Seeking advice for aouse hacking strategy in Austin

[Fumi Maher]

Hello community,
I am a new investor in the Austin area, TX and debating between two strategies. Since I am new to the town, I wanted to seek advice from experienced investors out there. Which strategy below would you do in the Austin market? I am looking for a property around $500k, single with a remote work and side hassle.

Strategy 1: buy a duplex, live in one unit (for one year as a "primary residence) and rent out another unit as a short-term / mid-term rental on Airbnb.
Strategy 2: buy a single-family house with at least 4 bd, live in one room, rent out the rest of rooms as a mid-term rental on Airbnb / long-term rental.

I am new in this game and here to learn everything. Thank you all!!

[Masyn Grant Barney]

@Fumi Maher, I'm not from Austin but I will give you the advice I give those here in Utah (most of which should transfer just fine) 

Renting by the bedroom seems to bring in the best cashflow. So whichever type of property, rent by the room if you are up for the extra management burden. Sometimes condos/townhomes are better at attracting young working professionals given that they are usually in more densely populated areas and often will have amenities that come with the HOA like pools, gyms, etc.

Buying a multifamily property tends to be better for scale. Here in UT we have strict occupancy limits in college towns of 3 unrelated people per unit. So renting by the room doesn't work as well there. Many just ignore the zoning rule though. That occupancy limit is often why many go with a duplex given they can rent to family and make more than they can renting to 3 singles. But 4+ singles works great if you can make it work. 

Hopefully that was helpful! I think both are great options and you can't really go wrong if you are going into it openminded. 

[Jordan Moorhead]

@Fumi Maher both can work well but you'll find one may be more attractive to you personally.

I've done all duplex househacks and incorporated MTR and STR when it made sense. I still own two of them and sold two of them to buy more rentals

I'm always up to talk househacking too if you'd like to grab coffee or lunch!

[Sasha Mohammed]

im in Orange County CA and there is a huge market here for room by room rentals here. i've been doing this for quite some time (over a decade now), and it certainly has its pro's and cons. 

my advice if you go about this is make sure you do proper vetting before moving someone in... not only for financials/ credit-worthiness, but also for temperament and expectations in a co-living space. 

we ask a lot of questions like "how do you handle conflict?" "what is your experience living with room mates?" "what does your M-F schedule look like" "how do you decompress at the end of a long day?" in a vast interview process with many steps before allowing someone to move in. a new roomie is an everyone-decision, not a landlord-only decision; if you're expecting people to co-exist in a space together (for longer than just a few months), you have to make sure they all have some things in common, or at minimum have the right expectations in terms of cleanliness and routine habits.

someone working the night shift and someone else having a 5am rise-time, or someone who works from home in a call-center job is not going to jive well for example. and someone who doesnt handle conflict well is not going to jive with someone who is brutally honest and up front about issues. 

happy to go into more deets on how we do things if it will help. this can certainly be lucrative in terms of cash flow, but there are huge mud puddles i have stepped in over the years which i have had to learn to navigate.

[Wale Lawal]

@Fumi Maher

Welcome to BP!

Both strategies you’re considering have their advantages: buying a duplex or a single-family home. Duplexes provide privacy, flexibility, and scalability, but strict short-term rental regulations may increase upfront costs and maintenance. Single-family homes offer higher cash flow, lower maintenance, and potential equity growth, but may have less privacy and slower unit growth.

Good luck!

[John Steffen]

Austin is flooded with STRs (and str regulations now) but it can still work, just use a good agent. I would lean more MTR or LTR regardless of product type. If you go RBTR, here are a few key criteria I've seen to assure comfort of living and lower vacancy / turnover:

- at least 400sqft per tenant and no more than 2 tenants to 1 full bath 

-excess parking where folks aren't blocking each other in and you're not getting complaints from your neighbors about overtaking the street parking. Bonus if you land a corner lot.

- multiple indoor common areas (think 2 separate tv setups). 

- exterior "usable square footage" (think covered patio, pergolas).

- extra storage space so tenants don't feel the need to squeeze their entire lives into one room (extra garage space, attic, detached shed)

- room for 2 full refrigerators! + ample pantry/shelf/cabinet space for dry goods.

[Ryan Kelly]

@Fumi Maher both are good strategies and we have clients doing both currently. Rent by the room may bring in more cash flow per bedroom, but may not cash flow as well if you convert the SFH back to a long term rental. A duplex is more flexible as you will have privacy on your side and can test out any strategy with the other unit ( LTR, MTR, STR, rent by the room). When you leave, a duplex will typically generate more cash flow as a long term rental than a single family home. I would consider both your short term and long term goals when buying the property. I'm happy to connect if you want to discuss options.

[Aubrey Durham]

Welcome to Austin! Both strategies have potential here, so it depends on your goals:

Strategy 1 (Duplex) can be a solid choice for building equity and generating cash flow, especially in Austin’s competitive short-term rental market. You’d have the flexibility to rent out both units later, potentially doubling income if you decide to move.

Strategy 2 (Single-Family) offers more room to house-hack and may attract tenants looking for mid-term stays. It could be a good choice if you prefer more personal space or want flexibility with different rental terms (like longer stays for remote workers).

In general, duplexes are more limited in Austin and can appreciate well, while single-family homes give you future flexibility and a wider tenant pool. Both can work, so it’s about your comfort level and long-term goals.

I am a licensed real estate agent here in Austin and I specialize in real estate investment properties. Reach out if you would like more guidance.

Good luck!!

[Matthew Kwan]

I am based in Seattle, but is licensed in Tx.

You can acquire your a primary residence from up to 1-4 units for as low as 5% with conventional or 3.5% with FHA with a few exceptions. Many buyers/investors are using this strategy to invest in real estate.

- get into real estate with a lower rate and lesser percentage down payment.

-house hack or rent out your vacant units out to lower your monthly mortgage payment.

-repeat the process every year by acquiring one house every year with the appropriate income qualification

There are several ways to run and make sure you are maximizing your rental income while keeping your living expense as low as possible. Try looking into zillow/Redfin and see what your potential rents you can get near the neighborhood by filtering the bedrooms/bathrooms of the intentional property that you are planning to buy. This will allow you give a reference point on how much potential rent you can receive. (Max vacated rents - your monthly mortgage payment) = +/- net cashflow. Happy to connect and assist you in your real estate investing journey.

Happy to connect if you are interested to expand your portfolio