All Forum Posts by: Brian Nel

Make sure you're looking places that you may find owner listed sales. There are a few sites if you Google "Texas FSBO". Also scour Craigslist. Driving through the neighborhoods you're interested in for yard signs is time consuming but may be helpful.

Also remember that as an investor you're looking for that home that's got some "ugh" factor to the other buyers that you can easily fix. Smoker's homes are the "best!" 

Great post. I've held this sentiment for a long time and you summarized it well. I searched until I was blue in the face for multifamily in the loop and best I could come up with was run down 2 units in Montrose way out of an attractive price range. 

If I had to throw my $0.02 in here, I think it's due to how profitable it is to increase the number of homes on a lot. As you mentioned, a 5k lot can be scooped up for $200k-500k depending on area. If that same lot is divided to 3 townhomes, each will sell for $500k-1M. The developers that do this have such a tight grip on their construction contractors (an interesting and sad story within itself) that they have the homes built for bare bottom dollar. I would estimate $150k-300k. So with our ranges stated here your developer is looking at $850k-$1.6M gross profit. And to think that from purchase to re-plat and sale can be 6 months, you'd be hard pressed to make the argument that someone would be better building a multifamily and holding. 

I would be curious to hear other opinions as well. 

Dan, I was in a similar situation to you years ago (incl. camper to live in) and I now house hack. Unfortunately I think the part that I read that's a deal killer is going to be the expected duration to own the property. Generally speaking, it's very hard to purchase and hold a property for less than 3 years and come out on top. There's just too many costs associated with buying and selling that you won't be able to recoup. You may find that simply living modestly (as your indicated lifestyle here of AirBNBing your personal space when needed doesn't sound too luxurious) and continuing to save you would be best. 

In addition to difficulties in remote property management, I'll also mention that Denver has rules around short term rentals. Specifically, you will have difficulty (or be entirely prohibited from) doing a short term rental on a property that you do not also reside in once you move. That is part of the reason businesses such as loftium.com have come about. Looking into one side of that (either as a host or as an owner) may fit your needs. 

I'm considering converting my unit to a furnished short or medium term rental. Like all of us in Houston not directly in downtown/midtown, there's not much in the way of walk-able attraction which is unlike AirBNBs I've stayed in personally.

I would like to hear from anyone else doing STR:

• what your common tenant is like (business, families, vacationers, etc),
• what lengths of stays,
• occupancy and 
• seasonality you experience. 

I had a friend pull STR comps so I know my expected annual revenue is roughly 150% that of long term rental however I will need to recoup costs from furnishing.

@Sean York No realtor recs, sorry, I did my buy side stuff solo. I'm sure many people here have good leads though. 

As far as land costs... they must support it. Check this out: 

https://urbanliving.com/development/12

This street is currently vacant, trailer homes and low income apartments. The new development homes are in the high $200s.

 South Independence Heights (essentially as close to 610 as possible) is where I see the most opportunity. 610 has formed the natural barriers preventing Heights type growth upwards (not sure you're missing out on much from the other side of 45) but as the original single family lots between Buffalo Bayou and 610 are bought up, people will naturally continue looking north. Combine that with proximity to established GOOF and a good thoroughfare, Shepard, I think it's ripe for gentrification. We already see some new development along the north frontage of 610 such as Whole Foods and fun, hip things north of the loop like breweries and restaurants. With the proper Heights alcohol ban lifted in the last few years we're also seeing more businesses opening that previously were suppressed farther south down by Rice Military because of alcohol sales. This results in more biz, more spending, more developing creeping north. People follow the fun shops, cafes and bars. Look at EaDo.... they built out a whole part of the city chasing a few trendy bars and venues (ha). 

Of course this is just all my $0.02 from having lived in both areas so validate my opinions independently!

You may consider hopping on Craigslist and picking up something used for the two months. $150 used washer and then resell for $100 in a few months will probably be cheaper than a rental. 

@Megan Hodges I definitely understand that sentiment. Duplexes are very hard to come by (especially anything not dilapidated). However, if it works for your needs, there are lots of options for homes with garage apartments or mother-in-law suites. That may give you the "two doors" you're looking for. 

A duplex new build on 7000 sqft for under $300k sounds pretty sweet actually!

I don't totally I understand the part about a duplex. Is this a whole duplex you'd buy with each side being a 3/3.5 for $275k total? Or just one half of it? 

Heights and Oak Forest are old and established A neighborhoods in/near the loop. I was mentioning Independence Heights which is significantly different (and you'll notice that reflected in prices as well). With most of the Independence Heights (as well as Heights proper) having no HOA, deed restrictions nor minimum lot size, there's lots of deals to be found. I'd suggest setting up an HAR or Zillow keyword search.

Regarding talking to builders, I'd be surprised if you're able to get a "deal". The very nature of new build developments is that they're manufactured and sold at a healthy market price so I'm not sure there's much for the investor-minded person there.