I think that property tax rate means different thing in Texas. Texas tax is a percentage of assessed value and their assessed value can be much lower than purchase price.
So an officially high tax rate could be actually lower than California, where tad rate is a percentage of purchase price.
Need to compare Apple vs Apple. Compare dividend yield with cap rate.
Dividend yield is not that high e.g. PG = 3.17%, JNJ = 2.85%, KO = 3.33%, PCG = 3.30%
For info, also own an index fund tracking S&P. I own stocks, RE (local and overseas), dividend paying stocks and index fund. I’m in the “wealth preservation” mode, no more “wealth growth” mode. Used to invest solely in growth stocks 
, now diversifying to RE, index fund and dividend paying stocks.
Thinking of buying RE there?
Texas taxes shown are net of actual purchase price and can go up with the market. .They have some of the highest property taxes in the country. .
I researched Nevada rentals…The cap rates were lower than Tahoe…Low rent, lots of inventory and no barriers to entry for new construction. .like anywhere USA
Property taxes are lower than Cali and no income tax…If you are a Nevada resident. …
Elt1 said Expense ratio should be about 25% of rent is right. I see similar in bay area and the same expense ratio is calculated by all lenders.
Investing is high with real estate. If I invest the same amount in SPY, with whatever fluctuations we have, I may not have headache, but heart attack ! I am not so much comfortable at stock market yet. Real estate, to me , is stable and less volatile, esp bay area.
Not seriously at this time.
I was evaluation tax benefits when I retire as Reno is near to lake Tahoe, easily reachable. If I move my primary (either to Reno or Seattle) after retirement, 401k withdrawal or stock sales or other capital gains are not taxed, right. In addition, after retirement I want to change my rental from SFH to high cash flow MFs using 1031 exchange. I do not know how much it is workable.
Any way, as of now, my stay is here in bay area.
Can’t be achieved in Austin. Property tax is already 25% of rent. Other expenses is another 25%.
Texan super high property taxes skew the numbers
Yea, my expense ratio to rent is about 38% in Austin. I am about 10% Gross rental yield and about 6% CAP. I leverage with 25% down, so my Cash on Cash is about 10%.
Like I have always said Texas is more expensive than it looks…Stay away…It is also very volatile. …and no barriers to entry…which means high risk and low appreciation long term…
Phoenix and Las Vegas has low expense. But Texas has a much higher IQ. Austin income is closer to silicon valley.
Why can’t Arizona and Las Vegas learn from Texas and attract some high paying jobs?
Phoenix and Las Vegas can be risky too…I invested in Phoenix. .New construction, build and sell…Hopefully it turns out…Buy and hold, not interested. …
@hanera, do you buy oversea properties with all cash (no financing) as well? If you finance, do you finance with the oversea bank or local bank here?
Legacy properties. While I’m in Singapore, I stayed in a private condo and rent out a private condo. Both are financed by Singapore banks. Mortgage rate there is very low, 1.86%. I didn’t sell them when I came over here.
Why is Singapore mortgage rate so low? Is it because Chinese/Indian are really good at paying bills?
I have long suspected that U.S. Mortgage rate is artificially high, it could be 1% lower and the bank still have good margin. Maybe too many borrowers here with poor credit and foreclosures are making our mortgage rate too high
Of course not.
Car loans are super cheap here in the US. Why? Because it’s super easy to take away the cars if people skip a payment. Heck, they even install some electronics to remotely ground your car if you fail to pay. Hong Kong mortgage rates are also super cheap. But you have to remember, 1) they only provide ARM; 2) no one provides 30 years amortization. The max is 20 to 25; and 3) it’s much easier to reprocess the houses.
Don’t know about SG, but HK doesn’t have non-recourse loans. It will follow you unless you declare bankruptcy. They also demand much higher down payment which makes the loans safer so they can charge lower interests.
Given all that I’d rather pay more interests here.
No idea but I can tell you some info:
a. Singaporeans are big savers. In addition, government forced them to save 40% of pay in CPF which can be used to buy RE.
b. Singaporeans don’t borrow money except for houses and cars.
c. Singaporeans don’t like to buy stocks. Many have hundred of thousands dollars in bank as saving deposits.
d. All mortgage are recourse.
e. Mortgage rate floats with libor.
I do not think that kind of low subsided mortgage is applicable to non-Singapore citizens. There are restrictions for outsiders (Foreigners) to buy houses in Singapore and limited to specific locality (which are permitted for foreign buyers). When my relative was removed Perm.residence status, he was forced to sell the home as he can not hold the property after PR status is removed.