All Forum Posts by: Eric Lee

@Hau N., this was for SFH as an investment property

Hi @Jeremy Michiels.  I'm in the DFW areas as well and have been shopping around for rates recently.  The best rate I've found so far is 4.625 for 20% down 30 yr.  That rate drops to 4.25 for 25% down.  Feel free to PM me if you want more specifics on the lenders I've spoken too.

Thanks everyone for all the info!

Thanks @Greg H.  I've also been using the Zillow rent estimator to get ballpark figures for rent, but based on what you said I'm guessing this is also not very reliable in Texas..  Do you have suggestions on the best way to estimate rent?  I understand the best method is probably to ask an agent for comps, but I'd still like to know if there's a good way to estimate when reviewing properties on my own, without having to ask an agent about each one.

Hi @Nick G. and @Mike Cumbie, appreciate the info!

Hi fellow BPers,

I'm new to real estate investing, and am looking into SFHs as rental properties in the Dallas area.  I'm trying to improve my methods for estimating expenses when analyzing deals, and I had a few questions related to property tax.

For example, when I look at a property on Zillow, I might see figures like this:

Why does Zillow show the property tax as the same each of the past 3 years, if the assessment value has risen?

In the MLS listing for this same property, it lists "Unexempt Taxes" as $3,173.

From the county website, I know tax in this area is 2.82%.  For this property I see an appraisal value of 148k, so the estimated 2017 tax is listed as $4174.

In general what is the method that you find the most reliable for estimating property tax?  I assume it would be the county website, but sometimes I can't find a recent appraisal value to use, so knowing the tax rate doesn't help.  In other cases I can see past years tax filings, but the owners sometimes have exemptions that won't apply for me, so I'm not sure how to factor that in.

Appreciate any advice you have to offer!

Great tips/advice @Chris Mason, appreciate it!

Hi @Chris Mason, thanks for the info.  So just playing with some numbers, for a 150k property (20% down, 130k loan), to lower the interest rate from 5.375 to 4.375 would require 4 points ($5200), is that right?  This would lower monthly payments from 672 to 599.  With that 73 dollars a month saving, it would take about 6 years to recoup the 6k.

Is this an accurate analysis, or is there anything else I'm missing that should be factored in?  Cashflow for rental properties in my area seem pretty low, so I'm wondering if buying points to lower the monthly payments is a viable/wise option.

Hi All,

I was wondering what the typical spread is between interest rates for a conventional 30 yr loan for a primary residence vs. a rental property?  My lender quoted me at 5.375% for rental property loan with 20% down (150-200k purchase price).  Looks like current rates for a regular loan are in the high 3's or low 4's.  Is this difference to be expected from most lenders for a rental property?  

Thanks!

Welcome @James L.!  I'm from the Dallas area and am also new to real estate investing.  I've been looking into SFHs to buy/hold as rental properties.   It does seem like Plano/Frisco are pretty pricey, so hard to get good rent to price ratio.  Looking for places that can get close to 1% has led me to looking in the Garland/Mesquite area.  Properties are a bit cheaper, but that also means a different class of tenant compared to plano or frisco.  Good luck to you!

@Vanessa Homuth Great advice in your posts, thanks for sharing!  I haven't looked as far as Little Elm yet, but I know it's a pretty up and coming area.  What is your experience with the demand for rentals in that area?  Are you able to get close to the 1% rule?