3 Things to Know About Investing in Houston Texas Single Family Homes

 

By VestPro Residential Services

Are you planning on investing in Houston Texas Single Family Homes? If so, you’ve come to the right place!

Now is a great time to invest in rental properties in the Houston area because mortgage interest rates are still historically low while demand for rentals is high.

If you’re ready to make an investment in single family homes, this article will provide you with tips you can use to do it effectively.

Know your investing criteria first

With any investment, be it stocks, bonds or real estate, you need to know what your objectives are. If you’re focused on safety and security, consider exploring low-risk investment homes that generate steady, reliable yield. An example of this may be a more expensive investment property in a good school district. You’re going to get a lower yield, but you may see better downside protection and less volatility. If you have a longer-term horizon or you’re seeking higher returns, you may want to take on a little more risk. Often, lower-priced homes will be riskier, but you may get higher yields and potentially higher long-term returns.

Don’t limit your investment property search to where you live

Consider this: If you lived in Atlanta, you wouldn’t buy Coca-Cola stock simply because its headquarters are local. The same principle applies to real estate investing. If your primary residence, income property, and job are all located in the same area, you have a lot of concentrated risk and are more vulnerable to the swings of the local economy. At my company Roofstock, an online marketplace for buying and selling leased single-family rental homes, we encourage people to spread risk by investing in markets outside of where they live. (Hiring a local property manager is key here.)

Diversification is just one reason to expand your investment property search. Another is access: If you live in an expensive urban or coastal area with relatively high home prices — the San Francisco Bay Area, for instance — finding an income property that’s cash-flow positive is going to be challenging, to say the least. You won’t be able to find a great income property for $100,000 in Seattle, Denver, or Oakland, Calif., but you can if the focus on the Midwest, South, and Southeast.  

Separate investing from operations

One of the appeals of investing in single-family rental homes is you can hire strong local property management firms to handle day-to-day management tasks of rent collection, repairs and maintenance, and leasing. Over the past several years, property managers have adopted new technologies and business processes to manage homes more effectively for owners.

While some people do choose to self-manage, hiring a property manager can save you a lot of time and potentially money in the long run. While property management companies typically charge between 7% and 8% of the rent, they manage properties for a living and can work to ensure the property is leased, in good condition, and the tenants are happy. Additionally, using a local property manager effectively allows you to buy properties outside of where you live, as self-managing is difficult if the property is not nearby.

Get Property Management Here

For effective property management contact Vestpro Residential Services at (832) 971-1841 or click here to connect with us online.

 

Has Your Rental Property become A 2nd Job? Hire A Property Manager Today

By VestPro Residential Services

Did you recently purchase a rental property but found that it’s turning into a 2nd or 3rd job? If so, instead of continuing to overwork yourself and staying frustrated with your rental property why not hire a property management company instead?

A Property Manager Will Save You Time and Money

Hiring a property management company will save you the time, money and hassle of managing your rental property yourself.

Our team of experts has skills in every major field including maintenance, rent collection, tenant placement and customer service to ensure that you and your tenants always receive the very best service on a monthly basis, for a great price!

When you hire us to be your Property Manager you can count on us to provide you with a full suite of property management services including:

Tenant Screening

Tenant Placement

Rent Collection

Customer Service

Maintenance

And More!

Imagine no longer having to take calls from tenants at night, or on weekends! When you hire us to be your Kingwood Property Manager you can count on us to provide you with reliable service at excellent prices every time!

Get Back to Enjoying the ROI from Your Rental

As a top property manager in the Houston Texas area, our primary goal is to get you back to enjoying the Return on Investment (ROI) from your rental property once again so you can relax and have the time to grow your portfolio of rental properties.

To learn more about the services we can offer you contact us at (831) 498-0016 or click here to connect with us online.

What Is The Snowball Affect? How Can You Use It To Buy More Rentals?

Are you planing on buying your first rental in the Houston Texas area? If so, you’ve come to the right place!

In this article we will explain the importance of the “snowball affect” and how you can use it to grow your portfolio of rental properties

What Is The Snowball Affect?

Metaphorically, a snowball effect[1] is a process that starts from an initial state of small significance and builds upon itself, becoming larger (graver, more serious), and also perhaps potentially dangerous or disastrous (a vicious circle), though it might be beneficial instead (a virtuous circle). This is a cliché in cartoons and modern theatrics and it is also used in psychology. – Wikipedia

Snowball Effect Explained

The “snowball” affect was coined by Berkshire Hathaway CEO Warren Buffett in his 2008 book called The Snowball which is about his life and investments which enabled him to build a network of well over $72 billion dollars.

Snowball basically refers to the principal of buying and holding onto your investment over time and then using your return on investment to invest more money to build your portfolio.

Snowball Effect in Real Estate Investing

Let’s say that you’re able to buy two Houston Texas Rental Properties and after expenses both properties will net you about $500 each per month, or an additional $12,000 of cash flow per year.

Now instead of spending that cash flow from your investments like most people will do you should consider saving the cash flow from your rental properties and within two years you will have enough money saved to put down on another Houston Texas Rental Property.

How the Snowball Effect Benefits You

One of the great things about the snowball effect is that if you follow this approach you would be able to buy a new rental property once a year, instead every two years, grow your portfolio, and have significant amount of cash flow coming in by the time you approach retirement.

Buy Houston Texas Rental Property

For more tips on buying Houston Texas Rental Property, or to speak with us about our property management services, contact Vestpro Residential Services, LLC today by clicking here or calling us at (832) 498-0016.

77338 Property Management

Are you searching for 77338 property management? If that is so, contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

We offer professional property management service for Humble, Kingwood, Dayton, Atascocita and the surrounding area.

If you’re thinking about hiring a property management company in Humble Texas there’s nobody better to manage your rental properties for you than Vestpro, especially for these reasons.

#1 – Professional Property Marketing

Our team of experts will save you the time, money and hassle of marketing your rental property yourself. You can count on our 77338-property management company to market your rental everywhere online so that potential tenants who are interested in moving to the area will become aware of your rental property.

#2 – Tenant Selection & Placement

Once your rental property is listed online we will review applications and choose the most qualified tenant to live in your single-family home, condo, townhome or multi-family rental property.

#3 – Customer Service

Another HUGE benefit that will come from choosing our 77338-property management company is that our customer service will save you the time and hassle of answering the phone yourself and potentially having to deal with tenants at night or on weekends.

#4 – Rent Collection

Imagine never having to hear the excuse “the check is in the mail” from your tenants again. Thanks to our property management company rent collection will become a breeze and you will be able to have confidence that your rent payment will be deposited on time into your account each month without you having to collect the rent yourself.

Get 77338 Property Management Here

For professional 77338 Property Management contact Vestpro Residential Services at (832) 971-1841, connect with us through our website or through social media.

How to Rent Your Property Fast

By Vestpro Residential Services

There’s no doubt that owning rental property is an excellent investment that can help you to build wealth while establishing long-term cash flow.

Sadly, owning rentals in the Houston area or elsewhere in the United States can become a burden when those properties are sitting vacant.

Thankfully, filling those vacancies is easier than you think especially if you follow these simple tips.

1. BE PROACTIVE WITH YOUR CURRENT TENANT

Ask your tenant 90 days ahead of the lease expiration whether they plan to stay another year. Consider offering them a small (or no) rent increase if they respond within 30 days of your notice. This gives you 60 days out from the end of the lease to search for a new tenant if your current tenant decides not to renew.

The benefits of this strategy are:

1) Gives your tenants an incentive to stay longer because of the lower rent increase (eliminating turnover costs altogether).

2) If your tenants decide to move out, you will have more advanced notice and be able to begin advertising your unit sooner. That way, you may even have a new tenant lined up as soon as your current tenant moves out, preventing you from losing rental income.

You’ll also want to routinely perform property inspections and stay on top of maintenance.  This is all part of being a great landlord for your renter, which can pay dividends in the long run.  By staying on top of maintenance and addressing issues quickly, you’ll spend less time on repairs while turning over the unit. This is especially true for cases like leaky faucets, which can escalate into much larger (and more expensive) water damage repairs. The last thing you want when trying to turn over property quickly is a major construction project or having to lower the rent because the property is in a state of disrepair.

2. OPTIMIZE YOUR ADVERTISING STRATEGY

You want to cast a wide net when advertising. This is because the greater the pool of prospective tenants, the better the chances you’ll have of finding a good tenant in a reasonable amount of time. Reach out to friends and family to let them know your property is coming up for rent and ask your existing tenants for recommendations. After all, good tenants are likely to know other good tenants. Publish your listing on multiple websites for maximum exposure.

Attractive advertisements go a long way to increase your chances of attracting a larger pool of renters, and therefore, renting an apartment quickly. When your property is empty, spend the time to take professional photos that can be re-used every time there is tenant turnover. Professional photos are much more appealing for renters and being prepared ahead of time prevents you from having to enter the unit when tenants are living there. After all, the unit might not be in the best condition and the current tenant’s belongings can be distracting.

Know what features tenants want in a property and be sure to advertise those features in your ads. Make sure to point out both the positive and less desirable aspects to the apartment, so you don’t waste your time or that of prospective tenants by showing them a property that isn’t right for their needs because, say, the closets are too small.

Disclose all necessary information about the unit in the advertisement and set expectations upfront about your income and credit requirements. Be sure to include your pet policy, and list other relevant deal breakers if you have them. Make sure details of the property and your rental criteria are clearly outlined in the advertisement. This will prevent you from wasting time on showing the property to applicants who are looking for more bedrooms, storage space, etc., or who don’t fit your rental criteria.

3. UNDERSTAND THE MARKET

The rent prices of comparable properties will give you a good idea of how much you will be able to charge your own tenants. It’s important to set the right rent price, one that is in line with the going rate in the neighborhood. If you’re asking for rent that is too high, you’ll soon find you don’t have many applicants, leading to longer vacancies and more money out the door.

The good news for landlords is that it currently appears to be a landlord’s market.  There is strong demand for rental homes, low vacancy rates, and an ability to increase rent pricesAccording to the U.S. Census Bureau Housing, vacancies are currently at the lowest levels since at least 2005 with a national average of 7.3%. However, you’ll want to familiarize yourself with vacancy rates at the local level, which may not be the same as the national average. For instance, the National Association of Realtors reports that in 2014, San Jose, CA had a low vacancy rate of 4.0%, while Ocean City, NJ had a high vacancy rate of 58.4%.

Get Property Management Here

At Vestpro Residential Services we offer professional property management in Kingwood, Humble, Atascocita and the surrounding area. To learn more about our services please call us at (832) 971-1841 or click here to connect with us online.

Kingwood Property Manager

Thinking about hiring a Kingwood Property Manager but don’t know who to call? If so, contact Vestpro Property Management today by calling us at (832) 971-1841 or click here to connect with us online.

We specialize in full-service property management so if you’ve been frustrated with managing your rental properties yourself, or you’re thinking about investing in another rental but don’t want the extra workload, there’s nobody better to call than Vestpro!

Full-Service Kingwood Texas Property Management

When you hire us to be your Kingwood Property Manager you can count on us to provide you with a full suite of property management services including:

  • Tenant Screening
  • Tenant Placement
  • Rent Collection
  • Customer Service
  • Maintenance
  • And More!

Imagine no longer having to take calls from tenants at night, or on weekends! When you hire us to be your Kingwood Property Manager you can count on us to provide you with reliable service at excellent prices every time!

We Know the Kingwood Area!

Vestpro Residential Service is a local property management company that specializes in offering property management service for the entire Houston Texas metro area including Kingwood, Atascocita, Dayton, and Humble.

Instead of dealing with a faceless corporation, you hire Vestpro to be your Kingwood Property Manager you can rely on real local service from someone who really cares about your rental property.

It Makes Sense to Hire A Property Manager

It doesn’t matter if you’re buying your first rental property, or another rental to add to your portfolio, it makes good business sense to hire a Kingwood Property Manager because we will save you the time and money of managing your rental property yourself.

Hire A Kingwood Property Manager

For a free property, management quote contact us today at (832) 971-1841 or get a quote by clicking here to connect with us through our website.

Dayton Texas Property Management

 

Do you need Dayton Texas Property Management? If this is so, make contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

Our property management business will save you the time, money and hassle of managing your rental on your own, focus on adding more rentals to your portfolio, and building wealth without your rentals becoming a second job like they are too many owners.

Dayton Texas Property Management Made Easy

Imagine never having to take a call from your tenants again or taking time out of your weekend to make repairs to your Dayton Texas Rental Property.

With Vestpro Residential Services managing your rentals for you, you can always rest easy in knowing that our experienced team of property management professionals will cover all phases of property management for you including:

  • Collect the rent
  • Maintain your rental
  • Provide excellent customer service
  • Market your rental online
  • Select great tenants
  • And so much more!

Owning Rentals Should Be Easy….

When you own a rental property in the Houston areas, the income is supposed to be passive.

Sadly, for many people, the income from their rentals isn’t passive at all and takes a lot of their time and energy.

Thankfully, with Vestpro working as your Dayton Texas Property Manager you can have confidence that your rentals will make passive income for you once again while we handle all work associated with your rental on the back end.

Now is a great time to GROW your portfolio of rental properties in the area and you can do this by hiring an Dayton Texas Property Management company to handle all of your property management needs.

Don’t miss out on capitalizing on the demand for rental properties in Dayton TX and across the Houston area! Right now, could be the best time for investing in rental properties that we will see in a generation

Learn more about Vestpro Residential Services by contacting us at (832) 971-1841 or click here to connect with us online.

Dayton Texas Property Management
Property management is only a call away! Contact us today to learn more.

Atascocita Property Management

atascocita property management

Do you need Atascocita Property Management? If so, contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

Our company will save you the time, money and hassle of managing your rental property yourself so you can focus on adding more rental properties to your portfolio and building wealth without your rentals becoming a second job like they are too many owners.

Atascocita Property Management Made Easy

Imagine never having to take a call from your tenants again or taking time out of your weekend to make repairs to your Atascocita Rental Property.

With Vestpro Residential Services managing your rental for you, you can rest easy in knowing that our team of property management professionals will cover every phase of property management including:

  • Rent Collection
  • Maintenance
  • Customer Service
  • Property Marketing
  • Tenant Selection
  • And More!

Rental Properties, The Way They Should Be…

When you own a rental property, the income is supposed to be passive. Unfortunately, for many people, the income from their rentals isn’t passive especially when they manage that rental themselves.

Thankfully, with Vestpro working as your Atascocita Property Manager you can have confidence that your rentals will generate passive income for you once again while we handle all work associated with your rental on the back end.

Now is a great time to EXPAND your portfolio of rental properties in the area and you can do this by hiring an Atascocita Property Management company to handle all of your property management needs.

Don’t miss out on capitalizing on the demand for rental properties in Atascocita and across the Houston area! Right now, could be the best time for investing in rental properties that we will see in a generation

Learn more about Vestpro Residential Services by contacting us at (832) 971-1841 or click here to connect with us online.

Kingwood Texas Property Management

Kingwood Texas Property Management

Are you searching for Kingwood Texas Property Management? If so, contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

Get Kingwood Texas Property Management

We specialize in full-service property management for the entire Kingwood Texas area and can offer you the following services:

  • Property Marketing
  • Tenant Selection
  • Tenant Placement
  • Rent Collection
  • Customer Service
  • Maintenance
  • And more!

If you’re still managing your Kingwood Texas rental property yourself, you owe it to yourself to find out how easy it is to have a professional property management company managing that rental property for you.

Save Time and Money

There’s no doubt that self-managing a rental property takes a lot of time and money. Thankfully, when you choose professional property management with Vestpro Residential Services, you can count on us to handle all aspects of property management for you.

How we save you time – Our experience Kingwood Texas Property Management team will save you time because you will no longer have to take calls from your tenants or make those little time-consuming repairs yourself.

How we save you money – We’re going to save you money each year by doing things like screening/placing qualified tenants, collecting the rent on time and only hiring qualified contractors to make repairs on your rental property.

Learn More About Vestpro Residential Services

To learn more about Vestpro Residential Services, and our Kingwood Texas Property Management services, contact us today by calling (832) 971-1841 or click here to connect with us online.

What tax impact will disasters have for Houston rental property owners?

Once it’s finished, 2017 will be remembered as one of the toughest years in recent memory especially thanks to Hurricane Harvey which formed on August 17th, carving a path of destruction in Houston and along the Gulf Coast until it dissipated on September 3rd.

What Tax Impact Will Natural Disasters Have For Property Owners In Houston?

When a major disaster occurs, the IRS normally tries to help the victims out by extending tax deadlines. After all, no one wants to have to worry about making tax payments or filing returns while their property is underwater or destroyed by a fire. For example, victims of Hurricanes Harvey, Irma, and Maria will not be required to make most types of tax payments and filings until January 31, 2018.

The IRS automatically identifies taxpayers located in a covered disaster area and applies the extended deadlines. Thus, to benefit from the extended deadlines, your rental property simply has to be located in a federally declared major disaster area. There is no need to ask the IRS for a deadline extension. You can determine if an area has been declared a disaster area by checking the FEMA website.

Deducting Losses from a Disaster

Insurance is always the first line of financial defense when disasters occur. However, not all rental properties are fully covered for losses due to natural disasters. Some types of losses may not be covered at all. For example, losses due to floods, hurricanes, and earthquakes may not be covered unless the property owner has obtained a supplemental policy. Even if a loss is covered, the property owner may still have to pay for part of the cost of repairing or replacing the rental property.

Fortunately, any uninsured casualty losses are deductible by rental property owners, subject to certain limitations. A “casualty” is damage, destruction, or loss of property due to an event that is sudden, unexpected, or unusual. Deductible casualty losses can result from many different causes, including (but not limited to):

  • Earthquakes
  • Fires
  • Floods
  • Government-ordered demolition or relocation of a building that is unsafe to use because of a disaster
  • Landslides
  • Sonic booms
  • Storms, including hurricanes and tornadoes
  • Terrorist attacks
  • Vandalism, including vandalism to rental properties by tenants
  • Volcanic eruptions

One thing that all of the events in the above list have in common is that they are sudden—they happen quickly. Suddenness is the hallmark of a casualty loss. Thus, loss of property due to slow, progressive deterioration is not deductible as a casualty loss. For example, the steady weakening or deterioration of a rental building due to normal wind and weather conditions is not a deductible casualty loss.

The Role of Insurance After a Disaster

A rental property owner may take a deduction for casualty losses only to the extent that the loss is not covered by insurance. If the loss is fully covered, there is no deduction. A property owner can’t avoid this rule by not filing an insurance claim. Indeed, a timely insurance claim must be filed, even if it will result in cancellation of the property owner’s policy or an increase in premiums.

The amount of the claimed casualty loss must be reduced by any insurance recovery received, or reasonably expected to be received if it hasn’t yet been paid. If it later turns out that the property owner receives less insurance than expected, the owner can deduct the amount the following year. If the owner receives more insurance payments than expected, the extra amount is included as income for the year in which it is received.

Amount of Casualty Loss Deduction

How much a rental property owner may deduct depends on whether the property was completely or partially destroyed.

If the property is completely destroyed (or stolen), the deduction is calculated as follows:

Adjusted basis – salvage value– insurance proceeds = Deductible loss

Adjusted basis is the property’s original cost, plus the value of any improvements, minus any deductions taken for depreciation or Section 179 expensing. The adjusted basis for rental buildings, land improvements, and landscaping are each determined separately. Adjusted basis should be easily found from a rental property’s depreciation schedules and/or tax returns filed for the property. Salvage value is the value of whatever remains after the property 
is destroyed; in cases of total destruction, this is often nothing.

If the rental property is not completely destroyed, the amount of the casualty loss is the lesser of 1. The property’s adjusted basis or 2. The decrease in the fair market value of the property due to the casualty, minus any salvage value and insurance proceeds.

An appraisal can be used to determine the reduction in fair market value of partly damaged property, as well as salvage value. Alternatively, the cost of cleaning up or making repairs after a casualty can be used as a measure of the decrease in fair market value if all of the following conditions are met:

  • The repairs are actually made
  • The repairs are necessary to bring the property back to the condition it was in before the casualty
  • The amount spent for repairs is not excessive
  • 
The repairs are for the damage only
  • 
The value of the property after the repairs is not greater than its value before the casualty

The amount of a casualty loss to rental property must be calculated separately for each item that is damaged or destroyed. This may include a rental building, landscaping, and other land improvements apart from the building. However, it is not necessary to separately deduct personal items inside a rental property, such as appliances.

Example of Casualty Losses

John’s rental building suffered wind damage due to a hurricane. The hurricane not only damaged the building, but damaged his landscaping—trees and shrubs—as well. John must separately calculate his casualty loss for the building and
 the landscaping. The adjusted basis of the building is $566,000. The trees and shrubs have an adjusted basis of $10,000. John hires an appraiser who determines that the fair market value of the building immediately before the hurricane was $700,000, and was $650,000 immediately afterwards. The fair market value of the trees and shrubs immediately before the casualty was $4000, and afterwards was $500. John’s insurance did not cover hurricane wind damage, so he expects to receive no insurance proceeds.

John calculates his casualty loss for the building as follows:

  • Adjusted basis of rental building before hurricane: $566,000
  • Fair market value before hurricane: $700,000
  • Fair market value after hurricane: 
$650,000
  • Decrease in fair market value: $50,000
  • Amount of loss (line 1 or line 4, whichever is less): $50,000
  • Insurance reimbursement: 
0
  • Deductible casualty loss = $50,000

John separately calculates his loss for the landscaping as follows:

  • Adjusted basis of landscaping before hurricane: $10,000
  • Fair market value before hurricane: $4,000
  • Fair market value after hurricane: 
$500
  • Decrease in fair market value: $3,500
  • Amount of loss (line 1 or line 4, whichever is less): $3,500
  • Insurance reimbursement: 0
  • Deductible casualty loss 
= $3,500

Deducting Losses in Federal Disaster Areas from Prior Year Taxes

Casualty losses are generally deductible in the year in which the casualty occurs. However, if a deductible casualty loss occurs in an area that is declared a federal disaster by the president, the property owner may elect to deduct the loss for the previous year. This will provide a quick tax refund, since the owner will get back part of the tax paid for the prior year. If the owner already filed the tax return for the prior year, an amended return for the year must be filed.

Casualty Gains

It’s quite common for a rental property owner to have a casualty gain rather than a loss. This occurs when the insurance reimbursement an owner receives exceeds the adjusted basis of a property that has been completely destroyed.

Example of Casualty Gains: Part 1

Sheila owns a rental building with a fair market value of $500,000. After years of depreciation deductions, its adjusted basis is $250,000. The building is totally destroyed in a fire. Sheila receives $480,000 in insurance proceeds. She has a $230,000 casualty gain.

A casualty gain is taxable income. However, the property owner need not pay tax on the gain the year it is received if the owner replaces the destroyed property and the cost exceeds the insurance recovery. Instead, the gain is postponed until the replacement property is ultimately sold or otherwise disposed of. The basis of the replacement property is reduced by the amount of this postponed gain.

To qualify as replacement property, the new property must be similar or related in service or use to the property it replaces. However, the rules are more liberal if the destroyed property was located in a federally declared disaster area. In this event, any replacement property acquired for use in any business is treated as replacement property. Moreover, the replacement property doesn’t have to be located in the federally declared disaster area.

To avoid paying tax on a casualty gain, the property must replaced within two years after the close of the first tax year in which insurance proceeds are received. However, if the property is located in a federally declared disaster are, this period is increased to four years.

The property owner doesn’t have to use the insurance proceeds to acquire the replacement property. Rather, the owner has the option of spending the money they receive from the insurance company for other purposes, and borrowing money to buy replacement property.

Example of Casualty Gains: Part 2

Assume that Sheila uses her $480,000 insurance proceeds to construct a new rental building. The new building cost $600,000. Sheila need not pay any tax on her $230,000 casualty gain since she reinvested her entire gain in replacement property. However, the basis of the new building is reduced by $230,000 to $370,000. This way, tax on the gain will have to be paid when Sheila ultimately disposes of the replacement property.

Click here to learn more!

Get Professional Property Management Here

For professional property management contact Vestpro Residential Services by calling us at (832) 971-1841 or click here to connect with us online.