All Forum Posts by: Dan Burstain

@Shreya Mehta  If you can find a place there in the mid $300's or updated can be low $400K it would be a solid investment.  Nicely located between 130 and 35.  With places further out like Jarrell and the like getting more and more development, Georgetown will be more and more attractive.  

@Thomas O'Donnell

First, a lot of people (who mostly don't live here or know much about our growth) keep saying Austin prices will crash.  If any of these people own property in Austin, please let me take it off your hands.  40 years of straight appreciation.  The largest dip in price in 40 years is 2.9% and we have been through housing crisis, oil crisis, dot com crisis, you name it.  We are the 10th largest city in the nation and even with all this appreciation we are still 23rd in median sales price.  30K new jobs a year, 120 more people each day, demand far exceeds current and future supply, but for some reason people think what goes up has to come down.  Look at the data and not a saying.  

Second, and maybe most importantly, as you said you only live once.  If you are choosing between San Antonio and Austin, go to the city you want to live in the most.  You will do well in either.  But I would much rather live in Austin than San Antonio.  I am sure there are others who feel San Antonio is better. I will say, Austin is constantly voted one of the top 5 cities to live in.  Find out what is important to you and your happiness and how it relates to each city and that really is what should be the deciding factor.  

@Thomas O'Donnell as @David Sandvig stated- hard to find a more appreciating city in the US than Austin.  Cash flow is better in San Antonio and you should find lower price points there as well.  Austin's market probably has a bit more competition as well as demand is still strong with about less than a month of inventory.   San Antonio is obviously a much bigger city as it relates to population but 120 people move to Austin every day and are usually coming for high paying tech jobs.  I don't know much about job growth in Austin but I can tell you Austin and its surrounding suburbs are seeing very strong job growth.  Complications? Probably all has to do with what you qualify for compared to what you want.  

Hey Jarrett,

I am an investor in Central Texas and have been looking lately at Lockhart and Uhland.  Word my sources are hearing is that they could land big company development deals sooner than later.  

If you are looking for newer homes at the $300K price point New Braunfels, Bastrop and Jarrell are the places to get this and the first two might see a tad more appreciation than Jarrell.  You can still find older homes closer into Austin at that price that will have higher appreciation but also need more work.

Nail in the coffin? More like umbrella in their cocktail. Yes, property tax bills are going up. That is because the homeowner just made $100K in equity. Can't afford your property taxes? Get a HELOC on this new found equity. Sell and take you $300K or whatever you made on your house the past 5 years and buy a place in a lower tax area or just further out and pocket some money. The people that are moving here every single day think our prices are very low in comparison. Again, we are 26th in median home price. I own 6 homes here in the Austin area and my property taxes went up a ton, but I would love to duplicate that year after year after year. I gladly pay 3% and keep the 97% of the properties increase in value.

@Chris Schorre I believe even at 8% interest rates we will continue to see climb in price.  Large increase in prices, yes, but from what point and where do they compare?  These are the questions investors should be asking.  Austin is a top 10 city in population, top 3 city in places to live, #1 in growth and stability, and yet 26th in median price.  Overpriced? Not even close.  Then look at the fact of supply and demand and with all the companies moving here, 150 people per day, but not enough homes being built to accommodate the demand.  These are the numbers people should be looking at vs. how much it has increased in the past 10 years or interest rates.  We were still selling houses when interest rates were 15%.  

By John Egan

While the Austin housing market continues to shatter price records, a new study shows it’s the best U.S. market for growth and stability.

The study, published by personal finance website SmartAsset, places Austin at No. 1 among 400 metro areas for housing growth and stability. That’s up from the No. 2 spot last year.

The study notes that Austin-area home prices soared 368 percent from 1997 through the end of 2021. That was the biggest spike among all of the metro areas examined in the study. Meanwhile, it estimates there’s a zero percent chance that an Austin-area home would suffer a 5 percent drop in value within 10 years of being purchased. 

In February, the median price of a home in the Austin metro area came within $5 of $500,000, representing an all-time high, according to the Austin Board of Realtors.

In SmartAsset’s 2020 and 2021 studies, Midland, Texas, ranked first for growth and stability. This year, it lands at No. 3. According to the 2022 study, home prices in the Midland area jumped 266 percent from 1997 to 2021, with a zero percent chance of a 5 percent decrease in home value over a 10-year period.

Half of the metro areas in the study’s top 20 are in Texas, including the state's other major metros.

Houston ranks sixth, with a 221 percent rise in home prices over a 25-year span and a zero percent chance of a 5 percent loss in value over a 10-year period. Dallas-Plano-Irving is seventh, with a 228 percent rise in prices and only a 1 percent chance of a 5 percent loss in value over a 10-year period.

San Antonio comes in 11th, with a 214 percent rise in home prices over a 25-year span. It also has a zero percent chance of a 5 percent loss in value over a 10-year period. Fort Worth-Arlington-Grapevine ranks 15th, with a 213 percent rise in home prices and, like Dallas, a 1 percent chance of a 5 percent loss in value in value over a 10-year period.

Odessa (No. 8), San Angelo (No. 10), Waco (No. 12), and Bryan-College Station (No. 17) are also among SmartAsset's best markets for growth and stability. 

Home-buying expert Liz Hutz notes that the two main drivers of home price increases are economic growth and job creation, both of which have enjoyed a torrid pace in Texas. For instance, Texas in November surpassed its previous pre-pandemic employment high by inching close to 13 million jobs.

“We will continue to unleash the full might of our economy, attract new business investments, and ensure a more prosperous future for all who call Texas home,” Gov. Greg Abbott vowed in December.

@Matthew Stallone it really depends on your goals. Are you looking to maximize ROI or cash flow. Thinking you can do both is just wishful thinking. Now it is St. Patty's day so sometimes people get very lucky but you need to look at it like a scale. One side has projected appreciation, the other side has projected cash flow. When one goes up the other comes down. So pick one you want. You make more money on the appreciation side. Of course, appreciation is icing on the cake in most areas of the country. But if you look at the data, you will see some cities have high projected appreciation with low downside. Also note that just because you have negative cash flow in year one does not mean you won't be making positive cash flow in year two or three and still grabbing that appreciation. People ask me where is the next Austin and I tell them, as Elon Musk believes, the next Austin is Austin. It is setup to continue to climb and our prices are still half of those like Seattle, San Fran and other cities. $350,000 brand new 3-4 bedroom home 20 minutes from downtown. $400,000 resale homes, 5 minutes from new Apple campus. Largest decrease in price in 40 years in Austin has been 2.9%. My money is here and will continue to be here for awhile. If not Austin, find a city that has a big government job sector for protection and also bringing in lots of new jobs in tech and other areas. Cash flow will come but the real money is in the overall return.

There are a lot of variables to what you are asking.  Construction costs can vary widely depending on....

1) Type of contractor you are using

2) Existing condition of place (foundation, plumbing, moving any walls)

3) Type of material using (flooring, countertops, fixtures and appliances)

Depending on what you are doing it could range from $15K to $150K and between 2 weeks to 6 months.  Ideally, you want an Investment Realtor or contractor to come with you to the place and let you know what you are looking at.  IMO