Newbie - Austin real estate

9 Replies

Hey guys, 

I am new to Austin- moved here during the pandemic. I work in tech and new to real estate investing. I’m looking to buy in or around the Austin area. What are some of the good areas/zip codes to invest right now? What has been the impact of covid on the prices in Austin? My goal is appreciation- (little cash flow would be nice). Hoping to connect with fellow investors and real estate agents.

Thanks, 
Anshul 

@Anshul G. Welcome to BP and always happy to connect with Austin investors. There are several different areas to consider depending on your more specific goals. Are you open to renovations? Some light remodeling? Do you plan to have a property manager or self manage? Do you want single family or small multi family? Budget?

if you are open to adding some sweat equity (remodeling), several Austin zip codes in the north, east, and south have options for you. If you want something “lower” relative cost and less work, I would focus on Pflugerville, Round Rock, Cedar Park, and evening Leander. There are many factors to consider, so hopefully this gives you a broad overview of options.

@Anshul G. - are you planning to live in the home and maybe house-hack?  Really depends on your budget and plans... if you're planning to live in the home, it opens up a ton of financing options that wouldn't be available if you're just buying an investment property.  Happy to chat and explore more deeply if you like.

Welcome to Austin, a great place to live and invest! We were there for 20 years in the tech industry and recently relocated to Salt Lake City. We got started in investing by joining the local REIA and getting on every wholesaler mailing list. I'd run all those deals through the Bigger Pockets calculator and my homemade spreadsheets, learning to run comps on Redfin for flips and rental comps on Zillow and our local rental classifieds, visiting properties for sale, and meeting with contractors. We had done a huge live-in rehab in Kyle TX that we sold before moving to Salt Lake that provided the cash we needed to start buying rentals with hard money lenders and providing our own down payments, as well as valuable experience managing contractors. Living in the house helped us to be very hands on and on top of the situation to become wise to all the ways they mess with you, or what you're looking for in a good one. We learned to never pay up front and create a schedule of payments so they're only paid once a stage of work is done and therefore easy to fire when they ghost or get unreliable. The best ones never asked for any payment until the job was complete and invoiced. Once we had that, I felt much more capable to manage a rehab I didn't live in, but in my same city. We bought 5 that first year (none through the MLS) and then moved into commercial multi-family with a 50 unit, 16 unit, and 18 unit with pretty heavy rehabs. Just get in there, learn to find good deals, find money, and manage construction. Just keep at it, learn something each project, and you'll do great!

Originally posted by @Ryan Kelly :

@Anshul G. Welcome to BP and always happy to connect with Austin investors. There are several different areas to consider depending on your more specific goals. Are you open to renovations? Some light remodeling? Do you plan to have a property manager or self manage? Do you want single family or small multi family? Budget?

if you are open to adding some sweat equity (remodeling), several Austin zip codes in the north, east, and south have options for you. If you want something “lower” relative cost and less work, I would focus on Pflugerville, Round Rock, Cedar Park, and evening Leander. There are many factors to consider, so hopefully this gives you a broad overview of options.

Hi Ryan,

Thanks for the response. For my first investment, I don’t want to make it too complicated. So I’ll want something in “ready state”. I’m open to both single and multi-family if the numbers make sense, but I hear multi-family are fewer and far between and extremely competitive. Looking to invest $350-375k. What are some of the zip codes that have seen the greatest appreciation and have potential for future appreciation as well?

 

Originally posted by @Rick Reeder :

@Anshul G. - are you planning to live in the home and maybe house-hack?  Really depends on your budget and plans... if you're planning to live in the home, it opens up a ton of financing options that wouldn't be available if you're just buying an investment property.  Happy to chat and explore more deeply if you like. 

I do plan to move into the house for about a year or so, but we may ultimately end up moving to the west coast once the covid situation settles down (still undecided on the move though). How is the financing/mortgage impacted if you need to rent out the house a year or so after the purchase?

Originally posted by @Jordan Moorhead :

@Anshul G. I invest on the east side and have had great luck before and during Covid!

Hi Jordan,

What are the zip codes you have invested in on the east side? What kind of appreciation and cash flows have you seen on your investments?

 

I do plan to move into the house for about a year or so, but we may ultimately end up moving to the west coast once the covid situation settles down (still undecided on the move though). How is the financing/mortgage impacted if you need to rent out the house a year or so after the purchase?

If you buy a home as your primary residence and then move someplace else, it doesn't change whatever financing you have for that home.  If you are going to buy another home on the west coast, then one of those will need to be characterized as a second home or an investment property.  A great mortgage broker will be a huge benefit.  I have referrals if you need one.

@Anshul G. I'm all 78721. I buy rehab projects so it's a lot of forced appreciation, not natural. I bought one for $260,000 in 2018, put $60k in and sell it for $430,000 next week.