Hey, I am looking to buy/build a new home in Austin to live in. I want to rent out the spare bedrooms in the house and I was wondering where I should best invest my money. I am looking to spend 400k on a house and I was wondering if I should spend it in either RR or leander. Leander seems to have nicer homes and access to the metro but RR is appreciating fast. I am putting 5% down so my monthly payments would be around 2k on a 400k home. If i have 4 bedrooms that means I can get 3 tenants. For a nice home in leander is it reasonable to charge 600-800 per room? How hard is it to find tenants to house hack? Any suggestions or tips?
Here is my input as a former realtor while in college and then a resident of Leander and Cedar Park over the last two years:
RR may be appreciating fast but Leander has more growth potential if you are looking at a long-term rental, I would even consider offer seller financing if you ever want to move on to a different investment. I rented the whole time I was there, first year being a room in a house and I'd say if you have a 400K house you could have a target audience for young professionals and easily have them at $700-900 per room. Friends that were paying $600 per room were in 20-30 yr old houses and newer. So if you're looking for something like a nice Terra Vista home and having roommates, like your house, I would go more on the high end to make sure you are helping yourself but also getting interest from people that know the worth of what you are offering. (Assuming you are very clean cut and professional yourself).
I would post ads with the local chamber, small business groups on Facebook, and for sure have a screening process that costs you at least a little bit to ensure they are the right fit. References helped me get my room as well as my job offer letter. Credit check and previous rental history can typically be a make or break when getting more info after their background check.
Hope that helps!
Hi @Ali Hamdani I love this idea. I would actually recommend buying a new build in Leander as it is becoming very difficult for investors to do that now as they are not selling to anyone buy primary home owners. Your CapEx will be low and it will be easier to rent. You also won't have to get into a bidding war as is the typical case right now. Your offer won't look as good in multiple offers with just 5% down. I agree with Jordan and Tyler on their comments. This is a good idea and I feel you will see great ROI.