Rising Above the Competition in the Austin, TX Market

Rising Above the Competition in the Austin, TX Market

Austin, TX · Member since 2015 · 6 posts · 7 votes

Hello to all my fellow BP members and followers! I want to reach out and open a discussion regarding the current market trends of REI in Austin, TX. For those veterans of Central Texas real estate, my question centers on the topic : how to combat both the over-valuation of Austin-area properties and saturation of "weekend warrior" investors who simply overpay for distressed homes.

Obviously, we are working in a market with high-demand -- due to the 100+ new residents we gain on a daily basis -- and short-supply. Keep Austin Weird -- or "Keep Austin Small" as it used to be -- is no longer sustainable. What investment strategies do you use to overcome the risks involved in such a market?

 -- e.g. off-market campaigns, short-term rental followed by comprehensive remodel and resale, owner-financing, etc. -- What strategies give you or your offer the edge?

One last question to end on : What do you see on the five-year horizon for the Austin REI market -- i.e. small corrections to pricing trends, large pricing crises, or continued rise in value?

(This is a very open discussion about the "investor's perspective" in and around Austin. Responses need not be singularly related to the proposed questions. Any input or further inquiries will be of value. Thanks in advance for your time!)

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Real Estate Investor · Williamson County, TX · Member since 2011 · 1k+ posts · 961 votes
11y

I rented a house in 24 hours...took it off zillow in less than 24.  Wilco.  Some apts are advertising that rents are reduced but reduced is relative.  I honestly feel bad renting at market rates.  But higher sales orices fuel higher property taxes fuels higher rents.  We need a breather...maybe a less expensive Sun City towards Manor or Taylor or Jonestown to draw the retirees out and  let workers find housing.

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  • Real Estate Investor · Williamson County, TX · Member since 2011 · 1k+ posts · 961 votes
    11y

    I rented a house in 24 hours...took it off zillow in less than 24.  Wilco.  Some apts are advertising that rents are reduced but reduced is relative.  I honestly feel bad renting at market rates.  But higher sales orices fuel higher property taxes fuels higher rents.  We need a breather...maybe a less expensive Sun City towards Manor or Taylor or Jonestown to draw the retirees out and  let workers find housing.

  • Austin, TX · Member since 2015 · 6 posts · 7 votes
    11y
    Originally posted by @Marian Smith:

    We need a breather...maybe a less expensive Sun City towards Manor or Taylor or Jonestown to draw the retirees out and  let workers find housing.

     Ebb and flow is extremely important to market trends. We hear so much about the in-flow of new residents, but hardly ever hear about those who choose to leave or are forced to leave -- due to increased population, traffic, prices, rents, taxes, etc. At least, I have no such statistics on hand... 

    While infighting and revision continues in the CoA Code and Permitting, I wonder which will come first, new infrastructure to incubate the development of periphery suburbs or the growth of autonomous micro-markets outside the bounds of Austin's current infrastructure?

  • Investor, Residential Construction · Austin, TX · Member since 2014 · 56 posts · 6 votes
    11y

    As a contractor and investor, our company remodels and builds SFRs. While we have issues finding the desirable properties, we never have issues with the retail exit strategy? "How is that possible?" you ask! By creating a product that is high in quality, style, functionality and efficiency, that stands out above the litter of mediocre remodels. Today, people who are serious about buying a house in the area where you are operating will pay more for an excellent property.

  • Interior Decorator · Costa Mesa, CA · Member since 2015 · 76 posts · 35 votes
    11y
    Hi Andrew, Austin is a nice area. Unfortunately, it became the new Newport Beach of California. I know many individuals that moved their from here because they could have a better life style. The properties their seemed like a steal for these guys compared to what they could buy here. I looked into Austin a few years back, but at that time there were regulations on what you could add or not add to fix up a property. I then made the decision to look elsewhere. It's not impossible to find the deals if your determined. Good luck. Melissa
  • Dan BurstainBusiness Member
    Real Estate Agent · Austin, TX · Member since 2014 · 361 posts · 331 votes
    11y

    There are 150 people moving to Austin every day now and the Austin area will surpass 2 million people by July of this year.  We do not have the infrastructure to handle much more growth, especially since we are sitting on a bed of limestone with a river running through the city which does not make underground transportation viable.  That is why you see mini-cities popping up that will be completely self sustaining around the Austin area.  Cities like Round Rock, Leander, Cedar Park, Pflugerville, and San Marcos, with Hutto, Kyle and Liberty Hill to follow.  Keep Austin Weird or Small is sadly a thing of the past.  Although it may just move down the road to Georgetown.  That is my take and I am also happy to help anyone invest in existing and up and coming cities here.  I focus on income properties and I believe the future is very bright for some specific central Texas markets.

    Dan Burstain, Investment Realtor51 Review
  • Cupertino, CA · Member since 2014 · 18 posts · 4 votes
    11y

    Does anyone know what are the sectors that are moving these 150 people to move in daily?

    Medical?  Education?  Technology?  Then where do you see the companies emerging and building?

    My bet was Technology, and we already see Apple and Google campuses expanding.  So I invested in Cedar Park. 

  • Austin, TX · Member since 2013 · 24 posts · 7 votes
    11y

    There is no over valuation. This is just the hot market we're in. Demand and supply. And, Yes there are still deals out there. You have to find it. The career fields are all the above and then some. Hence, great economy. Great demand. 

  • Austin, TX · Member since 2015 · 6 posts · 7 votes
    11y
    Originally posted by @Dan Burstain:

    That is why you see mini-cities popping up that will be completely self sustaining around the Austin area.  Cities like Round Rock, Leander, Cedar Park, Pflugerville, and San Marcos, with Hutto, Kyle and Liberty Hill to follow.  Keep Austin Weird or Small is sadly a thing of the past.

    Very much agree with your thoughts, Dan. We as investors will follow the path of least resistance into these micro-markets. I can only hope -- glass half-full -- that those moving into these areas will request houses with modern updates, reflective of their Travis county counter-parts. I'd like to  hear more of your views concerning income-producing properties in places like Cedar Park, Hutto, and Liberty Hill.

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