Texas Real Estate Markets: Booming or Overheated?
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Joe S.Pro Member
Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votesIf I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
11 Replies
- Lender · TX · Member since 2024 · 308 posts · 196 votes1y
As someone living in Austin, I’d recommend looking elsewhere. It’s a great city and still appealing for people moving in, but there’s a big oversupply right now in terms of housing (rents dropped by 8% last year). Prices are getting close to California levels and it might be difficult to find tenants with all the competition out there. I'd suggest looking into the Dallas/Forth Worth area instead.
- Member since 2024 · 100 posts · 15 votes1y
Quote from @Julia Lyrberg:
As someone living in Austin, I’d recommend looking elsewhere. It’s a great city and still appealing for people moving in, but there’s a big oversupply right now in terms of housing (rents dropped by 8% last year). Prices are getting close to California levels and it might be difficult to find tenants with all the competition out there. I'd suggest looking into the Dallas/Forth Worth area instead.
I appreciate your insights on Austin! It sounds like the oversupply is really affecting the market there, and with rents dropping by 8%, it might be tricky for investors to secure solid returns in the short term. I’m curious, what do you think are the long-term prospects for Austin—especially with the tech industry’s presence? Do you see it bouncing back anytime soon?
I’ll definitely look into the Dallas/Fort Worth area as you suggested. Have you had experience investing there, and if so, what’s your take on the current trends in that market?
- Member since 2024 · 100 posts · 15 votes1y
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
That's an interesting point about Texas taxes! While property taxes are definitely higher here, many investors are still drawn to the state's lack of income tax and the strong real estate market. I'm curious, if you were to invest elsewhere, what areas would you consider and what factors would drive your decision? Do you think the potential for appreciation or cash flow in Texas outweighs the tax burden? - 1yJoe S.Pro MemberInvestor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
Quote from @Kent Ford:
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
That's an interesting point about Texas taxes! While property taxes are definitely higher here, many investors are still drawn to the state's lack of income tax and the strong real estate market. I'm curious, if you were to invest elsewhere, what areas would you consider and what factors would drive your decision? Do you think the potential for appreciation or cash flow in Texas outweighs the tax burden?We have had instances in Texas, where the taxes outpaced any rent increase. Investors typically have more write offs than they have income… So no income tax in Texas is not as compelling as some might think in my opinion. I am speaking from an investor standpoint that’s going to rent out the property. If I didn’t live in Texas, I’d probably invest where I live. Lol. 😂
- 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
that was my experience in owning props in Texas. I am a firm believer that you have to live there and offset your prop tax's with zero income tax and of course be a local and self manage. then to me its like any other market in the country basically.. - Member since 2024 · 100 posts · 15 votes1y
Quote from @Joe S.:
Quote from @Kent Ford:
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
That's an interesting point about Texas taxes! While property taxes are definitely higher here, many investors are still drawn to the state's lack of income tax and the strong real estate market. I'm curious, if you were to invest elsewhere, what areas would you consider and what factors would drive your decision? Do you think the potential for appreciation or cash flow in Texas outweighs the tax burden?We have had instances in Texas, where the taxes outpaced any rent increase. Investors typically have more write offs than they have income… So no income tax in Texas is not as compelling as some might think in my opinion. I am speaking from an investor standpoint that’s going to rent out the property. If I didn’t live in Texas, I’d probably invest where I live. Lol. 😂
That’s an interesting point about Texas taxes! While the lack of income tax is a huge draw for many, I agree that property taxes can quickly eat into profits, especially for investors renting out properties. It’s a balancing act, and sometimes the numbers don’t always make sense. From your experience, how do you weigh the pros and cons of investing in Texas compared to where you live? Do you think there are specific markets or strategies that might help offset the high taxes here?
- Member since 2024 · 100 posts · 15 votes1yI completely get where you're coming from. Being local and self-managing definitely helps keep those property taxes in check. Without the income tax benefit, it really starts to feel like any other market, especially when you're not there to handle things firsthand. Do you think there are certain areas in Texas where this model still works well, or is it becoming more challenging statewide? How do you see the future of the Texas market for out-of-state investors?
Quote from @Jay Hinrichs:
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
that was my experience in owning props in Texas. I am a firm believer that you have to live there and offset your prop tax's with zero income tax and of course be a local and self manage. then to me its like any other market in the country basically.. - 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Kent Ford:
I completely get where you're coming from. Being local and self-managing definitely helps keep those property taxes in check. Without the income tax benefit, it really starts to feel like any other market, especially when you're not there to handle things firsthand. Do you think there are certain areas in Texas where this model still works well, or is it becoming more challenging statewide? How do you see the future of the Texas market for out-of-state investors?Quote from @Jay Hinrichs:
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
that was my experience in owning props in Texas. I am a firm believer that you have to live there and offset your prop tax's with zero income tax and of course be a local and self manage. then to me its like any other market in the country basically..
Joe can answer this other that funding a few land flippers in Texas the last few years I have not done any deals on improved properties.. And I dont personally hold any rental properties etc in Texas.. I just remember getting my tax bills on a few of the flip properties i funded in Dallas a few years back and man those things are eye watering. :) - Member since 2024 · 100 posts · 15 votes1yIt sounds like you've had quite the experience with those tax bills! What was the driving factor for you when funding land flips in Texas, compared to other types of properties? Do you think the high property taxes play a significant role in shaping your investment strategy moving forward?
Quote from @Jay Hinrichs:
Quote from @Kent Ford:
I completely get where you're coming from. Being local and self-managing definitely helps keep those property taxes in check. Without the income tax benefit, it really starts to feel like any other market, especially when you're not there to handle things firsthand. Do you think there are certain areas in Texas where this model still works well, or is it becoming more challenging statewide? How do you see the future of the Texas market for out-of-state investors?Quote from @Jay Hinrichs:
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
that was my experience in owning props in Texas. I am a firm believer that you have to live there and offset your prop tax's with zero income tax and of course be a local and self manage. then to me its like any other market in the country basically..
Joe can answer this other that funding a few land flippers in Texas the last few years I have not done any deals on improved properties.. And I dont personally hold any rental properties etc in Texas.. I just remember getting my tax bills on a few of the flip properties i funded in Dallas a few years back and man those things are eye watering. :) - 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Kent Ford:
It sounds like you've had quite the experience with those tax bills! What was the driving factor for you when funding land flips in Texas, compared to other types of properties? Do you think the high property taxes play a significant role in shaping your investment strategy moving forward?Quote from @Jay Hinrichs:
Quote from @Kent Ford:
I completely get where you're coming from. Being local and self-managing definitely helps keep those property taxes in check. Without the income tax benefit, it really starts to feel like any other market, especially when you're not there to handle things firsthand. Do you think there are certain areas in Texas where this model still works well, or is it becoming more challenging statewide? How do you see the future of the Texas market for out-of-state investors?Quote from @Jay Hinrichs:
Quote from @Joe S.:
If I didn’t live in Texas, I would probably invest elsewhere due to the exceptionally high taxes.
that was my experience in owning props in Texas. I am a firm believer that you have to live there and offset your prop tax's with zero income tax and of course be a local and self manage. then to me its like any other market in the country basically..
Joe can answer this other that funding a few land flippers in Texas the last few years I have not done any deals on improved properties.. And I dont personally hold any rental properties etc in Texas.. I just remember getting my tax bills on a few of the flip properties i funded in Dallas a few years back and man those things are eye watering. :)
currenty I just fund land flippers so we are in and out of the deals before we even pay prop tax's so I dont really care what they are as long as we sell for a profit ( which we do) its all good. Its the long term landlords that have to be concerned with prop taxs
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