Home Buying in Houston>Question Details

fredlw, Home Buyer in Houston, TX

I want to buy a property as investment in Houston. Budget around $70k-100k. Just started doing a bit research. Thanks for answering my questions.

Asked by fredlw, Houston, TX Tue Aug 20, 2013

#1 The most important question is : how much would be the rough ROI with current market situation with all the tax , insurance, HOA, manage and maintenance fee deducted in Houston? I studied for a while to find out although the house price is relatively low, the tax and insurance seems to be higher than some other states like CA and NV which doesn't lead to that much high of a investment return. Could it still possibly be 10%?
#2 I took some time looking at the university area. Do you think it's a good idea to rent to university student or better to employed family ? Which one is more stable in terms of renting?
#3 As I live in China , I wonder if I have to go on site when making the transaction or the buyer agent can represent me to finish all the deals? How long is it going to take to finish the whole buying transaction?
#4 Is it possible to hire a rental management company to help me manage the house all year round without having me involved on site? How much should I pay?

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Answers

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Hi Fredlw,
#1 ROI would be determined by how much you pay for the house and how much the home is worth. For example, I work with a real estate investor, I found him a home that he purchased for $83,500 cash. The house needs some work. He just told me today that he can rehab the home and still keep it just under $100,000. The home is appraised at $120,000 in 2012 and he wants it back on the market as a rental at the end of the month charging about $1,500 a month. We have not finalized the rental price yet. The tax rate for that area is high and it is at 3.33%. It is possible to be +10%. You just have to find the right house.
#2 You have to make the determination whether you want to rent to students or employed family.
#3 If all goes smoothly, the transaction should take around 30 days to close. You should contact a real estate lawyer.
#4 Yes, you can hire rental management company to manage the house. You should research and see how much each management company charges.
#5 My email is yahlei.barrios@century21.com. Email me if you are interested in having me find foreclosure or short sale homes for you.
2 votes Thank Flag Link Tue Aug 20, 2013
Thanks for your reply, which is very helpful. One more thing that confuses me is if I should go with several buyer's agent or just one agent to cover such a big area of Houston for houses? Since you know , agents might be from different places of the city? Sorry if the question is stupid, it's just the first I try invest in House in US.
Flag Tue Aug 20, 2013
Best place to start is to hire an Exclusive Buyer Agent to represent you. EBAs represent home buyers only, and work to get you the best price and most favorable terms. You can go to NAEBA.org for a referral to an EBA in your area.

I'm an EBA and I wrote a book called "Buying a Home: Don't Let Them Make a Monkey Out of You". It will be the best $6 you've ever spent.

Best of luck!
1 vote Thank Flag Link Mon Sep 2, 2013
Hi Fred,

Fellow investor here that buys property out of state. Since I didn't see any other investors chime in, let me give you my experiences.

1. A cash on cash ROI of 10%+ is possible but its tough as inventory has declined and prices are up. Taxes range from 2.5 to 3.5% and insurance differs as well in different areas. If you get a foreign national loan on that purchase, your ROI will go even higher.

2. For my rental properties, I have rented to families because my homes are in good school districts that at geared more towards family renters. University students normally don't have income and will need to be backed by their parents. Also, they tend to move after a year lease is over.

3. For my out of state transactions in Phoenix, I had a mobile notary come to me to have the papers signed. I did not need to be at the title companies office to close in person.

4. Yes, its possible to hire property management to handle the rental. However, you must be diligent in picking a good property manager. There are many that will nickle and dime you. Only you will take care of your property the best. I annually go to my properties to inspect them. Property management ranges from 7-12% with a half month to full month for lease up.

5. Houston is a big area. It is possible to have one agent to help you with all your transactions.

Finally, I want to add that foreign investors need to pay income tax on their rental income. Many investors form a LLC and open a US bank account under the LLC before purchasing property.
http://en.wikipedia.org/wiki/Foreign_Investment_in_Real_Prop…

If you have more questions, feel free to reply with your email address and I'll contact you.
1 vote Thank Flag Link Mon Sep 2, 2013
Hi Johnson, your reply is extremely helpful. Are you also trying to invest in properties in Houston? My email is :
fred7888@163.com, please contact me. Thank you.
Flag Mon Sep 2, 2013
Foreign National Loans

Borrowers using TIN Okay
Borrowers with NO CREDIT SCORE
Borrowers with NO SSN
Foreign Nationals {Expatriate}- NO PASSPORT {Must have valid work visa or 30% Down}
70% LTV Purchases
65% LTV Rate & Term Refinance
50% LTV Cash Out {Possible higher if financials are up to par}
Multiple properties OKAY
Corporation purchasing and refinancing OKAY

Richard- El Bey
Avarice Investments
(706) 399-7813 cell
(678) 752-8062 Office
thegocp@gmail.com
0 votes Thank Flag Link Mon Oct 14, 2013
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