All Forum Posts by: Hattie Dizmond

@Simon Cox

You live here, so you're aware of how large and diverse the Metroplex actually is.  To give you any useful advice on where to start your search, you would need to be a little more specific on your criteria and parameters for your buy & hold investing.  

Arlington offers some cash flow opportunities, as do Mansfield, Grand Prairie, HEB, Duncanville...you get the point.  

What price point are you looking at?  Are you OK with either B or C neighborhoods?  Will you consider a rehab?  If so, how extensive?  Or, are you looking for more turnkey?  The answers to all of these questions and more will determine what direction you should start your search.

Jay...that's a sound approach. We don't look at anything under $200k for flips. The buy & hold stuff we're doing is mostly wholesale, but we stay engaged with the buyers throughout the process, so that's where our knowledge of the ARV vs. appraisal comes in.

Our reasoning with the higher value is that it allows us to focus on areas that move quickly...even more quickly than the lower priced homes.

I didn't realize you were working in the DFW area.

 Yes to everything Jay said!  Foundation issues are nothing to be scared of.  If you're going to play real estate in most of Texas, you will have to deal with them.  A good inspector and learning what to look for is the key.  1 in every 3 houses here will have foundations issues at some point.

Jay...you're spot on with the appraisers and the ARV. One thing we've found that helps is providing the appraiser with the address of the comps we used to generate the ARV and our reasoning (i.e. which houses of those comps were flips or what the required updates of each comp was).  Appraisers have gotten lazy.  They are simply pulling solds and not looking at whether they are comparing apples to apples.  Most of the area has enough investor pressure we've been able to find at least 1 flip as a comp for the majority of our properties.  That was all on refi's for buy & hold properties, so I don't know how well it will work for a buyer's appraisal, but that information in the hands of the buyer's agent could get it over the threshold.  The last thing I'll say on the ARV is that the market here appears to be softening a bit.  Buyers are not being nearly as aggressive, and sellers are having to drop their asking prices back to a more market friendly level, as opposed to earlier this year and most of 2014, when properties were regularly selling 10% - 15% above asking.

As stated above, property taxes in Texas vary wildly from one municipality to the next.  Saying they are the highest in the country, with the exception of New Jersey is about as ridiculous as saying all of Michigan is a gang infested slum, simply because parts of Detroit are.

Also, Texas State sales tax is 6.25%, with local cities and municipalities adding on top, but it is capped by the state at 8.25%.  A simple Google search reveals these facts.  (Perhaps I need to write a new post on how to use Google?)

As for the fact Texas' property taxes are higher than a number of locations, I'll just restate my previous responses...

1. Texas is (I won't say immune.) highly resistant to the bubble or boom-and-bust phenomenon that occurs in many of the larger markets.  (Google "Texas" and "real estate bubble" for a great article by Texas Monthly examining why.)

2.  Texas has a balanced budget.  Our cities are not in bankruptcy.  Our infrastructure is sound.  Our schools are good.

3.  Rehab permits can generally be obtained...cheaply...in a single day.  New builds - existing lots - in less than 1-week.

4.  Texas has produced more new jobs this year than the remainder of entire nation combined.

I really could continue this list for a while.  But, the simple facts are, people are moving to Texas, and good quality properties will continue to be in demand for both purchase and rental.  The property taxes mean it is not the easiest place to generate positive cash flow in A & B neighborhoods.  However, it is possible.  And, I would suggest that some of the areas of DFW which I classify as "C" neighborhoods would easily be a "B" in other large metropolitan areas.  "C" areas of DFW do provide excellent cash flow opportunities, even without hitting the magical 2% number.

Yes...I was born and raised in Texas.  Yes...I'm biased.  However, I also lived through the banking crash of 2008, while living in Charlotte.  I saw what that did to a vibrant, hot economy and market.  You literally couldn't give houses away in Charlotte.  The white collar unemployment was ridiculous.  I had friends who purchased houses in 2006, 2007 and early 2008 who suddenly were so far under water on their mortgages they couldn't see the surface.  That was Charlotte.  I can't imagine what it was like in CA, FL & AZ.  

Texas didn't crash.  It was hard to sell, because suddenly no one was lending money to anyone without 20% down and an 800 credit score, but property values held.  I got back to Texas as quickly as I could.  Anyone who wants to complain about the property taxes or the sales tax or whatever, great...stay away.  It's less competition!

Tanya...take everything that Daniel said and multiply it exponentially!

You've got a great attitude, and it's refreshing, since a lot of people show up with nothing, asking for everything.

However, there are a lot of people who will pass themselves off as experts and want to use what you bring to the table.  Unfortunately, some of those folks are hacks, and I don't mean house hackers.  They don't know what they are doing, don't have their own capital, and will gladly take cavalier risks with yours.  So...choose your partners very carefully.

 Luis...if you continue in every post to promote NWA and your affiliation with them, you're going to start getting reported for advertising in the forums.

@George Searcy

The only areas you are going to have much success finding deals on the MLS are C-neighborhoods and below. If you're staying in North/Far North Dallas, Collin County and any of the other areas out that direction with quality school districts, you have better odds of winning the lottery. It isn't something to build a business plan around.

I suggest driving for $'s. However, don't send letters to those homeowners. You'll be one of many they receive every single day. Spend some time on the internet and find an active phone number for the owner. Talk to them. Knock on the door on a Sunday afternoon, if you have to. Call every FSBO sign you see. Think about doing your own marketing.

You can also form relationships with some local wholesalers.  However, as @John Chapman noted, stay away from the 2 large, local groups. Their ARV's are regularly skewed, courtesy of cherry-picked comps, which aren't really comps. I don't know what the percentage is, but a decent number of the "deals" they offer are actually listed on the MLS. The renovation budgets they tout are ridiculous, and even if all the numbers they publish are accurate, the deals I've seen are still not deals. With that said, there are some good, honest wholesalers in DFW.

I love Oak Harbor!  Fell in love with Puget Sound and the islands many years ago.

 LOL...that one went pretty quick!

Hey @Account Closed

We're active in the DFW area and would love to connect.