Recommendation for Fort Worth area zip codes (MTR/LTR investment)

[Dylan Lin]

Hi there! Been lurking around the forum a bit. I am at the tipping point of really dialing down to purchase my first investment property before the end of 2023 (Hopefully sooner). I am hoping to connect with someone that knows Fort Worth inside out (growth trend, specific zones and regulation to pay attention to, etc). 

Here's my investment criteria and preferred strategy:

1. Under $350k for somewhat turn-key on the market deals, or $200k BRRRR deals.

2. For MTR or LTR

3. Able to beat at least 0.8% Rent-to-Purchase ratio

4. Zip codes with the most growth potential. 

I am also very interested in properties that can be turned into student housing (TCU, UNT, etc). 

So if you are a investor friendly agent that also has an investment portfolio yourself, investment-friendly lenders (that knows all the most up-to-date strategies for investment loan types), and contractors, I would love to connect with you! Thank you in advance!

[Steve Garcia]

Hello Dylan,

I am not an agent, but I am a newbie investor. I have a LTR in North FW and a MTR in Arlington. The North FW market is strong and has seen growth with much more to come. For LTR it will be challenging to meet 0.8% ratio. A MTR will get you there and I do think the MTR would work great in the North FW area. Have you used Price labs? I would suggest creating a market dashboard on the software for the North FW/Haslet area. Filter out all the Airbnbs that are listed for 30+ days and scrub the data to determine what your return can be. I also suggest subscribing to the CI Morning Impact newsletter for up to date news in the FW area. It will speak of growth, new jobs, and traffic patterns etc. Let me know if you have any questions. 

[Bruce Lynn]

@Dylan Lin  Happy to assist you with Ft. Worth if you need it.

I think you can purchase at $350 or under.  Plenty of options.  

Lots of talk about MTR and that seems to be the investment vehicle of the day, but I personally think there are very limited opportunities for this to be a success. Hospitals are doing their best to cut back on travellers which probably peaked during Covid era. From the travellers I know, housing stipends getting cut way back. When you look at the MTR housing forums there seems to be a real disconnect between what they want to pay, and what is fair for owners to charge to make MTR/STR worth the expenses. They seem like they want to pay LTR, but you really probably need double that to pay for utilities, turnover, vacancy, furnishing, etc.

The few MTR I know about and a lot of the STR seem to have a lot of vacancy. If you think on MTR you might have 1 month vacant between 3 month rentals, that's 25% vacancy a year. OUCH....that means your rate has to make up for that....which then causes even a bigger disconnect.

Some people talk about insurance rentals, but I think that is really few and far between.  I get those calls from insurance companies and they too are really looking to pay the LTR rate, sometimes willing to sign for a year, but want a clause to be able to vacate with 60 day notice.  They might be willing to pay slightly more than LTR, but I think if you want 2x-3x LTR they end up sending them to extended stay hotels from what I see.

20 years ago many companies gave some nice housing allowances to people relocating, but seems like most of the time now, if they get some kind of relocation assistance, it's more like a flat fee $5000-$10K-$20K and they can spend that however they want....STR, LTR, MTR, extended stay hotel, moving van. When you give the employee the choice vs the company providing the MTR housing benefit, seems like most are much tighter with their money.

Of course plenty of people probably have had difference experiences, but that's what I see.

on LTR for the most part I'm seeing about .7 Rent to Purchase Ratio....probably luck to get .8 or more, but most of my owner clients have been able to catch this up quickly over the past 5 years or more.  Everyone says now they wish they had bought more.  So that may mean you need to put down more money than minimum to get break even or cash flow...30-40% down.   Of course it depends on what you buy, where you buy, price point, etc.

Ft. Worth is a huge city, so lots of target zip codes depending on what you want to buy.  Generally I like Northeast area...and far west all the way to Weatherford.

[Melissa Shaw]

Hi, 

I recently bought a duplex for $295,000 for MTR in late June. A lot of growing pains. 

I inherited an occupied unit with a renter that has not been the most cooperative. 

2nd unit has been on the market for MTR since Saturday (5 days) no hits. I’m stressing. 

I Already had to replace an entire AC unit because the seller wired the unit wrong and ran the compressor to the ground. Seller had told me he replaced the unit a year ago. Come to find out it was a 2018 unit and never registered for warranty. $6,600 later 1 new unit. 

A list of things I have already had to do to bring the place up to approximately $18,000. 

1st Property manager didn’t want to deal with the long term tenant so bailed on me. 2nd property manger has been great in managing the tenant. 

A lot of growing pains and still the in progress… 

here is the listing for your reference - 

https://www.furnishedfinder.com/property/561115_1

[Bruce Lynn]

Quote from @Melissa Shaw:

Pictures are great.  Nice interior design?

Were you able to find someone to PM for you both long and MTR?    Are you going to keep the LTR until their lease is up?...or what was your thought about getting them out.

What are you telling people for parking since it single car drive?   Are you forcing the MTR person to the street?   I know street parking is pretty common in that neighborhood, but just wondered what your plan is there, or did you create some kind of parking in the back?

How big is it?  Is it 1bedroom or efficiency?

What are you doing for yard care there?  Are you taking care of everything?

If the LTR rate is $1200, but the MTR rates is $1650, I'd almost think it is about a wash if you're including utilities, lawn care, and management fees, and calculate vacancy or am I missing something.   What kind of vacancy rate did you use for your projections.   I have a fair # of people contacting me now about MTR and in my head I'm using 25% vacancy rate, thinking 3 month stays, 1 month vacant is occupancy about 75% a year.....but that is total guess.

Keep us updated on your success.

[Nicole Gullotti]

Hi Dylan, I just started my search in Fort Worth as well with basically the same criteria as you listed. I'm working with 2 agents that were both referred to me and have been really great. They suggested I look into the South Side and Fairmount. Hope that helps!

[Kevin Coco-Senyszyn]

Quote from @Nicole Gullotti:

Hi Dylan, I just started my search in Fort Worth as well with basically the same criteria as you listed. I'm working with 2 agents that were both referred to me and have been really great. They suggested I look into the South Side and Fairmount. Hope that helps!

 Be careful where you look on South Side. Property values and rental quality varies from street to street. You may find that similar properties on opposite sides of I35 are not similar investments. I recommend having your agent drive the area when looking for those appreciation "hot spots." Fairmount will likely do very well in the next 10 years.