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Why Houston Continues to Be a Top Market for Rental Property Investment

Investing Where People Want to Live: What High-Growth Markets Mean for Property Owners

Real estate investing isn’t just about buying properties—it’s about investing in markets with strong long-term potential. The best-performing rental markets tend to share common characteristics: population growth, job creation, economic diversity, and a high quality of life. These are the factors that create consistent rental demand and long-term appreciation.

During a recent episode of Real Estate Rewind, Auburn Realty and Auburn Capital Partners explored two thriving markets—Chattanooga, Tennessee and Houston, Texas—to discuss what makes a market attractive for both residents and real estate investors. While the cities are very different in size, they demonstrate many of the same qualities investors should be looking for when building a rental portfolio.

What Makes a Strong Rental Market?

Successful real estate investing starts long before purchasing a property. Choosing the right market often has a greater impact on long-term returns than choosing the right individual property.

Markets with long-term investment potential typically offer:

• Consistent population growth
• Diverse employment opportunities
• Business-friendly environments
• Strong quality of life
• Ongoing residential development
• Healthy demand for rental housing

When these factors align, they create sustainable demand from both renters and future homebuyers, helping support occupancy rates and property values over time.

Why Population Growth Matters

One of the biggest drivers of rental demand is population growth. Cities experiencing inbound migration naturally require additional housing, creating opportunities for investors and property owners.

Both Chattanooga and Houston have experienced significant growth fueled by:

• Expanding job markets
• Attractive lifestyles
• No state income tax
• Business relocation
• Strong local economies

As more people relocate for work or lifestyle reasons, the demand for professionally managed rental housing continues to increase.

Housing Preferences Are Changing

Today’s renters have different expectations than they did even five years ago.

Many people relocating to a new city prefer to rent before buying. Renting allows them to explore neighborhoods, shorten commutes, and determine where they want to settle without the immediate responsibilities of homeownership.

At the same time, Build-to-Rent communities have become increasingly popular. These communities offer many of the advantages of single-family living while providing professional maintenance and property management, making them attractive to both residents and investors.

Why Professional Property Management Matters

As rental housing evolves, so do resident expectations.

Professional property management helps owners maximize the value of their investment by providing:

• Faster leasing
• Resident retention strategies
• Preventative maintenance
• Consistent communication
• Financial reporting
• Efficient day-to-day operations

For investors, quality management often translates into fewer vacancies, better resident experiences, and stronger long-term returns.

Investing Is No Longer One-Size-Fits-All

Today’s investors have more options than ever before.

Some prioritize immediate cash flow through older value-add properties, while others focus on long-term appreciation with newer construction that typically requires less maintenance.

There is no universal strategy—the best investment depends on an owner’s goals, timeline, and risk tolerance. Experienced property management professionals can help investors evaluate opportunities that align with those objectives while minimizing operational challenges.

Strong Communities Create Strong Investments

Beyond economic data, successful markets are places where people genuinely want to live.

Chattanooga continues to attract residents with outdoor recreation, walkable neighborhoods, and ongoing redevelopment projects. Houston offers world-class healthcare, diverse employment opportunities, outstanding dining, arts, entertainment, and access to coastal recreation. These quality-of-life factors help support long-term housing demand across multiple demographics.

The Value of Local Market Expertise

Every real estate market is unique.

Neighborhood trends, development activity, rental demand, pricing, and investment opportunities can vary dramatically—even within the same city.

Working with a local property management team gives owners access to market-specific knowledge that helps guide leasing strategies, maintenance planning, resident retention, and investment decisions.

Whether you’re purchasing your first rental property or expanding an established portfolio, partnering with experienced local professionals can help you make informed decisions and maximize your investment’s long-term performance.

Looking for Property Management in Your Market?

Strong real estate investments are built on more than great properties—they’re supported by knowledgeable local teams that understand their market.

Whether you’re investing in an established metro area or an emerging growth market, professional property management can help protect your investment, improve resident satisfaction, and position your portfolio for long-term success.

Whether you’re considering an investment in the fast-growing Houston market or the vibrant, expanding Chattanooga area, having a local property management team makes all the difference. From understanding neighborhood trends and rental demand to maximizing occupancy and protecting your investment, our experienced professionals provide market-specific expertise to help you succeed. Learn more about our Houston Property Management services and Chattanooga Property Management services to see how we can help you achieve your investment goals.

Full Transcript

Speaker 1 (00:05):

Welcome to Real Estate Rewind. I’m your host, Tyson Schutze. I am the founder of Auburn Realty and Auburn Capital Partners, and I am excited today to have several special guests with us representing a large geographic area of Auburn team members. And I will introduce them in a minute, but just a reminder for folks about Real Estate Rewind, we are on Spotify, Apple Music, [00:00:30] and YouTube. You can like and subscribe us by looking up Real Estate Rewind with Tyson Schutzi. So in joining me today in studio, I’ve got Aaron Isley who was sitting in my chair, the host chair for some earlier episodes, but is now here to make sure that we stay on track. So welcome, Aaron.

Speaker 2 (00:50):

Thanks, Tyson. I’m happy to be here.

Speaker 1 (00:53):

For those that may have missed some of the earlier episodes, Aaron assists Auburn has been a key team member in helping us build [00:01:00] out the marketing, branding and direction of Auburn for the past several years and also is very active in a number of small businesses in Aiken and thriving in that downtown community there. So thank you for joining us, Aaron. We also have one of our longest tenured team members, Jason Weathers from Chattanooga, who’s our market director. Welcome, Jason.

Speaker 3 (01:27):

Hey. Hey everybody. Good to be with you today.

Speaker 1 (01:30):

[00:01:30] And you joined us in 2019, correct? And it’s going to be seven years this month, right?

Speaker 3 (01:36):

That’s it. Seven years.

Speaker 1 (01:37):

That’s it. And in a previous episode with you, we had a special guest of your dog, Tucker. Is Tucker going to be joining this episode or has he moved on to other things?

Speaker 3 (01:48):

Tucker’s moved on to a nap currently, hopefully. But it just depends. He may make himself known any minute now.

Speaker 1 (01:56):

Okay. Well, he’s got to get that rest in. So we’ll [00:02:00] see if Tucker reappears here. And then we’ve got Kristen Brady, one of our newest team members based out of Houston, and you’re joining today. Welcome, Kristen.

Speaker 4 (02:10):

Thank you. Thank you for having me.

Speaker 1 (02:12):

Yeah. And Kristen is on the sales side, long time Houston native. And then what we wanted to do today is really get together two of our different team members and markets and talk about both why they love where they live and then [00:02:30] what it means or what people should consider when they’re looking at either relocating, living, or one of the main thing that Auburn assists people with investing in these markets. As a reminder for our audience, Auburn is in 10 different markets currently. And the way we think about what markets that we go into is we’re looking for dynamic growth markets that are favorable for investors and feel like they have a high quality of living to be friendly for [00:03:00] businesses, attractive for residents. And really at the end of the day, from Auburn’s perspective, we wouldn’t go into any market that we wouldn’t also considering owning property.

(03:11):

It’s cool for me to also really get to learn, and for our clients, to get to learn about these markets from locals. And I know Jason, you and Kristen have slightly different journeys. Jason, you grew up in Chattanooga where you’re based, moved away to Charlotte for about 12 [00:03:30] years and moved back, what, seven years ago right when you joined Auburn, correct?

Speaker 3 (03:35):

That’s correct. Yep.

Speaker 1 (03:36):

Yeah. So you’ve been able to see how dynamic your market has changed both from the perspective of somebody that lived there and then somebody that left and came back. So we’re looking forward to hearing that. And Kristen, you’ve basically lived your entire life in Houston, except for a small portion of time abroad. You were born and raised in Houston and [00:04:00] live there currently, correct?

Speaker 4 (04:02):

Yes. Yes, I do.

Speaker 1 (04:04):

Okay, cool. Well, so Jason and Kristen, if I’m considering looking at moving to Chattanooga or Houston, what would be one of the main compelling reasons as to why Chattanooga Houston would be a great place to live?

Speaker 3 (04:22):

One thing for Chattanooga is just how vibrant the city is and has been over the course of the last few years and the growth and [00:04:30] things of that nature. The outdoor activities are just so appealing to those that continue to live here and relocate to Chattanooga. One of the main factors is the quality of life or the outdoor activity and for the cost of living, just being so close to the river and the mountains. And to be centrally located right in the middle between other major cities gives folks an opportunity to still have [00:05:00] some travel destinations that are nearby. But just as continuous, Chattanooga has continued to grow, plenty of nonstop flights out of Chattanooga to get you to many destinations and just many attractive factors there for the quality of life and as the city continues to grow.

Speaker 1 (05:19):

And for those who don’t know, Chattanooga is two hours north of Atlanta and two hours south of Nashville. One similar characteristic that both Chattanooga [00:05:30] and the state of Tennessee has and Houston and the state of Texas is we’re seeing Auburn continues to see huge population inbound migration and people moving to no income tax states. So both of your states have no income tax, which I think has been a big driver of growth. Kristen, if I’m considering Houston, why should I consider Houston? As somebody that was born and raised there, but also lived there their whole life. What do you love about Houston?

Speaker 4 (05:58):

Yeah. I mean, Houston [00:06:00] is very diverse. Obviously being one of the fourth largest city in the United States, I’ve not only just seen the growth personally, but there’s continued growth. We have a strong job market in Houston, very diverse economy. Another thing that stands out to me about Houston is just the access to. The beach is very close. You’ve got some [00:06:30] major airports for travel. There’s a huge growth downtown and Midtown Houston as far as fine arts and cuisine and different festivals and activities for people to partake in. So there’s always something going on in Houston and the growth is just, it just continues. I mean, even now, I’ve even noticed a huge explosion in Houston. So there’s definitely a growth of people coming into Houston as well. Yeah.

Speaker 1 (06:59):

And [00:07:00] I think it’s hard to remember sometimes that Houston’s the fourth largest city in the country. I mean, there’s New York and LA and some of the larger cities get the headlines, but Houston is huge. And I think you mentioned something that I think is, although Houston and Chattanooga are very different markets and very different cities, the diversity, right? Houston used to be primarily known as a sort of city energy market where the local economy was very dependent on that. And I think that’s a big part of it, but there’s been many other businesses, [00:07:30] industries that have relocated and really grown and thrived in the market, correct, Kristen?

Speaker 4 (07:35):

Yes. No, there’s definitely been lots of large corporations that have moved in. So we’ve just continually seen the expansion in the job market and people coming into Houston as well. And

Speaker 1 (07:50):

There’s a really large growing and thriving medical community in Houston as well, correct?

Speaker 4 (07:55):

Yeah. So the Texas Medical Center is an amazing [00:08:00] asset and facility here in Houston. A lot of people fly into Houston just to get some of those medical procedures and care. So the fact that it’s right here is another great attribute to the city.

Speaker 2 (08:17):

I will say too, jumping in here, I’ve never been to Houston either. I haven’t been to Chattanooga or Houston, which I need to go to both of these places. And I have the tour guides to take me around. But I [00:08:30] will say one thing I know about Houston is that my husband and I own a wine shop and he is part of a large network of wine professionals. And the food and wine scene in Houston rivals that of New York and LA. So I’ve heard a lot about that in Houston as well as the arts community there. An old colleague of mine from the Smithsonian [00:09:00] I think is helping to organize this big contemporary art fair. So it’s culturally very rich from what I understand.

Speaker 4 (09:07):

Right. Yeah. And we have the museum district, there’s a huge in town, there’s a huge arts center. So there’s always all different kinds of activities. And yeah, the arts is huge. Even music, I would say there’s a lot of just very diverse. Houston is very diverse in many ways. So it’s definitely, [00:09:30] I feel like something for everyone.

Speaker 1 (09:32):

It’s an interesting. We’ve talked about this diversity in a number of our podcasts that I think that that’s really a strong attribute that we look for in markets we want to go into is we don’t want to be in a market where there’s only one employer, there’s only one dynamic there that if anything were to happen to it, it would not be beneficial for our residents, our investors. And so I think Houston and Chattanooga are very different in size, [00:10:00] but I think that growth of multiple facets of the cities make them very interesting. So as you guys think about the different markets and how they’ve grown, what have you guys seen has changed as it relates to housing? Do you see big shifts that have occurred in housing in your markets? And how has that changed over the past five to 10 years in each of your market?

Speaker 3 (10:27):

For here in Chattanooga, it’s been a lot of growth [00:10:30] with multifamily apartment communities being built just to keep up with the demand of housing needs here. So a lot of new permits that were pulled in the last few years and all of those, the majority of those complexes and developments are above ground now and housing people. So that’s where a lot of land development has taken place within Chattanooga and within 45 minutes, going into North Georgia, going into [00:11:00] Cleveland, Tennessee, just things of that nature that tie into what you mentioned about the dynamics of employment here, whether it’s healthcare, logistics, Volkswagen, different aspects of different communities here, neighboring cities that’s driving that growth. So it’s been a lot of opportunity for growth, build to rent, which wasn’t on the radar when I first joined Auburn here in Chattanooga. [00:11:30] So much in Chattanooga in 2019 has had four communities built in the last four years.

(11:38):

So that’s been a space that’s now occupied now too.

Speaker 1 (11:41):

Yeah. And it’s interesting that I think both of the markets, I would say, are probably reacting to large inbound populations and needing for more types of housing. You mentioned multifamily and build for rent, which is something we’ve talked about on a number of episodes. What do you see [00:12:00] in Houston, Kristen?

Speaker 4 (12:02):

Yeah. For Houston, I mean, there’s still a big push for the single family homes, but I have seen a little bit of diversification, more duplexes in town homes. Of course, in town Houston, there was always a great development of town homes, but I’m kind of seeing some of that trickle out to the suburbs. So I’m seeing a little bit of product diversification there. And then of course there’s a huge build to rent scene [00:12:30] as well in Houston. There’s many different communities that are solely for rental. And those are done in a different way. I recently had the opportunity to go look at a build to rent community just south of the medical center. And I was actually highly impressed in that same area. There were a couple different build to rent sections, but I got to see the diversification [00:13:00] of some of the just basic build to rent homes that were kind of put in tightly.

(13:10):

And now people are wanting to be in more of a community home feel. So when I went and sold several different sections, there was another section with Willow and Sierra Vista where they really made a point of creating the homes. Even [00:13:30] though they were built for rent, they really felt like a home.

Speaker 2 (13:33):

They

Speaker 4 (13:33):

Were maintained and manicured. And honestly, it looked like one of the best sections in the neighborhood. And with Build to Rent is such a huge or becoming a huge part of people that are looking to rent

Speaker 2 (13:52):

If they

Speaker 4 (13:52):

Want to have options. Renters these days, they’re looking at their diversification of options. And coming out [00:14:00] of maybe an apartment or something on those lines, being able to be in a nice home and a nice community and everything’s taken care of, that really also helps with, on the investment side, tenant, their retention. In an investment property, you want your tenants to enjoy where they’re at. Call it home. Stay there for more than a year. So I’m seeing on some of [00:14:30] those build to rent communities, those are really attracting tenants. So yeah, there’s lots going on in Houston, lots of growth. Just definitely seeing a lot of different types of homes being built in Houston. So we’re seeing more of a diversification there.

Speaker 1 (14:52):

I think also what’s interesting is how and where people live is changing so much. I [00:15:00] live in Charleston and we have a, similar to Houston and Chattanooga, we have a lot of people moving to the area. Not everybody has a local native friend like you, Jason, or like you, Kristen, to kind of advise where to go. And so you have people that I think come to town to try on a location or area to see if it’s where they want to be. And I think what’s really cool, Kristen, about the community that you referenced that Auburn is assisting with and some of these others is [00:15:30] that doesn’t have to be any less of a experience for the resident to be in. In many ways, it can mimic the home ownership experience without some of the hassles and the headaches. And so that time that maybe is not spent with some home ownership activities can be spent getting out into the community, figuring out if, “Hey, is this particular part of the city that I’m living in?

(15:58):

Is this where I want to be?” [00:16:00] How are you guys seeing people come to the different markets that you’re in, decide where they want to be? Where are you guys seeing those folks start their journey? And how is that different from your all’s versions of the communities that you live in that you grew up in? Jason, you want to go first on that?

Speaker 3 (16:21):

Yeah. So a lot of that depends on the demographic. We get a lot of folks that have a job offer. They move to Chattanooga [00:16:30] and they rent for a year or two to figure out where they want to live, where they want to buy, if Chattanooga’s going to be long term for them. So if that’s the young professional moving in, they may be attracted to the different neighborhoods that as we discussed, have that outdoor lifestyle, more connected, going out. There’s many after work events and things going on that they may tie into the community [00:17:00] and location closer to downtown. And the same thing goes for families that are relocating here that are going to appreciate the affordability compared to other larger metropolitan areas. And then retirees that are moving here that they can experience the Four Seasons and access quality healthcare here. So seeing a lot of that pick up over the last few years where we’re seeing more people relocating to work, renting for a [00:17:30] year or two.

(17:30):

And then we want to keep them long term and have a good experience with them moving here into Chattanooga. But often they find a home to purchase and are staying here just due to the quality of life and their job opportunities.

Speaker 1 (17:46):

Yeah. And thanks for that, Jason. Before I go to you, Kristen, I had just recently attended a land and home building conference in Charleston. And it was interesting that they were talking about, and these are large national production [00:18:00] home builders, that these different buckets of sort of renters and buyers are merging in a very interesting way that at different points in life it may make a lot of sense for somebody to buy. And these are different points it may make sense to rent. Or that could be in the same market within a period of a couple years. Kristen, I know not only are you a Houston native, but you’ve had a lot of experience as an agent on the sales side. How are you seeing just the overall market [00:18:30] change in Houston between people considering renting before buying or considering it renting at different stages in their journey compared to some of your earlier days in real estate?

Speaker 4 (18:43):

Oh, I’ve seen the ups and downs. I got in at the recession time in 2008, 2009. So I’ve definitely seen the ups and downs. But I would say Houston, end of last year to beginning of this year, we’ve seen the prices pretty much stabilize. So we’re back [00:19:00] at kind of like a. And with a steady growth as well. With Houston being as large as it is, to be honest, I think anybody looking to move to Houston, it’s really looking at if they’re moving for a job or want to be close to certain family or friends, identifying those certain areas. Because I’ve had relocation clients coming to Houston and I mean, they’re really surprised at how large it is. I mean, sometimes it could take [00:19:30] you an hour, hour and a half to get one side of Houston to the other. But definitely there’s a lot of growth both north and south of Houston and it’s continuing.

(19:43):

And a lot of it is, again, brought by job growth, people coming into Houston. So that’s been something that’s been consistent throughout the years.

Speaker 1 (19:54):

Yeah. And I think it’s interesting too, we’ve all been in real estate a long time to be able to see these markets [00:20:00] change. And some things don’t change in the markets in terms of the fact that they’re cyclical. There’s periods of greater growth and periods of stabilization. But what I think is most interesting is what I’m seeing more and more is the concept of renting and buying just shifting. And people being more open-minded to different options at different points in their life. [00:20:30] You bring up a good point about Houston is I haven’t spent a ton of time in Houston, but I was coming to market and seeing some of the really nice assets of our strategic partner, the Willow at Sierra Vista. It was fascinating to me that the length of time that it could take to get from one portion of the city to another.

(20:48):

And so I think if you’re coming into the market and not sure where you want to be or not needing to be in a certain location for family or friends, starting [00:21:00] in a rental capacity can be a really good place for anybody to start regardless of job, employment, income, et cetera. And that’s different than I think it’s been in the past. Are you seeing more of that, Kristen?

Speaker 4 (21:17):

Yeah, definitely. I mean, there’s definitely right now a lot more renters. And so with that, those renters are looking for different types of options. And then some people, it’s just a lifestyle [00:21:30] choice. They’ve just decided I just want to kind of fill out certain areas, live there for a couple years. For them, they don’t really have to worry about the home maintenance and some of the extra cost involved with actually owning a home. So I’ve seen a lot of renters just decide to, “Hey, I’m happy to call this home. This feels like home. I’m good.” So yeah, there’s definitely been a little bit of a change. So yeah, I mean, there’s growth in both, but there’s [00:22:00] definitely, I would say, an influx of renters right now, for sure, for several different reasons. But Houston has a lot to offer.

Speaker 1 (22:10):

So Jason and Kristen, you guys have talked about some of the larger sort of things that are attracting people to the city. What do you guys like to do in your city? If you guys have some free time, Jason, what are you doing on the weekend in Chattanooga? What are you doing? What are your favorite parts to go and favorite things to see [00:22:30] and interact with in your hometown?

Speaker 3 (22:33):

Yeah. Practically every weekend I’m running on the river walk along the Tennessee River. So I’m getting out and about and there’s different points you can start and run to. So I’m out exploring that. And as that’s connected into more neighborhoods, I can start at different points and see that development kind of run through the south side of Chattanooga where our minor league baseball team, [00:23:00] they just built Erlanger Park on a historic hundred-year-old steel mill that’s been just dormant for years. And that’s been a huge impact. Going to bring in residential commercial on that pocket. So getting out and about running and just seeing some of the changes firsthand as I’m out exploring a little bit, if you will. So that’s one of my favorite things to do along with a lot of the new developments that have brought different [00:23:30] places to go eat and go check out live music.

(23:33):

Chattanooga has had many venues that have been open for a while or new ones that are attracting more artists here. So it’s just nice to see that where you don’t have to travel like you used to, to see live music or events. A lot of that’s coming to Chattanooga now.

Speaker 1 (23:49):

And I know we’ve discussed on other situations that Chattanooga’s the first national park city and it has really spent a lot of time and money connecting [00:24:00] the different pieces via a bunch of greenways, right? That’s all been a new development in the recent history there?

Speaker 3 (24:09):

Yeah, it has been because Chattanooga was a huge manufacturing town. ’50s and ’60s, we had the designation of the Smoggiest city. It wasn’t LA. It wasn’t somewhere that you would think of. It was Chattanooga. Then that was a national news coverage.

Speaker 1 (24:27):

Not a designation anybody wants, right?

Speaker 3 (24:30):

[00:24:30] No, no, not at all. So I mean, going from that to be recognized as a national park city just shows how far Chattanooga has come with developing outdoor activities and creating these green spaces and parks and things like that for outdoor enjoyment for everybody. So I mean, that’s a huge thing to have. There’s less than a handful of countries worldwide that have the days of the nation like this, and Chattanooga was the first in the United States.

Speaker 1 (25:00):

[00:25:00] Cool. And I know you mentioned concerts. There’s a lot of music coming to Chattanooga. What do you like to do and go see there? Is there certain concerts that you’re going to? I think you’ve got a certain type of music that you’re seeking out in Chattanooga that comes there regularly.

Speaker 3 (25:18):

Yeah. There’s plenty of bands that come here, but anytime we can get a tribute band from the 80s, whether it’s Talking Heads or Def Leppard or Bon Jovi, definitely going [00:25:30] to go check those out first. So good thing being here in Chattanooga is that if they are Atlanta and Nashville, two hours there and back to go see folks. So can always keep that going.

Speaker 1 (25:44):

Nice commute to see your 80s cover band.

Speaker 3 (25:47):

That’s right. And that was just like Bon Jovi’s number one song from 2005, Who Says YouCan’t Go Home? That was the reason I moved back from Charlotte to Chattanooga.

Speaker 2 (25:57):

There you go. And also sometimes being on that [00:26:00] in between the bigger cities, you end up being like the Sleeper Show. And so those are actually some of the best venues to see the live shows. So that’s cool, Jason. I’ll have to come join you for one of those tribute bands one day.

Speaker 3 (26:18):

Well, come on. We get plenty of them throughout the year.

Speaker 1 (26:21):

I used to live in Augusta. And like Aaron said, we would catch bands in between Atlanta and Charlotte. So sometimes being [00:26:30] outside of there. So Kristen, as a newer team member, I haven’t gotten to know what your ’80s music taste is or not, but would love to hear what you do. Yeah. Oh, okay. Well, maybe we don’t have the ’80s fan there, but I would love to hear what you do in Houston. I think when we originally started speaking, you were actually going on a trip outside of Houston to some of the area outside there. And you mentioned that there’s a number of places, [00:27:00] not only in Houston, but you can get to beaches, some beautiful other area around Houston as well to spend time. So what do you like to do in Houston? What would you advise somebody that’s moving to town to seek out when they come to town?

Speaker 4 (27:15):

Yeah. I’m a bit of an outdoorsy type person, so definitely I love to be on the water. So there’s access to several different lakes. I live near Lake Conroe. Down South Houston, there’s [00:27:30] Clear Lake. Then obviously there’s Galveston. So anytime I can get on the water or on a boat, I’m there. And what really amazed me, honestly, being born and raised in Houston is Galveston is always there. And I just kind of slept on it like, oh yeah, the beach is less than an hour away. But it wasn’t really until I was an adult that I really ventured into Galveston and went further down the coastline, not like that far out of Galveston, but it really [00:28:00] amazed me the diversification once you kind of get down on the beach. I mean, I was like, “Oh wow, the sand is really nice. The water’s clear.” And those are some things that I didn’t even get to experience until I was older.

(28:12):

But definitely being close to the beach is nice. Again, I love music. I grew up in a musical family. So I think it was just last week I was at a concert downtown. These bands came in from [00:28:30] Finland and other places, so very diverse.

Speaker 1 (28:34):

So

Speaker 4 (28:34):

What’s your

Speaker 1 (28:34):

Music of choice, Kristen?

Speaker 4 (28:38):

Well, it’s all over the place, to be honest. But I have to say, this band I saw last week, they did Metallica by Cello.

Speaker 1 (28:50):

Interesting. So a

Speaker 4 (28:52):

Band

Speaker 1 (28:52):

From Finland doing Metallica by Cello. I mean, I don’t know that I can get more diverse than that. I think that [00:29:00] checks all the boxes, right?

Speaker 2 (29:01):

Only in Houston, folks.

Speaker 4 (29:03):

I mean, I was highly shocked. I was like, “Wow, that is pretty amazing.” But yeah, Apocalyptica was the name of them. But yeah. Nice. So I listened to music of all genre. Yeah, I know. I was like, “Oh, who knew? I didn’t know you could do that with a cello. Okay.”

Speaker 1 (29:19):

I think one of the things that’s always maybe struck me as both fascinating, but also a very simple way of thinking about is it makes sense to consider [00:29:30] investing where people want to live. And there’s been these big movements of populations to Southern markets like Chattanooga and Texas for a number of reasons. The natural resources and I think what is right in the backyard. But then as you have more and more people moving to these cities, you get interesting dynamics of perspectives and backgrounds that create a Metallica cello there and other things like that. [00:30:00] I think that’s really what is amazing about where you guys live is these markets take on a new life, even the people that you were born and raised in these cities. And so how do you guys communicate your perspective of the markets that you live in with people that are interested in living there, whether it’s residents or investors?

(30:22):

How do you all best feel people can get to know the different markets that we’re in to decide if it’s the right [00:30:30] place for them to invest or live?

Speaker 3 (30:34):

Yeah. I just kind of try to get a feel of what their experience has been, whether it’s personally or with their investments on where they’re coming from and what they’ve experienced and seen. How does it compare? How does it contrast to Chattanooga? If there’s certain things that they don’t like about other markets or their hometown that differs from here. Just trying to learn their interest and their perspectives [00:31:00] to help guide that question along to just really understand where they’re coming from and what their objective is really. And just having that, being the local leader in eyes and ears of someone looking here for me to be from Chattanooga, to share the experience with them briefly from my time here and things I’ve seen. So that kind of gives them an [00:31:30] overall picture of how much the city has grown in the last 10 years, what’s just recently happened, what’s in the pipeline for the next two or three years to help gauge that interest.

Speaker 2 (31:42):

But I think you nailed it there, Jason, with the objective, right? Because an investor coming into Chattanooga who might be looking for cash flow and then an investor in Houston or why Houston might work for them [00:32:00] with a more build to rent product and it’s more the longer term equity play. So it’s really kind of understanding. And what’s great about Auburn is that there’s not just one opportunity. There are ample opportunities across markets to fit these different objectives.

Speaker 3 (32:20):

Yeah. And we work with many investors in some recent conversations where I’ve built my portfolio out. I’ve got some C to B minus B [00:32:30] properties that I’m fine there. And I understand what that portfolio is going to do and how it’s going to perform, but now I want to go into something new and it’s going to be because I’m going to see the equity in that property with years to come. They don’t want to sell what they have currently. They just want to take a different approach. So that mind shift can change where I’ve [00:33:00] been working with someone for five years and their mindset’s always been to find properties that they could add value to. A little bit undermarket, need some repairs. But now they’re like, “Hey, I’ve done that. I’m tired of doing that.” You experience trouble along the way, you start peeling back that onion, you’re going to discover more is needed and it just cuts into your overall plan.

(33:23):

So some of that mindset has shifted as conversations and growth [00:33:30] is happening in markets. And like in Chattanooga, well, five years ago we couldn’t promote certain build to rent communities that wasn’t happening here, but now we can. And Auben as well can have that conversation because we’re involved in that in other markets to lead that investor to look at all aspects and in different markets.

Speaker 1 (33:51):

Yeah. And that’s a great point, Jason. Before I flip it over to you, Kristen, I think one of the interesting things that Auben’s journey has been on, it’s [00:34:00] been similar for my own personal journey as I started more in markets like Chattanooga where you had what are called more value add properties that you buy an older aged asset and you improve it. Those properties are given classifications based on their location, their condition, BEC class. But also realizing there can be a lot of value in owning newer construction product that is more predictable. [00:34:30] And as Aaron said, has some higher potential for appreciation and equity growth. And that’s led Auburn into markets like Houston, Kristen, where you are, where you only need to spend a very little time in Houston and realize how much growth there is there currently, but how much is likely going to continue in the future.

(34:51):

And with that, that can be more dynamic upside for investors. But it may also [00:35:00] mean when the investor is buying in, that maybe there’s a little bit less cash flow at least initially, or maybe appearances of less cashflow without realizing that there could be a better cashflow because you’re not doing repairs and maintenance. So Kristen, how do you think about the Houston market or how have you seen people attracted to Houston market compared to other places where they’ve invested historically?

Speaker 4 (35:29):

Yeah. [00:35:30] I mean, again, Houston has a variety of options. So there’s a lot of different types of assets that you can invest in. But one thing with Houston is there is still like housing is affordable, the housing affordability for an investor to get into the market. And then again, with the newer homes, there may be a little bit of less cashflow in the beginning, but long term when you’re doing a buy and hold, there’s just less maintenance. [00:36:00] There’s less CapEx that you’re having to spend. So down the line, you’ll see not only the equity and the value appreciate over time, but then you’ll be spending less money having to maintain the home, fixing some of those larger items. So back when I was investing with the hedge funds, there was a lot of older homes that we eventually did not, we weren’t able to acquire because it required so much maintenance.

(36:26):

So that’s one key thing with a newer construction, something that’s newer is [00:36:30] you don’t really have to necessarily worry about, okay, do I have to replace the roof or do I have to replace the AC? Because everybody knows in Houston we definitely need our air conditioning. So yeah, there’s definitely perks to some of the newer construction options as well and energy efficiency.

Speaker 1 (36:50):

Yeah. And I think you bring up a good point too, is that it can be a easier ownership experience. The owners can be in a position where they have to [00:37:00] make less decisions on what they do with their cashflow and what seemingly may on the front end appear as less profitable can be better over time, particularly if you have a longer term strategy. If you’re not looking to just get in and out of the market, some of these newer construction assets can perform significantly better than some of the age inventory as you hold them over time.

(37:27):

So I think one of the things that’s interesting about [00:37:30] Auburn and what we’re seeking to do investors is also give investors the option to do both. They can have, like most investors, I think the word that we’ve used on this podcast a number of times is diversity of having a diverse portfolio of, it doesn’t have to be an either or where you have investment in a primary market like Houston, it’s the fourth largest city in the country, or investment in a growing market [00:38:00] like Chattanooga that’s a secondary tertiary market that maybe you’re owning a older vintage asset because that’s what’s more readily available. You can have the opportunity to, working with Auburn, own both and have individuals in market, Kristen, like yourself or Jason like you that can help talk through the appropriateness for the investor because it’s also investors want different things and have different time horizons as to how long they’re [00:38:30] willing to hold it or what their objectives are.

(38:32):

How have you guys seen that different in both of you all have had long tenured experience? How’s that different for different investors and how do you meet those objectives with the market when you’re meeting people in their investment journey?

Speaker 3 (38:49):

Yeah, it’s just talking through their particular scenario. For some investors, the better opportunity may be not to squeeze out another few years [00:39:00] of an aging asset just due to some of the CapEx items that they are dealing with. It may be recognizing the equity that they have built, selling at a strong price point from where they entered the market at, and then deploying that capital into new properties that may be a better fit for them for the strategy to be more consistent. If that’s what they’re going after, just, [00:39:30] “Hey, I don’t care if I clear 500 a month like I do at this property on a good month because it’s unpredictable. I’d rather have half that, but it be stable and consistent.” And so that’s just where we have ongoing conversations for those needs for long-term goals.

Speaker 1 (39:51):

Cool. And Kristen, how do you see it? You’ve worked with institutions, you’ve worked with individuals, you’ve worked with a number of different [00:40:00] residents, homeowners, all different, you’ve seen it from a number of sides. How do you help people evaluate what is right for them at the point of acquisition in the process?

Speaker 4 (40:12):

Yeah. I mean, every investor has their own idea of what they’re looking for. So we’ll have those conversations and discuss what’s available. Another thing though, too, that I like to bring to the table is different options. A lot of times, sometimes [00:40:30] investors get stuck looking at one certain type of asset and maybe not have been open-minded in the past to other types of maybe even a town home or a duplex or even a smaller multifamily. And so a lot of times you can have those conversations where that’ll help them diversify their portfolio. And a lot of it is readily available here in Houston. So I like to show just different options as well. [00:41:00] We all know that we have to pivot with the market and the market has led us different places at different times. So it’s just really having those conversations to try to meet their goals.

(41:11):

And then too, sometimes I like to add in like, “Well, there’s also this option over here.” And then a lot of times they’re like, “Oh, I didn’t really realize that’s a great asset to invest in.” So I’m always keeping my eyes and ears open for what else is out there. There’s also a huge [00:41:30] off market assets that are held off market. So a lot of times with my different networking and all of that, I’m able to bring off market properties to investors where they otherwise wouldn’t have probably seen them.

Speaker 1 (41:44):

Yeah. And that’s a great point, Kristen. I appreciate that is the diversity that some investors want or potentially should have in a portfolio can occur in one market. You can have different types of residential assets that have very different dynamics [00:42:00] and different benefits and different pieces for people to consider. Well, I thank you guys both for joining the podcast today. I would love to hear if you only had 36 hours in your city, what should somebody do in your markets?

Speaker 3 (42:22):

36 hours here in Chattanooga, I would definitely have a mixture of things. We got some local [00:42:30] museums here that are great. If you’re into looking at art and sculptures and things of that nature that you can spend your time doing. A lot of smaller mom and pop shops that are at the Bluffview Art District, there’s some coffee shops and art studios that are right there. As you’re walking outdoors, seeing all that, you can still pop in and see some of what the locals have here in Chattanooga. So I would take in [00:43:00] a mixture of that and just downtown is so walkable in many aspects. The Tennessee Aquarium that’s here, it’s a fantastic aquarium. Our Chattanooga Zoo, you can really just make a plan and knock out so much due to the proximity of all of our attractions here. But also find, there’s a lot of locally owned coffee shops, a couple of local record stores that are unique to Chattanooga.

(43:30):

[00:43:30] So I would seek those out.

Speaker 1 (43:32):

So in Jason’s tour of Chattanooga, we’re doing art, coffee and records. I like it. Those are cool things. Kristen, what are we doing in Houston for 36 hours?

Speaker 4 (43:43):

Let me see. Well, definitely I wouldn’t. I mean, there’s such a great variety of cuisine. So for sure going in town, trying all different types of foods. We have the museum district. There’s tons of fine arts. [00:44:00] I love my music, so there’s plenty of the live music going on. And then if you can get down to any of the water, the lakes, they’re wonderful. There’s just, I don’t know, 36 hours might not be enough time.

Speaker 1 (44:17):

So we’re doing food, art and water in your version of

Speaker 4 (44:21):

Houston. Yes. All right. We could fit in a little bit of voting as well. Yeah.

Speaker 2 (44:26):

Kristen, have you ever been to the Rothko Chapel in Houston?

Speaker 4 (44:30):

[00:44:30] Well, is that the one downtown? I think.

Speaker 2 (44:35):

Yeah, the Rothko Chapel. Yes, I

Speaker 4 (44:38):

Have.

Speaker 2 (44:41):

Yeah, I’ve always wanted to go there. So when I come there, we’ve got to go to the Rothko Chapel.

Speaker 4 (44:48):

I’ve

Speaker 2 (44:49):

Always wanted to see

Speaker 4 (44:49):

That. There’s lots to see. Even in town, there’s the Heights area that’s very eclectic. And there’s just a lot of history for sure as well to see throughout Houston.

Speaker 2 (45:00):

[00:45:00] And sorry, the Rothko Chapel is referencing the artist, Mark Rothko.

Speaker 4 (45:05):

Yes.

Speaker 1 (45:06):

All right. So we’ve got Aaron and Kristen are going to go to the Rothko Chapel and we’ve got reasons to go to Chattanooga and Houston. Jason and Kristen, thank you guys very much for participating in Real Estate Rewind. I think it’s really cool to be able to learn about your cities from locals. I mean, I think [00:45:30] that’s what I’ve really enjoyed as I’ve come into the different markets is seeing the love that you guys have for where you live. It translates into giving a version that other people can decide if that’s the right place for them to live and invest. So thank you guys very much for joining our episode today. We appreciate it.

Speaker 3 (45:52):

Yep. Appreciate being here. Thank you. Thank

Speaker 4 (45:53):

You for having. Thank

Speaker 1 (45:54):

You for having me. All right. You have a great day.

Speaker 3 (45:55):

Okay.