Taking a Risk in a Gentrifying Area

[Brad Gibson]

Good afternoon y'all. I'm a pretty experienced LTR and MTR investor in Texas. I'm looking at perhaps acquiring two or three SFR's in the Fair Park/South Dallas area. I don't live in that area, but I frequently attend the State Fair of Texas and other events in the area...including the annual Texas/OU football game at the Cotton Bowl Stadium.

Dallas voters recently passed a new bond to invest additional moneys into the Fair Park to continue to have it serve as an attraction for in-town and out of town visitors.  On recent trips through the area, it is clear that what had been an underserved neighborhood is starting a transformation.  There are at least 10 new construction homes and an equal number of fix and flips on the market.  

The location puts it 5 mins from Deep Ellum (bar and live music district), 15 mins from Bishop Arts (one of the trendiest areas in DFW), 5 mins from downtown Dallas with no freeway time, and has the light rail green line running right through the center with the next stop at the Baylor medical center which is a large hospital complex.

Can anyone local to the area give some insight as to whether they see this as an up and coming area that will continue to gentrify or perhaps just a flash in the pan because the lots are comparatively inexpensive.

I'm considering purchasing two or three SFR to use as MTR's since STR's are now outlawed in Dallas. They will not be a cash flow monster or perhaps even positive, but should be break even. The play would be to hang onto them for 2-5 years while the area improves and then evaluate whether to sell or continue to grow the equity.

Thoughts?