Explosive Growth in Texas Investment Buyers

Investors across the globe are purchasing single family rental properties throughout Texas. Texas migration patterns, the strong economy, and lack of financing are driving rents to skyrocket. Rents have increased almost 10% in east Dallas, Uptown and other areas throughout the metroplex. The luxury rental market and the market that previously fell within the range of first time home buyers is now further hollowing out the rental market. The lack of financing available for first time home buyers coupled with distressed sales such as short sales and foreclosures, creates the perfect storm for investor purchases...Another game changer is how residential real estate is now viewed as an asset class by institutional investors and private equity funds. Many funds that have been buying in the sand states, (Florida, Nevada, Arizona and California) are now buying in Texas due to the lack of distressed inventory.
The amount of capital that has been on the sidelines for the last five years in the distressed debt market has created a lot of pent up demand for distressed mortgage debt. A lot of that capital is now being transitioned into the residential single family market. Logan Waller, President of Waller Group Properties and Waller Group Property Management provides services for several hedge funds and many individual investors. “An Australian hedge fund that could purchase anywhere in the world chose to first invest in North Texas. This speaks volumes for our N. Texas Market, we have worked with investors for years since we list properties for most of the major banks and servicers. The difference in the investors over the last year is that they are institutional and high net worth individuals...The investors in years past have been less sophisticated property flippers that were looking for a quick return, usually with unrealistic expectations. They can no longer compete with our institutional investors and high net worth individuals that use our platform of services from acquisition, renovation, accounting, make ready and lease up; providing a true passive investment to the investor. High net worth individuals have the ability to take advantage of the low interest rates through cross collateralizing their assets, allowing them to borrow at almost half the cost of a typical first time home owner.”
 With increasing rents, investors are seeing a 7-14% cash on cash return on their money.  As the stock market becomes more volatile, an income producing investment property that can be purchased for 1/4th of replacement cost is a VERY attractive alternative."


Logan Waller,
Waller Group Properties
214.704.5001
Dallas•Austin•Houston