November 27, 2023Read More
- Start by finding a trustworthy, investor-friendly real estate agent
- You don’t need a specific license to flip houses in Texas
- Best cities for flipping include Austin, San Antonio, Houston and Dallas
- There is abundant opportunity for profit as a Texas home flipper
- It’s important to do your due diligence and you will face challenges
How To Start Flipping Houses In Texas
If you’re looking to get started on an endeavor to flip houses in Texas, you are taking the first steps on an exciting journey. There are a few things you need to do first, and the fundamental step is to find a reliable investor-friendly real estate agent.
If you come to us, we can help you get a strong understanding of local markets in Texas, research trends and identify opportunities. We can also assist in finding the right lenders to fund your journey. With us in your corner, you can get a strong footing in this lucrative market and start making profits that could change your life.
We are also Texas property investors, so we are constantly researching and identifying prospects throughout the state. The things you need that we can provide include:
- A strong, up-to-date understanding of local trends in the Texas real estate market.
- A robust knowledge of the legal aspects of real estate transactions in Texas.
- Access to a broad range of financial resources aimed at investors.
- Contacts for professionals who can handle legal work as well as renovations and repairs to make properties profitable.
- Market research and property assessment skills.
We take all the hard work out of searching and strategizing. With us by your side, you will have a constant source of support to carry you through how to start flipping houses in Texas.
Do You Need A License To Flip Houses In Texas?
There is no specific license required to flip houses in Texas, as long as you are not engaging in any real estate activities that require a real estate license. If you work with us, we can handle the marketing of your properties and negotiate transactions. These are activities that fall under the definition of what a real estate agent does, and a real estate license is required to do them.
If you have any questions about the specific licensing requirements for the activities you intend to engage in, contact us and we can talk. Alternatively, consult with the Texas Real Estate Commission (TREC) or contact a relevant attorney for legal guidance tailored to your circumstances.
Best Cities For Flipping Houses In Texas
The biggest factor to consider when looking at the best cities for flipping houses in any state is the current market conditions. Things can change over time, but there are some cities known as hotspots for house flipping due to things like demand and profit potential. These cities include:
- Houston: There is a large housing market here with very diverse neighborhoods. As such, real estate in Houston offers many opportunities for Texas home flippers if you know where to look. Median listing prices stand at $325,000.
- Dallas-Fort Worth: We operate in Dallas because it is a bustling metropolitan area that has a particularly strong real estate market. Demand has been on the rise in suburbs for some time. Current median listing price is $415,300.
- San Antonio: This is a city with a growing population and a relatively low cost of living. As such, it often emerges as a popular destination for flipping houses in Texas. And you can acquire properties at a median purchase price of $275,000.
- Austin: Home prices are rising here as the city’s tech industry goes from strength to strength, so there is great potential for house flips if you have the capital to invest. Currently, the median listing price here is around $579,000.
The key variables to watch out for to spot destinations with cashflow-positive potential for house flipping include affordability of housing, demand, economic growth, populations growth and market trends. Analyzing all these factors can be challenging and time-consuming, but we can take all that work off your hands to find prospects on your behalf.
Important Texas House Flipping Stats To Know Before Start
It’s important to understand that opportunities for house flipping in Texas depend largely on local markets and trends. There is plenty of opportunity in the state, but it requires an expert eye and careful evaluation of different variables to find the right prospects for investment.
You need to look at median purchase prices, and these can vary dramatically. For example, the median purchase price in San Antonio is currently $275,000, while in Austin it is $579,000. Nevertheless, both are seen as good cities for house flipping because of the potential profit from resale values. Residential property prices in Texas are increasing by an average of 4.69% per year in Texas, which is more than twice the national average. You might be interested to know that, since rental income is not taxable in Texas, many choose to purchase properties here to let, rather than pursuing a house flipping strategy.
Price per square foot is another important consideration. Going back to our examples in San Antonio and Austin, the former has real estate available at a median price of $153 per square foot, while in the latter it is higher. In Dallas-Fort Worth, the price is approximately $223 per square foot, and this all has an impact on the average gross profit in the cities. These are all calculations we can run for you so you can have all the data in your hands to carry out your analysis.
The Texas demographics that influence flipping include:
- Population size – current population growth in Texas is around 1.56% per annum.
- Median household income – currently around $67,000.
- High school graduation rates – at least 94% according to the latest records.
- Travel time to work – the average for Texas currently stands at 26.4 minutes
These are general snapshots of key demographics for the state as a whole, but Texas is a big state. Texas home flippers should pay close attention to localized statistics as these are far more accurate signifiers of where the opportunities lie. But these are the demographics to explore, and we can run all of that analysis for you.
Is Flipping Houses Profitable In Texas?
Texas is one of the more profitable states in the USA for house flipping. And it is growing rapidly, emerging as one of the best places in the country for forward-thinking real estate investors. There is huge potential for profit for Texas home flippers, but it all comes down to the skill level of the investor and the amount of work done in researching and planning.
You will find affordable real estate and competitive, luxury property in different cities in Texas. There is something for everyone here, as long as you are prepared to do the work in finding prospects. If this is daunting for you, let us do the research and analysis so you can make decisions from an informed perspective. We can even help you find the most suitable fix and flip loans for your circumstances to embark on your journey.
How Much Can You Make Flipping Houses In Texas?
Texas is a profitable flip state and it is possible to make a quick flip for shrewd Texas house flippers. Every deal is different and the numbers in your specific project will determine the amount you can make. Prior experience, education and professional network are also key considerations, which is why it can be so helpful to have an investor-friendly realtor in your corner.
If you do the work to find the right deal, you can make a good profit just about anywhere in the state. Here are some key statistics to consider:
- The median purchase price of investment properties in Texas is around $181,000.
- The median resale value after renovating a property is around $224,000.
- This means that Texas home flippers can expect gross revenue in the region of $43,000.
As mentioned, these kinds of numbers are achievable, but you need to find the right opportunities through market research and carry out shrewd negotiations, effective renovations and time your sales right. We can help you make the right decisions every step of the way.
Local research is crucial to find houses to flip in Texas. You can make use of the wholesalers’ power, attend auctions, look for off-market properties, seek foreclosures and more to keep your finger on the pulse of the market.
Utilize The Wholesalers’ Power
Wholesalers are real-estate professionals and investors who specialize in identifying off-market properties and selling them at a discount to investors. You can access them via online platforms and wholesaler lists, or build a network of connections to stay close to them. We have links with wholesalers and can help you leverage their capabilities to find prospects to flip homes in Texas.
Attend Bank Auctions
Bank auctions, also known as foreclosure auctions, are a viable option for finding prospects for Texas home flippers. You will need to thoroughly understand the auction process and find upcoming auctions. Never forget the importance of visiting properties first to establish their viability, and securing financing to fulfill your obligations upon winning an auction.
Find Off-Market Properties By Using Direct Mail
This requires a strategic approach, reaching out to property owners who may be interested in selling. You will need to:
- Build a targeted list
- Craft convincing direct mail pieces
- Take a personalized approach
- Remain compliant with regulations
This approach takes patience and persistence but could yield results to find off-market properties. You need good skills in building relationships and maintaining professionalism to inspire trust and close deals. This is another area where an investor-friendly realtor can be helpful.
Register With Multiple Listing Service (MLS)
You need to be a licensed real estate agent to do this. Some investors find this helpful, but it may be more prudent to work with an existing real estate agent instead. Look for those that specialize in working with property investors for the best results.
Seek Out Foreclosures
The foreclosure process in Texas has specific laws and regulations that you will need to familiarize yourself with. You will then need to access public records and use online foreclosure listing websites to find potential prospects for house flipping in Texas. As investor-friendly real estate agents, we can help with this process.
Challenges You Can Face While Flipping Houses In Texas
Texas house flippers face stiff competition in this emerging real estate market. There are also various other challenges, including:
- Market volatility
- Assessing the condition of properties
- Costs of renovation
- Adhering to building codes
- Obtaining finance
- Paying property taxes
- Finding buyers for renovated properties
Essentially, you need to carry out an assessment of the pros and cons of getting involved in flipping houses in Texas. It is not a casual undertaking; you must be committed and diligent. We can take much of the legwork out of your hands, but you must still be committed and carry out your due diligence to succeed. For example, you will need to make comparisons between different cities to find your ideal destination, and you will have to lay out a lot of capital to get started.
There is risk, and there is reward. You will face challenges on this journey, and it is down to you to decide whether you are prepared to meet them head on.
How To Flip Houses In Texas With No Money
It is possible to flip houses in Texas with no starting capital, but it might be more challenging to access financing for your endeavor. It may be necessary to seek private money lenders, hard money lenders or pursue property wholesaling in order to get started.
Private Money Lenders
Finding private money lenders like individuals or private companies to fund your first investments can be an option for some. You will have to locate them and establish a rapport, then present your investment opportunity and negotiate favorable terms that motivate the lender to enter the deal with you. A legally binding loan agreement will have to be drawn up, but it can be a great way for Texas home flippers to get started.
Hard Money Lenders
These private individuals or organizations offer short-term, asset-based loans to real estate investors for flipping properties. You will need to find a reputable lender and fill out a loan application with them, which will involve a property evaluation and legal documentation to confirm the terms of the arrangement.
This is where you act as an intermediary to carry out property transactions between motivated sellers and end buyers. You do not actually purchase properties yourself, but you get a portion of the sale proceeds in exchange for connecting the seller with the end buyer. This can help raise capital whilst gaining experience in the real estate market so that you can start your own journey later.