Austin, TX · Member since 2014 · 9 posts · 0 votes
Seems like cash flow is impossible in Austin but if you go further South, North, or East you can find some good pockets that have decent cash flow. Ran the numbers on this property in San Marcos, and it seems to work well (~$200/month).
Lender · Austin, TX · Member since 2018 · 241 posts · 136 votes
6y
You are looking in the right areas for cash flow opportunities @Nicholas Thompson. The best opportunities for cash flow in interior Austin are in zip codes 78744 and 78724, even then it's rare. There are opportunities in Kyle and Buda, though San Marcos's growth pattern and it being in Hays county gives it a leg up. Hard to miss along the 35 corridor
Rental Property Investor · Austin, TX · Member since 2016 · 361 posts · 394 votes
6y
I didn't check your analysis, but a couple points: 1. there is an HOA payment of $26/month (likely paid annually), so don't forget to factor that in, and 2. if you were to pay the asking price, you would be all in for at least $65K. If your stated cash flow of $200/month is correct, that's 3.7% CoC return. That's obviously quite low. If your reason for purchasing this home would be more for wealth building than cash flow, then this could be a pretty decent deal. If you are more interested in a monthly return, then this deal doesn't look so good.
Lender · Austin, TX · Member since 2018 · 241 posts · 136 votes
6y
You are looking in the right areas for cash flow opportunities @Nicholas Thompson. The best opportunities for cash flow in interior Austin are in zip codes 78744 and 78724, even then it's rare. There are opportunities in Kyle and Buda, though San Marcos's growth pattern and it being in Hays county gives it a leg up. Hard to miss along the 35 corridor
Realtor · Austin, TX · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Jarrod Covey I would put a huge asterisk on labeling any area in Austin best for cash flow. The right property in any area with the right strategy can produce results. High end properties that rent by the room are able to produce incredible cash flow if it's in a desirable location. Central locations that perform month to month rentals or STRs for traveling professionals are seeing tremendous success even now. I would agree that the zip codes you mentioned have better rent to price ratios when considering a single lease strategy, but those zip code also tend to have higher vacancy as well.
Realtor · Austin, TX · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Nicholas Thompson with the approximate ratios you have here I would also consider Round Rock. Some solid options around $250k with rents moving closer to $2k/mo. Not all of them, but worth a look. Manor and Hutto also have some worth investigating as emerging submarkets of the Austin MSA. I will give you that home you have there looks nice though and the numbers look fair as @Kris Wong mentioned, but not stellar.
Flipper/Rehabber · San Marcos, TX · Member since 2016 · 128 posts · 38 votes
6y
San Marcos is a hard spot mainly because of the high property taxes. There are deals just harder to find. I look at the surrounding areas. Smaller towns etc.