All Forum Posts by: James Wenzel

Anywhere in the major metros of Texas is great.  You will most likely get a little more cashflow in Ft Worth, Houston, and San Antonio.  DFW and Austin are a little pricey compered to the other major MSAs.  You could possible gets some deals in suburbs and especially Ft Worth.  

I typically target 3/2/2, approx 1500sf properties in nice working class areas.  You can usually look at the crime graphs from the local police depts.  Basically avoid areas with shooting and where you will need a gun to collect rent.  If you target SA, Houston, Ft Worth, maybe suburbs of Dallas, you can get a nice working class rental for $175-300k and get an approx 10-20% cashflow.  Appreciation, will also continue to skyrocket in the TX market due to low supply and everyone moving here.  

Some of the factors to consider: What do close STR competition have in it, size, are you doing a super STR, or just a standard STR, etc...

Just furnished 2 standard STR in the last 6 months in San Antonio TX. 3/2/2 1500sf STR in nice locations with 20min to everything in a standard working class area. The stuff you buy new - Couches, mattresses, chairs (anything that can have bed bugs), TVs. Stuff you buy used - Washer/dryers, TV stands, dressers, end tables, coffee tables, pretty much everything else. We paid the kids to refinish the old furniture. We did very simple decorating with area carpet, large lamps, decorative chairs, benches, light pics on walls. Bought a ton of stuff on Facebook marketplace and Amazon, all in for the 3 bedroom was was approx 10k. Remember, thats for a standard simple nice STR. I had an associate that did a super STR and spent 75k. A simple one is plenty of profit in TX. Just know the market.

Fix and flip - short term, faster chunks of money in short periods, its a job, when complete must do it again, no real tax benefits. BRRR - passive income, long term, tax benefits, cash flow and equity growth. Most people when they first start investing in RE do both. They buy some long term rentals and BRRR down the road as well as flip a few when have time. I have actually replaced my income and my wife with cashflow from using the BRRR. Bought a bunch of SF rentals (long term rentals, and short term), then pulled a bunch of dead equity out and reallocated it into passive commercial RE investments. Have cash flow and equity multiple markets and CRE sources.

I have invested in Austin in the past, but have shifted more toward San Antonio.  The deals are so much cheaper there and have a lot more yield/cashflow.  Also getting nice appreciations there.  Properties appreciated 150% in 2-3yrs.  

I do have a development in the St Elmo area that I am invested in.  Should be a very nice class A that will be completed in the next 2ish yrs.  Retail, farmers market, housing etc...  That might be a place to buy before its finished.  

Location, growing population, growing job market, landlord friendly laws, submarket analytics (as a baseline), are the deal analytics conservative, moderate, or aggressive, CAP rate manipulation for CRE deals. I also like deals that are already cash flowing. I typically put 80% of capital into cash flowing assets and the other 20% of capital in other things like developments etc... Most of the deals I invest in passively double my money in 3-5yrs.

So excited for you. I love the single family long term rentals as well as short term rentals. Also love investing in larger passive commercial real estate syndications. Its all about the cashflow and equity. You do need to get plugged into a local educational RE meet ups. You can go to the meetup app and type in DFW. There you can actually meet live other like minded investors, brokers, wholesalers etc... so you can start getting deal flow and start to deploy your money. A lot of times they also offer educational courses on how to ID good deals and BRRR method the money out down the road.

Usually we leave a local treat for the guests.  Our short term rentals are in central TX, so we leave the best local chips and salsa.  Anything that comes out of Cody Wy?  Maybe a local beef jerky, local whiskey or wine?  If they have kids, maybe a buffalo stuffed animal etc...

Lots of great states to invest in Real Estate.  I typically focus on major metros that are landlord friendly (super important, 1 law could kill a deal), growing population, lots of jobs, low supply of doors (builders cant keep up), look at Uhaul stats to help.  I have personally invested in Texas (San Antonio, Houston, Austin, Dallas Ft Worth area), Florida, Arizona, Georgia, and I also like the Carolinas.  I heard Indiana is also good, just have never invested there.  I have invested in long term rentals, short term rentals, and syndications.  With 100k, you can buy your own deal, but I would also look at investing in commercial real estate syndications if you are busy.  Those are passive investments and I am typically seeing 2x your money at 3-6years.  The best way to evaluate those deals is to meet a bunch of syndicators in those areas and get on their deal flow list.  I get 5-10 a week from different folks and just choose the best one to invest my capital in.  I put 80% into cash flowing assets, then the other 20% into other RE stuff.  

Rule #1 in investing for me is to put my first 80% of capital in cash flowing assets.  Then the other 20% into more risky plays.  I personally would not invest in negative cash flowing properties up front.

With inflation kicking in, property taxes going up, insurance going up, dollar going down, and CAPEX for repairs/stuff breaking (AC, plumbing, roof, etc...), that projected 25k will turn into 30k-50k. I actually bought a vacation rental in the past for the same family reason, and a bunch of stuff broke, so my projected profits disappeared and had to pay a ton out of pocket. It turned into a thorn in my side. Eventually sold it.

What I would think about doing is buy multiple cash flowing RE assets, then use that cash flow from your investments plus the projected 25k out of pocket to rent on a nice property every summer or go on a killer vacation.  

#1 get educated, take a quick class on STR hosting and how to start it up. Also listen to some podcasts on STRs. Favorite podcast is on STR is https://www.thanksforvisiting....

#2 Create a quality product.  Cozy minimalist style, don't put too much stuff in there, rugs, drapes, large lamps, and lots of spacing.  Don't want it crowded.  You really don't need that much decor.  We have are theme based on the local area.  Buy new mattresses and new couches/chairs (heard bed bug nightmares).  The rest you can buy on Facebook marketplace etc...  We got all our TV stands and nightstands and just had them refinished.  

#3 Customer service and reviews are the key. My wife runs our STR and she is a rock star on making the guests feel welcome and that all their needs are met/exceeded. Currently she has 100% 5 star reviews on all her properties. Little things, like a welcome sign with names, leaving a local favorite (local bag of chips and salsa) etc..., favorite things to do list.

Bottom line - Offer something thats excellent, kindness/customer service, produce a great product, and understanding the business in your market. You want them to feel at home and that their needs were exceeded when they visit.