The Lone Star state is booming, and cities like Fort Worth, Garland and Arlington are turning into excellent markets to own rental property. | Getty Royalty Free
For at least the last decade, if not longer, Texas has been on the up-and-up in terms of population and business prosperity. The demand for single family homes has been on the rise in Texas for quite some time, and despite fairly low housing prices statewide, many home seekers are choosing to rent instead of buy. As a result, rental rates are surging. And Texas has a lot of pull factors luring in American looking to relocate, perhaps the main benefit being no income tax.
Here’s a look at the best places in Texas to own rental property as an investment.
Fort Worth is one of Texas’s principal twin cities, alongside Dallas, separated by just a few miles of the Trinity River’s course. Fort Worth has many features making it conducive to owning rental property. The population in Fort Worth has grown about 6% from 2010 to 2018, and 48% since the year 2000, when its population stood at just 534,694 compared to 792,700 as of 2018. Plus, the median home price is about $255,000, which is comfortably less than the U.S. average, according to Zillow data.
Another huge benefit for potential Fort Worth rental property owners: It is home to several colleges in the area. College students are lucrative segment for rental property owners especially because their parents — and their much more substantial wealth — pay for their children’s rent. Because of this, property owners can charge higher rents because of the near-insatiable demand for student housing. For example, zip code 76109 in Fort Worth, which surrounded Texas Christian University, has a median rent of $2,874, according to Zillow.
Here’s a breakdown of some important figures if you’re considering buying rental property: Median list price – All Homes: $255,000 Median rent: $1,442 1-year increase in home values: 10% 1-year job growth rate: 3.2%
To get the most comprehensive view of the Fort Worth real estate market, check out this interactive map of the area featuring home prices and rental prices.
Garland, Texas has several critical factors covered that make a great rental property market: Robust job and population growth as well as great affordability for prospective investment property owners. The population in Garland has grown nearly 5% since 2018 and 10% since the turn of the millennium. Plus, the median home price is $219,999, which is over $50,000 cheaper than the national average, $275,000, and great for potential property owners.
Here’s a breakdown of some important investment property figures:
Median list price – All Homes: $219,999 Median rent: $1,500 1-year increase in home values: 11% 1-year job growth rate: 1.6%
A key factor to keep in mind is that Garland’s median income is less than the U.S. average, according to Census Bureau data. Additionally, in terms of wage distribution, 16% of incomes are between $20,000 and $30,000 — the highest percentage of all income brackets — which could make homeownership much less of an option, while renting becomes even more so. For an even closer look at the Garland rental property market, check out this interactive map of prices in the Garland area.
Arlington is also located in the Dallas-Fort Worth metro area. As such, Arlington has been benefiting from the general population and economic surge that the metro area and Texas overall have been experiencing.
Like Fort Worth, Arlington has its share of colleges to lure renters with money. Perhaps most notable is the University of Texas at Arlington, which also boasts a state-of-the-art planetarium. Other geographic bonuses include AT&T Stadium, where the Dallas Cowboys play their home games, as well as Lake Arlington.
Arlington’s population has grown impressively over the years. From a population of 332,969 in 2010, Arlington’s current population in 2018 exceeds 390,000 — a growth rate of 18% over eight years.
Here’s a breakdown of some important figures to consider before you buy property in Arlington:
Median list price – All Homes: $240,000 Median rent: $1,521 1-year increase in home values: 9% 1-year job growth rate: 3.2%
You’ll find that there is plenty of profit to be made owning rental property in Arlington, especially if you take a closer look at the rental market, so check out this interactive map that features current home prices as well as current rental rates.