Looking for a Real Estate Market on the Rise? Think Dallas-Fort Worth
By: Deborah Ann Tayloe •
2019 is looking bright for real estate investors in the Dallas Fort-Worth Metroplex. The metro area just took top honors in Price Waterhouse-Cooper’s Emerging Trends Real Estate Report, which surveys real estate experts throughout the United States and predicts the hot spots for 2019.
This report looks at a range of factors that impact the outcome. These indicators are based on data such as job growth, unemployment rate, the declining value of retail space, the number of global investors, and the overall local economy. Based on those, and many other indicators, real estate experts are able to predict the hottest markets.
Interestingly, Dallas-Fort Worth is not the only metro area in Texas on the list. San Antonio and Austin are also in the top 20. This makes the prospect of doing business in Dallas, with the potential to expand business into relatively close additional markets, even more alluring to the truly eager investor.
How You Can Make Money Investing in Dallas Real Estate
While all of those statistics are very interesting, you might be asking yourself how you can make some serious money in Dallas. Some of the best real estate investments will likely prove to be:
- Low-rise apartments
- Flipping single family dwellings
- Development of mixed-use properties
Let’s take a closer look at each opportunity and the reasons why each one offers a unique opportunity.
There’s the beginning of a shortage of affordable single family detached homes on the Dallas Fort-Worth market. This is due to the influx of population over the past several years. In fact, DFW’s population grew by 146,000 in 2017. This was the highest in the entire United States for that time period.
People are coming to Dallas for the well-paying jobs, the relatively low cost of living, and the warm and relaxed lifestyle. Businesses are coming to Dallas thanks to the low cost of doing business in Texas, a welcoming and skilled workforce, and the availability of commercial real estate.
As this growth continues to grow, so do the interest rates on mortgages in the United States. In fact, mortgages have crept up throughout 2018. However, mortgage rates hit a sharp spike in September that had some potential homebuyers slamming on the brakes and lowered new home sales by 5 1/2% from August to September.
The combination of all those new Dallas area residents eating up a good chunk of the home inventory and the rising mortgage rates have some buyers weighing other options.
One fantastic option for these wary home shoppers? Low-rise apartments.
These family-friendly units are budget-friendly, and they’re available in the best school systems and the nicest communities. In addition, the nicer low-rise communities offer resort-like amenities like swimming pools, coffee bars, grilling facilities, and more to command a higher rent and attract all those young professionals relocating to the area.
For those reasons, low-rise apartments offer a great investment opportunity.
Flipping Single Family Dwellings
Ok. I know I just said that real estate mortgage rates have buyers running scared. That’s true. But what if you could offer them a wonderful home at such a great value that they almost forget about the higher interest rate.
While there are people who would rather rent an apartment than purchase a home with a higher interest mortgage, there are those who shy away from rentals. They strongly prefer the investment home ownership and the stability it implies for their family. However, they might need to look for a home slightly lower in price range to offset that higher interest rate.
That’s where you come in.
Flipping single family dwellings is a way for you to purchase a home for a smaller investment. These properties are often in an area that’s undergoing a revitalization or a distressed or foreclosed property. Therefore, you can buy them below market value.
You will have the additional expense of renovating the property into a spectacular property that prospective buyers can’t resist. Because you purchase it for a bargain and budget the renovation wisely, you can still price it competitively, so it sells quickly and for a profit.
Flipping homes can be risky. However, the rewards are worth the effort. In fact, for the first quarter of 2018, Dallas ranked in the top 10 home-flipping cities in the entire United States.
Development of Mixed Use Properties
A sad sight to see in the real estate sector is the rapid decline in retail occupancies. It’s an epidemic throughout the United States. Gone completely are some once healthy retailers, such as Rite Aid, Toys R Us, Bon Ton.
One major reason for the collapse of the retail space is largely due to the emergence of online shopping as the demand for value and convenience increases.
Dallas is impacted by the loss of retailers as much as every other US city. For example, the DFW Metroplex was home to 6 Toys R Us stores.
The retail collapse leaves the DFW area plagued with once-occupied spaces standing empty, like scars on the faces of the neighborhoods where they once flourished. This leaves unoccupied buildings primed for your investment.
With a wise investment and smart planning, these spaces can be turned into mixed-use properties. You have the opportunity to turn a vacant retail shopping center into office space, loft-style living, restaurants, or perhaps even divide up the space to attract small, local retailers.
This is a savvy way to reinvent vacant properties to help revitalize a community while still making money.
The Bottom Line:
To say that the Dallas-Fort Worth real estate market is booming is an understatement. It’s outpacing every other market in the United States on almost every level.
Thanks to the low costs of living and doing business, an eager to work supply of young professional workers, great weather and lifestyle, the DFW Metroplex is the place to do business in 2019. There are more opportunities in this region than in any other.
Investing in Dallas real estate could be the biggest payout of any gamble you’ve ever taken.
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