focus on the quick flips? The big question really is, will it soon flood again or not? Perhaps the more accurate question is, when is it going to flood like that again? All investors will continue to have a place in the Houston market. Houston is a large metropolitan area retaining its resiliency. Even though the rate of new residents moving here has slowed, it hasn’t halted or reversed. Economic oppor- tunity overall outpaces both disaster and downturn poten- tial. Investors can learn from Houston to simply follow the need, whether it’s alleviating homeowners from distressed situations, or fulfilling the demand of the next wave of new residents following a good opportunity. So much depends on the weather, but as Houston gains more global attention and economic diversity, Hurricane Harvey’s hardships, like its floodwaters, will recede. •
to sell could do so quickly to plenty of interested buyers.
Brian Spitz is the CEO of Big State Home Buyers. Learn more about the Houston market and reach him at BigStateHomeBuyers.com.
UNSEEN BUT IMPORTANT RESULTS The most profound difference Harvey made on the invest- ment market was unseen in the headlines. The storm reminded outside investors that, while opportunity exists in this market, there is a significant risk in purchasing hundreds of investment homes in Houston. Taking the financial liability aside, directing the operational impact a natural disaster like Harvey could have on a large rental portfolio is a job that could quickly cancel out the positive attributes of investing in the Houston single-family rental market. Of course, many hedge funds continue to buy homes in the greater Houston area, but not with the same power and urgency as other areas. The insurance costs, risk manage- ment and procedures for managing a situation like Harvey should scare institutional investors who aren’t used to handling the niche Houston market. This is good news for local buyers. In the months since the flood, conglomerates and other out-of-state private investors have moved in. Those who really understand investments in single family real estate know that investors profit by solv- ing problems. An event like Harvey is a disaster that few are equipped to overcome. Many have come to Houston from other markets, identifying Harvey as an opportunity. And now that most of those homes are absorbed from the markets, those new investors in town are looking for a good reason to stay. The result? Rising marketing costs and more competi- tion for local investors. However, the severity of flooding has prompted many companies unfamiliar to Houston to evaluate their strategy — do they buy significantly damaged homes in flood-prone or flood-uncertain areas as-is, or do they only
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