Did anyone check out the news from HAR release few days ago?
The Houston Real Estate market rose to record territory in June, as we saw the greatest one-month sales volume of all time and sent average and median prices to new highs
If want to see full report, here you https://www.har.com/content/newsroom?pid=1548
What do you all think about it?
I know immediately what are all the questions popup in investor minds.
- Do you think it's still market to invest?
- Do you think you can still find deals in this market?
- Is it going to highly priced and competitive?
Let's talk about it people.
My answer, yes, it's very good market to invest. On the Real estate cycle, we are closing in on the Stage 6, Late Stable stage and will hit the peak soon. Recession is expected around 2020-2022. It might not be due to Real Estate but it will have some parallels and when we get their, we will be at the peak and drop down depending on the effects of recession. But we still have long way to go.
There are still good deals out there depends on how you look at it. But it's surely competitive when the deal is right!! You just have to jump on it quickly.
What's your thoughts?
Everything is going up
I agree with the predictions about the market continuing to rise at least through 2020. The perception is the deals are not there and that is true.....sort of. You really need to be focusing on the right markets and be willing to do more work for them. If you are keeping the appreciating market in mind the deals are there and please everyone stop watching HGTV!!!!!! It is not that easy.
I think that model with the least amount of risk right now is buy in a good school area (7 or 8), 20-30K in rehab and rent it out for 1-2 years while the market appreciates.
Houston will correct eventually but it probably won't crash. Great chance to buy and hold any time.
I totally agree with @Ryan Terwilliger . That is well said. Finding a solid flip is a great way to build the capital stack, but it is really a perfect time to develop a solid rental portfolio in Houston.
I don't need to view HAR, I can see it with my properties. The amount people are willing to pay for junk I bought just a year or two ago is shocking.
I paid $6m for a property I bought just over a year ago and got an LOI for $9m. I've done $0 to it (other than fix some operations)
Based on the inventory of multi-family properties currently available, I’ve started to look closer at single family homes for buying and holding. Of course, it’s far more difficult to scale that way but it has become very difficult to find multi-family properties that cash flow from day one. From my perspective, I’d avoid betting solely on appreciation in a market that just hit record sales volume, average home price and median home price.
I think Houston is still a great market to invest in, especially for investors with a long term view. Considering the oil crash over the past few years didn't have much of an impact on the real estate market, I'm curios to see what will. It's hard to see a slow down in the near future with such a large, diverse, and business friendly economy such as Houston's.
The market is strong, and the dials are still out there. I may take you a little longer to find them, but they are there.
I try not to worry about predicting the crash or correction and focus more on building a solid portfolio. Slow and steady, that is how my wife and I have built our portfolio for the last 3 years.
@Jon S. I used Longhorn III Investments on one of my properties, went very smooth.
Keep it coming guys. This is healthy conversation and much needed for many newbies who are getting turned down.
As I said earlier, deals are out there. It's how you look at it. I don't have people to get the deals. I have many new investors who say they want to start their portfolio but not ready to jump in either worried or thinking more numbers.
Numbers out there are just freaking crazy. Summer selling season I guess. Starting to wonder if I should sell my own place and move into a trailer somewhere, LOL, or just rent something. Wife would likely not understand, but we'd be debt free.
@Vijaianand Thirunageswaram I totally agree with you regarding the real estate market cycle and expected downturns. However, there are a few unknown that are out of the control. Inflation and fed rates.
Inflation has been surging a bit for past 2-3 months which is a bit concern given that fed is aggressively raising the rate. The yield curve starting to flat line which is a strong leading indicator for market corrections. If the 10 year rates were to rise, either rent goes up or cap rates have to go down to compensate for the yield shift.
I believe there are numerous opportunity left on multifamily deals where price point of around 800k-3m where most institutional buyers are not looking at.
You should not sell the property for debt free unless you are paying high int rate or price is good. If you have locked in low rates, those debts are good ones and should keep it that way.
I've been following Dr Dotzour for a few years. Guy has been spot on. Here is what he said at a recent luncheon for the GHBA
I think he covers threats to the economy and the media very well
@Dave Chapa thanks for the feedback! We appreciate it.
The rebound of oil and gas coupled with effects of Harvey are making Houston market very interesting. I think pre harvey it was def turning to a seller's market and actually anything above 600-700k and up are still lagging
But anything sub 300k...man it has been active!
Tells me a lot of work out there for mid to lower income categories which is great
This is great news, Im a newbie investor and Houston was my starting point. I purchased a quadplex with great returns and I'm holding on for the long run. I do remember reading this article by harvard extension school predicting the next the next housing bubble. 2022-2024 I'm ready to capitalize. https://www.extension.harvard.edu/inside-extension/how-use-real-estate-trends-predict-next-housing-bubble
@Darlington Agu Very good article. Thanks for sharing! We are in 2018 and just 4-6 more years until recession. My plan is to add few more rentals for 3 more years and start planning to take advantage of recession. Let's see how it goes.