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San Antonio Housing Market Was Red Hot in 2016

The housing market in San Antonio in 2016 was hot as home prices went to the highest levels ever. The local paper reported that 29,508 homes were sold, which was more than an eight percent increase from 2015.

The median price for San Antonio real estate increased six percent to $204,300. This was the very first time that the median sales price had been over $200,000 for an entire year, including the real estate boom years of a decade ago.

Also, the inventory of homes that are available dropped in December 2016 to only three months. this indicates there are more buyers than sellers in San Antonio.

So what does this mean for San Antonio real estate investors? Well in my experience, it means that real estate prices are going up, and buying homes for many people in San Antonio is becoming more difficult. For people who earn a good income of course, the homes in San Antonio are very reasonable.

But for people who earn $3000 per month and don’t have credit, buying a home with conventional financing is very difficult. That is the reason I focus my San Antonio investment strategy on owner financing.

Here is a good example of an under market value property that I am selling right now:

  • Finance Your Investment Properties
  • Address: 1319 S Hamilton St., San Antonio, TX 78207
  • Year Built: 1956
  • Description: San Antonio buy and hold investors and real estate investors  – Another Major cash flow opportunity, 30% instant equity under market value, almost cute cottage, needs minor help, booming San Antonio Market West of Downtown,  2 beds, 1 bath, 616 sqft, lot size: .05 acres, estimated repairs: 5K, clean/lawn maintenance/interior paint/front paint. Max After Repair Value: 69K
  • Cash Price on San Antonio Fixer Upper:  $42,000 CASH ONLY
  • Exit Strategy: Owner Finance with 5k in repairs: 5Kdown payment, $695.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: 69K, see attached sold/rental comparables.
  • Sold and Rental Comps: Sold Comps 1301 S Hamiltonrental comps 1301 s hamilton

This property is only $42k cash, and with $5k in repairs, you can sell this with owner financing (you’re the bank), to a family with job and income but no credit. The major advantages of this type of deal are that you do not have repair expenses ongoing. Also, you can limit your initial out of pocket costs. If you were to rent this house out, you would have to do $20,000 in repairs, not $5000.

Owner financed homes is the backbone of my real estate investment portfolio in San Antonio. Each home earns at least 10% ROI with no expenses.  This type of buy and hold investing helps to support the working families of San Antonio as well, so it is a win win.

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How To Do Only $5,000 In Repairs on a San Antonio Fixer Upper

One of the challenges of being a real estate investor is how to do investment property repairs affordably without going over budget. If you spend too much on your investment property repairs, you can lose all profit in your deal.

I have done many San Antonio property rehabs in the last 16 years. Some of them cost $10,000, $20,000, $30,000 and more. Those were rental properties, and while I was still able to make a positive ROI on most of those deals, I prefer when I can to limit the repairs on San Antonio investment properties to $5000 or so.

How do I limit repairs on an investment property to $5000, you ask?

Simple. I do not rent the property out. Renting out the property means you have to do extensive repairs of $15,000 or more and have the property inspected by the city in most cases. Spending that much on rehabs makes it harder for me to make money. Another problem with extensive repairs on investment properties these days is construction costs have shot up in San Antonio in the last 24 months.

So, rather than renting the home, I sell the property with owner financing to a blue collar family with a job but no credit. I get $5000 down, 10% interest, and a payment ranging from $695 to $995 per month usually.

The family usually have home repair skills, so they see it as a good deal to buy a fixer upper in San Antonio and perform much of the repairs themselves.

Basically, I just spend $5000 to do inside and outside paint, minor plumbing and electrical, clean up the lawn and get rid of junk. Then I sell it with owner financing. Buy and hold with owner financing is my preferred exit strategy. It allows me to increase my ROI and not have to maintain San Antonio investment properties.

Another advantage I have is that I own a construction company, so I am able to do repairs on San Antonio investment properties very affordably.

Below is a nice under market value San Antonio investment property deal that is great for an owner finance strategy:

  • Address: 1319 S Hamilton St., San Antonio, TX 78207
  • Year Built: 1956
  • Description: San Antonio buy and hold investors and real estate investors  – Another Major cash flow opportunity, 30% instant equity under market value, almost cute cottage, needs minor help, booming San Antonio Market West of Downtown,  2 beds, 1 bath, 616 sqft, lot size: .05 acres, estimated repairs: 5K, clean/lawn maintenance/interior paint/front paint. Max After Repair Value: 69K
  • Cash Price on San Antonio Fixer Upper:  $42,000 CASH ONLY
  • Exit Strategy: Owner Finance with 5k in repairs: 5Kdown payment, $695.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: 69K, see attached sold/rental comparables.
  • Sold and Rental Comps: Sold Comps 1301 S Hamiltonrental comps 1301 s hamilton
  • For more information, please contact us. 
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SOLD – 50K – 1319 S Hamilton St., San Antonio, TX 78207

  • Address: 1319 S Hamilton St., San Antonio, TX 78207
  • Year Built: 1956
  • Description: San Antonio buy and hold investors and real estate investors  – Another Major cash flow opportunity, 30% instant equity under market value, almost cute cottage, needs to be converted to a 3 bed 1 bath, booming San Antonio Market West of Downtown,  2 beds, 1 bath, 616 sqft, lot size: .05 acres, estimated repairs: 25K, clean/lawn maintenance/interior paint/front paint, room addition. Max After Repair Value: 109K, recommend to rent for 2 years then sale at Max ARV.
  • Cash Price on San Antonio Fixer Upper:  $50,000 CASH ONLY or hardmoney
  • Exit Strategy: Owner Finance with 5k in repairs: 5Kdown payment, $750.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: 75K, see attached sold/rental comparables or rent out $795 section.
  • Sold and Rental Comps: Sold Comps 1301 S Hamiltonrental comps 1301 s hamilton
  • For more information, please contact us. 

More pictures of San Antonio investment property:

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SOLD – 820 S. San Manuel Ave., San Antonio, TX 78237

  • Address: 820 S. San Manuel Ave., San Antonio, TX 78237
  • Year Built: 1964
  • Description: San Antonio buy and hold investors – Major cash flow opportunity, neighborhood in high demand, booming San Antonio Market west of Downtown, 3 beds, 1 bath, 928 sqft, lot size: .09 acres, estimated repairs: 5K, clean/lawn maintenance/interior paint. Max After Repair Value: 95K
  • Cash Price on San Antonio Fixer Upper: $70,000 CASH ONLY
  • Exit Strategy: Owner Finance with 5k in repairs: 5K-10K down payment, $995.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: 99K, see attached rental/sold comparables.
  • Notes; This under market value property is best owner financed; you can leave most of the repairs to the end buyer.
  • Sold and Rental Comps: Rental Comps 820 S San Manuel Sold Comps 820 S San Manuel
  • For more information, please contact us. 

More Pictures of San Antonio Investment Property:

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SOLD – 401 Carroll St. San Antonio, TX 78225

 

  • Address: 401 Carroll St. San Antonio, TX 78225
  • Year Built: 1955
  • Description: San Antonio buy and hold investors and real estate investors  – Location Location! Very popular neighborhood south of downtown. 401 Carroll St. San Antonio, TX 78225, 3 beds 2 bath, 1000 sqft, built: 1945, Lot Size: .14 acres, Subdivision: Palm Heights, Estimated repairs: 15K, interior/exterior paint, update kitchen/bath, sheetrock, trash removal interior/exterior. ARV: 89.9K,
  • Cash Price on San Antonio Fixer Upper:  $45,000 CASH ONLY
  • Exit Strategy: Sell with Owner Finance terms, 15K in repairs: 5k-10K down, $895.00 monthly P/I, 30 year amortization, 10% interest, Price: 89.9K.  NOTE: We recommend owner financing this investment property rather than renting; you will be able to save your cash outlays on the repairs by owner financing it rather than renting. 
  • Sold and Rental Comps: Sold Comps 401 Carroll St
  • For more information, please contact us. 

More Pictures of San Antonio Under Market Value Property:

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SOLD – 1301 S Hamilton St., San Antonio, TX 78207

 

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  • Address: 1301 S Hamilton St., San Antonio, TX 78207
  • Year Built: 1956
  • Description:  Under market value property for San Antonio real estate investors, excellent cash flow opportunity, neighborhood in high demand for terms, booming San Antonio Market west of Downtown, 3 beds, 1 bath, 1391 sqft, lot size: .09 acres, estimated repairs: 22K, clean/lawn maintenance/exterior paint/sheetrock/roof/plumbing/electrical. Max After Repair Value: 95K,
  • Cash Price: $42,000 CASH ONLY.
  • Exit Strategy: Owner Finance with 22k in repairs: 5K-10K down payment, $950.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: 95K, see attached sold comps..
  • Notes: ROI should be 14-15% per year. 
  • Contact us for more information or to make offer.
  • Sold and Rental Comps: sold-comps-1301-s-hamilton

More images of San Antonio real estate investment:

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OFF MARKET – 549 N San Bernardo Ave, San Antonio, Texas 78228

San Antonio Real Estate Investors,

This under market value property is only $46,900 with $6000 in repairs. We will do the repairs needed to get it resold with owner financing. Expect an ROI of ~13-14%. It has a huge yard and 4 bedrooms, which is a rarity in this price range!

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  • Address: 549 N San Bernardo Ave, San Antonio, Texas 78228
  • Year Built: 1958
  • Description:  Under market value property and another cash flow opportunity for San Antonio real estate investors, large beautiful lot, 4 beds 1 bath, 1000 square feet, lot size: .30 acres, subdivision: Memorial Heights, 6K repairs, lawn maintenance, interior paint, clean trash in/out, After Repair Value: 73K,
  • Cash Price: $46,900 CASH ONLY.
  • Exit Strategy: Owner Finance with 6k in repairs: 5K down payment, $750.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: $73,000.00, See attached sold/rental comps.
  • Notes: This San Antonio owner finance,  under market value property has a very large lot, which will appeal to many families.  It features FOUR bedrooms, rare in this price range. Also, we advise owner financing this house rather than renting, with just $6k in repairs – boosts your ROI.
  • Contact us for more information or to make offer.
  • Sold and Rental Comps: sold-comps-549-n-san-bernardo rental-comps-549-n-san-bernardo

More Pics:

bath bed-1 bed-2 bed-3 bed-4 kitchen living water-heater

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Why San Antonio Is A Great Market for Owner Financing

As a buy and hold investor in San Antonio, you have the option of either renting out your investment property, or owner financing it.

I have done both buy and hold strategies in the last 16 years. While I still hold some rental properties, I really like to owner finance properties in San Antonio. I think that the San Antonio market is a good place to owner finance for several reasons:

#1 Huge Blue Collar Hispanic Market

We like to serve the hispanic blue collar market in San Antonio. These are hard working people and are very oriented towards family.

Most of my buyers are electricians, roofers, plumbers, carpenters, painters, cooks, oil workers etc. Many of them have  two or three jobs and good income.

They often have large, extended families, and they have the ability to repair the houses that I sell them. To them, hard working blue collar people, I am offering them an affordable opportunity to own their own home.

If the home needs to have a new roof or new flooring, they usually can do the project themselves inexpensively. This saves them money, and it saves me money as an investor because I do not need to spend as much to rehab the house.

#2 Many Hispanics Are Cash Only People

There are hundreds of thousands of hispanics here who lack credit. They may have good income of $4000 to $8000 per month, but they either do not believe in credit, or they have bad credit. However, they have the income and the job stability to afford their own home.

With credit markets as they are, it can be tough for a buyer with no credit or bad credit to get a loan from a bank. It got even harder after the mortgage crash of 2008 and 2009. Sometimes these blue collar buyers have no conventional financing options; even FHA won’t work with them.

Why should a hardworking family that makes $5000 per month have to rent forever? It doesn’t seem fair at all. That’s where I come in.

#3 Owner Financing Is a Win Win for Everyone

Let’s say I have an under market value San Antonio property that I bought for $50,000. To resell it with owner financing, I may need to only spend $5000 to put in flooring, do minor foundation work, clean up the yard, and get rid of junk in the home.

Then, I can sell it with owner financing at $5000 down, $799 per month, 30 year note, 10% interest usually, no prepayment penalty. It is my job to make sure the end buyer has the job and income to support the payments; this is a requirement under Dodd Frank.

Everyone wins in this scenario: Me as the San Antonio real estate investor is making 12% or more per year with no repair costs.

The end buyer gets to own their own home and stop paying rent to a landlord.

The neighborhood gets another home owner who will probably fix up the house, which encourages others to buy and to fix up their home.

The city gets more tax dollars from owner occupied homes, and the local buisness community gets more money from people buying things to fix their homes.

That’s why I love San Antonio owner finance deals. Interested? This is a good San Antonio fixer upper:

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  • Address: 1360 Essex St San Antonio, Texas 78210
  • Year Built: 1956
  • Description: San Antonio buy and hold investors – Another cash flow opportunity, 1360 Essex St San Antonio, Texas 78210, 3 beds 1 bath, 1002 square feet, lot size: .19 acres, subdivision: Denver Heights, 6K repairs, clean/lawn maintenance/interior paint, After Repair Value: 79K.
  • Cash Price on San Antonio Fixer Upper:  $45,000 CASH ONLY
  • Exit Strategy: Owner Finance with 6k in repairs: 5K down payment, $795.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: $79,000.00, see attached comps.  NOTE: We recommend owner financing this investment property rather than renting; you will be able to save your cash outlays on the repairs by owner financing it rather than renting. Renting out this San Antonio investment property is possible, but at least another $10,000 of repairs will be needed. 
  • Sold and Rental Comps: sold-comps-1360-essex-st rental-comps-1360-essex-st
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Make 15-16% ROI in San Antonio Investment Properties

The stock market is back on the way up, and could hit 20,000 in early 2017. Consumer confidence is also at a 10 year high, and many experts think that we are in line for a period of serious economic expansion.

Even though many investors are getting into the stock market, our top investors keep a lot of their money in under market value San Antonio investment properties. Many investors once put their money in the stock market and lost it in the 2001 or 2008 crashes. Generally, putting your capital into owner financed San Antonio properties or rental properties will do better over time.

If you buy your properties at the right price and in the right area, you can enjoy steady, long term returns of at least 10% per year. That is my goal: I want to make at least 10% per year on each buy and hold investment property. And if I can do better than that, well, that’s just gravy!

The good news for San Antonio buy and hold investors is that I am finding more properties in early 2017 that are allowing high returns in the area of 15%. That’s for two reasons:

  • I have found more under market value properties to put under contract in the $40,000 to $50,000 cash range. I have seen a bit of a dip in some prices in the homes that I buy. I don’t know if that will last, but in the last three months, I’ve seen more sub-$50k homes in my neighborhoods than I did for much of 2016.
  • I am generally recommending that my investors owner finance houses rather than rent them. The major reason is that construction costs have increased in the last two years. This is making $10,000 rehabs for rental properties cost $15,000 or more. If you owner finance the investment property, you can spend maybe $5000 on rehab, and leave the rest of the repairs to the end buyer, who usually is a blue-collar Hispanic family who can handle rehab work. Saving $5000 or so in rehab costs increases your ROI.

With some of the under market value properties I have found lately in 78210, 78201 and 78207, I have seen investors hit 15-16% ROI. And that is a long term return – most people cannot count on their stock market portfolio making a steady 15% ROI!

Again, I am perfectly happy as an investor to get 10-12% ROI; that type of return allowed me to financially retire early, but these days I am seeing 15%+ returns on some homes. So give it some thought as an alternative to investing in the volatile stock market. Here is a recent San Antonio fixer upper with 15%+ returns potentially:

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  • Address: 1360 Essex St San Antonio, Texas 78210
  • Year Built: 1956
  • Description: San Antonio buy and hold investors – Another cash flow opportunity, 1360 Essex St San Antonio, Texas 78210, 3 beds 1 bath, 1002 square feet, lot size: .19 acres, subdivision: Denver Heights, 6K repairs, clean/lawn maintenance/interior paint, After Repair Value: 79K.
  • Cash Price on San Antonio Fixer Upper:  $45,000 CASH ONLY
  • Exit Strategy: Owner Finance with 6k in repairs: 5K down payment, $795.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: $79,000.00, see attached comps.  NOTE: We recommend owner financing this investment property rather than renting; you will be able to save your cash outlays on the repairs by owner financing it rather than renting. Renting out this San Antonio investment property is possible, but at least another $10,000 of repairs will be needed. 
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OFF MARKET – 1360 Essex St San Antonio, Texas 78210

 

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  • Address: 1360 Essex St San Antonio, Texas 78210
  • Year Built: 1956
  • Description: San Antonio buy and hold investors – Another cash flow opportunity, 1360 Essex St San Antonio, Texas 78210, 3 beds 1 bath, 1002 square feet, lot size: .19 acres, subdivision: Denver Heights, 6K repairs, clean/lawn maintenance/interior paint, After Repair Value: 79K.
  • Cash Price on San Antonio Fixer Upper:  $45,000 CASH ONLY
  • Exit Strategy: Owner Finance with 6k in repairs: 5K down payment, $795.00 monthly PI/TI, 30 year amortization, 10% interest, Sales Price: $79,000.00, see attached comps.  NOTE: We recommend owner financing this investment property rather than renting; you will be able to save your cash outlays on the repairs by owner financing it rather than renting. Renting out this San Antonio investment property is possible, but at least another $10,000 of repairs will be needed. 
  • Sold and Rental Comps: sold-comps-1360-essex-st rental-comps-1360-essex-st
  • For more information, please contact us. 

More Images of this under market value San Antonio Investment Property:

bath bed-1 bed-2 bed-3 front kitchen large-back-yard living-room