HOT MARKETS: DALLAS/FORT WORTH
Texas-Sized Demand Dallas-Fort Worth metro area is a hotbed of economic, housing and investing activity.
Mutual and FedEx will bring thousands of new employees to suburban Dallas. A massive State Farm Insurance campus for 8,000 workers in Richardson is filling up and a new $350 million corporate campus for American Airlines is planned near the Dallas Fort Worth International Airport. NO. 2 Big & Growing Demand for Rental Housing The nation’s ninth largest city in terms of general population, Dallas has been growing at twice the national rate for years. Builders are having a tough time keeping up. Between 2000 and 2011, it is estimated, 12,608 people moved from Dallas-Fort Worth to San Francisco – but 17,118 abandoned San Francisco to move to the DFW metro area. With 7.1 million people today, DFW is expected to reach 10.5 million residents and 6.6 million jobs by 2040. Housing demand follows, led by rental demand.
in the DFW area, and odds are this will remain the case going forward. •
NO. 3 Affordable Properties Can Still Be Had—But Hurry! Moderately priced investment properties, all but impossible to find in places like California, are still available in DFW. For example, San Francisco is No. 1 on the Realtor.com hot market list but the average home there cost $1,408,330 in mid-April. By contrast, in Q1 2016 the typical home in Dal- las-Fort Worth was priced at $210,000 (and appreciating faster than historic norms), while you can bet the average San Francisco rent is higher than the average DFW mortgage payment. If you are a mid-level tech professional with a family to house, feed and educate, your income goes further living in DFW than SFO and the Bay Area. The upshot: good rental returns and continued gains in equity are still ahead. Like your income, your real estate investment simply goes further
Tim Herriage is CEO and co-found- er of 2020 REI Companies, through which he looks to serve sin- gle-family-home investors in new
by TIM HERRIAGE
A nother sign—if you need it—that the Dallas-Fort Worth metro area is a prime target for real estate investors is this: DFW has only around two months of resale housing inventory available for sale. This is truly a seller’s (and smart investor’s) market. DFWhousing is being squeezed by three unrelenting demographic-based trends: heavy in-migration (80,000 new people in 2015 alone) based on well-paying job open- ings, resulting in rising housing demand and appreciating home values (12 percent in Dallas County over past year). This has led to an average supply of resale homes stuck at around a 2 months’ supply at the current
sales rate. The National Association of Realtors says a six-month supply is a good balance between buyers and sellers. Why Dallas/Fort Worth? Dallas/Fort Worth is one of the biggest job creation and population growth mar- kets in the U.S., with lots of new high-qual- ity jobs, relatively low housing prices (historically speaking,) favorable tax rates, (no state income tax) and an abundance of land for development—ideal for wise housing investments. Here are three reasons why the DFW region continues to be a top target market for real estate investing:
NO. 1 More Big Employers Say Yes to Texas While the energy business has slowed, contrary to assumptions about Texas, this is not what drives DFW (less than 1% jobs are energy-based.) New, well-paying technical jobs are emerging in healthcare, transportation and energy sectors as well as from the area’s existing base of comput- er, aviation and telecommunications firms. The area hosts 21 national corporate head- quarters for Fortune 500 companies. Big employers are getting bigger. Toyota’s 100- acre campus for its new U.S. headquarters and new regional operations for Liberty
ways that include acquisition, brokerage, consulting, disposition, equity and financing. He is often consulted as a leader and inno- vator in the real estate investor space. Her- riage formerly was managing director of B2R Finance, an early innovator in rental port- folio financing; is founder of The REI Expo; and has Franchisee and Development Agent experience with HomeVestors of America. He has completed well over $1 billion in real estate investment transactions, including the acquisition of more than 1,200 houses. He can be contacted at tim@2020rei.com or 469-723-2213.
12 | INVESTOR REVIEW
SEPTEMBER/OCTOBER 2016 | 13
Made with FlippingBook - Online magazine maker