Looking for advice: Arizona vs. Texas

[Kolbi Heilmann]

My husband and I are new investors looking for the best place to get into real estate. He going to do a skill bridge program through the Navy and we are currently crunching numbers to figure out where we will have the most success in investment and as real estate agents. We are currently stuck choosing between Arizona and Texas. We would greatly apppreciate any tips or advice anyone has.

Options we are looking at:

-phoenix, flagstaff, chandler, maricopa

Vs.

-San Marcos, Austin, Denton, Dallas 

[Terry Zannella]

Hi Kolbi,

 I’m currently in the Air Force and have lived in and owned rental properties in both Phoenix, Arizona & San Antonio, Texas.

Personally those are two of my favorite states, They both have great jobs, growth, local economies, demographics, etc. 

I would be cautious about looking for the “best” place because like everywhere else they have both advantages and disadvantages and I believe it’s up to you to determine what is “best” for you. 

Regarding investments, all of mine in both states have done well with appreciation, low vacancy, good cash flow etc. 2 differences come to mind. 1 - Property taxes are higher in Texas. 2 - In general, similar properties are more expensive in AZ.

Now to clarify, neither of those are a problem for the following reasons.

1 - The lower purchase price in Texas offset the higher property tax, and as long as the property cash flow‘s that won’t be a big factor.

2 - The higher purchase price in Arizona is typically offset by higher rents which will usually provide you similar returns.

Since I believe both places can provide good returns, how would I go about making the decision? I would look closer at each individual city you listed and determine exactly what it is you’re looking for.

Do you want to be close to friends or family, if so where are they? Do you prefer to be in a large dry climate such as Phoenix, smaller mountain town such as Flagstaff, or a bit more humidity (and grass) in central Texas? Do you need a VA hospital/clinic?(Phoenix, Dallas, San Antonio and Corpus Christi have them).

 Hope this gives you a few ideas...