All Forum Posts by: Joseph Baldini

Let's Start a discussion.

I've heard mixed thoughts and feelings from those Investing here in Austin TX. I deal with Flippers and Builders and Buy/Hold Landlords.

My firm has been putting out Off-Market Investment property with 20% equity, Minus the cost of repairs.

So, I've been dealing first hand with Investors in the area who scoff at the idea of 20% being anything close to a deal, while others are more than delighted, and see value in the equity capture here in the high speed and appreciating Austin Market.

I'd like to hear some thoughts from everyone...

Hello Garth.

Welcome to the high paced, high energy world of Austin Real estate. I'm not going to attach my name to any particular realtor in town. However, when choosing agent, especially here in Austin, look for one who is also an investor. Someone who has first hand experience in the market here and has experience doing it themselves. In your case, specifically doing rehabs. 

From what I've ascertained, some realtors here are very investor friendly, and some are not. Make sure that whoever you choose is investment savvy and is able to run comp numbers in the same fashion that an appraiser would. It will amaze you how many agents do not know how to do this correctly. 

Hey Jeremy.

I wholeheartedly agree with Alex. 1% deals are extremely difficult to find here in Austin. A good wholesaler is really going to be your best option, and even then, hitting that mark can still be a difficult task. Even if you get something deeply discounted, you'll still need to factor in a rehab budget. 

Appreciation is just outpacing the rental market. Your single family residential sweet spot is really going to be the outer suburbs such as Round Rock, Cedar Park or Georgetown. The rental market in these areas are really solid and they have working class people moving there every day. 

Agreed. Good point Carrie. 

If you want to find deals to rent, the outskirt suburbs are really the sweet spot. North, East and South. These areas have loads of young working class people moving there every day.

AUSTIN TEXAS STRAIGH UP!!!

For Multifamily Holds and Single Family Flips for sure. The city is exploding and the days on market are in the single digits! What else needs to be said...

I like to track down Eviction lists. That can be found at the Civil office of the Justice of the Peace's office at each individual precinct of your county. I'd say that would be your best bet to find divorce lists as well.

As always, nothing beats personally walking into an office vs. a phone call or an e-mail. 

Also note, More often than not, you'll need to submit a request in writing. So, be prepared and have one ready when going in for the first time. You may have to wait a few days for them to process your request and most of the time they'll charge you a few dollars for the copies.

There are lots of meet up's that go on here in town. Some are in the evening and some happen around lunchtime. Meeting people face to face is by far and away the best way to make contacts. 

Be sure to bring enough business cards and have your 15 second pitch ready.

Good luck 

If this is an inflated market with negative cash flow left and right for buying new rental property, it begs the question why not explore 2 different options. Seeing as the only variable that any of us can control are our own strategies, 

1. Adapt your location. Deals can still be found in the suburbs and outlying areas of Austin. They are being filled with renting, working class, young people every day.  They can be tricky to find, but they do exist. You may need to contact some off market providers.

2. Adapt your investment strategy. Fix and flip for income, or make equity plays on your property acquisition. 

Adaption is the key to survival here. 

Hey Raymon. 

Can you tell me more? 

Good decisions are really dependent on what your strategy is, and what you're trying to accomplish. Your buy strategy will be drastically different if you are buying to be an owner occupant vs. buying to invest. Then, there is the question of what is your investment strategy? You'll be looking for different characteristics if you trying to fix and flip, or if you are buying something that's already at the top of the market. Are you trying to hold this property to collect rent, or buying to sink some cash into it for equity and speculate on the appreciation?

The more specific you can be in what you are trying to accomplish, the more successful you will be in making that good decision.

Furthermore, I've got a pretty good handle on what's going on in the Austin market. Let me know if I can do anything to help you move forward .

I reached out to a loan broker last week in order to create a mutually beneficial cross referencing relationship here in Austin, Tx. I work with an acquisitions firm here in the local area specializing in finding off market distressed property for the behalf of investors who would like to fix and flip or add to their buy and hold portfolio.

I asked if she had people who need projects, and to feel free to send them my way. This could be a great opportunity to subsequently create some business for one another. I can supply the projects if she could supply the financial means to allow her investors to get it done.

My firm supplies property at 80% of ARV minus the cost of rehab repairs. Our fee is already built into the cash price.

At which point she responded: Thank you for reaching out, Joseph, I get these types of emails frequently from agents. I have clients looking for real deals (70% ARV with realistic ARVs and budgets) so you are welcome to send me those deals.

I responded, That's fair. However, please take a moment to consider the fast pace and demand in the Austin market. Not to mention the high price point and low days on market. 70% is a great rule of thumb for the Mid West or some more rural areas, but in Austin that's just not a realistic number. It's just about the hottest market in the country and a place where people simply want to be. If your clients are demanding 65 or 70% deals, Austin is just not the market for them. Also, take into consideration that our fee is built into our price, it's not added on after the fact. That's a big deal in factoring the final costs after all is said and done. Honestly, if you come across someone who has a 70% deal with fees built in to the price, send them my way. My guys would snatch that up in a heartbeat.

I'd love to hear some different takes on this by some others form all over the different areas of the Real Estate and Investing World.