Looking to invest in Austin area Real estate market

[Account Closed]

Hi All,

I live in Houston, TX and looking to buy a property in Austin, TX and rent it out, basically looking for a investment property. Why I choose Austin is because of growth potential , large multi-national companies opening their offices in Austin and also close friend moving to Austin permanently next month. Please provide any advice/suggestions. 

[Maria Tan]

Hi Harish, I don't blame you, I love Austin. I live in a suburbs of Houston, however, I do have 2 properties in Austin-- 1 condo and 1 SFH. I purchased the condo for my daughter who is studying at UT and the SFH is a rental. The condo is in a very good location (78757) walking distance to restaurants (eg. Hopdoddy, Verts, etc.) and spitting distance to UT/downtown bus stops. The purchase price 2 years ago was $125K. Today, a similar unit is being sold for $165K. The SFH is about 3 miles away in an area that is "gentrifying" (78753). I purchased the property in February this year for $175K. After only a few months, comparable properties in the area are being sold for $190-200K. Just like what the experts have mentioned, if your goal is cash flow, Austin is not the best place. I am only breaking-even because property taxes have gone up and I have to hire a property management company. Although I am not an expert and definitely new to biggerpockets, I am happy to hold on to both properties for at least 5 years due to what I think will be the growth potential. When I was on my house hunting phase, I was very particular about location given my limited budget--the closer to downtown the better since Austin traffic is getting worse everyday. Both properties are relatively close to downtown (approx. 6 miles).

I hope my experience will help you decide which way to go in terms of plunging into the crazy Austin market.

Good luck!