Do people consider property taxes rates when choosing a market

[Harry Zhang]

Hi everyone!

I'm just starting to get into RE investing, I was wondering if property taxes play a big part in where people choose to invest.

For example investing in Texas probably has a 3x increase in property tax rate compared to Oklahoma. After the mortgage is paid off, wouldn't you be paying 3x the property tax which eats into the net income? So in my head, I would assume that for the same price, Oklahoma would be a better choice!

However it seems people don't talk about this part?

[Rick Albert]

It can be a factor but it just depends.

You used Texas as a great example. They don't have state income tax. So as an out of state investor, the higher property taxes are a turnoff because I don't really benefit from the no state income tax plus in real estate there are tax write offs. So one argument can be that you need to find a hybrid of low state income tax (where you have write offs anyways) and lower property tax.

It is a factor in your net cash flow but that's about it. If the numbers work, go for it. If it doesn't, move on.