Arguably the most important factor to evaluate when selecting a real estate syndication investment is the local market of the target property. The age old axiom of Location, Location, Location has stood the test of time for good reason. Investors should target markets with growing populations and employment opportunities which leads to higher rent prices. Combine this with business-friendly environments and a low relative cost of living and you have a winning formula.
The market we will be exploring today is Houston, Texas.
Market Overview
Houston is the 4th largest city located in the United States and the largest in Texas with a current population of over 2.3 million which is a 10% increase since 2010
With more than 145 languages spoken and residents from over 90 countries, Houston is the most ethnically diverse metro area in the United States
At a size of 665 square miles, Houston is large enough to contain Boston, Miami, Minneapolis, New York, San Francisco, Seattle and Washington
Behind only New York City, Houston has the second highest number of Fortune 1000 companies (49) due to the pro-growth government, low costs and regulations, and no state tax for corporate or personal income
Less than 3.5 hours from other major Texas cities such as Austin, San Antonio and Dallas
Offers the 4th largest airport system and is the only city in the Western Hemisphere with two four-star rated airports
Key Real Estate Investment Drivers
Rents are growing at a rate of 8% year over year and 6.6% over the past 3 years
Forbes ranks Houston as one of the best places for careers in the U.S. given the diversity of industries across energy, manufacturing, health care, research, aeronautics and transportation
The population is also projected to surge this decade, with another 1.2 million residences forecasted by 2030
Low taxes and high wages make Houston #1 in average monthly take-home pay compared to other U.S. cities
Houston has the 2nd lowest cost of living of the 20 most populous cities
Prior to the Covid-19 pandemic, Houston had a record low unemployment rate and is positioned well for a stronger recovery than most cities
Houston boasts numerous awards which will continue to bolster its perception as a destination city
As we can see from the data, Houston checks many of the boxes that real estate syndication investors are looking for in a local market. Finding the correct property and sponsor are still critical components of a successful no-hassle, hands-off investment, which is where our company can help.