Updated almost 2 years ago on . Most recent reply
Rent Amounts Down in Austin Tx
Single Family rent in Austin is currently Flat YOY (down 0.05%) How are you keeping your investments afloat in this market? What tips and advise would you give/ wish you knew as a newbie??
- Sabrina Flores
Most Popular Reply
It always helps to understand supply and demand.
A few years ago people in this forum were saying Austin was on a rocket ship to the moon because of all the tech jobs moving in. For a while that was true. (And, it may be true again in a few years.) Right now, it isn't true.
People were only looking at tech jobs; the demand side of the equation. Looking at just the demand side is only half the picture. Currently, Austin has a huge amount of apartment construction coming on line, and this is putting the pressure on rents. (see graphic) I don't expect the next two years you will see much rent growth in Austin.
In the many cities in which we've invested, we have seen this supply / demand interaction play out in cycles. Early on, sometimes we won and sometimes we lost. We've learned to seek out markets with steady or growing demand and a housing supply that is not quite keeping up. Generally, that puts you on the winning side.
It's part of the reason I don't buy the normal BP mantra about "Appreciation Markets" vs "Cashflow Markets". Having cashflow does not mean you cannot get strong appreciation. If you follow supply /demand closely, you can experience both!
