Texas real estate investors have been enjoying rampant growth and undying optimism. Over the past several years, major cities throughout Texas (especially Houston) have benefited from rising demand and rising prices. Many experts believe that this growth trajectory will continue, ultimately leading to greater profitability for anyone with assets in Texas.
There’s certainly room for debate on this, since real estate markets aren’t exactly predictable. But if you believe in the Texas real estate market, and the future potential for developments in this state, the time is now to start reassessing your financial portfolios and making major investment moves.
What are the best financial moves to make if you believe the Texas real estate market is only going to grow from here?
Optimism for Texas Growth
There are several reasons to be optimistic about further growth in Texas real estate markets. These include:
- Coastal exoduses. Residents of coastal cities have been flocking to Texas for a variety of reasons, many of which originated with the COVID-19 pandemic and subsequent lockdowns. This migration wave is unlikely to abate anytime soon.
- Economic stability. Texas is a rare example of a fiscally responsible state, with relatively stable economic conditions.
- Job prospects. Big cities and rural areas throughout Texas are home to dozens of prominent employers, setting a course for massive job growth in the future.
- Diverse opportunities. Texas isn’t a monolith in terms of space or culture. You can find sprawling swaths of rural land as well as interesting major cities like Houston and Austin – so there’s something for everyone.
The Best Financial Moves to Make
These are some of the most important financial moves to consider making if you’re also optimistic about the future for Texas real estate:
- Keep your Texas house. First, if you currently own a home in Texas and you believe that prices are going to rise in the future, retain ownership of your property. Thousands of homeowners are currently tempted to try and sell their house simply because price estimates have grown so much; if you paid $300,000 for a house less than a decade ago and it’s currently estimated to be worth $500,000, it’s tempting to sell the house and reap the $200,000 profit. But what you need to keep in mind is that this isn’t necessarily the peak. Over the next several years, the price of your home could grow even further. Also, if you’re interested in moving for an entirely separate reason, consider maintaining your property and using it as a rental; even if you’re moving across the country, you can hire a property management company to take care of rental property affairs remotely.
- Consider refinancing. If you currently have one or more properties in the Texas area, and you’ve owned them for a long time, you should think about refinancing. Refinancing your home loan could give you access to a lower or more favorable interest rate; recently, mortgage rates have increased slightly, but they are still near historic lows. Depending on your current situation, you might be able to save hundreds of dollars per month on your monthly payment. The catch is, refinancing can be costly, so it’s typically only favorable if you plan on keeping the house for an extended period of time (i.e., many years to decades).
- Look for promising buying opportunities. If you predict growth on the horizon, it’s important to secure assets as soon as possible, so you can buy them at the lowest available price. That means you should be on the lookout for promising buying opportunities. Rising demand and low inventory has pushed prices relatively high throughout Texas, so finding promising opportunities is challenging. But the only way to find them is to actively look for them.
- Pick up a rental (or several). One of the most effective ways to make money in the real estate market, especially long term, is to invest in rental properties. These properties generate ongoing cash flow and simultaneously appreciate, assuming you’ve made an investment in the right area. Consider converting your current property into a rental or adding a separate rental to your portfolio. It could be a great way to improve your long-term prospects.
- Diversify your holdings. Portfolio diversification is an important investment fundamental for all investors, regardless of what markets they’re in or what their risk tolerance is. Even if you’re blindly optimistic about the future of the Texas real estate market, it’s still a good idea to invest in different types of properties in different areas. You should also invest in assets other than real estate. This way, you’ll be less prone to suffering losses because of market volatility.
Bonus: Form New Partnerships
As a bonus tip, you should consider forming new partnerships. The bigger your network is, and the closer your relationships are, the better your positioning will be to take advantage of the Texas real estate market.
These are some of the best types of connections to make:
- Real estate agents. Real estate agents can help you find new opportunities. They can also make it much easier to buy or sell your properties.
- Property managers. Property management companies and individuals can take care of your rental properties on your behalf, turning them into truly passive sources of income generation.
- Peers and rivals. It pays to know the other people investing in your local markets. You can trade tips, collaborate when necessary, and even make direct exchanges with each other.
- Prospective partners. Along similar lines, meeting new people is a great way to meet prospective partners who can help you achieve your real estate investing goals.
The Texas real estate market isn’t going anywhere. Optimistically, we expect most areas throughout Texas to continue growing. But regardless of how you feel about the Texas market or what you’re hoping to accomplish, we can promise one thing – Green Residential can help.
With buying agents, selling agents, property managers, and more, we can help you with everything related to real estate. Contact us for more information today!