Any ideas for low budget starting investments in NW ATX?

Any ideas for low budget starting investments in NW ATX?

Real Estate Agent · Los Angeles · Member since 2017 · 107 posts · 33 votes

I had a realtor show me some properties today for the first time. Among them I saw:

  • A cute place 10 minutes from downtown that almost made me throw up from the curb because a decade of cat piss resided inside
  • A one story that was trying to act like a two story with a metal spiral staircase deathtrap, rotting wood all over it, major cracks and water damage all over, and needed at least 60k of repairs and updates while it was posting only 10k below comps
  • A duplex that looked like it was interesting until I found out it was right next to the street with some of the highest crime rates in austin.
  • A grandma house that was a step away from i35 (one block of houses in the way). The noise was terrible.

The realtor didn't really follow the 70% rule at all; all of the properties were pretty close to comps and I really wouldn't be making money off them even if I was able to do all the work.

My work is close to 4 winds and 620 and I'm trying not to go past 30 minutes of commute time. I only have enough saved to do FHA as of now and I realize I need to get my capital up asap so I can start buying places with cash. How do people usually do this? How would you start getting capital really quickly when you have a decent job but very low net worth?

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Georgetown, TX · Member since 2016 · 96 posts · 74 votes
9y

If you are using FHA you will have to live in the property for at least a year, I would recommend house hacking a duplex. There are some decent multi-family deals in Round Rock, that have a good amount of potential; solid growth rate, potential to ad value through TLC upgrades, and that are not to far away form your job.

Flips can be difficult to find but if you can justify offering less than asking price to get you your 70% rule, its worth a shot. The worse thing a seller can do is reject your offer but they could see reason.  Just because a home is overpriced doesn't mean it doesn't have potential. 

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  • Real Estate Investor · Austin, TX · Member since 2011 · 271 posts · 106 votes
    9y
    Get a capital partner and a realtor who knows deals meaning is an active investor. Good luck. Keep at it. Top schools getting too cash transactions like Leander ISD so maybe poke around up there.
  • Georgetown, TX · Member since 2016 · 96 posts · 74 votes
    9y

    If you are using FHA you will have to live in the property for at least a year, I would recommend house hacking a duplex. There are some decent multi-family deals in Round Rock, that have a good amount of potential; solid growth rate, potential to ad value through TLC upgrades, and that are not to far away form your job.

    Flips can be difficult to find but if you can justify offering less than asking price to get you your 70% rule, its worth a shot. The worse thing a seller can do is reject your offer but they could see reason.  Just because a home is overpriced doesn't mean it doesn't have potential. 

  • Cedar Park (Austin), TX · Member since 2017 · 4 posts · 6 votes
    9y
    Hello Zachary Barton. I am a newbie to REI, and your comment caught my eye because you sort of suggested what I think my 1st move will be. I have decided to find a Duplex to buy in Round Rock particularly and house hack. It will have to be somewhat of an older one, or a foreclosure. Do you have anymore advice or ideas as to what to do with something like this being that it will need repairs, hopefully mostly cosmetic? I know it's a highly desirable area, and I expect to save the income and look forward to the value increasing. Just trying to find the best way in other than wholesaling. Which I am studying. I plan on attending the next local REI meeting and learning as much as possible. I'm very excited!
  • Broker/Investor · Georgetown, TX · Member since 2011 · 249 posts · 146 votes
    9y

    I like your enthusiasm @Brendon K. but don't consider REI to be a sprint. It's more like a Spartan Race. Agents have a tough time in this market because prices are so high. The MLS isn't the place to find investment deals right now - so don't blame that person, I'm sure he/she was doing their best. Buying at a discount is the key to making REI work. I recommend a daily look at the reo sites: homepath; freddiemac; hudhomestore; bankofamerica; wellsfargo; hudsonand marshall; and auction.com. There are plenty more, but this is a great place to start.

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