Torn between 3 cities to start investing - 'Two Driven Women' - PART TWO!

[Denise MacDonald]

Hi BB Forum,

You may have read our first forum post a while ago about getting started and more entrenched in the industry on a full time basis in the following capacities: 

- Wholesale (Stage 1)

- Fix/Flip (Stage 2)

- BRRRR (Stage 2)

- Buy/Hold (Stage 3)

We are out of country investors looking at the best market to have longevity in and it's coming down to Pheonix, Houston or Dallas. We want to delve deep into one city first before moving to another.  Would really like any insights you all may have on the potential (if you have worked in them) in these markets and if you feel there is opportunity in all 4 stages of our strategy in that city.  If so, what neighborhoods in those cities do you think have most potential?  We are looking for now at B/C class neighborhoods where there are investors flipping and there is some room for growth.  

Also, if you are a potential buyer, it would be very interesting to hear from you on neighborhood potentials in your city.  We are leaning more towards Houston than Dallas, but still interested in learning any insights around the difference and opinions in those two cities in TX.  

We are working with a coach and have great tools for moving forward and really excited to get cranking. Just wanted to get a pulse from this amazing community on market potenital in these cities and specific neighborhoods, etc.

As a side note, if you work in these cities as a cash buyer, investor, title company, realtor, property manager and are investor friendly, feel free to reach out! 

All the best to you all and your journeys.

Denise & Joanna

[Bob Stevens]

Rentals in those cities MAY yield you 3% net, why bother? IMO you should look at other cities that will yield 3, 4 5 times that 

All the best 

[Denise MacDonald]

@Bob Stevens Thank you for your input.  That's an interesting number. I think it depends heavily on the deal you get and what part of the cities you invest in, but I do think when you average it, it can seem pretty low. 

[Travis Timmons]

Those are all fine if you know what you are doing. Phoenix, Houston, and Dallas are massive, sprawling land masses of cities/metro areas. There's probably 100 submarkets within each of those. 

The premise of the question shows how inexperienced you are...that's why you are not getting a lot of responses. We've all been there; it's okay, but you ask about housing markets like it is picking stocks. It is much more hands on and dependent upon some sort of subject matter expertise.

[Denise MacDonald]

@Travis Timmons The subject matter is not new to us, those markets are, hence the humility to ask for input.  The comment you made tells me you are unwilling to provide that, yet you still took time out of your day to express yourself. Wishing you much success in your endevors.   

[Travis Timmons]

The premise of the question was flawed. That's all; it's not a personal attack. It's like asking "What type of food is good?"...it's just too broad. Is Houston, Phoenix, or Dallas a good market? Of course they are, but get on a plane and check them out. Or lean into some sort of unfair advantage or relationship in one of those markets.

Here's an anecdotal example...I own a rental in Sugar Land, TX (suburb of Houston) and even Sugar Land has a dozen little sub markets. Due to the population growth of the last 10-15 years, there are uneven student populations in schools. Many of those districts are being re-drawn. Without knowing the nuances and potential re-districting for each level (elementary, middle, and high school), it's going to be really difficult for you to invest wisely. So, is Sugar Land or Houston or fill in the blank a good place to invest? If you know the ins and outs of the market and are skilled operators, of course, but if you buy a property that switches from Travis High School to Lamar, you're likely going to lose 10-20% of the property's value overnight.