Cash flow vs appreciation?

[James Lindsey]

hello everyone,

I am just starting out in Austin, Tx and I have been running the numbers on all the properties I can find here in Austin for the past couple of months. I am searching for a multiplex to house hack however I have not been able to find hardly any properties at all single family or otherwise that would properly cash flow here. The appreciation however will be awesome no matter what I buy here. So if my main concern is cash flow should I be willing to give that up for buy and hold appreciation in a market like this? This would be my first home purchase. I am very new to the game.

[TJ P.]

Originally posted by @James Lindsey:

 I've been keeping an eye out as far as an hour away from Austin but that makes my daily commute multiple hours during rush hour which doesn't make any sense when your job earnings depends on how many hours you work. I would be left with no time for further real estate investing or family.

 ATX is tough to cash flow. I was there the past couple of years before moving to the Bay Area ( Am I glutton or what???) If I hadn't moved, I was looking at house hacking way outside of Austin proper- Think Killeen, Bastrop, Elgin, San Marcos. I didn't come to these locations arbitrarily either. I decided what I was willing/able to spend on the finance side, factored in the class of neighborhoods I would live in and scoured those areas that fit the bill. I've used this approach in most cities I've lived in and have had interest in investing in (cash flow) and found that you can usually map concentric delineation of affordability. Austin simply left no options for me and pushed my search further out.

Many will talk about what "edge" you will provide in your RE ventures to be successful.  I was willing to commute longer than was customary. If this isn't palatable to you then ATX in its current state may not be your best choice for this type of investing.

[Cesar S.]

Just to add to this,  I think it depends on your area,  if you live in a larger city with a lot of jobs/transportation then as others mentioned the cash flow may not be as great.   However the appreciation potential can make it a home run.   I ended up being a landlord by accident (wife couldn't live in 600 Sq ft apt) but if I had sold it when I moved since it was negative cash flow I would've lost 20% in appreciation.   Bottom line is know where you are investing and do what makes sense to you.