This month, GREA's Mark Allen discusses the challenges faced by multifamily property owners in Texas due to the increase in non-controllable expenses, particularly property taxes. While rent growth has slowed down, expenses such as marketing, repairs, and maintenance continue to rise, resulting in a situation where costs are outpacing income growth. Property taxes, in particular, have seen double-digit increases in recent years, making it a significant burden for multifamily investors.
Allen states that some counties have proposed assessed values for multifamily properties that are higher than their current market worth. This exacerbates the issue of rising property taxes and discourages further investment in the Texas real estate market. There is a proposed bill currently under consideration in the Texas Senate, House Bill 2, which aims to provide tax relief for property owners while allocating funds for Texas schools.
However, Allen emphasizes the importance of multifamily owners protesting their assessed valuations, seeking the assistance of tax consultants, participating in local budgeting processes, and contacting state legislators and officials to address the issue of property tax increases. He calls for collaboration between multifamily owners, the Texas Apartment Association (TAA), and state and local leaders to find solutions that support a fair and equitable tax system, promote economic growth, and ensure stability for all stakeholders.
Despite these challenging market conditions, our conservative underwriting process remains intact. By diligently analyzing and assessing potential investments, we ensure that we stay profitable and minimize the impact of factors such as rising property taxes. Our commitment to thorough underwriting helps us navigate market fluctuations and maintain a strong investment portfolio. Rest assured that we are dedicated to success and actively working to address the challenges posed by the current real estate landscape.
Read the full article on the D Magazine website.
WE ARE UNDER CONTRACT!
Our biggest highlight of the month is that we are under contract on Luna Vista! We are so excited to get things moving with the new property and went through due diligence just this past week. If you're interested in investing with us, register to our upcoming webinar on Thursday, June 8th, 7pm CST.
In addition, we hosted the second Market Pulse Live Masterclass, which was a massive success! We never want to stop educating our investors and community, and these events are a powerful platform to do just that. In addition, we love meeting up and networking with other like-minded individuals.
Our round table of experts joined us for a super educational conversation that gave all of us a deeper understanding of what goes on behind the scenes during the investment process. This event was available both in-person and online, and we had an amazing turnout. A heartfelt thank you goes out to our presenters and all the attendees who joined us and posed thought-provoking questions.
Buckle up for more Multifamily Empire events in the pipeline - there are none quite like them!
We are under contract! When opportunity comes knocking, you answer the door! Ask any good real estate investor, and they will tell you that you can't wait for the perfect market conditions to find new investment opportunities. Even though the market isn't as hot as it has been in recent years, we found a good prospect, and we jumped on it. As we discussed above, using extremely conservative and promising underwriting is more critical now than ever. With that in mind, we are under contract on a 232-door property that we are so excited about! And we're hitting the ground running! Our investor relations team is eager to hear from you and share more about the property. As always, we have skin in the game, too, and are investing more than just the hard money. Our process has proven to work - we take care of the community, the community takes care of the property, and the property takes care of the investors! Register to our webinar to learn all the details about the opportunity. Thursday, June 8th, 7pm CST. See you there! - Neander and Delia Lima
Working with Neander, Delia and the Multifamily Empire team, at its core, is a work-hard/play-hard relationship. The same day we closed our first deal together, they hosted a Brazilian style BBQ for their team and tenants at the property. You don't find that type of grassroots character every day! They are extremely knowledgeable and detailed operators and are always diligent throughout the acquisition and escrow process, ensuring they cover the financial and physical aspects from every angle. We have always found Multifamily Empire to be honest and communicative making them a good fit as a partner for any business transaction. One of the benefits of real estate is to choose who you want to work with, and we would always choose to work with the Multifamily Empire team.
Develop a Strong Brand Identity
It's crucial to build a strong brand identity for your properties. Create a compelling value proposition and unique selling points that differentiate your properties from competitors. Effective marketing strategies help reach potential tenants and communicate the benefits of living in your multifamily properties.
Establish a Comprehensive Financial Plan
Successful multifamily real estate investors prioritize financial management. Develop a detailed financial plan that includes all aspects of property investment, such as acquisition costs, ongoing expenses, and revenue projections. It's essential to have a thorough understanding of your financing options and regularly review your financial plan to adapt to market conditions and optimize profitability.
Maintain Accurate and Organized Financial Records
Accurate accounting practices are crucial in multifamily real estate investing. Implement a reliable system to track income and expenses for each property, whether it's a basic spreadsheet or specialized accounting software.
