Texas vs. Florida
for Multifamily Investing

Investors from all over the country are investing big on apartment buildings in the South and Southwest, chasing population growth and surging rents that they predict will continue to outpace inflation this year. Landlords claim they’re tracking the movement patterns of workers and their employers who fled the outbreak to Florida, Texas, and other southern states. Warm weather, business-friendly governments and laws, lower taxes, and fewer regulations have enticed businesses and people from California, the Northeast, and other parts of the country to relocate to these states.

It’s difficult to choose between Texas and Florida as a place to put your money, especially since both are excellent real estate alternatives. MSC, for example, has a number of investments in Florida and Texas. Let’s look at the advantages and disadvantages of each to assist you in making the best option. There are several things to consider when deciding where to invest, such as stability and development potential. When it comes to Texas vs. Florida, both states have a wealth of investment opportunities. However, depending on your goals and interests, certain important distinctions may make one state more enticing.

One of the most subjective words in the English language is “best. “Best movie, best song, greatest actor, best car, best ice cream… best whatever you want to call it. The truth is that everyone has their own interpretation of what “best” implies. Unless you’re talking about the top states in the United States to invest in real estate in 2022.

What distinguishes a state as one of the best?

Although not every investor would agree on the best state to invest in, there are a few significant factors that rental property investors use to determine which states are the greatest:

  • Property prices are rising, and market values have historically increased.
  • Affordably priced rental property can help you maintain your cash flow high and your equity expanding, resulting in higher long-term earnings.
  • Housing demand is continuous and predictable as a result of population expansion.
  • Residents and businesses have an incentive to prefer one state over another because of job growth and job gains.
  • High rental occupancy rates indicate how much of a market’s housing supply is unoccupied.
  • Due to considerations such as housing affordability and lifestyle choices to rent rather than own, as well as potential for future expansion, a growing share of renter-occupied households indicates how appealing a housing market is for renters.
  • Low property taxes help to keep the cost of living low and investment property net cash flow high.

Florida

  • $328,576 is the median home value.
  • Year-over-year rise in median home value: 23.9 percent
  • Housing that is occupied: 82 percent
  • $2,271 per month is the average rent.
  • The average rent has increased by 37.56 percent in the last year.
  • 36 percent of homes is occupied by renters.
  • 0.84 percent increase in population
  • 2.57 percent increase in employment
  • Average property tax range (biggest percentage of households): $3,000
  • The weather is just gorgeous. The weather is one of the most significant benefits of investing in Florida real estate. For renters, this is a significant selling factor. With so much water and so many beaches, the state essentially sells itself to rentals.
  • Economic development. Florida is a great place to invest in long-term growth. You won’t have to worry about vacancies because it’s a well-known tourist destination.
  • There is no income tax. Florida, like Texas, does not have an income tax, which is a huge plus for investors.
  • Appreciation. Because so many people are relocating to Florida, housing is in high demand. This can contribute to a rise in the value of your home over time.
  • There is a lot of inventory. Property is constantly available in Florida. This state has a wide range of rental options for all types of renters. Before demand rises, now is the perfect time to buy a Florida property.
Texas
  • $267,523 is the median home value.
  • Year-over-year rise in median home value: 20.5 percent
  • Housing that is occupied: 88 percent
  • The average monthly rent is $1,448.
  • Year-over-year rise in average rent: 10.94%
  • Housing occupied by renters’ accounts for 38% of all housing.
  • 1.02 percent increase in population
  • 2.97 percent increase in employment
  • The average property tax range (for the biggest share of families) is: + $3,000
  • Everything in Texas is bigger, even real estate. It is home to one of the country’s main commercial markets.
  • There is no state income tax. The lack of a state income tax is one of the key reasons why so many people and businesses relocate to Texas. This can be a huge benefit for investors, as it can help them get the most out of their money.
  • Population growth that is steady. From other states, a large number of people are migrating to Texas. As the demand for rental homes rises, this provides real estate investors with additional opportunity to profit.
  • The economy is doing well. Because of the state’s various businesses and cheap taxes, Texas’ economy is booming. This provides a lot of security and investment possibilities.
  • Landlords are adored in Texas. The state prioritizes real estate owner protection; thus, their property laws are on your side.

What’s the next step towards locating your ideal state?

Once you’ve chosen the finest states to invest in, the next step is to begin studying and investigating rental property on a local level. That’s because while a single state may be favorable for investors on a macro level, cities and towns inside each state may overperform (or underperform) the state averages. For example, many individuals today are moving to the suburbs and smaller secondary cities within the same state to escape from the high expense of living in bigger urban centers.

The fact is that practically every state has places where real estate is good and some places where it is not. But by choosing the finest states to invest in real estate in, then narrowing down your decision by city, you may tremendously enhance your success as a real estate investor.

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MarketSpace Capital, LLC is a Houston, Texas-based private equity real estate development firm focused on ground up developments and value-add investments throughout the United States.

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Disclaimer: *For sold properties, actual sales price is reported. For active investments, the Estimated Current Value is based on the Managing Member’s estimate of current value. Recent acquisitions are generally valued at the acquisition price. Values may be internally prepared. This web-page/website is for informational purposes only and is qualified in its entirety by reference to the Confidential Private Placement Memorandum (as modified or supplemented from time to time, the “Memorandum”) of any offering of MarketSpace Capital.