Real Estate Listings
As the fourth-largest city in the nation, Houston, Texas, is known for its professional sports teams, space program and affordable real estate. In fact, the real estate in this culture-filled metropolis is among the cheapest in cities of similar size. With so much to offer at such a nice price, you may find yourself agreeing with the city’s citizens that it doesn't get much better than this.
If you’re investing in Houston apartment realty, learn more about market trends and how to lure tenants to your building.
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| Population 1,953,631 | Median Age 30.9 yrs | Household Size: 2.67 |
| Avg Commute: 27.4 min | Avg Income $36,616 | Avg Home Value: $79,300 |
| July High: 93.6°F | January Low: 43.2°F | |
Houston Apartment Realty
Market trends
If the rest of the United States takes a cue from the expensive Puget Sound area — with Seattle ranked No. 1 on Forbes’ 2005 list of the most overpriced areas to live — apartment rentals may be on the rise. Real estate prices throughout the country have burgeoned almost out of control in recent years, which inevitably forces many lower middle class individuals and families to rent rather than buy. According to Dupre & Scott Apartment Advisors, apartment development in the Puget Sound area will rise from just over 2,000 units in 2005 to over 4,500 in 2007. Houston apartment realty may be a smart place to put your money.
Unfortunately for many investors, the rise in the number of units coupled with the rising cost of real estate doesn’t correspond to rising rent rates, so many landlords are losing money. If you plan to invest, you have to watch your money and your property carefully. Try to buy during a buyer’s market, when you will pay as little as possible for the apartment building. You can determine if the market is a buyer’s market because the price discount (the discrepancy between the seller’s asking price and the actual price paid) will be large. In addition, there will be a high percentage of homes waiting to be sold in the U.S. market. If you watch for these cues and buy your property at the right time, your investment can really pay off.
Tempting Tenants
Another downside to the increasing number of rental units is increased competition for apartment investors. In order to lure tenants to your apartment complex, you need to do more than just offer a room. Tenants are looking for lower prices and higher quality — two things that rarely come together. You must be able to offer a high-quality living place with some amenities tenants may not find elsewhere. High-speed Internet is an example of a perk landlords might offer tenants.
Cleanliness and green spaces surrounding apartment buildings are also things tenants will take into account. As an investor, you should be aware of your customer base. Who are your primary renters? If families make up the bulk of your tenants, make the apartment a family-friendly place by installing a safe playground or a sandbox in the courtyard. Make the area seem as safe as possible by fencing in lawns. If, on the other hand, you rent primarily to students, make the apartment building student-friendly by setting up a study room or a game room in a central area. These special features will cost a bit of money initially, but the expense should be worth it when tenants are drawn to your building.
Investing in Houston apartment realty requires dedication and a willingness to stick with your investment through some potentially low times. Judging from Dupre & Scott’s graph of apartment development trends, apartments always seem to be in demand.
By Genevieve Jenkins
A REALTOR® is a real estate professional who is a member of the National Association of REALTORS®