All Forum Posts by: Ryan Kelly

Any market and any property can cash flow. The question is, how much leverage is the investor using to purchase the property and at what interest rate. If people bought thin deals, then when the market drops they go under. However, if you purchase with a cash flow cushion already in place, you can ride out any down turn or slow down in the market. The chart is correct, Austin has overbuilt multifamily units and it will take a few years for the supply and demand balance to return.

@Jason Sousa Bell County continues to have a far better rent to purchase price ratio than the Austin metro as the price points are more affordable. Still a challenge to cash flow with a typical down payment, but they can be found with the right deal.

@Jordan Moorhead house hacking is working well in this environment. We're also getting some pretty sweet deals on new construction with closing cost incentives. If those don't work, you know I'm a fan of Bell County!

@Simone Montague-Jackson you are on the right path and keep focusing on saving capital. I’m in Austin too and happy to connect. I’ve got several great property management recommendations in the area.

@J Shoe A trust isn't used for asset protection purposes, it is purely for estate planning. The 10-Unit complex would be a commercial business, so the simple answer is to purchase and operate in an LLC. If you want to have the LLC owned by your trust, that is always an option. As others have said, I would talk with your CPA and asset protection attorney for formal advice.

@Austin Bright Texas is currently seeing very aggressive premium hikes due to several large insurance companies pulling out of markets and due to claims for numerous storms and natural disasters (hail, hurricanes, Houston floods, etc). I’m commonly seeing policies going up 25% to 60% year over year. I can’t answer specifics about your property, but not surprised you are seeing a steep rise.

@Ilan M Aliphas read your contract. It should outline specifically what will happen if specific decisions are made and who is entitled to the earnest money. Did you use a real estate agent? Title company? They can assist you.

@Daniel Barad do you have a good relationship with a real estate agent? If so, have them pull lease comps to see what similar properties are actually leasing for, not just advertising for. Takes 5 minutes and far more accurate than the guessing game of online estimators.

@Sarah Ali you are never too old. We purchased our first rental when I was 44 years old and now have 7 units a few years later. Who says you need to pay the mortgages off? For many of us, the debt is an asset which can be refinanced for extra cash as you pay down equity. Don’t make it complicated. Go find ONE property you want to own, run the numbers, and buy it.

@Scott Trench most people are not investing in the state, but the city in the state. Many are actually in blue cities in red states, like Austin, which is a great balance. Progressive, fast growing cities with landlord-friendly state laws. It’s a good balance.

Austin simply got overbuilt in the short-term, especially in multifamily, which is creating a bit of over supply, but that will fill up in the next 1-2 years with the pace of growth. The land and landlord laws have nothing to do with present day conditions or concessions. Just look at two years ago when landlords got multiple applications in hours and tenants were willing to pay 20-40% higher rents to “win” the lease. It always comes down to supply and demand.