Interested in buying a rental property in Austin.

[Ahamed Nafeez]

I would like to buy a rental property in Austin, TX. The range am looking for is around $225-$275K. What are the best options I have in terms of websites and resources? I am a newbie in this area and would like to know more about the real estate market in Austin.

[Alex G.]

You didn't say if you're local or not. Of course, realtor.com,  austinhomesearch.com and similar sites have all current listing inventory. But if you live out of area your best resource would be a real estate agent. You need somebody in Austin to be your eyes to describe condition of properties and neighborhoods, provide comparable sales and rental analysis.

More importantly, you should put your thinking cap on and strategize a bit. What are you after exactly? Austin in general has become an "equity" town rather than a "cash flow" town. I.e., you'll probably do a lot better buying as close to Downtown or Domain where appreciation is  a big driver, than if you were to buy on the outskirts where your cashflow will be better. 

There are always trade offs, of course. If you're buying central you'll likely have to deal with 40-50 years old house (old plumbing, electrical, outdated floorplan, lower ceilings, 1-car or no garage, etc) that will generate higher repair bills during your ownership and higher property taxes. On the outskirts, you can get a 10-15 years old home in a good condition with a decent floor plan that may not need any major cash infusions for a while, and your taxes will be lower.

Within your target price range, you  should be able to find plenty of homes in both categories. With 20% down conventional financing at that price point, whether they'll break even (or even come close to breaking even) after expenses  is a big question. Make sure to run your income and expense spreadsheets and keep in mind the difference between old and newer homes in terms of maintenance / repairs.