Rental Property in Dallas

[coolguy007]

Hi,

With property prices rising, do you think it is advisable to invest in a rental property in Dallas? I live in Seattle. The prices are too high here, but Dallas still looks affordable. What are your thoughts?

 

[David G]

I don't live in Dallas, but in Fort Worth. Rents here generally are pretty cheap, compared to most cities around the country. I guess it'd depend on the type of property you're looking at.

 

[coolguy007]

I am looking for a Single Family home in Frisco area. 3 bedroom houses are around 250K. Property taxes are 2% though. :-( Anyone has any insight into rents in Frisco and should I trust the rent estimates on Zillow. Anything else I should be aware of? Thanks in advance.

 

[Alex1432]

Do you have experience with rental properties? Are you going to have a local agent deal with housing issues be sure to calculate that into your profit equation.

 

[Gody]

I have a few rental properties out in Dallas-Fort Worth area. Most of my properties are out in Mansfield. They are 3br/2ba sides of a duplex(about 1500sq feet and they rent for 1225). I've owned property out there for 5+ years now and I'm really happy with the purchases. Most of my renters have renewed their leases consistently and I've had very few months of vacancy amongst all my properties there.

If you do your research properly and make sure you get a solid property and decent location then you should do fine. Texas has a lot of positives going for it in terms of real estate. The property taxes may be higher than other places at 2%, but remember there is no state income tax so you won't be taxed on potential income produced by your property.

 

[Matt]

I don't have any rentals yet, but it's on my list, perhaps for this year. I really think there are a ton of factors to consider rather than just accessibility of property price.

It's not rocket science, but there are a lot of variables to identify good investment properties, and it's a tough market going up against the guys with experience.

Would love to see a thread on Rental Properties in general, including things like liability, cap rates, identifying property etc.

Further down the line there are matters of ancillary probate to factor in too...

 

[Haley]

I have a few rental properties out in Dallas-Fort Worth area. Most of my properties are out in Mansfield. They are 3br/2ba sides of a duplex(about 1500sq feet and they rent for 1225). I've owned property out there for 5+ years now and I'm really happy with the purchases. Most of my renters have renewed their leases consistently and I've had very few months of vacancy amongst all my properties there.

If you do your research properly and make sure you get a solid property and decent location then you should do fine. Texas has a lot of positives going for it in terms of real estate. The property taxes may be higher than other places at 2%, but remember there is no state income tax so you won't be taxed on potential income produced by your property.

Do you manage them yourself?

 

[Gody]

I live in San Diego so I have a property management company take care of them for me. Depending on the type of property, a property management firm can take a fee from 5-10% of your monthly rents. Some property management companies also take a fee everytime they renew the lease or acquire new tenants or everytime a service/repair call is needed so its important to assess the full picture when looking for good property management. I do have a couple properties in San Diego that I manage myself and its not too much work once you figure out what works. Obviously the quality of the tenants and the property tend to lead to less hassles in the long term.

I really think rental property is one of the best investments someone can make. I see so many benefits to investing in real estate in comparison to stocks and funds that I've really focused my investment time and money in that arena. I will try to write a post at some point to detail some the benefits I see. Hopefully the info can benefit many of you here.

 

[SCC]

I'm a residential real estate attorney in dallas and I have a lot of clients that invest in rental properties. They will either buy them and then re-sell them through owner-financing or buy and rent. I haven't gotten into myself but there are some who seem to do real well. I know our city has real estate investing clubs that have meetings with tutorials and networking and that sort of thing. If you look into buying rental properties in whatever city you live in I'd recommend looking for similar groups.

 

[freebee]

It's a seller's market right now, in that prices are way up from what they were a couple of years ago. I have investments in the rental market in the DFW area.
Even at current prices, there is good income to be made in this industry. As Gody has stated : Do you research, and select solid properties in solid areas. Also, there is a need to be disciplined, especially if you are highly leveraged.

 

[Annie H.]

I am looking for a Single Family home in Frisco area. 3 bedroom houses are around 250K. Property taxes are 2% though. :-( Anyone has any insight into rents in Frisco and should I trust the rent estimates on Zillow. Anything else I should be aware of? Thanks in advance.

You won't get a ton of advice but a resource is:

http://www.zillow.com/advice/

When buying rental properties, as noted above, if you're not close enough to manage the property be sure to factor in a 10% management fee and be prepared to pay top dollar for maintenance and repairs. The average rental management company has their own staff and the rates they charge you are far above market. Also, if you're in a market where there are lots of rentals available make sure you have a plan to incentivize your management company to show/offer *your* rental instead of any others they may have. As with anything, you need to do your homework (perhaps deal with a rental closer to you that you can manage yourself first).