Investor · Bay Area, CA · Member since 2020 · 8 posts · 3 votes
Hi BP community!
I am a new investor looking to invest in the DFW market. I've visited the area several times over the last decade because my brother lives in the Dallas suburbs.
Goal: Buy and hold rental properties, BRRRR in the near/far future. Budget: <150k. I understand that its hard to meet the 1% rule in the DFW market these days
Cities of Interest: I heard that Irving, Grand Prairie, Arlington, HEB, and Forth Worth have good rental potential and are landlord friendly(?) compared to Dallas/Mesquite/Garland.
Can anyone provide any insight in which cities/neighborhoods to look into? Also, is it worth it to look into 2-4plexes or should I stick to SFRs?
I have 9 SFRs in the DFW area...in Grand Prairie, Arlington and ft worth. I got 8 of them under 150k in the last three years. It’s doable and I’d be happy to help. I get the 1% rule or better on all my properties under 150k. There’s a huge demand for rentals out here due to all the out of state residents moving here. I’m from the Bay Area myself btw. Let me know if you have any questions and I’d be happy to help you out.
@Dustin Tran Both the 1% rule as well as finding suitable rentals under $150,000 is going to be difficult. There are certainly homes under $150,000 but not a lot that would fit the type of home I'm looking for a rental (personally, everyones different).
I'm familiar with all the above listed cities - and you're likely to find cheaper houses in areas of FW, GP and Arlington. HEB is pretty centralized and thus is harder to find homes anywhere near $150,000.
MFH's are going to be quite competitive just because of our market not having many and plenty of folks interested. Just a supply and demand factor there.
@Dustin Tran are you working with $150k cash or is that the total budget? If you can leverage the cash you should be able to find something, if that’s the total budget there’s not much out there that I’m aware of but I haven’t looked outside of Dallas proper
Welcome to the Big DFW and getting bigger. You are correct 1% rule is tough, but maybe not impossible. Under $150,000 is limited, but also not impossible. For some reason the past 2-3 months I've seen more reasonable priced homes come on the market than I have seen in the past 2-3 years, so that is good. Not sure if that is a pattern, or just luck, or if there is some bigger issue at work. I feel for the most part it was just a good time for some people to cash in on profits, and have some cash for emergencies.
There could be some, but I think pretty rare to see duplex for under $150,000.....there are some for $150,000 per side. Rare for some reason that I see triplex. Again there are some, but I don't see many come up for sale.
I have 9 SFRs in the DFW area...in Grand Prairie, Arlington and ft worth. I got 8 of them under 150k in the last three years. It’s doable and I’d be happy to help. I get the 1% rule or better on all my properties under 150k. There’s a huge demand for rentals out here due to all the out of state residents moving here. I’m from the Bay Area myself btw. Let me know if you have any questions and I’d be happy to help you out.
@Dustin Tran I loved DFW market but 1-4 units don't work in the market and it wouldn't meet 1% rule. Even if it meets the 1% rule, property taxes and the tenant pool in that area won't make you any money. I owned couple of properties and sold them late last year. I am also in Bay Area so PM me if you need any help.
@Bruce Lynn and @John Morgan, I must be doing something wrong, because the VAST majority of deals I've seen lately, (MLS, wholesaler-provided, etc.) do not typically meet the 1% threshold, especially when building in closing, rehab and holding (hard money costs.) I have been looking at deals every single day (literally) in the most of those markets, (I live in DFW too,) and getting a deal to cash flow is dang near impossible. Anecdotally, even wholesale deals are getting bid up and most are going highest/best now as a result. It's frustrated me to the point where I am considering trying to source my own leads. I would greatly appreciate any insights/advice...been ready to buy for quite some time now.
I have recently looked at the prices of single family homes and am quite surprised at the prices. I live in DFW and have been investing there since 2004. I have single family and multifamily properties. Similar houses in an area where I paid $80K for several fairly new (less than 5 years old HUD foreclosures) single family houses are priced north of $200K. I understand appreciation, but wow. These prices scared me back to multifamiy.