Austin Texas Investors & Agents ('Neighborhood Grades' Project)

Buying & Selling Real Estate
9yFollow

Austin Texas Investors & Agents ('Neighborhood Grades' Project)

Account Closed
Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes

Hello everyone! I'll get right to it...

I am an investor who lives in Denver, flips out-of-state and reinvests into rentals in metro Denver. I recently launched this project, called "Maximus Neighborhood Grades" in an effort to develop neighborhood-level grades for key cities all around the country. So, this project will help me out, but I hope that it will also help investors (particularly out-of-state ones) get a feel for the neighborhoods of a given area no matter where they live.

You can find out details about the overall project in my BP blog post here: https://www.biggerpockets.com/blogs/8592/54303-bp-...

The first city, Cincinnati, is now complete and you can see the results here: https://www.biggerpockets.com/blogs/8592/54304-pro...

Austin Neighborhood Grades

The purpose of this post is to launch the sub-project for Austin, Texas. The goal is to grade all ~64 neighborhoods of Austin based on criteria localized to the area. 

Request: If you are a knowledgeable investor (in-state or out-of-state) in Austin or an agent in Austin, I would appreciate if you would comment below or reach out to me to volunteer some of your time in helping to get this project done. You will be given full credit in the blog post that will be published at the end of the project (per the links above). But, more importantly, you would be helping investors far and wide. 

3Reply
27 views

Investor-friendly agents in Austin, TX

See the agents BiggerPockets members work with in Austin, TX.

Most Popular Reply

Carrie Hiner
Real Estate Agent · Austin, TX · Member since 2015 · 181 posts · 75 votes
9y

I would love to be involved. 

1Reply
See this reply in the discussion

13 Replies

Jump to latestLatest
  • Carrie Hiner
    Real Estate Agent · Austin, TX · Member since 2015 · 181 posts · 75 votes
    9y

    I would love to be involved. 

    1Reply
  • Account Closed
    OP
    Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes
    9y
    Hi Carrie Hiner that is great to hear. Please DM me your email and mobile and I will be in touch with you soon to kick things off. So far it is you and Dan Burstain that are on the team!
    0Reply
  • David IvyPro Member
    Real Estate Broker · Austin, TX · Member since 2016 · 353 posts · 699 votes
    9y

    @Account Closed

    It looks like an interesting project. However, I balked when I noticed that the "Neighborhood Grades" are at least partly based upon household income (e.g., "wealthiest people" and "middle class") and crime (e.g., "high" and "warzone"). A major upshot of the Fair Housing Act is to prevent real estate professionals from steering buyers toward or away from certain areas or neighborhoods on the basis of such factors. If I understand the law and my training correctly, I cannot discuss or directly provide any information on economic class, such as white collar, blue collar, or high unemployment, with prospective buyers, even if those buyers are investors or otherwise specifically ask for that information. This also applies to local crime statistics, even if my data comes from another source. All I can do, in light of the Fair Housing Act, is point clients to some public resources to aid them in researching it themselves.

    Am I wrong here? Or does this not apply to my participation in a project like this? Thanks!

    0Reply
  • Account Closed
    OP
    Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes
    9y
    Jacob Pereira Has also come on board to help out!
    0Reply
  • Account Closed
    OP
    Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes
    9y
    Hey David Ivy , thanks for the reply. What you say is true, with one caveat. You are assuming than an D grade, for instance, is meant to steer a buyer away from investing in an area. In fact, as a flipper or rental owner, I would not seek to invest in A neighborhoods. Value is too high, caps are too low. Most investors look at lower grades for investments due to potential for development. With that said, the criteria chosen can and will differ based on location. So, for example, we may decide that those two criteria are not an important differentiator for Austin neighborhoods and/or land on a completely different set of criteria for grading a neighborhood. I will probably add a disclaimer to all of these final reports. I do appreciate your concern, however, and I won't be offended if you decline my open invitation.
    0Reply
  • Account Closed
    OP
    Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes
    9y
    Additionally, the final report counts as a public source, non-specific to a particular buyer, and not in violation of any protected groups under the Act
    0Reply
  • David IvyPro Member
    Real Estate Broker · Austin, TX · Member since 2016 · 353 posts · 699 votes
    9y

    @Account Closed

    Thanks for the reply! The Fair Housing Act, as I understand it, applies even if the real estate professional is providing the household income or crime information without any intention to steer a prospective buyer toward or away from any particular area. We simply cannot legally provide the information. We can only suggest other resources with that information, right?

    Best of luck with the project. I'll definitely be interested to see the Austin report!

    0Reply
  • David IvyPro Member
    Real Estate Broker · Austin, TX · Member since 2016 · 353 posts · 699 votes
    9y
    Originally posted by @Account Closed:

    Additionally, the final report counts as a public source, non-specific to a particular buyer, and not in violation of any protected groups under the Act

    This is basically the heart of my question. I don't know enough about the Fair Housing Act to know if this is right. I guess my concern is that, even if it's a public non-specific source, it's still provided by a licensed real estate professional. Maybe this is just my broker's legal department being overly cautious, but that's what's been drilled into my head. This is a pretty interesting issue.

    I'd definitely be interested in participating in the Austin project if it just focuses on things like cap rate and 1% rule. 

    0Reply
  • Jacob Pereira
    Real Estate Agent · Austin, TX · Member since 2014 · 636 posts · 486 votes
    9y

    @davidivy,

    From my understanding, the fair housing act only covers a few select categories, such as race, country of origin, and familial status. As of right now, we're free to discriminate as much as we want on the basis of criminal background and income. 

    Surely you still advise your clients as to which areas have good schools and low crime rates? I know at one point, Austin tried to prevent discrimination based on source of income, but that didn't go through.

    Of course listen to your broker rather than me, but I'm fairly confident you're in the clear if you want to participate.

    1Reply
  • David IvyPro Member
    Real Estate Broker · Austin, TX · Member since 2016 · 353 posts · 699 votes
    9y

    @Jacob Pereira

    I absolutely do not advise clients as to which areas have good schools and low crime rates. That's illegal. When clients ask questions about quality of schools, local demographics, and neighborhood safety, I refer them to reliable third-party public information sources rather than give my own judgment or opinion. For schools, I point them to school district websites or places like greatschools.org. For crime, I suggest checking out the local law enforcement websites or places like spotcrime.com.

    Check out some articles here, here, and here.

    I know this might seem counterintuitive, since almost everyone uses this kind of information when deciding on what property to purchase, but as far as I know and have been trained, this is the recommended best practice for any real estate professional in light of the Fair Housing Act and the prohibition against "steering."

    1Reply
  • Account Closed
    OP
    Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes
    9y
    I'll send you guys an email by Wednesday with next steps to begin grading the neighborhoods. I'll figure out the best way for all of us to interact (perhaps a group chat in Google Hangout?)
    0Reply
  • Account Closed
    OP
    Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes
    9y
    FYI: If we're vigilant, the whole project should take a couple of weeks to complete. I have created the polygon map (e.g. longitude/latitude) of each neighborhood and loaded it within Maximus. Now, to fill it in :-)
    0Reply
  • Account Closed
    OP
    Rental Property Investor · Westminster, CO · Member since 2016 · 124 posts · 39 votes
    9y

    The colors are random right now....

    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free