Looking to invest in NW Austin (Cedar Park, Round Rock)

[Naveen G.]

Hi everyone,

I'm from the San Francisco bay area and I'm just starting out in the real estate investment world and I'm really glad I found this website. I am learning quite a bit by going through different posts on Austin real estate investing. I am looking to invest in a single family home in Cedar Park or Round Rock (preferably Cedar Park). The reasons being some of the zip codes in these areas have good schools and these areas are also pretty close to tech companies. I am primarily looking for appreciation and not cap rate (completely fine with less cap rate after paying mortgage using monthly rental). However, before taking the plunge, I wanted to get some expert advise.

• What is the prediction for these areas (Cedar Park or Round Rock).?? Did they already reach a point where further appreciation will be very slow.?? In the coming years, how is the job growth going to look like in the NW Austin.??
• I do not want to spend beyond $250,000. I see that none of the new constructions are available in this price range(checked online and could not find any). So, I am open to buying old constructions. Ideally, I would also like the lot size to be bigger (>=0.25 acres). I see few such listings online. But I am not sure if there are any catches. So, is it possible to find good single family homes with big lots in my budget.?? (in a good location and good school district).
• If I end up buying an old home, what will be the disadvantages.??
• How fast old constructions get rented in these areas.?? Will I ever end up in a situation where I can't find a renter for months.?? (from reading online, I found that houses in these areas get rented fast. Not sure if that applies only to new houses).
• Can I also get suggestions/references for few local realtors who can help me find the house.?? (would be ideal if the realtor also deals with property management).

I would really appreciate if any expert can answer the questions. Thanks in advance.!!

[Dan Burstain]

Hi Naveen,

Let me see if I can answer your questions.  

What is the prediction for these areas (Cedar Park or Round Rock).?? Did they already reach a point where further appreciation will be very slow.?? In the coming years, how is the job growth going to look like in the NW Austin.??  

****These cities continue to grow and job growth remains very strong for NW Austin and its Tech Corridor.  I think appreciation will show steady growth for a number of years to come.  

I do not want to spend beyond $250,000. I see that none of the new constructions are available in this price range(checked online and could not find any). So, I am open to buying old constructions. Ideally, I would also like the lot size to be bigger (>=0.25 acres). I see few such listings online. But I am not sure if there are any catches. So, is it possible to find good single family homes with big lots in my budget.?? (in a good location and good school district).

*****You can find good homes in Cedar Park that go to the very good Leander School district for under $250,000.  There are even a few with 1/4 acre or more lots although that limits you a bit.  As for new construction, you can find it just above that price point at about $260K.  

If I end up buying an old home, what will be the disadvantages.??

****** Sure, older homes come with more Cap Ex needs.  In other words, you need to replace things a lot sooner if they have not been replaced.  A home built in 20+ years ago (in say 1997) may be on its original AC and roof.  Both of which might need to be replaced soon.  A costly problem.  Where as you might buy and sell a new home before ever thinking of needing to replace anything major like that.  Now old homes do have some positives.  They usually have large mature trees in the neighborhood vs. new developments.  Many people like the look of that.  

How fast old constructions get rented in these areas.?? Will I ever end up in a situation where I can't find a renter for months.?? (from reading online, I found that houses in these areas get rented fast. Not sure if that applies only to new houses).

******  House get rented fast when they are priced right and don't rent fast when they are overpriced.  It is just that simple.  We are at 95% occupancy and if you price your place at market rate you should have no problem renting it.Any place that goes for months not rented is severely overpriced or has major things wrong with it.  

Can I also get suggestions/references for few local realtors who can help me find the house.?? (would be ideal if the realtor also deals with property management).

******* I don't think I am allowed to toot my own horn on this site even if asked... I am sure someone will PM you.