How would you rank San Antonio, Austin or in between for rentals?

[Rory Butler]

We're moving to Texas! We have a couple of properties in high-priced Seattle that we are cashing out to reinvest in Texas. We'll be home shopping for ourselves in Canyon Lake, and will be looking to invest about $600-700k additional cash in rental properties. Our goal is to maximize long term cash flow. We're trying to team up with a local realtor/management company to make the whole process work.  We've spoken with a few and there are 1 or 2 that we like, and can see working with long term. The problem is that each one only covers a certain area, whether it be high priced Austin, low rent San Antonio, or in between (San Marcos, New Braunfels). So if we pick a company we'll also be picking a location. This isn't really something we want to do piecemeal either because of 1031 concerns. Considering our budget and goals, which of these areas do you think offers the best balance of investment factors such as taxes, home prices, demographics, and economy? Where would you invest $600-700k in order to NET the highest monthly return? This forum is the best place that I could think of to get unbiased and expert opinions. Thanks so much!

[Sharon Powell]

If you’re looking for minimal risk, I would suggest choosing properties near the bases. If you’re looking for sooner rather than later, now is the perfect time to get something under contract, because PCS season is nearly here and people moving here this summer are beginning to look.
My personal strategy isn’t the most popular one, but it works for me. I’d rather pay more for a newer home, not have to worry about deferred maintenance, and then target military renters for several reasons.
-There is some recourse if anything were to go wrong (their supervisor would get involved)
-you can see what housing allowance is for different ranks and know who will probably be interested in your home
-and if it’s a good home, chances are high that they could help find your next renter when they PCS out
-no property manager is really needed because I do automatic rent payments, and maintenance isn’t much of an issue

It depends on what type of properties you want, but your money will likely go farther in SA than Austin, and probably NB and Canyon Lake as well.