Duplexes in Houston - 77004 Greater Third Ward

[Monte Mabry]

Hi all,

I wanted to get some opinions, facts, or just advice from Houston investors. Feel free to shoot holes in my ideas!

My Situation:

I have been renting for the past several years and I am thinking it might be time to buy since my lease ends in July. My interest has been in duplexes due to the fact that I can lease out one unit while living in the upper unit. The numbers seem right for my price range with regards to a mortgage requiring 15% down and a renter that would likely pay over half of my monthly payment towards my mortgage/insurance.

Due to affordability I have been looking in the 77004 zip code which is also considered the Greater Third Ward. I ran across one home priced in the lower 300s to which an offer had already been accepted; likely due to the low asking price. I did follow up with a backup offer but that won't likely come through.

This are has duplexes in the mid 200s some of which currently have renters but they aren't necessarily where I would want to live until the area develops more. 

Is it a good idea to buy a duplex in this area, even if I don't want to live in it, and solely rent it out to get just over 1% in rent over the purchase price?

What are your opinions for growth in this area over the next several years? Do you think having two nearby universities will improve the value even though this has been a rougher transitional area for a while now?

Do you believe the duplexes, along with the older single family homes, will see much appreciation over the next few years?

Are there other areas you would consider before you would consider this area?

Thanks,

Monte

[Yavor Tomov]

Hi @Monte Mabry, 

I think you have a good idea. However, make sure the numbers are good before buying, do not forget to look at the taxes and please if you buy in the area PROTEST your taxes every year.  All properties in that area are old (30s) which implies major repairs ( roof, plumbing, foundation) so make sure you have reserves if you need to fix something big. Also make sure you get a good inspector. Regarding the area I personally like it (I love victorian style, hope I never have to demo one of those houses). Also have the observation that the area is slowly improving due to many hoses are getting rehabbed or new are getting constructed. 

All the best