You don't have to live in the Dallas area to benefit from the excellent rental market here. If the market where you live isn't ideal for growing your rental property portfolio, smart investors know to look elsewhere. The most successful investors keep up to date about where to buy next to increase their wealth. One of the best things about being a real estate investor is that there are no boundaries!
Dallas is an attractive market for investment properties! Businesses love the area, and that brings more people looking for places to live as they pursue work. Taxes are reasonable, and there are plenty of existing properties. Plus, new builds are popping up all the time! It's a great time to invest, but before you jump into your next Dallas rental, make sure you know everything you need to know for success.
1. Research the Market(s)
We believe the DFW area is one of the best places to grow your rental property portfolio—but where, exactly? Everything really is bigger in Texas. Between Dallas and Ft. Worth, you're looking at considerable opportunities in real estate!
Many suburbs surround the Dallas and Ft. Worth "proper" cities. No two suburbs are exactly alike; it's critical to know the differences in tax rates, commute times to prime business sectors, and what renters want in that area.
There are pros and cons to investing in just about any suburb or city. Conducting the appropriate market research gives you the information you need to make the best decision for your growing portfolio.
2. Decide on a Property Type
Are you looking for existing homes? Buying established homes and updating them for rentals works well in this market.
Turnkey properties are also a great way to ramp up your income faster when you decide to add another rental property. It's the same concept as buying a property on your own; it’s already leased and comes with expert property management. It's an optimal situation for out-of-state investors!
Have you considered new builds? New construction is almost everywhere you look in DFW. Purchasing a newly-constructed, turnkey home might be more cost-effective with a quicker return as a rental. Look for a company that specializes in turnkey, new-build properties for a better ROI addition to your portfolio.
3. Run the Numbers!
It can "look" like the perfect property to add to your investments, but have you run the numbers, yet? Don't jump on the purchase without running the numbers to make sure it's a profitable property.
Don't get distracted by the home, the neighborhood, or the amenities without making sure the cost of the property, taxes, HOA fees, insurance, and maintenance will generate net revenue for you after the rent collection each month.
A beautiful home doesn't always make a wise rental property investment. The numbers will tell you if you're making a good investment—or if you should keep looking for another property.
4. Decide How to Manage the Property
It's tempting to feel like you're saving money by managing properties on your own. However, this can be difficult when you're an out of state investor. Think through the realities of managing a property on your own from afar:
Do you have friends or family nearby?
If you have a reason to visit often, you can include landlord tasks during your visits to keep an eye on your rental house. With the right family members in the area, you might be able to enlist their help keeping an eye on your property. If this is not an option for you, you may want to consider investing in professional property management.
Do you have a network of local contractors for maintenance?
It can be a challenge to respond to maintenance emergencies when you're not close to your property. Establish a trusted network of contractors who can perform routine maintenance and respond to after-hours emergencies right away.
Do you have a tenant screening process?
You don't have to be local to screen tenants. However, when you don't live in the area, it's challenging to show your property or meet tenants for an in-person interview.
Don't let these details keep you from purchasing your next Dallas-Ft. Worth rental property! A local property management company can provide all of these services—and more—when you decide DFW is the place you want to invest.
We Help You Invest in and Manage Your Properties!
You need local, expert property managers to make the most money from your investment properties in Dallas-Ft. Worth. You want the most comprehensive rental property management team in the metroplex. Contact RentHub to get started.