Real Estate Agent · Sebastopol, CA · Member since 2019 · 36 posts · 16 votes
Hello,
I live in Sonoma, CA and have been looking into buying investment properties out-of-state. Houston, TX has caught my eye in terms of market and demographic statistics. Does anyone else have any experience investing in the Houston area? Do you believe it is a lucrative market? If so, are there any credible Property Management firms you like to use?
Real Estate Broker/Owner & Property Manager · Sugar Land, TX · Member since 2013 · 660 posts · 459 votes
7y
@JoJo Tucker Houston is still good rental and investment market. Today NPR reported that rental price still continue to claim but not as much as in the past. Only issue is the big Property tax bill which comes at the end of the year. If you can dodge that bullet using proper planning and numbers when you get in, you could do wonders..
I do everything in this market and we love it. We have few projects ongoing currently and more to come in the next half of the year. You can still find deals if you want to jump on and build portfolio if you connect yourself with right people.
Rental Property Investor · Katy, TX · Member since 2015 · 175 posts · 111 votes
7y
Houston is still a good market however "lucrative" is subjective. If you can, spend some time here and learn the areas you want to invest.
There are several good PM in Houston, just asked around. We are on our third year with ours, it's been a good experience. We worked out some kinks in the beginning, on both sides, and now have a very good working relationship. Our PM also bird-dogs potential deals for us too.
Investor · Tempe, AZ · Member since 2018 · 1k+ posts · 731 votes
7y
Hi @JoJo Tucker, I haven't personally invested in Houston but have worked with some investors who do. Regarding PMS in Houston, that is a large metro in regards to area. It would be beneficial to know what general areas you are considering. From my experience, there are several that will cover the entire metro and a good handful who focus solely North or South.
I'm assuming you're talking more Houston proper, but in case not. The Woodlands area would be a different set of property managers who specialize in that area (Conroe,Spring).
Real Estate Broker/Owner & Property Manager · Sugar Land, TX · Member since 2013 · 660 posts · 459 votes
7y
@JoJo Tucker Houston is still good rental and investment market. Today NPR reported that rental price still continue to claim but not as much as in the past. Only issue is the big Property tax bill which comes at the end of the year. If you can dodge that bullet using proper planning and numbers when you get in, you could do wonders..
I do everything in this market and we love it. We have few projects ongoing currently and more to come in the next half of the year. You can still find deals if you want to jump on and build portfolio if you connect yourself with right people.
Specialist · Houston, TX · Member since 2015 · 55 posts · 21 votes
7y
Hey @Vijaianand Thirunageswaram, in regards to your "proper planning" comment above regarding taxes, I'm just curious on how you structure your deals to help offset the hefty property tax bill in Texas. Would you mind elaborating a little more?
Property Manager · Katy, TX · Member since 2015 · 1k+ posts · 1k+ votes
7y
@JoJo Tucker Houston, like all markets, has good deals and bad deals - you just have to know where to look!
@Vijaianand Thirunageswaram is correct - the property taxes have really eaten into the rental returns over the past few years. We hire a company to protest our property tax bills on our behalf. Ad Valorem Tax is the company we use.
As far as PM, we couldn't find any companies that were reasonably priced and offered a great service. Some of the companies have a lot of nickel and dime fees, in addition to the management fee, that can really add up. And other companies were just flat out bad!
So we starting doing our own property management a few years ago and just this year have started managing for other investors.
There are a lot of great opportunities here in Houston. The key is making sure you have defined goals and your strategy is set.. Once you have that then you align your team with your goals and have straight forward conversations with them on expectations.
We manage over 1,000 properties in Houston and DFW and 50-60% of our owners are out of state. It is important that before I help someone find a property that we have a conversation to make sure that we align with each other
I would look up NARPM and start with them..Below are some questions I would think would be a good starting point for you to see who really treats their company like a business or a hobby.
My business partner is a regional VP for NARPM and I am happy to help if you need anything please reach out
Questions to Ask prospective management companies
What are your average days on market for vacant homes?
What is your average rent amount for all properties managed?
What is your average work order cost for the owner?
What is your average make ready cost for the owner?
Are all my invoices uploaded to my owner portal?
How do you advertise your vacant units?
Do I receive video of my pre and post make ready?
Do you have a setup fee?
Do you upcharge on maintenance?
When do you make owner payments? How often?
Are you a Certified Property Manager?
Are you a member of NARPM?
What is your Guarantee?
Do you provide move in and move out reports
How many pictures do you take of the property prior to tenant moves in and after the tenant moves out
Do you get weekly reports when the property is vacant what prospective tenants are saying about your home
Do you provide monthly newsletters to your tenants
Do you hold investor education classes to help me become a better investor
Do you have single point portfolio based management services?
How many properties do the owners actually own themselves?
What do you do to ensure that the tenant is responsible for security deposit disputes since that is the largest reason for owner lawsuits
How familiar are you with the newly changed laws that can affect you the owner if they are not used correctly?
Investor · Durango, CO · Member since 2016 · 35 posts · 23 votes
7y
We currently have rental properties here in CO and NM but we've been thinking of trying vacation rentals, specifically in the Lake Conroe area. Any thoughts?
Real Estate Agent · Houston, TX · Member since 2017 · 290 posts · 233 votes
7y
Good posts! I grew up in Sugar Land for much of my childhood, and it's incredible the growth and new builds out there in the past 10 years! Schools, schools, and schools! Such a powerful draw.
Flooding will continue to be the elephant in the room ( city) I think for the foreseeable future all over the city, but if your existing home did NOT flood during Harvey, that really should give some confidence in that properties long term out look, IMO. That storm was unique in many ways.
Investor · Sugar Land, TX · Member since 2016 · 62 posts · 48 votes
7y
Flooding is not a simple issue as rain does not fall evenly across all of the huge Houston metro area. I live in Sugar Land and just last month on May 7th we got 6" of rain in 2 hours and 10" in 24 hours causing flooding. This was worse than any period during Harvey.
Rental Property Investor · Houston, TX · Member since 2018 · 70 posts · 33 votes
7y
Due to the high property taxes and rising insurance rates and having 100 and 500 year floods every year or two - I have elected to invest outside of Houston
Real Estate Broker/Owner & Property Manager · Sugar Land, TX · Member since 2013 · 660 posts · 459 votes
7y
@Tony McCargar Lake conroe has opportunities but not as compared to Galveston. If you can get cheap properties, then go ahead with STR or AirBNB otherwise it's not great and varies depending. But conroe itself is really getting lots of action and it's one of the top growing cities in US. So I would be surprised that lake conroe market to pick up near future..
In related to PM companies, try looking for good and small companies who put their time and effort to work between tenants and landlords and not charge nickel and dime. We have been property management specifically for smaller investors to promote real estate investment because many starting out investors really get burnt by managing themselves and regret their decision in real estate investing. We want to ease their worries and increase their investments interest. That;s our main goal. Look for companies like that and not something which is for making money.
Due to the high property taxes and rising insurance rates and having 100 and 500 year floods every year or two - I have elected to invest outside of Houston
I’ve lived in the Houston area for almost 20 years now, if you have any questions about different parts of Houston I know it pretty well please send me a PM. However I don’t have much experience in the market as I’m trying to get my first deal now as well.
Hey @Vijaianand Thirunageswaram, in regards to your "proper planning" comment above regarding taxes, I'm just curious on how you structure your deals to help offset the hefty property tax bill in Texas. Would you mind elaborating a little more?
Property tax is just another bill like anything else. Utilities, insurance, etc. You just pencil it into your income/expense and make sure the deal works.
Investor · Beaumont, TX · Member since 2016 · 171 posts · 277 votes
6y
It's a good market, however I think Dallas and Austin are more lucrative than Houston in terms of rent growth, job growth, and population growth. Since I am near Houston though, I will still continue invest in my "backyard" though