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May 25, 2016May 29, 2021

My Best Tips for Successful Buy and Hold Investing in San Antonio

Investing in under market real estate in San Antonio has treated me well over the years. I firmly believe that investing in under market value fixer upper San Antonio properties for the long term is the best way to enjoy long term cash flow.

If you are on the fence and are about to dive into buy and hold investing, I have some simple tips to share, as a successful San Antonio property wholesaler:

Work with a real estate agent and investor

Most real estate agents just represent people who are buying or selling their personal residence at retail prices. The majority of agents do not invest in real estate themselves, so they are often unable to help you find a good under market value fixer upper that will produce good positive cash flow.

It can help to become an agent yourself so you can source your own deals, but it’s not essential at first.

Cash flow!

You need to get a San Antonio wholesale property under market value enough so that when you do the repairs and collect rent from the tenant, you will have enough to cover all of your expenses. These usually include mortgage, taxes, insurance, repairs and vacancies.

Right now, the San Antonio real estate market is pretty hot, and good fixer upper deals for affordable homes are harder to find. This is why working with a highly experienced real estate agent and investor is so important: She can help you find a good under market value deal that can produce cash flow. Also, if you work with an experienced investor agent, she will probably have a good rehab crew that can do the fix up work at a fair price.

Here is a nice wholesale property deal in San Antonio I just found that will produce $1150 per month in rental cash flow:

Address: 126 E Dullnig Ct., San Antonio, TX 78223
Year Built: 1919
Description: Major cash flow on this San Antonio fixer upper distressed property – 4 beds 1 bath, 1100 sqft, two large storage units in the back, Lot Size: .19 acres, Yearly taxes: $1,600.00, Estimated yearly insurance $700.00, Estimated repairs: 30K, includes interior paint, electrical/plumbing up to code, landscape, trash removal, kitchen/bath updates, central HVAC, flooring, 2 room conversations, foundation/roof repairs.
Max ARV: $109-$115k

Cash Price: $55,000

If you do that San Antonio distressed property all cash, you should have about $700 left for positive cash flow – not bad! – after expenses.

Due diligence

You need to carefully consider if the wholesale property you want to buy will generate the cash flow you want.

A very common error for new fixer upper investors is to overdo the rehab or not be aware of all the things that have to be fixed.

Only invest if the cash flow is there

I never buy an under market value property based upon what I think the value of the house will be in a few years. That is real estate speculation and that is a great way to end up in the poor house. If after I run the numbers – property cost, rehab cost, all expenses – I generate positive cash flow of a few hundred dollars, I do the deal.

Don’t forget repairs and vacancies

I like to account for at least $50 per month for repairs on my fixer upper deals in San Antonio. Also, plan on a 5% loss for vacancies. However, I often do San Antonio Section 8 rentals, and I find that this type of rental income is quite solid and safe; I have Section 8 tenants who have been with me for 5 years or more.

Above all, after you find a good potential under market value property that will produce positive cash flow, do the deal. Don’t sit around thinking about it too long or you may never take action. Many people think about investing in San Antonio wholesale property, but the majority never do a deal because of fear.

If you do your due diligence as I outline, there should be no reason to not move forward on that property!

May 25, 2016September 15, 2016

SOLD – 126 E Dullnig Ct., San Antonio, TX 78223

Address: 126 E Dullnig Ct., San Antonio, TX 78223
Year Built: 1919
Description: Major cash flow on this San Antonio fixer upper distressed property – 4 beds 1 bath, 1100 sqft, two large storage units in the back, Lot Size: .19 acres, Yearly taxes: $1,600.00, Estimated yearly insurance $700.00, Estimated repairs: 15K, includes interior paint, electrical/plumbing up to code, landscape, trash removal, kitchen/bath updates, central HVAC, flooring, 2 room conversions, foundation/roof repairs.
Max ARV: $109-$115k

Cash Price: $48,000

Exit Strategies:

Rent with 30K in repairs: $1150.00
Owner Finance San Antonio wholesale property with 20K repairs: 5k down, $995.00 monthly P/I, 30 year amortization, 10% interest, Price: 99K. Or, owner finance with quick $5k clean up, resell for $79,900.

Contact us for more information or to make offer.
Sold and Rental Comps: Rental Comps 126 E Dullnig Ct Sold Comps 126 E Dullnig Ct

More Images of this San Antonio under market value property:

May 18, 2016May 18, 2016

San Antonio TX Economy Still Strong, Even With Oil and Gas Slowdown

Personal income growth since 2011 in Texas ranks #2 in the US, with only North Dakota ahead. Some San Antonio real estate investors think that crashing oil and natural gas prices would have slowed down the Texas economy, but the Lone Star State continues to do well. And San Antonio buy and hold properties continue to sell and rise in value.

Note: I don’t personally worry much about what the economy does in San Antonio anyway. In the 2007-9 crash, I bought and sold $2 million in real estate and still had my San Antonio buy and hold houses rented out with no problem. San Antonio affordable homes are always in demand.

Economic experts in Texas this month stated that several areas of the Texas and San Antonio economies continue to keep job growth going and wages rising. For example, health care is very strong, and San Antonio has a very strong military presence with several Air Force and Army bases.

Even with low oil prices, Texas still created 1.7 million jobs from 2010-15, which is the best in the US. In the same time frame, the entire US economy lost 400,000 jobs.

The oil and gas slow down has had some impact in Houston, but San Antonio is continuing to see low unemployment and wage growth. San Antonio is seeing economic growth in the 3-4% range.

Even though oil prices are low for the time being, research shows that oil production has only dropped marginally in Texas. There are 2.5 million barrels per day produced in this state, down from 2.8 million two years ago. The small production decrease has come even though there are only 200 or so active rigs in the state, which is down from 900 two years ago.

This means good news for San Antonio buy and hold investors, and San Antonio flip investors. I continue to buy and sell real estate investments, although the prices are up 20% from two years ago.

I recommend doing Section 8 rental property for a good San Antonio buy and hold investment, as the rental market is very strong:

Address: 804 S San Eduardo Ave, San Antonio, TX
Year Built: 1949
Description: Fixer upper, under market value 4 beds 1 bath, 816 sqft, built: 1949, lot size: .1 acres, yearly taxes: $1,200.00, estimated yearly insurance: $750,
Estimated Repairs: 30K, roof, central hvac, windows, plumbing, electrical, kitchen/bath update, interior/exterior finish.
Cash Price: $48,000
Exit Strategies: Rent San Antonio investment property with 30K in repairs: $1,095.00 with section 8, no need to chase the monthly payment, San Antonio Housing Authority pays direct deposit to your account.

May 16, 2016May 16, 2016

Positives and Negatives of Section 8 Real Estate Investments in San Antonio

Section 8 rental property in San Antonio is a controversial topic in some quarters. Section 8 housing came to be during the Great Depression, when the federal government wanted to provide public housing for lower income people. Today, the purpose of section 8 is to offer subsidized housing to certain lower income citizens.

But is San Antonio section 8 property a good real estate investment? Generally, I say yes; I like to deal with the San Antonio Housing Authority and section 8 renters. That said, it depends on the property and a few other things. Let’s look at section 8 rental property pluses and minuses:

Pluses

Your income is stable and guaranteed each month. You receive your payment each month electronically. After a person applies and passes the background check and other screening, the section 8 voucher gives them up to 100% assistance for their rent.
Higher rent. You can reassess the rent you charge each year and increase it by up to 8%. So, if you rent your San Antonio investment property for $800 monthly, you could raise it to $1175 in five years.
Incentive to keep up the San Antonio rental property: There is an annual inspection, so if the renter trashes the house, they can lose their voucher. Note: I do serious rehab on the San Antonio fixer upper before I rent it, and pictures are taken. So if there is a lot of wear and tear, I can show the tenant did it.
Large number of possible tenants: The GoSection8.com website has thousands of prospective San Antonio renters and it is quite easy to get a house rented.
Long term rent: I find that most section 8 renters rent for many years, so you will have fewer vacancies with your San Antonio rental property.

Minuses

Government bureaucrats: You have to deal with the red tape of the Section 8 bureaucracy and this can cause some delays. However, I find that the San Antonio Housing Authority is pretty good to work with.
Slow payments: It can take longer than I like to get a renter in my San Antonio buy and hold property due to delays with the government. But, once the tenant is in, the rent comes in every 30 days on time.
Inspections: Section 8 has fairly strict inspections, but I do complete rehabs and I know what Section 8 looks for, so I do not have major problems here.
More repairs: The renter does not own the San Antonio property so it is possible that more wear can happen.
Late payments: I have had a few tenants over the years pay late, and reporting them can take some time.

Generally, I find section 8 rental property in San Antonio to be a good bet. I am able to get good renters into my investment properties by carefully screening potential renters.

Here is a good potential San Antonio section 8 rental property:

Address: 4907 Waycross Ln., San Antonio, Texas 78220-1840
Year Built: 1971
Description: Under market value fixer upper 4 beds 2 bath, 1078 sqft, lot size: .13 acres, yearly taxes: $1,200.00, estimated insurance: $750.00, estimated repairs: 30K; central hvac, flooring, update kitchen/bath, roof, interior/exterior finish.
Price: $49,000 Cash
ARV: 109-115K
Exit Strategy:

Owner Finance with 30K repairs: 5k down, $1,095.00 monthly P/I, 30 year amortization, 10% interest, Price: 109k
Rent with 30K in repairs: $1,095.00 with section 8, no need to chase the monthly payment, San Antonio Housing Authority pays direct deposit to your account.

May 15, 2016May 29, 2021

Why I Still Think Buying and Holding San Antonio Real Estate Is the Best Investment

We think that buying San Antonio investment properties with a buy and hold strategy is the best idea for real estate investing here.

Here are the five major advantages to buying and holding real estate investments in San Antonio, in our years of experience.

Income: Most investments you purchase offer a regular return, such as an annuity, or potential for appreciation in equity (stocks), but buy and hold real estate offers both of these. The best buy and hold real estate investments offset your expenses and debt, and also produce monthly positive cash flow of 5-10% per year. Meanwhile a typical annuity pays 3-4%.
Depreciation: Flipping houses in San Antonio is great and I have done my share, but the IRS is always going to get its piece of your real estate profits with flips. With buying and holding, you can write off the value of your San Antonio wholesale property over 27.5 years. This depreciation is negative income. However, it is only negative in a paper sense because your costs of upkeeping the property come out of your cash flow. So, depreciation losses reduce or remove your positive cash flow and reduce your taxes.
Building up equity: The cash flow from your San Antonio investment property allows you to pay your mortgage without spending your own money. Each month, also, part of your loan principle is paid off. About 15-25% of every loan payment will pay off the principle of your loan and add to your equity.
Appreciation: Your real estate investments can go up in value, and of course they can go down. The good news is that with properly cash flowing real estate properties, you are making profits regardless of what is going on in the market. My San Antonio properties did drop in value by 20% in the crash, but I was able to continue receiving income from them; in some cases, I even could increase the rents in the downturn. As long as you have positive cash flow in downturns, you will be fine. I did great in the downturn five years ago with my San Antonio real estate investments. I bought and sold $2 million in real estate during the crash.
Leverage: If you put $25,000 into mutual funds, and it increases by 10%, you made $2500. If you put that same money into buy and hold real estate, you can buy a $75k property with a $60,000 mortgage loan. If it goes up 5%, you made around $3500, or a 20% or so return!! So, maybe the stock market has a better return on average but with buy and hold real estate, your returns are based upon a higher amount than your actual investment of principle.

As I said, I also flip houses, so this is not an either/or deal. But I like buying and holding affordable San Antonio properties because of the tax advantages, the passive cash flow, and the ability to scale. If I am holding 25 houses producing $500 of cash flow each, I have that each year, and as equity builds, I can refinance and buy more.

In summary, San Antonio buy and hold investing is the best ‘get rich slow’ scheme. You can over time create residual income, and also increase your equity exponentially as you pay down the principle, and also through appreciation and leverage.

If you are looking for a good under market San Antonio investment property to buy and hold, here is a nice $48k deal:

Address: 804 S San Eduardo Ave, San Antonio, TX
Year Built: 1949
Description: Fixer upper, under market value 4 beds 1 bath, 816 sqft, built: 1949, lot size: .1 acres, yearly taxes: $1,200.00, estimated yearly insurance: $750.
Estimated Repairs: 30K, roof, central hvac, windows, plumbing, electrical, kitchen/bath update, interior/exterior finish. ARV $99k.
Cash Price: $48,000
Exit Strategies: Rent San Antonio investment property with 30K in repairs: $1,095.00 with section 8, no need to chase the monthly payment, San Antonio Housing Authority pays direct deposit to your account.

With this under market value San Antonio fixer upper, you can rent it section 8 for $1100 per month, and after 6 months, you can cash out refinance approximately $70,000 and do another rental property. Your cash flow on the above deal would still be approximately $250 to $300 per month.

May 13, 2016January 6, 2017

OFF MARKET – 308 Strong Ave, Ballinger TX 76821

Address: 308 Strong Ave, Ballinger TX 76821
Year Built: 1900
Description: Texas fixer upper cash flow king – 3 beds 1 bath, 1300 sqft, ¼ acre lot, yearly taxes: $500, yearly insurance: $500,
Estimated Repairs: NONE – Resell AS IS.
Cash Price: $18,000
Exit Strategy: Owner Finance this buy and hold under market value property with ZERO repairs: 2k down, $395.00 monthly P/I, 30 year amortization, 10% interest, Price: 39k. Strong demand for affordable houses under $500 per month here.
Contact us for more information or to make offer.

More Images:

May 12, 2016May 15, 2016

5 Simple Tips for Better High Cash Flow Investment Properties

The San Antonio real estate market is quite hot in 2016, and I am seeing many new San Antonio real estate investors trying to get into the game.

If you want to get rolling in San Antonio buy and hold or flip properties, there are a few things that I can advise that will maximize your chances of great cash flow success!

Focus on the type of investing you want to do. Many newer real estate investors want to get involved in too many types of real estate investing in San Antonio. Lack of focus can lead to problems, as you never really become an expert in any particular area. My focus as a San Antonio real estate investor and licensed agent is on affordable, under market value single family homes. I buy San Antonio fixer uppers for $50,000, do $20,000 in rehab, and either owner finance them or rent them out section 8.

I advise focusing on buying and holding investment properties over the long term for the most part. Flipping San Antonio houses is fine for building capital, but flipping carries more risk, and there is no way of telling when that house will sell.

I can usually rent out a house section 8 in 30 days for good San Antonio real estate cash flow, or sell with owner financing in 30-60 days.

Work with experienced investors and partners. Real estate investing groups in San Antonio and elsewhere are full of people who talk a good game but have actually done very few deals. I strongly advise that you partner with a San Antonio real estate investor who has done several hundred deals, and ideally, is a licensed real estate agent. That way he can offer you under market value properties that have a good chance of producing positive cash flow. I’m happy to mentor new San Antonio real estate investors – who have capital to invest in buy and hold real estate. Note, you can buy a fixer upper from 100 San Antonio property wholesalers, but how many of them have built a portfolio of investment properties themselves? I have.
Buy in the right location. As an experienced San Antonio buy and hold investor, I typically buy a bit north of downtown, west of downtown, and south of downtown. I buy in up and coming areas, on the edge of more expensive neighborhoods. This is a great buy and hold deal in such an area for just $45,000.
Get finances in order. To get rolling in buy and hold real estate investing, you want to have at least $50,000 in the bank for investing in San Antonio in 2016. This could change as the market changes over time, but $50,000 is a good rule of thumb. It helps if you have good credit as well so that you can put 20% down on a rental property, rehab it, and then rent section 8.
Build a strong real estate investing team. Most new real estate investors try to go it alone and that is tough. To be successful in buy and hold real estate investing, you want to work with an expert real estate investor, a real estate agent who invests himself, a good property manager, full time construction crew, lenders, attorney and CPA. The better your team, the more chances you will be successful. I have my team in place and will help serious investors to invest in San Antonio real estate, if you have capital:).

May 11, 2016

Great Buy and Hold Cash Flow Deals Still Available for $45k in San Antonio

The San Antonio real estate market is very hot, with the median property sale averaging nearly $200,000 which is a big increase from 2012, according to recent statistics.

This heated up market has had an effect on the San Antonio real estate investing market, too. Back in 2012, I could buy many fixer uppers for $20,000 or $30,000, stick $10,000 into them, and resell with owner financing at $59,900.

Now it is more challenging for me to find cheap San Antonio fixer uppers. It is very rare that I can find an under market value San Antonio property in an acceptable neighborhood for $30,000.

That is the double edged sword of having a strong local economy: People have more money in their pockets and unemployment is low, which is great. On the other hand, San Antonio fixer uppers are more expensive than in the past.

On balance, I like the current market because working people in the city have more money and they have jobs, which is a good thing for them, their families, and the city as a whole.

I have recently been able to find under market value San Antonio properties for under $50,000, which still means that the San Antonio real estate investor can still make 12-14% ROI, which is excellent.

My favorite current strategy is to buy a fixer upper for about $45,000, do $25,000 in rehab, and then rent the property out to a section 8 renter. That way the San Antonio real estate investor does not have to chase rent, and I can usually get the house occupied and producing cash flow in 30 days.

Here is a great fixer upper to consider for this strategy:

Address: 804 Virginia Blvd, San Antonio, TX 78203
Year Built: 1900
Description: Act fast – hot market and low under market value price! Serious cash flow on this San Antonio fixer upper! San Antonio wholesale property has 3 beds 1 bath, 900 sqft, built: 1900, Lot Size: .07 acres, Yearly taxes: $1,000.00, Estimated yearly insurance $600.00,
Estimated Repairs: includes interior paint, plumbing up to code, /bath updates, Max ARV: 79K.
Cash Price: $45,000
Alternate Exit Strategy: Rent with 25K in repairs: $995.00 with section 8, no need to chase the monthly payment, San Antonio Housing Authority pays direct deposit to your account.

May 8, 2016

I Continue to Buy and Hold With Section 8 Rental Properties in San Antonio

I hold a lot of San Antonio owner finance properties but in recent years I have been doing more section 8 rentals for San Antonio investment properties.

Some people do not like section 8 rentals because they think they can have more problems with those types of renters. However, I find that generally, using section 8 with the San Antonio Housing Authority works quite well.

Section 8 rental property can work really well for the out of state investor who wants to reduce taxable income and enjoy depreciation and write offs. As much as I like owner financed property, you cannot write off anything or reduce your taxable income with depreciation.

I have been doing section 8 rental properties in San Antonio for several years and I have found there to be many great advantages:

You will always get your payment electronically on time. You never have to worry about chasing down rent payments.
If the economy goes down, you do not have to worry about the San Antonio renter losing his job. The voucher will always pay their rent.
I can often charge more rent to a section 8 tenant.
I really love how easy it is to market for section 8 renters. All I have to do is post the San Antonio buy and hold property on the GoSection8.com website and I start to get calls from potential renters.

Of course, it is very important to screen the potential renters carefully. I do background checks and credit checks, and I always verify employment. I want to have potential renters that have a voucher that covers the rent, and I also want them generally to bring in at least $1500 in additional income per month, and I increase that if there are several children in the house.

Last, doing section 8 rental property allows you to leverage your money. You can often do a 20% down loan on a San Antonio investment property, and then do the rehab. Once it is occupied for a few months, you can cash out refinance about 80% of the ARV and use that cash to buy more property. This is a quick way to build capital and buy and hold cash flow.

In short, doing section 8 rentals with San Antonio wholesale property is a really fine way to increase your net worth and cash flow.

April 28, 2016August 4, 2016

SOLD – 4907 Waycross Ln., San Antonio, Texas 78220

Owner Finance with 30K repairs: 5k down, $1,095.00 monthly P/I, 30 year amortization, 10% interest, Price: 109k
Rent with 30K in repairs: $1,095.00 with section 8, no need to chase the monthly payment, San Antonio Housing Authority pays direct deposit to your account.

Comps: rental comps 4907 way cross ln sold comps 4907 way cross ln
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