I recently sat down with an investor from California and commiserated with him. He told me about his situation of having to buy properties in California, knowing he would negative cash-flow and that there was no equity. He purchased only with the hope of appreciation (which as we all know has not happened in the last few years). While I empathize with this investor and anyone in his situation, I would say to you as I did to him–There is a better, smarter way to invest your dollars!
GO TEXAS!
As we say here in the Lone Star state, “Everything is bigger in Texas” and that includes the returns. Really, it’s easy to see the opportunity that investing in Texas can bring.
The top three reasons to invest in Texas are:
1. Get more for your money.
It cannot be overstated enough that leverage is the name of the game in investing. When compared to other areas in the U.S. you will be blown away with the length your money can go to here in Texas. It is not uncommon to purchase investment homes here for 30,000 dollars to 40,000 dollars. Whereas, a comparable property in other markets such as California, could easily have a down payment higher than this total price, plus a loan.
2. Appreciation, Appreciation, Appreciation
Appreciation is what many investors in other markets are hoping and praying for. Well in Texas investors do not need hope, as the market has been growing at about a 10% clip, which includes 2007. Now for all of you east and west coast investors who were used to the 20% and 30% appreciation of a few years ago you may not be impressed. When you analyze the economic demographics of the three major cities San Antonio, Houston and Dallas you see that the appreciation you’re looking at in Texas is based on job growth and a housing need, as opposed to the hysteria of a few years ago on the coasts. I don’t know about you, but I’d take a true 10% appreciation over a phony 30% appreciation any day of the week.
3. Things in Texas are just better all around for investors.
From top to bottom you will be hard pressed to find a state government that works on behalf of the investor more than Texas. Landlord laws are set up in favor of the landlord. We’re able to evict tenants in 21 days or LESS. We pay no State Tax. Additionally, we have a government that is currently attracting more and more jobs by giving the companies who relocate here tax incentives. Which means that the economy is only at the surface of what it can accomplish. Throw in the new trade line that will run from Mexico straight through Texas and you have job growth and economic projections like you have never been seen before.
I invite all investors to take a closer look at the Texas market. Once you go Texas, you won’t go back.
Brian Payton
President and CEO of ATW Investments, Inc.
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