CA homeowner with equity to invest in TX - need some advice.

[Cynthia Veenendaal]

Hello :)

I'm new to BiggerPockets and new to real estate investing. I've got some big decisions to make and thought I'd reach out to the BP community for advice and insight. Here's my story...

I currently live in West Covina, CA and have considerable equity in my home. My husband and I have been thinking about selling our home for the past few years as the neighborhood just isn’t what it used to be. From much of what I’ve read, many sources are forecasting a drop in CA home prices around 2020; so we’re thinking that we want to put our house on the market this summer. But if we sell and buy another home this summer as planned, we would find ourselves in a “Catch 22”. If we sell, we are likely to receive top dollar for our home…yay! Conversely though, if we buy at the same time, we will likely pay top dollar for our new home…boo!

Inasmuch as we’d like to upgrade to a better home, the thought of paying over $750K for a home seriously makes body parts pucker! After much discussion, my husband and I concurred that investing our equity would be the better choice for us right now.

Our goal is to build a profitable portfolio of single and multi-family (up to 4 units) properties using the BRRRR method. However, due to the current market and the liberal CA laws that favor tenants, we're not too keen on investing in CA. Thankfully, while researching out-of-state real estate investing, I stumbled across BiggerPockets. What a blessing! I've since been listening to and reading as much information as possible (which I refer to as "uploading to my Windows 69 operating system" lol). I just finished reading "Long-Distance Real Estate Investing" by David Greene and highly recommend it! I'm now reading "What Every Real Estate Investor Needs to Know About Cash Flow…" by Frank Gallinelli.

After some research, we've honed in on the following areas of interest: San Antonio and Austin as well as some specific suburbs (Leander and Round Rock) and areas in the corridor (Schertz, New Braunfels, Kyle and San Marcos). Since my husband and I have been toying with the idea of moving out of state for the past few years, we're thinking that house-hacking a multi-family property might be a good means of cutting our teeth in REI.

But man that would be a huge leap of faith for us! We are both CA born and raised and have never lived anywhere else. While there are a lot of things that we don’t like about CA, we are realistic and fully aware that we’ve been incredibly spoiled by its weather and amenities. I work remotely and will likely be able to take my job with me, but my husband would have to find work. The hard pill to swallow is that he works for a school district and has an awesome benefits package that will be hard to lose. When you’re in your early 50’s, good health insurance is a major factor!

There is so much to consider. Should we sell this summer and then rent here in CA while we hope and wait for more of a buyer's market before buying our next home (meanwhile investing in rental properties in TX)? Should we sell and house-hack somewhere in TX for a year or so instead of throwing pesos away on crazy CA rents? (We may even find that we like TX and might want to stay. I visited a friend in Leander in October. I didn't care for the heat and humidity but found that the people were kind and respectful and I LOVE how Jesus is not a dirty word there.) Should we stay in our current home (and gamble that its value won't take a significant hit if there is a recession) and just access our equity via a HELOC for investments? I know I know, my thoughts are all over the place. But these are the questions that keep me awake at night.

I figured that many of you be familiar with my particular real estate market and may have some advice in that respect. Many of you may even have been in similar circumstances and faced similar tough decisions. So I said to myself…”Self, why don’t you tap into this vast well of knowledge and experience!?”

So my question is simply this, WHAT WOULD YOU DO IF YOU WERE ME? (I truly welcome any advice or feedback. At this point I’m just eager to hear someone else’s thoughts – mine are relentless!)

PS: Here is what I do know right now… We will be buying 1 to 2 investment properties in TX this year and are planning to visit within the next 3-4 months. We’re looking to connect with an agent who is experienced in working with investors and interested in partnering with us on this adventure. We’re also looking for property management, construction and financial (funding and tax related) resources. Please feel free to message me. I’d love to connect with you.

PPS: Thanks to all of you who took the time to read my post. I know it’s lengthy!