How does it make sense to buy a condo/house in Texas?

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North Texas Cajun
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Re: Why would people buy condos/SFH in Texas?

Post by North Texas Cajun » Sun Feb 11, 2018 11:45 am

runner540 wrote:
Sun Feb 11, 2018 8:18 am
scfr wrote:
Sat Feb 10, 2018 10:11 pm
Where are you getting 2.6% as the property tax rate? I live in Texas and my overall property tax rate is 1.6%. (And a quick Google search says that the average in the state is 1.9%.) Six different entities levy a tax where I live. Five of those six entities offer exemptions, so I pay tax to those entities on less than the full value of my property. I applied for the Homestead Exemption the same day I closed on my house.
All the Dallas properties I've seen have 2.7% rates (tax/assessed value).

Is it possible that you haven’t looked at all the properties?

According to this website, property taxes in Flower Mound and Highland Park are only 2.08%. In University Park, only 2.11%. In Westlake the property tax rate is 2.13%. These are four of the most desirable parts of the Dallas Fort Worth metro area.

Here’s some other low tax rate suburbs:

Lewisville - 2.08%
Grapevine - 2.29%
Plano - 2.18%
Rockwall - 2.21%

I have cherry-picked the lowest suburbs. But some of these are large suburbs, and some are close to many thousands of jobs.


https://www.davedowns.com/dallas-property-tax.php

essbeer
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Re: Why would people buy condos/SFH in Texas?

Post by essbeer » Sun Feb 11, 2018 12:12 pm

Smorgasbord wrote:
Sun Feb 11, 2018 12:35 am
Here's a more apples to apples comparison in the same building.
Buy for 200k plus $700/month condo fee, and ~$300 a month property taxes.
http://www.har.com/5150-hidalgo-street- ... e_29326995

Rent for $1800-$2,000 a month:
https://www.zillow.com/homes/for_rent/H ... ect/15_zm/

Unless I was expecting increases in property values to vastly exceed inflation, I'd probably take the rental.
To me that seems like a pretty decent price. You are getting back 6% in rent after fees and taxes. With the homestead exemption you'd get back more than that. Houston is the fastest growing metro over the last decade, so rent appreciation is very likely. Because of the high HOA you get a multiplier effect on rent increases -- 10% increase in rent will be like a 20% increase in profit. If you believe in thinking of your home as a negative bond, that seems like a really good bond.

runner540
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Re: Why would people buy condos/SFH in Texas?

Post by runner540 » Sun Feb 11, 2018 1:50 pm

North Texas Cajun wrote:
Sun Feb 11, 2018 11:45 am
runner540 wrote:
Sun Feb 11, 2018 8:18 am
scfr wrote:
Sat Feb 10, 2018 10:11 pm
Where are you getting 2.6% as the property tax rate? I live in Texas and my overall property tax rate is 1.6%. (And a quick Google search says that the average in the state is 1.9%.) Six different entities levy a tax where I live. Five of those six entities offer exemptions, so I pay tax to those entities on less than the full value of my property. I applied for the Homestead Exemption the same day I closed on my house.
All the Dallas properties I've seen have 2.7% rates (tax/assessed value).

Is it possible that you haven’t looked at all the properties?

According to this website, property taxes in Flower Mound and Highland Park are only 2.08%. In University Park, only 2.11%. In Westlake the property tax rate is 2.13%. These are four of the most desirable parts of the Dallas Fort Worth metro area.

Here’s some other low tax rate suburbs:

Lewisville - 2.08%
Grapevine - 2.29%
Plano - 2.18%
Rockwall - 2.21%

I have cherry-picked the lowest suburbs. But some of these are large suburbs, and some are close to many thousands of jobs.


https://www.davedowns.com/dallas-property-tax.php
Yes, I'm aware that each municipality has its own rate. My point was that 2.6% is not an insane assumption: it's actually quite close to actual for one of the largest cities. I was referring to the city of Dallas, which have a 2.7% rate. For everyone's reference, here's a good list:
https://www.davedowns.com/dallas-property-tax.php

Freefun
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Re: Why would people buy condos/SFH in Texas?

Post by Freefun » Sun Feb 11, 2018 2:12 pm

I think it could clearly be worth it for folks with families or other reasons to have a home. For me, I may need to make some changes. I'm single and have SFH near downtown. I bought too much house because the realtors suggested I get something easier for resell... otherwise I would've picked up a 1 or 2 bedroom place. While I can afford it there's a clear loss of opportunity costs especially considering they're building like crazy here and I can't imagine values appreciating (and if it does them taxes only go up).

As I'm going to retire soon I may look into renting my place out and experimenting with other things- either renting a smaller place or look at locations where I can get a home for less $ (purchase + taxes + maintenance etc.). As I come from the east coast (NY and then Miami) by comparison Houston overall is quite low cost so I'd have to admit I'm saving some money in other areas.

In summary I think ones choice of SFH or not is as much about quality of life as it is about just the money aspect.
Remember when you wanted what you currently have?

North Texas Cajun
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Re: Why would people buy condos/SFH in Texas?

Post by North Texas Cajun » Sun Feb 11, 2018 2:18 pm

runner540 wrote:
Sun Feb 11, 2018 1:50 pm
Yes, I'm aware that each municipality has its own rate. My point was that 2.6% is not an insane assumption: it's actually quite close to actual for one of the largest cities. I was referring to the city of Dallas, which have a 2.7% rate. For everyone's reference, here's a good list:
https://www.davedowns.com/dallas-property-tax.php
OK. Perhaps you only meant to write about the city Dallas. But the OP asked why would anyone buy a condo or SFH in Texas. And the comment you responded to - by SCFR - also specified Texas, not Dallas.

I was only meaning to support scfr’s comment that 2.7% is not an accurate rate to use for Texas.

What is often unclear when using the word “Dallas” is whether one means Dallas the city or Dallas the county or Dallas the metropolitan area. The same confusion arises when using the words “Los Angeles”, which also may refer to a city, a county, and a metro area.

Lonestarz
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Re: Why would people buy condos/SFH in Texas?

Post by Lonestarz » Sun Feb 11, 2018 2:30 pm

I work downtown. Downtown proper is absolutely dead after about 6. Sure there are some nice restaurants and various happy hours but if you compare actual downtown to anywhere else between downtown and west beltway 8 you will see sparce it is. After about 7 pm, during weeknights 60% of the people I see out are homeless.

What you find are people who bought several years ago and will rent out for tax/fees plus a markup over their mortgage. You may be able to rent out a house for similar price to what it costs now to buy (still more than the owner paid) but if you plan on renting for another 5 years... you might be able to rent for similar to current purchase price but likely much more than the cost of you had purchased.

In 2 houses in Houston we experienced 34% and 22% appreciation in 7 and 5 years respectively. I don’t expect such huge appreciation unless you want to buy in gentrification neighborhoods but if we are talking about cost of rent vs own you can’t just look at current prices. Even rent vs own calculators have a projected rent/property value assumption.

Also the comment was specifically about Houston. Houston and Dallas probably have similar property tax rates and upper 2% is legit if you wantto live in a city. Texas is mostly rural so state wide averages mean nothing.

North Texas Cajun
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Re: Why would people buy condos/SFH in Texas?

Post by North Texas Cajun » Sun Feb 11, 2018 3:31 pm

Lonestarz wrote:
Sun Feb 11, 2018 2:30 pm
I work downtown. Downtown proper is absolutely dead after about 6. Sure there are some nice restaurants and various happy hours but if you compare actual downtown to anywhere else between downtown and west beltway 8 you will see sparce it is. After about 7 pm, during weeknights 60% of the people I see out are homeless.

What you find are people who bought several years ago and will rent out for tax/fees plus a markup over their mortgage. You may be able to rent out a house for similar price to what it costs now to buy (still more than the owner paid) but if you plan on renting for another 5 years... you might be able to rent for similar to current purchase price but likely much more than the cost of you had purchased.

In 2 houses in Houston we experienced 34% and 22% appreciation in 7 and 5 years respectively. I don’t expect such huge appreciation unless you want to buy in gentrification neighborhoods but if we are talking about cost of rent vs own you can’t just look at current prices. Even rent vs own calculators have a projected rent/property value assumption.

Also the comment was specifically about Houston. Houston and Dallas probably have similar property tax rates and upper 2% is legit if you wantto live in a city. Texas is mostly rural so state wide averages mean nothing.
Actually, Lonestarz, the OP said “Texas” and “large Texas cities”. He used Houston as an example, but it was clear to me he was not referring to just Houston.

The property tax rates vary significantly across the Dallas Fort Worth metro area. Those rates are closer to 2% rather than 3% for a number of suburbs close to where jobs are being created. And some of these lower tax suburbs are large, such as Lewisville-Flower Mound-Highland Village with 200,000 population, and Plano-Allen with 400,000 population. These are not by any stretch of the imagination considered rural areas.

One of the reasons why the big cities of Dallas and Fort Worth are losing big employers to the suburbs has to be the lower property tax rates for employees. This started decades ago when companies such as EDS, Dr Pepper, Frito Lay, JC Penney, and others chose the suburbs. Exxon Mobil and Kimberly Clark are not in low tax suburbs, but their employees can live in such nearby ones. The growth of suburban power continues today as Toyota North America and the Amazon fullfillment center rejected the bigger cities.

Property taxes matter, and large metro areas like Dallas are anything but uniform in that respect.

need403bhelp
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Re: Why would people buy condos/SFH in Texas?

Post by need403bhelp » Sun Feb 11, 2018 4:53 pm

runner540 wrote:
Sun Feb 11, 2018 8:20 am
need403bhelp wrote:
Sat Feb 10, 2018 8:08 pm
FYI, as a Houstonian, med center and downtown are two completely separate areas.

Also I own in med center area (condo), PITI is $1000/month or so (a little less) with $200/month HOA. Someone I know who rents in same complex pays about same total amount. I did buy in 2003 though.
What would the PITI be for someone buying now?
I honestly don’t know as I haven’t looked.

Interestingly, I believe if I bought in 1998 my PITI would have been much less. Properties I considered at the time went up 2.5x in price over that five year period.

slbnoob
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Re: Why would people buy condos/SFH in Texas?

Post by slbnoob » Sun Feb 11, 2018 11:56 pm

I can think of one reason why people would buy in the Houston burbs: lot of inventory and prices are lower than they've been in a few years. I know because I'm trying to rent/sell my house in Katy since I moved out for a new job. So if you must buy one, this is better time to buy than at least summer 2014 I would think.

hookemhorns
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Re: Why would people buy condos/SFH in Texas?

Post by hookemhorns » Mon Feb 12, 2018 1:01 am

I live in Dallas and my effective average property tax rate is ~2.5% after the homestead exemption. There are many areas that are higher. Quoting the rate for Highland Park or UV is laughable since those are very wealthy areas with starting SFH prices of $1mn with many homes in the $2-3mn range - well above the average for Dallas. The other factor to consider is that assessed home values routinely increase 5-10% per year. People love to harp on CA's income taxes, but Texas effectively has a backdoor version of it via property tax.

North Texas Cajun
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Re: Why would people buy condos/SFH in Texas?

Post by North Texas Cajun » Mon Feb 12, 2018 9:43 am

hookemhorns wrote:
Mon Feb 12, 2018 1:01 am
I live in Dallas and my effective average property tax rate is ~2.5% after the homestead exemption. There are many areas that are higher. Quoting the rate for Highland Park or UV is laughable since those are very wealthy areas with starting SFH prices of $1mn with many homes in the $2-3mn range - well above the average for Dallas. The other factor to consider is that assessed home values routinely increase 5-10% per year. People love to harp on CA's income taxes, but Texas effectively has a backdoor version of it via property tax.
Quoting the property tax rates for Plano, Lewisville, Flower Mound, and Grapevine is not laughable. All of these suburbs have property tax rates well below the 2.7% quoted by the OP. These suburbs may be far from the Dallas jobs in the center city. But they are not an outrageous commute to the hundreds of thousands of jobs in Las Colinas, LBJ, far north Dallas, and Legacy business districts. My daily commute from Flower Mound to the Stemmons Fwy offices was rarely more than 30 minutes.

Are the starting prices for homes in University Park really $1mm? Zillow shows a few - mainly condos but a couple of SFH’s - below $600,000.

Derivative
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Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Derivative » Mon Feb 12, 2018 12:00 pm

[Thread merged into here, see below. --admin LadyGeek]

Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

I have some money saved up and am planning to relocate to Houston, TX from the Bay Area (California) to find a new job. I am a UC Berkeley graduate (2012) with high academic stats (3.8+ GPA, excellent grades, etc.) and I hope to eventually become a doctor. I want to gain residency in Texas to go to medical school there since it is cheaper and less competitive than California. Based on the time away from school and the field, I probably will not get into a California medical school due to the fierce competition. I have a good amount of money and retirement funds saved up from working and saving in California (stayed with parents).

Cash saved: Over $130k
Retirements (Roth and Solo 401k) funds: Over 70k

Right now I work as an private and online tutor for several companies and basically run my own tutoring business as well with student referrals. The work I do does not provide any health benefits, time off, retirement, etc. I haven't really ever been fully employed (only contractor/part time/self-employed tutoring jobs). I want to find a W-2 work in the hospital. Is this possible with my degree in molecular biology? How high of a salary can I expect and try to aim for? What positions? Should I expect more job opportunities in Houston by so many medical centers or in the Bay Area? I basically need more recent medical experience to add to my applications for medical school so I think getting a job (instead of just volunteering) is the best route.

Lastly, I have been considering house hacking but not sure if that is a good idea or if I should just buy a small cheap 60k 2br/1bath condo near the medical centers and try to get a roommate. I am thinking the cheaper the better due to high property taxes (2.6% in Houston)? I would rent but I am not sure about the stability and whether that would be better than buying a 60k 2br/1 bath condo. I am considering house hacking to build equity during my time before medical school and maybe rent it out during medical school, but I don't like the idea of owning a huge property in a hurricane/flood zone.

Any advice/suggestion is greatly appreciated. I am somewhat lost on the next step towards my medical career.

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Sandtrap
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Sandtrap » Mon Feb 12, 2018 12:12 pm

IMHO
Keep things as simple as possible so you can focus on your medical career.
Renting gives you flexibility, simplicity, and doesn't tie you down compared to a purchase and depending on a roommate.
Work, and volunteer, as time allows in the medical field. A degree in molecular biology will open doors for a "real regular job" which you need.
Protect your momentum going forward by minimizing financial and personal lifestyle distractions.
Set incremental goals and stay excited about achieving those goals.

mahalo,
j :D

Random Poster
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Random Poster » Mon Feb 12, 2018 12:20 pm

Derivative wrote:
Mon Feb 12, 2018 12:00 pm
Any advice/suggestion is greatly appreciated. I am somewhat lost on the next step towards my medical career.
Apartment near the Medical Center.

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Ethelred
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Ethelred » Mon Feb 12, 2018 12:31 pm

1. To answer the question you did ask: If I was moving to Houston as a single person who didn't know the city, I would definitely rent, at least initially. Partly because there are big variations in safety and character of different parts of the city, and partly because Houston is very different to the Bay area and California in general, and you might hate it.
2. To answer the question you didn't ask: I would particularly recommend you rent rather than buy. You come across as being pretty unsure as to the direction you want your life to take. That's not intended as a criticism.

I wouldn't worry too much about hurricanes and flooding. It is a serious issue for the city as a whole, but as long as you do your due diligence on location you should be fine. Just check the maps of flooding from Harvey, and live outside that.

livesoft
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by livesoft » Mon Feb 12, 2018 12:45 pm

You should not buy. You should rent.

I know someone who moved to Houston to obtain TX residency and then applied to medical school. They worked at a laboratory technician in the Houston Med Center and later went to med school in Dallas.
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3504PIR
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by 3504PIR » Mon Feb 12, 2018 5:50 pm

livesoft wrote:
Mon Feb 12, 2018 12:45 pm
You should not buy. You should rent.
amen.

gostars
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Re: Why would people buy condos/SFH in Texas?

Post by gostars » Tue Feb 13, 2018 12:25 am

A quick glance through University Park shows everything under $800k is either attached (duplex/triplex/townhouse) or wrecked. Anything detached starts around $900k, and most of those get the description of "cottage" which I think is code for tiny and no insulation. $1mm seems pretty accurate as a starting point for something you'd actually want to live in.

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Watty
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Watty » Tue Feb 13, 2018 7:05 am

Another +1 on renting.

In addition to deciding what you want to do it also sounds like you are single and if you get in a relationship your housing needs may change.

Many single people do buy property though once their situation is more stable.
Last edited by Watty on Tue Feb 13, 2018 9:58 pm, edited 1 time in total.

chevca
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by chevca » Tue Feb 13, 2018 7:15 am

Agree with others, you should rent.

OP, didn't you just start a thread about, why would anyone buy a SFH in TX? Now, you're thinking of buying? :confused

Derivative
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Derivative » Tue Feb 13, 2018 10:27 am

chevca wrote:
Tue Feb 13, 2018 7:15 am
Agree with others, you should rent.

OP, didn't you just start a thread about, why would anyone buy a SFH in TX? Now, you're thinking of buying? :confused
There were people on the thread that stated reasons to buy? I just want to know whether it would be wise in my situation and with my grad school and wealth-building goals.

faboinvesting
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by faboinvesting » Tue Feb 13, 2018 11:15 am

First off, congrats on being able to save so much money. Wow...I'm a noob here so maybe that's the norm but wow lol.

I live in Houston. As you probably know, Houston is known for it's Medical Center so I imagine that here would be a good place to start your medical career.

Since you're new to Houston and don't really know if you'll like it, I'd say go with renting first. Even if it's just a 6 month lease somewhere. During that time you can feel the city out. Learn the different parts of town and where you may or may not wanna live. Find out what kind of commute to and from school you're willing to deal with. Assess the housing market. Find out things like that before you purchase a house, duplex/multiplex, or condo. And whenever you do finally purchase something, I'd say definitely rent out a room if possible.

audioaxes
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by audioaxes » Tue Feb 13, 2018 8:18 pm

I think thats a good idea if you are planning to be a landlord once you move on from whatever place you buy. Plenty of properties that will pull in well above the 1% rental return rule. Obvious advise is to be aware of any property that could have been hit by the flood last year.

Saving$
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Saving$ » Tue Feb 13, 2018 9:36 pm

You have a goal, but not a specific plan for the next x year.

Rent. Do not buy. You need to structure your life for maximum flexibility to implement a plan to meet your goals.

Moving to Houston and renting an apartment hoping to get a job at a nearby medical center may not be the ideal way to move forward with your goal. Brush up your resume, and start sending it out from California. Apply for LOTS of jobs. Don't move until you get a job. Don't do anything to affect your current income stream until you get a job.

Given what you have written about your background, an 8-5 job in a structured environment would be VERY helpful to your resume. Take any one you can get in Houston close to a field you are interested in, that you can do for a year.

Chuffly
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by Chuffly » Tue Feb 13, 2018 9:51 pm

I'm with the rest of the "you should rent" chorus. After living in Houston the past couple years, I'd be a little skeptical of the safety of any condo you could scoop up for $60k.

Given that you have expressed reservations about flood risk, it wouldn't hurt to consult this tool:

http://www.harriscountyfemt.org/

The one major word of warning is that some areas depicted outside that map's 500-year floodplain still experienced flooding. So the tool isn't bulletproof. But it will at least it will give you an idea of the highest risk areas to avoid.

Another helpful tip - look at Zillow. If you start to look through houses in a neighborhood close to a bayou, you can start to get a sense of where the transition occurs from houses that took on floodwater to houses that stayed dry. The latter are more than happy to tell you, while most of the former have pictures of drywall missing from the bottom half of the house's 1st floor.

Just a few helpful tips.

fasteddie911
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by fasteddie911 » Sat Feb 17, 2018 9:44 am

Rent. The rental market is pretty good. Lots of rental complexes and availability, move-in specials, etc. You should have no problem finding a nice studio or 1br unit for less than $1500. You may have to move within a few years for school and renting makes that easy. This is a pretty bold move for the sake of med school acceptance and tuition savings, but good on you. I actually looked up stats on med school applications and I didn't realize the difference between UC and UT schools was that significant.

letsgobobby
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by letsgobobby » Sat Feb 17, 2018 9:53 am

i went to med school in Houston as an out of stater. PM me if you want to talk.

essbeer
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Re: Should I buy a house, duplex/multiplex, or condo in Houston, TX? Any advice?

Post by essbeer » Sat Feb 17, 2018 10:11 am

Chuffly wrote:
Tue Feb 13, 2018 9:51 pm
I'm with the rest of the "you should rent" chorus. After living in Houston the past couple years, I'd be a little skeptical of the safety of any condo you could scoop up for $60k.
You could, potentially, get a nice condo for $60k in an historic building with a sky high HOA fee. The OP might be able to float that. I'm kind of assuming that the OP is far more affluent than most of the other posters in this thread assume. The guy has just graduated from college and never been fully employed, but has $130k. To me, that sounds like a graduation present. It might be specifically for buying a condo to help establish residency.

Derivative
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How does it make sense to buy a condo/house in Texas?

Post by Derivative » Sat Mar 24, 2018 12:01 pm

[Thread merged into here, see below. --admin LadyGeek]

How does it make sense to buy a condo/house in Texas? With property taxes being as high as 2.6% in many large cities, for a 200k home, it would cost roughly $5,200 in property taxes a year ($433 per month); and for a 300k home, $7,800 in property taxes per year ($650 per month) . Given this, for someone who is single and has no family, how would it ever make sense for them financially to buy a home when they can find places to rent for $500-$700/month?

Based on the high property tax and high HOA fee for condos, I would have to say it is financially stupid for a single person to buy a home or condo in Texas if they can find a good place to rent for $500-$700/month? Am I correct on this?

Is the only good time to buy a home in high property tax states when you have a

I am asking this question as I may be moving around to some high property tax states...

Any advice/insight is appreciated. Thank you!

Commodore
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Re: How does it make sense to buy a condo/house in Texas?

Post by Commodore » Sat Mar 24, 2018 12:17 pm

I Agree with your assessment that Texas has property taxes > 2% of the appraised property value; however as an offset, Texas has no state income tax. What you may also discover that the local economic environment in Texas is red hot with a lot of employment opportunities and therefore a massive influx of people moving here. Lots of demand for both buying houses/condos and rental rates for apartments, therefore prices are rising.

I’m thinking your rental range of $500-700 is on the low side if you are considering a major metro area like Houston, Dallas, San Antonio, Austin.

Good luck.

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HomerJ
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Re: How does it make sense to buy a condo/house in Texas?

Post by HomerJ » Sat Mar 24, 2018 12:19 pm

Well, off the top of my head, a $200k or $300k home in Texas is a LOT nicer than a studio or 1-bedroom apt for $500-$700.

If you're single, and a 1-bedroom apt is all you need, and you're perfectly happy with the choices at the $500/month level, then absolutely you should rent, not buy.

Gufomel
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Re: How does it make sense to buy a condo/house in Texas?

Post by Gufomel » Sat Mar 24, 2018 12:23 pm

You’re comparing a $300k home to a $500-700 per month rental?

I’m not sure what city in Texas you’re referring to, but if $300k is an average middle-class home in that area, then a place that you can rent for $500-700 per month would be an absolute dump of an apartment. Probably 800 square feet, 60 years old, and in an extremely high crime area.

I’m not sure why you’re comparing these two options.

The property taxes will be priced into the rental price. But if you’re single, don’t know how long you’re going to stay in the area, and don’t care to own your own house, then it’s probably smart to rent. But property taxes aren’t the reason.

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Re: How does it make sense to buy a condo/house in Texas?

Post by Pajamas » Sat Mar 24, 2018 12:24 pm

Derivative wrote:
Sat Mar 24, 2018 12:01 pm
it is financially stupid for a single person to buy a home or condo in Texas if they can find a good place to rent for $500-$700/month? Am I correct on this?
Probably true anywhere in the U.S., although what you would rent is probably not what you would buy. For a young single person, seems like renting would absolutely be the way to go.

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JoMoney
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Re: How does it make sense to buy a condo/house in Texas?

Post by JoMoney » Sat Mar 24, 2018 12:26 pm

There are lifestyle differences between owning and renting, different people have different preferences.
Availability of different neighborhoods/schools, being able to make modification or additions to the structure or yard/patio, knowing you're not likely to be forced to move by a landlord selling, no changing (increasing) rents, no pet restrictions, ... there are others, but the idea is that renting vs buying is often more a consumption choice rather than an investment decision.
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Re: How does it make sense to buy a condo/house in Texas?

Post by NoGambleNoFuture » Sat Mar 24, 2018 12:31 pm

You're not finding awesome (see: safe) rentals in Texas for 500-700/month... and if you are, nice houses in that area are more like 100-140k.

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Re: How does it make sense to buy a condo/house in Texas?

Post by Atilla » Sat Mar 24, 2018 12:31 pm

Or you can live where property taxes are 2.3% of assessed value each year - AND have income tax on top of that. It's one big reason we aren't upgrading our living situation - the property taxes get stupid real quick.
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Re: How does it make sense to buy a condo/house in Texas?

Post by TxAg » Sat Mar 24, 2018 12:44 pm

A decent place is probably $1000/month. Been a few years though.

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Re: How does it make sense to buy a condo/house in Texas?

Post by riverguy » Sat Mar 24, 2018 12:45 pm

Do you really think renters don’t end up paying property tax?

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Re: How does it make sense to buy a condo/house in Texas?

Post by Mike Scott » Sat Mar 24, 2018 12:52 pm

States without income taxes get their tax money in a different format. I guess you have to decide if you can make the local system work for you.

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Re: How does it make sense to buy a condo/house in Texas?

Post by jainn » Sat Mar 24, 2018 12:54 pm

HomerJ wrote:
Sat Mar 24, 2018 12:19 pm
Well, off the top of my head, a $200k or $300k home in Texas is a LOT nicer than a studio or 1-bedroom apt for $500-$700.

If you're single, and a 1-bedroom apt is all you need, and you're perfectly happy with the choices at the $500/month level, then absolutely you should rent, not buy.
+1

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Re: How does it make sense to buy a condo/house in Texas?

Post by BanquetBeer » Sat Mar 24, 2018 1:07 pm

I don’t know why people rentfor $3-400/mo when a membership at the YMCA is $70/mo and tent camping under the freeway is free.

Case 1) $375k 2400 sq ft house with $10.5k/yr property tax/insurance
Case 2) rent case 1 for $10.5k costs+Interest+$800/mo profit to landlord
Case 3) rent a old/cheap apartment for $800/mo that isn’t comparable to the house..

I agree it is probably never a good financial decision to buy a house vs $700/mo rental or to buy a nice car vs Corolla. The reasons people buy a house are typically because they want the lifestyle/space a house provides or because they are not a single person and to rent a equivalent space (case 1 vs 2) is more economic to buy

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Re: How does it make sense to buy a condo/house in Texas?

Post by Ztx » Sat Mar 24, 2018 1:11 pm

Yes, property taxes are very high here but rental market is very hot too and 700 per month won't get you much.
I lived in $600 per month apartment while single and it made sense (financially) but with a family it's much nicer in a house so it's a quality of life decision.

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Re: How does it make sense to buy a condo/house in Texas?

Post by JBTX » Sat Mar 24, 2018 1:18 pm

How many threads do you need to start to ask the same question?

viewtopic.php?f=2&t=241145&p=3774136#p3774136

viewtopic.php?f=2&t=241413&p=3780454#p3780454

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Re: How does it make sense to buy a condo/house in Texas?

Post by goblue100 » Sat Mar 24, 2018 1:29 pm

TxAg wrote:
Sat Mar 24, 2018 12:44 pm
A decent place is probably $1000/month. Been a few years though.
In North Dallas you are in the ballpark. A guy I work with rents a two bedroom 1000 sf apartment for $1300 a month. Its decent but not deluxe, and they go up at least $50 a month every time the lease renews.
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Re: How does it make sense to buy a condo/house in Texas?

Post by Pajamas » Sat Mar 24, 2018 1:41 pm

JBTX wrote:
Sat Mar 24, 2018 1:18 pm
How many threads do you need to start to ask the same question?

viewtopic.php?f=2&t=241145&p=3774136#p3774136

viewtopic.php?f=2&t=241413&p=3780454#p3780454
:oops:

Hey O.P., it makes zero sense for you to buy while you are in grad school unless you know with absolute certainty that you won't be moving afterwards. You should also be focusing your attention on your education rather than your wealth-building activities right now.

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Re: How does it make sense to buy a condo/house in Texas?

Post by Wagnerjb » Sat Mar 24, 2018 3:05 pm

Derivative wrote:
Sat Mar 24, 2018 12:01 pm
How does it make sense to buy a condo/house in Texas? With property taxes being as high as 2.6% in many large cities, for a 200k home, it would cost roughly $5,200 in property taxes a year ($433 per month); and for a 300k home, $7,800 in property taxes per year ($650 per month) . Given this, for someone who is single and has no family, how would it ever make sense for them financially to buy a home when they can find places to rent for $500-$700/month?

Based on the high property tax and high HOA fee for condos, I would have to say it is financially stupid for a single person to buy a home or condo in Texas if they can find a good place to rent for $500-$700/month? Am I correct on this?

Is the only good time to buy a home in high property tax states when you have a

I am asking this question as I may be moving around to some high property tax states...

Any advice/insight is appreciated. Thank you!
You asked this same question here on this forum a month ago. Did you not like the answers you got?

viewtopic.php?f=2&t=241145&p=3774093#p3774093
Andy

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Re: How does it make sense to buy a condo/house in Texas?

Post by boglegirl » Sat Mar 24, 2018 3:06 pm

Derivative wrote:
Sat Mar 24, 2018 12:01 pm
How does it make sense to buy a condo/house in Texas? With property taxes being as high as 2.6% in many large cities...
FYI, it can be even higher. I think the worst (highest) city/school district combination in the Fort Worth area gives a total property tax rate of almost 3.2%.
Pajamas wrote:
Sat Mar 24, 2018 1:41 pm
JBTX wrote:
Sat Mar 24, 2018 1:18 pm
How many threads do you need to start to ask the same question?

viewtopic.php?f=2&t=241145&p=3774136#p3774136

viewtopic.php?f=2&t=241413&p=3780454#p3780454
:oops:

Hey O.P., it makes zero sense for you to buy while you are in grad school unless you know with absolute certainty that you won't be moving afterwards. You should also be focusing your attention on your education rather than your wealth-building activities right now.
Umm, yeah, you are obsessing about this way too much right now. Sign a new lease and when you have a job/know where you're going to live, you can come back and ask again and maybe the 4th time will be the charm.

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Re: How does it make sense to buy a condo/house in Texas?

Post by LadyGeek » Sat Mar 24, 2018 5:18 pm

Derivative - It's best to keep all of the information in one spot. I merged two similar threads into here. Please ask all of your condo/house questions in this thread.
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