Sadly, capital is not unlimited no matter if you are a real estate investor looking to flip your first house, a developer building apartment complexes, or a private money lender supporting 100s of investors' real estate business. So, how do we here at Bench Equity decide where to invest our money? First, we look for markets that are rapidly growing that also have a large supply of homes in need of renovation. Then, we look for markets that have proven they can stand tall through economic setbacks. This intuitively leads us to investors hungry to capitalize on the wealth of opportunities present when demand for homes stays higher than builders can keep up with. Texas offers all this and more, which is why we think you should invest there even if you’re not a local!

The energy, construction, and technology industries have played a huge role in attracting Americans from all over the country to move to Texas. Strong growth in these sectors over the last century has made Texas the 2nd largest economy in the United States with a $1.77 Trillion GDP. During the 2009 recession, Texas proved to be one of the most economically resilient states and still managed to see compounding annual growth in excess of 7% between 2009 and 2014. The presence of large tech, energy, construction, IT, and transportation companies headquartered in Texas brings thousands of new employees to Texas every year, and each new family is going to need a few thousand square feet to call home. 

Even with the major changes that have taken place this year from rising interest rates and high inflation, the Texas real estate market has stayed strong. The economic resilience of the 4 major metro areas (DFW, Austin, Houston, and San Antonio) is truly impressive. Here are some interesting stats that motivated us to commit our capital to Texas.

1. Texas has 4 of the top 12 markets with the highest house building prospects
2. Texas home values have risen 99.56% with few signs of slowing down, meaning long-term investments are likely to have huge appreciations in value.
3. 2.2 Months of Single family inventory (6 months considered a balance market, and flippers can see huge returns in a Seller’s market)
4. Average of $43,210 in profit per flip with cheaper housing prices making it easier to do a higher volume of deals.
5. 15.9% annual population growth rate in 2021

With steady population growth and a strong job market, Texas has everything an investor needs to succeed. Combine that with a strong construction and wholesaling industry and you end up with an ocean of good deals and the contractors you need to get the work done! We love investing our capital in Texas and hope that you take advantage of the funding we’ve made available to that market the next time you do a deal there!

When you’re ready to buy your next Texas investment property, complete our 5 minute online application at https://benchequity.com/apply and get approved in under 24 hours! 

References: 

1. “9 Industries Driving GDP Growth in the Texas Economy,” Investopedia, 2021, https://www.investopedia.com/articles/investing/011316/texas-economy-9-industries-driving-gdp-growth.asp
2. “Texas Housing Market Predictions 2022 and 2023,” Norada Real Estate Investments, 2022, https://www.noradarealestate.com/blog/texas-housing-market/
3. “Texas Housing Insight”, Texas A&M University Texas Real Estate Research Center, 2022, https://www.recenter.tamu.edu/articles/technical-report/Texas-Housing-Insight
4. “How to Flip Houses in Texas”, New Silver, 2022, https://newsilver.com/the-lender/flipping-houses-in-texas/
5. “Updates on Texas Demographic Trends and the On-going research at TDC” Texas Demographic Center, 2021, chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://demographics.texas.gov/Resources/Presentations/OSD/2022/2022_03_07_CommissiononCommunityCollegeFinanceWorkingGroup.pdf