McKinney, TX

I was out finalizing a lease for one of my clients yesterday. The listing agent was not available so I met with the owner of the property. My clients got stuck in traffic so we had some time to chat. The conversation turned to investment homes.

Many investors confuse rental rates with cash flow assuming that getting the maximum amount of rent equals maximum cash flow. I'll argue the opposite is usually true.

There are at least two hidden costs that need to be factored into the cash flow equation. The first is vacancy rate and the second is the cost to lease. Both subtract from long-term cash flow.

Any time a property is vacant it's not producing revenue. Limiting vacancies should be a factor in rental pricing. Let's assume I have a property rented for $1500 a month on a single year lease. If the tenant vacates the property after the lease ends, I incur the loss of revenue while the property is vacant and I have the cost to lease it. The other "cost" is realizing that most damage to a home happens during turnover. If I can get a good tenant to renew, I avoid all three losses.

While you may need to raise the rent on a renewal to cover increased expenses, this increase may cause our tenant not to renew. If I raise the rent on my $1500 property to $1600, I hope to generate another $1200 a year in cash flow. If the tenant moves out and the property takes 30 days to lease, I've lost $1500 plus I have the cost of leasing the property. The best time to consider raising rental rates is in between tenants.

The other place to consider this concept is when a tenant is asking for a reduced rental rate on a multi-year lease. On my $1500 rental, I will often reduce the rent to $1450 for a two-year lease. Why? Long-term cash flow. I know I will not have any downtime after a year and I will not have the cost to lease it again. The $50 a month reduction is $1200 over the two-year lease. If I have 30 days of vacancy and I have to lease it, my loss of revenue and expense to lease it can reach $2400 in my market. Additionally, I have to pay for utilities and lawn maintenance while I'm leasing it.

Maximum rent does not alway equal maximum cash flow.

Want to work with an experienced team of agents on your next investment property? Contact us at 214-227-6626.

Photo licensed from iStockPhoto

Originally posted at http://www.thebranchteam.com/wordpress/2012/03/12/does-maximum-rent-equal-maximum-cash-flow/

Spring Break in McKinney, TX

It's officially Spring Break in Texas! Now that McKinney ISD has released the children to their parents for one whole week...you may be wondering what to do with them!!

Have no fear....here are my Top 7 things to do in and around McKinney for the week of March 12-18!

1. Enjoy Towne Lake Park - rumor has it that there are still quite a few fish left over from February's Trout Derby - see if you can snag one! If not, enjoy paddle boats, volleyball courts, playground, 1.2 mile jogging path or horseshoes.

2. See a movie at iPic Theaters in Fairview - this isn't your normal stadium seating popcorn and candy slinging theater. At iPic you can reserve recliners complete with chairs, your own waiter and a selection of gourmet food, beer and wine. And of course you can still enjoy some popcorn and sweets!

3. Go Golfing! Are you kidding? There are literally 5,000 golf courses in McKinney. OK, that's a slight exaggeration...but even if there's more people playing this week, it won't matter...there's plenty of green space to go around. OR - just stick to Top Golf in Allen! Either way, you can get your golfing fix without having to travel too far.

4. Hit up Main Street McKinney! Go shopping at a boutique you've been promising yourself and your teenage daughters you'd check out, binge on some old fashioned candy or popcorn at Mom & Pops, or unwind after the kids have been put to bed at Landon's winery or Grotto.

5. Bike, run, skateboard, Segway or just WALK around the many jogging and hike/bike trails around Stonebridge Ranch and Adriatica. The Crepe Myrtles are beginning to bloom and it's just BEAUTIFUL outside! Perfect time to renew that New Years resolution you made to "exercise more"...and now you can do it with the kids by your side!

6. Want to swim, but don't enjoy freezing pool temps? Head over to the Allen Natatorium! It's closer than Hurricane Harbor, 10% of the price, INDOORS and still offers up water slides, a lazy river and jungle gym thing for kids to go nuts on!

7....and on the 7th day....REST!!! Do absolutely NOTHING. Staying in PJ's just might be in order!

So there you have it....have fun and RELAX this week! Re-connect with your kids and then share with me YOUR favorite things to do!

For the last few weeks my Facebook feed has been blowing up with posts like this around the 7 or 8 PM timeframe:

Yep...McKinney, Texas is LOVING that Hollie Cavanagh finally made it through to the Top 13 in this season of American Idol after she came so close last year.

My 4th grader is jazzed because Hollie attended the same elementary school as he goes to - Glen Oaks Elementary. According to him, she has been mentioned in their morning announcements at school the last two weeks and "Hollie Cavanagh" are the words on everyone's lips.

I must say it's pretty cool...especially since I believe she's one of the top 3 most talented singers this year. Seriously. You always know the first 5 or 6 who are gonna go - you know the ones are consistently in the bottom, or get saved on a "wild card" or something like that. But Hollie's the real deal, dog (<---that's my best Randy Jackson impersonation)! Last week she did an incredible job of a Christina Aguilera song from a Disney movie, and this week she was totally believable singing Whitney Houston.

Time will only tell if McKinney, TX will get to appear on the "Hometown Visits" episode as the final show draws near...but if I had to be a betting woman (and I have recently!)...I'd say our chances are GREAT!

McKinney Texas Real Estate Sales were up 16% in January 2012 over the same month last year with 113 homes selling this month! For the year to date, overall home sales were at 113 homes sold, a 16% from last year. Mckinney Texas real estate total dollar volume of homes sold this month was $24,819,312 which is a 26% change from this month last year. For the year to date, the total dollar sales were at $24,819,312, a 26% change.

Register online to have monthly updates on your city and neighborhood automatically emailed to you from Mckinney Real Estate. Search Mckinney Texas homes, Mckinney Texas foreclosures, and Mckinney Texas short sales and find Homes in Mckinney. Research current Mckinney home values at DFW Home Values Report.com. This service is FREE and available without any obligation from DFWTeamRealty.com.

New Mckinney Texas real estate listings experienced a -10% change for the same period last year with 219 homes listed this month. For the year to date, overall home listings underwent a -10% change with 219 homes listed this year. Listings pending sales this month underwent a 23% change, with 150 homes contracted. Listings under contract for the year to date experienced a 23% change, with 150 homes under contract for this month.

The average sales price of a home in Mckinney was $215,405, a 4% change from this month last year. Overall, for 2012, the average sales price was $215,405 a 4% change. Sellers received 94% of their asking price this month, which is a 3% change from last year. For year to date, sellers received 94% of their asking price, which is a 3% change. This month, homes spent an average of 93 days on the market until sold, which was a -20% change from last year. For the year to date, the average number of days on the market was 93, an overall change of -20%.

The current supply of active listings on the market this month was 513 homes. This is a change of -37% from the same month last year. For the year to date, the supply of active listings on the market was 513, a -37% change. This month there was a 3.1 month supply of homes on the market; this was a -42% change from last year. For the year to date, there was a 3.1 month supply of homes on the market, which is a -42% change from the same period last year. The average price per square foot was $82 this month; a 0% change from last year. For the year to date, the average price per square foot was $82, a change of 0%. Mckinney real estate is known as area 53 in the North Texas Real Estate Information System. Information is believed reliable but is only as accurate as reported by the system in the month of January 2012.

The DFW Metroplex is also known as Dallas Fort Worth Arlington Metropolitan Statistical Area, a title designated by the U.S. Census which encompasses 12 counties within the U.S. state of Texas. The area is divided into two metropolitan divisions: Dallas Plano Irving and Fort Worth Arlington and is comprised of over 70 area cities both incorporated and unincorporated.

The DFW Metroplex is, by population, the largest metropolitan area in Texas, the largest in the South, the fourth-largest in the United States, and the tenth-largest in the Americas. The DFW Metroplex encompasses over 9,000 square miles of total area, making it larger in area than the U.S. states of Rhode Island and Connecticut combined. It is also the sixth largest gross metropolitan product (GMP) in the United States, and is approximately tenth largest by GMP in the world.