Phoenix Investor Entering Houston MSA

[Jared Vidales]

Hey Guys! Long time member here, haven't posted in a while, but still out there doing deals!

I currently operate out of Phoenix & Vegas. We run a direct to home owner acquisitions strategy squiring 20-25 deals on a month basis across both markets. My partner and I have had our cross-hairs on Houston ever since Harvey hit, and we're lining up our resources to open a small office and set up an operations team for a fix/flip & hold strategy to balance out the yield of our existing portfolio. 

We have 3 SFRs in escrow now we picked up directly from home owners and will be our first 3 assets in the market. 

77804 -- PP: 90k Rehab: 10k ARV: 189k

77065 -- PP: 95k Rehab: 5k ARV: 187k

77065 - PP: 90k Rehab: 5k ARV: 190k

My question is to wholesalers and other investors, what margins are you experiencing in the market today? They seem insane compared to how easily the 3 properties came to us. Also, how is labor currently with contractors? 

Thanks again, and I plan to be more active on the forms. 

[Belinda Lopez]

Harvey homes are the big unknown in the Houston market right now.  Yes, folks have a short memory and plenty of buy and hold investors are picking these up at pennies on the dollar but the fix and flip exit strategy is pretty risky for investors.  First time flooded homes are different than multiple flood homes so you REALLY need to know the areas where folks are fleeing and where they are rebuilding and returning.  It can take years to rebuild, work through insurance issues and move home.  Many folks just give up and walk away.  Mortgage companies have given many folks months of not having to make payments but that is coming to an end and we are seeing a definite uptick in foreclosures.

Labor is now readily available but so are the fly by night guys who take folks money and never finish the work.  There is no licensing of contractors in the state so that can make it tough to find quality contractors.

If you are coming to Houston, come on down! There is plenty of room for quality investors and plenty of opportunity. You might want to try the strategy others are doing and coming down for a few weeks, attending all the local REIA and investor meetings and do your analysis before moving. There are plenty of opportunities to partner with local groups as well.

I'm involved with the Realty Investment Community of Houston and we help educate and offer networking for local investors. We are seeing more non-local folks than ever at our meetings just like yourself; folks wanting to survey the landscape.  Our largest meeting is the first Saturday of the month and then we have several smaller meetings throughout the month where you can really ask questions and get to know some of the top, most active investors in the area in a friendly setting.  We also offer to send out wholesale deal info like those to our membership who are the top buying group in Houston.  Deals sell within days, sometimes hours if they are truly deals.

Welcome to Texas!