.

OP

Rental Property Investor · Austin, TX · Member since 2020 · 7 posts · 2 votes

6y

Thanks @Rob Lee and @John Morgan for your insights - more and more sounds like DFW is where it's at! Definitely open to investing there being that it's still in Texas :)

Ronald RohdePro Member

Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes

6y

DFW is a great market. I like the north burbs of Austin as well.

I recommend Key Renter if you need a property manager, very tech savvy and keep you informed, my clients love them.

Whatever route you go, you'll need an LLC to protect your assets.

Rental Property Investor · Kansas City, KS · Member since 2015 · 45 posts · 29 votes

6y

Originally posted by @Alex Olson:

Originally posted by @Johnny Wolff:

@Leah Richards - you're personally located in one of the hottest and most sought after RE markets in the country/world. Option #1 seems like a slam dunk if you ask me. I live in KC now, but bought 3 properties in Austin in 2015/2016 on the outskirts in the $300-$400K price range...each appreciated $100K in value in a couple of years...and my total ROI returns were incredible (>100%). Really think doing a house hack where you use a primary residence loan on a Duplex (like @jordan moorehead recommended) is an outstanding move. If you need me to connect you with the RE agent I used to buy my 3 places - let me know. He is partially retired now because he made so much on Austin real estate himself, but he's a cool dude and he gets RE investing.

Where are your investments in KC now? What have you seen for appreciation here?

Current investments in KC are in Prairie Village. Appreciation in KC is ok. Nothing to write home about. KC does offer a nice balance of stability with minimal holding cost though.

Account Closed

Plano, TX · Member since 2018 · 48 posts · 28 votes

6y

If both of you are on the same page then I would 100% go the house hacking route. If you can find a 4-plex in an area that you wouldn't mind living for a couple years then you will be off to a great start. If you are going to invest in DFW then you might as well invest in a better market for cash flow (likely one outside of Texas), it's not like you can run by Dallas on your way home from work to replace a door knob.

Alex Olson

Real Estate Broker · Kansas City Metro · Member since 2015 · 2k+ posts · 1k+ votes

6y

@Johnny Wolff Is it single family I assume? What appreciation would you look for?

Investor · Kansas City, MO · Member since 2019 · 130 posts · 118 votes

6y

@Alex Olson - I think my rule of thumb for the KC metro is to assume appreciation will match annual inflation. Some hot submarkets might beat it (Prairie Village right now for example) in the short term. But think that is sort of an atypical for KC. Population, job, and income growth are pretty average. Density isn't that intense. KC is a great market for stable singles and doubles.

[email protected]512-674-5478

Ryan KellyBusiness Member

Real Estate Broker · Austin, TX · Member since 2018 · 1k+ posts · 1k+ votes

6y

@Leah Richards You've got a lot of great advice on this thread. I live and invest in Austin and I would concur a duplex or multi-family property gives you the greatest flexibility AND is easy to flip to full investment property when you move out. We just purchased a duplex in south Austin and the opportunity for cash flow is much easier versus single-family in highly appreciating Austin.

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Shally Kakkar

Member since 2020 · 1 post · 0 votes

6y

@Johnny Wolff could you please share that RE agent in Austin? As a first time investor I would luv to work with experienced person.