Anna, Princeton, Fort Worth or other? Best places to look for IPs around DFW

[Mahesh Thatavarthi]

Hi,

I have been doing a lot of digging but wanted to ask the question here as well as there are a lot of experts around the area that can help me. I am looking for the best cities/locations around the DFW area to buy an investment property around the $300k-350k that meet the following factors

1) Better property appreciation (historical and forward looking)

2) Better rent appreciation (historical and forward looking)

3) Price to rent ratio of homes in the area

3) Rental vacancy rates in the area

4) Any companies moving to the area to ensure that the employment rate is steady or grows

Please share if there are other factors to consider. Based on your response, I can narrow down my research and find a good property. 

Appreciate your help! 

[Bruce Lynn]

@Mahesh Thatavarthi   If only it were that easy.   No slam dunks in real estate that I've ever seen.   If anyone would know the accurate answers to all these questions, we'd all be billionaires right.   It's like asking what will interest rates be in 12 months, or what will be the best and worst performing stock in 2023.

In general follow the growth.....that will be places on the outskirts, but not too far out.   As others have mentioned, I'd look generally between 35 and 75, north of 380 to the OK border.  There's always a balance though of price, rent, income, distance to jobs.   Second places probably to look are South between Mansfield and Waxahachie maybe even down to Waco.  3rd spot around south Ft. Worth, Burleson, Crowley, out to Weatherford.

Lots and lots of companies moving to the area....just seems like it is non-stop.  Universal is actually going to be in Frisco, Tollway and Eldorado.  McKinney airport looking to add commercial service.  Lots of factories building or looking at Sherman.  McKinney still has tons of room for corporate campuses.  Goldman Sachs will be 5000-6000 people in downtown Dallas within next couple of years, Wells Fargo building a corporate campus in Las Colinas to house about 4500 people.   Craig Hall, one of the smartest people in real estate still building his corp campus in Frisco at Hall office park...tearing down 2 buildings and building high rise apts, hotel and some other stuff.  Jerry Jones, probably more successful in real estate than running the Cowboys continues to buy land north of Frisco.   So plenty of things happening in Frisco, but not everyone can afford to live in Frisco and Prosper, so development will go north.

New construction rarely works well for investment properties, so skip Princeton....also no demand drivers there to speak of.

Another stat to look at is average wages then divide by 3 or 4 to get yearly rent people can pay.  Then put that into your yield calculations to find out what price range you should be in.  If at all possible I would be less than $300K if possible. Closest to $200K if you can.  Those will be the people most likely to rent long term.   $350K is still tough, but potentially those people are buyers, not long term renters if they have discipline to save, so you'll have more turnover as you move up the rent scale most likely.  Turnover/vacancy kills your returns.