First time home buyer rental property advice

Austin, Texas
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First time home buyer rental property advice

Kamaria Peters
Member since 2019 · 6 posts · 2 votes

I live in the city of Austin Texas where the market is starting to get very expensive to buy a home. I am a first time home buyer and want to take advantage of the lower down payment to purchase my first property for investment. I’ve been looking into duplexes that are in the 250k-300k range, but most of them are in poor condition and are in tougher parts of town. Not really sure if I’d be comfortable living there and may cost way too much to renovate to raise rent. There was an opportunity for a single family home in brand new development in my price range, so I considered renovating the garage into a studio apartment and living inside there and renting the whole house out. Problem I think I may run into is finding someone willing to rent a house with their landlord living in the garage space. Any advice on how I can go about my first rental property investment in Austin as a first time home buyer?

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Beau Fannon
Real Estate Agent · Austin, TX · Member since 2017 · 229 posts · 259 votes
7y

People who rent a SFH are going to want the garage for themselves unless you're renting to college kids. Your thought process is admirable but realistically unrealistic.

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  • Shawn McenteerBusiness Member
    Realtor · Boonton Township, NJ · Member since 2013 · 2k+ posts · 1k+ votes
    7y

    Go to local REI meet ups, see what other investors are doing in your area. Network, find some buy and hold investors and ask what is working for them.

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  • Beau Fannon
    Real Estate Agent · Austin, TX · Member since 2017 · 229 posts · 259 votes
    7y

    People who rent a SFH are going to want the garage for themselves unless you're renting to college kids. Your thought process is admirable but realistically unrealistic.

    3Reply
  • Kenneth McKeown
    Real Estate Agent · Dallas, TX · Member since 2016 · 432 posts · 341 votes
    7y

    @Kamaria Peters You could always look for SFH that have a detached garage unit in the back - there's a lot of those in Dallas... or I would likely stick to MFH. Most people are never going to be okay living in a house with someone else living in their garage.

    You could also purchase a SFH and rent out the rooms - maybe purchase something below value and renovate throughout living in it as well as rent out the rooms to minimize your expenses.

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  • Nick Sheveland
    Rental Property Investor · Austin, TX · Member since 2018 · 128 posts · 84 votes
    7y

    I highly recommend working with someone that's already doing what you're doing aka a Mentor just like @Lexi Teifke mentioned(that dude rocks lol). Also I would recommend looking for a duplex that's off market. I've seen all of them on the MLS and yes they are in a sketchy part of town for that price range. I wouldn't live there and I wouldn't want to rent to anyone that would live in that part of town. Contact wholesalers and let them know what you're looking for and your price range that way they can keep an eye out for you. Also looking at rental ads on Clist and offering to buy might work. You could always "drive for dollars" too. Drive a part of town you'd like to live in and write down the address of the house you like, go home and get on the CAD site enter the address and find the owners address. See if you can find them on FB, get a phone number, or even send them a letter. You're doing good so far being on BP. Listen to the podcasts and act on the tips they give you and you'll go as far as you care to. Let us know if you need anything!

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  • Allison Stewart
    Rental Property Investor · Austin, TX · Member since 2018 · 76 posts · 46 votes
    7y

    We bought a duplex that needed a significant amount of work in a less than desirable area (it looks less than desirable, but it's a really hot neighborhood right now since it's less than 2 miles from the Domain) - and we ended up doing most of the work ourselves, with subcontracting out a few jobs. If you're willing to put some sweat equity in, you'd be amazed at what you can accomplish for relatively cheap. Most of the areas that have duplexes look rough but we haven't had any issues in our house - and we love our neighbors. I'd be happy to talk more about our experience if you'd like to PM me! 

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