Investment property FM Grapevine Coppell (Dallas, Arlington: sales, renters, condo)

[macjoubert]

I am looking to buy an investment property , preferably a single family around 250-300k.
I need it to rent for around 1$/sqft to profit.

Here's my research so far:
There seems to be more inventory in the FM/Marcus area but the homes are old, narrow streets lots and lots of cars parked.(I hate that and as a leasee I wouldnt like that either.
FM/ FM HS seems to be better but less inventory.

Coppell Schools are very good , but less inventory and a 2000 sqft home sells for almost 350k! But chances of renting at a premium are high, land is hard to come by to build.

Lastly Grapevine, Gr/HS isnt very good, so the areas i've narrowed down are zoned to Carroll and Heritage. In other words piggy backing on Southlake and Colleyville but paying Grapevine rents.

Any of you landlords out there have any thoughts? Im just coming out of a multifamily deal which made for great cash flow, so SFHs are new to me.

[WorldKlas]

You should determine if your strategy is appreciation on the initial investment or income stream. If its income stream, its super important to find a property where you have less competition for other houses for rent. Since that is my strategy, I can offer my observations. I stay aware of good school zones but location to employment centers is my first goal.

As part of your analysis, I recommend you do a search on Realtor.com and padmapper.com to access the volume of rental properties (SFH's) actively available in the area. In the places you mention, the prices are high and in the past the availability was high as well.... Tho I have not looked lately. I looked recently and was surprised to see how many rentals were available in Plano!

I have always sought houses to lease out in (near airport) Euless - zip code 76039 - where zoned to GCISD and also in Irving (Las Colinas business corridor) and the Firewheel area of N. Garland (Plano employment corridor).

Smaller, cheaper houses in the Irving ISD command decent rents and attract child-free couples who work in Las Colinas. I have never had a vacancy in an Irving property without dozens (usually 100+ inquiries) of folks asking for it. Tenant turnover on my Irving properties has been 100% no lost rental days for over 6 years now on 5 properties.

[ChristieP]

Grapevine HS is just a step behind CHHS, and both are still among the best in DFW. There's no reason to avoid GHS.

North Euless is a great area!

[macjoubert]

Originally Posted by WorldKlas

I have always sought houses to lease out in (near airport) Euless - zip code 76039 - where zoned to GCISD and also in Irving (Las Colinas business corridor) and the Firewheel area of N. Garland (Plano employment corridor).

Smaller, cheaper houses in the Irving ISD command decent rents and attract child-free couples who work in Las Colinas. I have never had a vacancy in an Irving property without dozens (usually 100+ inquiries) of folks asking for it. Tenant turnover on my Irving properties has been 100% no lost rental days for over 6 years now on 5 properties.

On SFH my strategy is appreciation more than direct cash flow. My duplexes were rich in cash flow but I had maneuver like crazy to get them to sell at all , and then sell for profit.

What areas of Irving are you talking about? North or South?

[WorldKlas]

Originally Posted by macjoubert

On SFH my strategy is appreciation more than direct cash flow. My duplexes were rich in cash flow but I had maneuver like crazy to get them to sell at all , and then sell for profit.

What areas of Irving are you talking about? North or South?

Since my investment goals have been cash flow, I go anywhere in Irving I can buy at a good price that is between O'Connor and Story, both North and South. I have also owned 2 places in VAlley Ranch but the prices to buy and usually 2 HOA's don't support my investment goals.

These days if I were buying for long to mid appreciation, I would be looking in areas that are still somewhat affordable but will likely be the next wave of desirability for first time owners... Hebron area, Martin High School (SW Arlington) attendance zone, Dan D. Rogers Elementary (Dallas) zone, Roanke/Northwest ISD and possibly if there is anything affordable in JJ Pearce High School (Richardson) attendance zone.

IMO, a cash flow strategy should aim for "what people want now" with consideration for how to keep it flowing by knowing where you won't have tons of other rentals. An appreciation strategy should be a bit more focused on "what will likely be hot when I want to sell" also with consideration for making sure you can keep it rented and the property can support itself.

[CzechGrazer]

I have a few rentals... I'm just playing devils advocate:
- first, why $1 rent per sq foot? I would think the rental rate you try to get should be based on percent of sales price. Rental price per square foot means nothing to me as far as rental viability. (Obviously it is a strong indicator on how nice a neighborhood it is)
- 300k homes have a very limited rental market. You're short term cash flow would greatly improve and long term appreciation should be about the same if you bought two 150k properties. Yes, you may have to sacrifice a little with regard to school district.

[macjoubert]

Originally Posted by CzechGrazer

I have a few rentals... I'm just playing devils advocate:
- first, why $1 rent per sq foot? I would think the rental rate you try to get should be based on percent of sales price. Rental price per square foot means nothing to me as far as rental viability. (Obviously it is a strong indicator on how nice a neighborhood it is)
- 300k homes have a very limited rental market. You're short term cash flow would greatly improve and long term appreciation should be about the same if you bought two 150k properties. Yes, you may have to sacrifice a little with regard to school district.

That's easy to answer, because I want my cake and eat it too.
Its a misconception that multi family appreciates per market, it appreciates based on GRM so your sale price is based on the rents you earn as a factor.
Over the years you put money in to fix up the place, while exiting you sometimes wont be able to make it back, though it cash flowed nicely for you.

I want both, 300k homes carry risk yes, but in the right location and most importantly right schools will rent and sell fast. 1$/sq ft is the bellwether of the desirability factor.Another factor is quality of tenants, under 150k and your renters are blue collar, cash only types.That comes with a whole new set of problems.

Ideally i'd like to own it for around 4 years and sell it for a profit and have it cash flow over the years of ownership.
Thats what 1$/sq ft gets you, if you rent for under that you know you are under the market rent in that area and the property isnt attractive to rent and most likely to sell.

[macjoubert]

How do you determine rent based on your purchase price? Thats new to me.

[WorldKlas]

Price of house doesn't necessarily pre-select tenant. Good screening makes good tenant. Almost all my tenants have college degrees and all earn considerably more than 3x the rent. In my rentals (I only have 7 at this time)

Irving, value $120K = couple: he, body shop manager & she, property manager for large corp
Irving, value $120K = couple: she - phD school psychologist, he: chef at quality chain restaurant
Grapevine, value $140K = family; he, IT programmer (100k+ income). She: Data entry. One elementary aged child
SW Arlington, value $150K: family both Teachers, 2 kids attend private school
SW Arlington, value $190K: family Maintenance Tech & Teacher: 2 kids attend public school (Martin HS Attendance zone)
Midlothian, value $120K: family he: police officer. She: nurse: 2 kids attend public school
Dallas, condo vlaue $80K: family. He: aircraft mechanic. She: pt nurse RN. Baby.

[macjoubert]

Originally Posted by WorldKlas

Price of house doesn't necessarily pre-select tenant. Good screening makes good tenant. Almost all my tenants have college degrees and all earn considerably more than 3x the rent. In my rentals (I only have 7 at this time)

Irving, value $120K = couple: he, body shop manager & she, property manager for large corp
Irving, value $120K = couple: she - phD school psychologist, he: chef at quality chain restaurant
Grapevine, value $140K = family; he, IT programmer (100k+ income). She: Data entry. One elementary aged child
SW Arlington, value $150K: family both Teachers, 2 kids attend private school
SW Arlington, value $190K: family Maintenance Tech & Teacher: 2 kids attend public school (Martin HS Attendance zone)
Midlothian, value $120K: family he: police officer. She: nurse: 2 kids attend public school
Dallas, condo vlaue $80K: family. He: aircraft mechanic. She: pt nurse RN. Baby.

Very impressive, good going.
What sort of cash flow do you get ?