Advice on first real rental property?

[David H.]

Hi all-- I'm a new member and I was hoping to get some guidance on how exactly to choose a good rental property that will generate a solid income stream (to pay for my kids' college in 10-15 yrs).  I'm very fortunate in that I make a good W2 income plus already have significant equity in a home I had lived in but now rent out.  This is my first foray into purchasing a property specifically for rental purposes.

I'm planning to take out a cash-out refinance loan from my other rental property (I'm thinking $150-$200K) to purchase a townhouse or single family home in Houston that is mostly turnkey and then renting it out for an additional income stream.  I know this is not great timing as interest rates are high but I don't have a time machine and can always refinance later. One concern is that property taxes in TX are high so I may need to rely more on appreciation to build future income rather than have a good income flow now (as payments on my cash-out refinance may equal or even be greater initially than rent).  Do you have any tips -- specifically what do you recommend I look for regarding neighborhood and specifics of the home?  I don't have much experience in fixing up a home but I have a few connections to good contractors.  Do you have any recommendations on how to find a real estate agent who is smart, experienced and has my best interests in mind?  I figure that's a good first step.  Would love to hear any tips/advice you can share.

Thank you very much in advance!

Dave