Struggling to House Hack in Austin Area

3 Replies

Hey all, I'm new to BP and recently moved to Austin. I've been looking to own property for a while now since the Navy, and Austin's allure, along with Brandon Turner's book, has given me the confidence to get this ball rolling.

I am looking to use a VA loan to purchase a home that I can live in and rent out to others. A multi-family would be ideal, but I would live in an ADU also and rent out the main house if I were able to find that (square footage does not matter to me for my personal living situation).

I have been looking for the last week through online listings and an MLS app and pickings seem pretty slim. It looks like any decent multifamily property is either not near Austin, or is fully occupied (which is a disqualifier for me due to occupancy requirements of VA loan). I realize I will have to accept negative cash flow for a while, and that's fine; in the meantime at least I'll be building equity in a growing market and not wasting money on rent.

Can anyone generally familiar with this market provide any advice or words of caution? I am very enthusiastic about networking with others around the area and having discussions. I am soaking in as much information as I can every day and would like to start building relationships.

Thanks y'all!

I would be very cautious of negative cashflow. Run the numbers on the property as if you were buying it as an investment. Once you move on to the next property, it will be an investment. 

There are plenty of arguments against buying a home, and Austin can be a tough place to house hack. The multifamily supply is pretty low. Most of the small multi family being built now is sold as individual condos. You may want to consider renting where you want to live, and buying where the best return is. If square footage isn't a concern look for something cheap and walkable so you can invest your money where the numbers work. 

Originally posted by @Jim Robertson :

I would be very cautious of negative cashflow. Run the numbers on the property as if you were buying it as an investment. Once you move on to the next property, it will be an investment. 

There are plenty of arguments against buying a home, and Austin can be a tough place to house hack. The multifamily supply is pretty low. Most of the small multi family being built now is sold as individual condos. You may want to consider renting where you want to live, and buying where the best return is. If square footage isn't a concern look for something cheap and walkable so you can invest your money where the numbers work. 

 Thanks a lot for the advice! Good point. I may have to get creative; I will certainly need to exercise more patience.

Currently I'm paying rent to live in a duplex for $1000/mo and I was feeling rushed to start putting my money into equity, but surely it would be more responsible to take my time making the right choice on a good investment.

Walkable as in East Austin? Thanks for the reply, you have helped me to settle my brash eagerness.

-Max

@Maxwell Reeder what you are experiencing is very common here in Texas.  In Texas there is TONS of land.  So much raw land that housing prices are less expensive here than other cities.  But in locations like Chicago, New York, San Fransico, New Jersey....they have very limited land.  When home prices are higher and land is scarce, then you need duplexes and tri-plexes more to battle the cost of housing.  While we have some multi unit properties here it's certainly not like other places.  You'll continue to have challenges finding a property that fits your description but it is possible...just really difficult.  

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