Austin, TX Condo vs. Single Family Home - Which is more worth it?

Question

Hi everyone!

I'm excited to post on BiggerPockets for the first time and get some perspective from seasoned realtors and investors with experience in the Austin area. I'm moving from Arlington, VA to Austin in May and would like to househack for about 2 years before either renting out or selling. I'm looking at properties in the 300k - 350k range which would mean either a condo in downtown Austin (would like to stay close to UT Austin) or a SFH ~45 minutes outside of Austin. Would love to hear any opinions on whether I should look at condos in downtown vs. SFH based on cash flow and appreciation? Thanks!

Ryan Kelly · Answer

@Stephanie Yokoyama welcome to Austin! If you plan to purchase a condo near UT Austin, I would be careful not to purchase in the campus neighborhoods where they will be filled with students. Many of them have lower prices because they simply are owned by parents to lease to their kids, then they sell them when the kids graduate to another set of parents. Party central. I would focus on east Austin or north-central Austin for a small condo if you want to stay in the city. Since you are new to town, you don't want to live far out. Even $300k-$350k is very tough to get a single-family home anywhere in the metro currently. Happy to chat about the market anytime.

Nicholas Riley · Answer

@Stephanie Yokoyama I'm curious what did you end up going with?

Celine Crestin · Answer

Condos are difficult as they typically have high monthly fees associated with them. Appreciation and rent are not always as strong as with SFR, but it is possible. Austin is huge overall boundary wise - so when referencing commute times in - are you referring to downtown? You can get a solid SFR home that you would have no problem renting out in the suburbs for your budget. Happy to chat if you have more questions or want to bounce ideas off of. :)

Andrew Hogan · Answer

Condo for appreciation or SFH for cash flow on possibly appreciation. Just depends how much work / time you want to put into it. If you can lock in a new condo during the initial phases it's usually an instant jump in price by the time you get your keys.

Laurel Chauvin · Answer

Stick with the SFR over a condo. You own the land which is ultimately the appreciating asset. The pool of buyers for condos is smaller and the HOA fees tend to put you close to the cost of a SFR.

There are some areas that you might be able to get into at your top end and still be within 25 minutes of downtown.

Jonathan Soto · Answer

i will do single family home as these tend to appreciate faster than the condo. and price and hoa you could possibly be crushing cash flow if you decide to rent after moving out

Conner Olsen · Answer

@Stephanie Yokoyama generally, homes will appreciate faster than condos. If you are okay living further away from downtown I'd recommend a home.

Eliott Elias · Answer

Condos will generally kill your cash flow with the HOA you pay. One pro is there is always a market for condos, young professionals are leaning more towards purchasing condos because of their price points and general vicinity within Austin. However, they don't appreciate as well as single family homes do, your budget will go up considerably to buy a SFR but its a safer investment.

David Sandvig · Answer

@Stephanie Yokoyama If it was me, I'd invest in the home over the condo. There are a number of rapidly growing areas that are still within that price point. Just to name a couple areas: Hays County to the south of Austin was the fastest growing county in the U.S. last year, and Cedar Park to the north is also rapidly growing.

If you were considering turning the condo into a short term rental, Austin does require an operator's license for short term rentals.

Stephanie Yokoyama · Answer

Thank you for your perspective! I know condos typically appreciate at a much slower rate than SFHs so trying to keep that in mind. I've also heard many new condos are being developed in Austin in the coming months which makes me lean more towards SFHs further outside of downtown Austin.

Austin, TX Condo vs. Single Family Home - Which is more worth it?

Austin, TX Condo vs. Single Family Home - Which is more worth it?

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