Investing in Austin (Cedar Park/Round Rock)

[Mak Sharma]

Hello Everybody,

I am new to BP. Looking to invest in Austin (Cedar Park or Round Rock?) area with a long term horizon and hoping to get in with 1% rule.

Will I be able to find something decent? Is it too late? Would appreciate any inputs or suggestions!

Best,

Mak

[David Ivy]

@Mak Sharma

Welcome to BiggerPockets! What type of investment are looking to make? If you're interested in single-family homes, then it will be practically impossible to find anything in the greater Austin area, including Cedar Park and Round Rock, that meets the 1% rule. To get anywhere close, you'll need to find a good deal on a property that needs work. Unfortunately, everyone else is looking for these properties. Your best bet is to find an exclusive opportunity by marketing directly to distressed sellers yourself. Wholesalers also often get deals that are too thin for a flip, but they can make sense as a BRRR. However, people are buying pretty thin wholesale deals as flips at 80%+ percent of ARV in Austin. You can still get pretty close to the 1% rule on the occasional fourplex in Austin. Those properties will usually be in poor condition.

If your goal is merely to find something that cash flows while putting the least amount down as possible, then you can find occasional opportunities. These will still likely be very thin (e.g., a SFH that cash flows $100/mo.). It's just tough all around right now.

Here's some very general info. you may find useful:

• Over the past 90 days in Austin, the median SFH sold for $370,000, and median SFH rent was $1,795/mo.
• Over the past 90 days in Cedar Park, the median SFH sold for $296,000, and median SFH rent was $1,695/mo.
• Over the past 90 days in Round Rock, the SFH sold for $275,000, and median SFH rent was $1,600/mo.