All Forum Posts by: Scott Pigman

We're moving to the Austin area soon and we're trying to figure out whether or not to buy or rent and if we buy, what kind of house we should get. 

I've tried to ask this in a general way, but for anyone who knows the area, we're looking in Cedar Park or Round Rock, TX, more or less near the Lakeline mall.

If we buy, the options are:

1. Buy a nice house in a good neighborhood. In a year or so we could turn it into a rental but the returns aren't great (rent < 1% of purchase). Or we can continue to live there. 

2. Buy an okayish house in an okayish neighborhood for less money. The rents are also going to be lower, so it's not like it's going to be a better cash flowing property. We wouldn't want to stay there for much more than a year. The advantage is that we're spending less money today.

I'm wondering what any of you would do, and how you'd make your decision. For the record, I'm in my forties and we have a three year old. So I'm looking at this differently than I would have when I was a 23 year old bachelor.

My thinking is that the nice house will likely (no guarantees) appreciate more than the okay house, and so will the rents. The cheaper houses are cheaper for reasons that can't be fixed, like they're near a major expressway. So I think they're probably not going to perform as well. 

This isn't a pure investment question since we will be living there ourselves. Buying a house with the great cash flow that we wouldn't live in ourselves isn't an option. (Besides, there really isn't anything with "great" cash flow in the area). But still, we don't want to have negative cash flow if we decide to rent or be upside down if we decide to sell.

Welcome, @Christopher N Grant ,

I'm in Owings Mills and just getting started myself, although I'm moving to Texas next month.

The MAREIA meetings in Owings Mills are good. I've heard that the Baltimore REIA is good too.

The DC-REIA meetings in Upper Marlboro are basically pitch-fests for Sherman Ragland's RealInvestors course. Go to meet people, but when they start the hard sell sit on your hands. (or not, I hear that people have been successful with them, but I feel they really play on people's fears to get them to sign up).

One thing I've learned about MD that's different from other states is that we have some pretty tough laws regarding foreclosures. Basically if a homeowner is more than 60 days behind in payments you can't even talk with them unless you're a realtor or attorney. Google PHIFA or check out this video:

http://www.google.com/url?sa=t&rct=j&q=&esrc=s&sou...

@Brian Mathews & @Elizabeth Colegrove 

Thanks for sharing your different viewpoints regarding renting to military. It's good and useful to see some back and forth :)

My REI-newbie who was never in the military take on it: 20 year olds, particularly 20 year old men — regardless of whether they're in the military or not — are idiots.

I'm kidding. Sort of. I don't think that most of them are idiots all of the time. But there's a reason why car rental companies don't usually rent to anyone under 25. (I speak as someone who was once a twenty year old. Many of my friends were also once one themselves.)

Brian's description sounds a lot like undergraduate student housing. Except for the part about the cars. 

Questions: So can a landlord have a policy of not renting to anyone under 25 years old? Or below a certain rank? Can you not put a limit on how many unrelated people can live in a house and require that all tenants be listed on the lease? If a soldier is a problem tenant can you bring it up to their commanding officer? 

Thanks again,

Scott

Thank you everyone for your comments.

@Jon Klaus  What would you consider an "outlying town"? Would that be something like Round Rock, Cedar Park, and Georgetown, or do you mean further out than that?

@Paul Timmins Your suggestions sound very solid. Student housing is definitely something I want to look into. I hear that there's some sort of small college downtown. (I kid, I kid)

@Uday T. those percentages - are you talking about ROI or the "one/two percent rule"? I fear you're talking about ROI...

@Gregory Tran  I definitely want to start educating myself about what's 60-90 minutes away. In particular I want to research the Fort Hood area. Tell me if I'm wrong but I'm thinking that a market with a constant inflow of military families needing housing and an outflow of families looking to unload the house they bought has some opportunities.

and to anyone, I guess that on BP a "vote" is like a "like" or "+1" and not like a "vote off the island" or "vote to impeach", right? :-)

Thanks again and all the best,

Scott

Hello all,

I'm just starting out as an RE investor; this site is a great resource. Right now I'm in Baltimore county (i.e the suburbs), but next month I and my family are moving to the Austin area - probably Cedar Park or Round Rock. We're converting our current house into a rental so I guess that technically I'll be an investor then, but since we paid full retail ten years ago it doesn't seem right to say that yet.

I'm hoping that before we arrive in Texas we can find a house we can buy as a owner occupied and then covert to a rental in a year or so. But frankly that seems like a heck of a hail Mary play to pull off. So I fear we'll end up renting for awhile.

But the big questions I'm trying to work out, and which you may see me posting into the forums, revolve around working out exactly what my initial strategy will be. I know I want to buy and hold, but where? I hear Baltimore has great cash flow in the city, and I'll have to travel back here for work anyways... But which block is ok and which is a war zone can change in a block -- and I don't know the city very well. (fwiw, I lived in Michigan in the 90s and used to go into Detroit sometimes. Baltimore has areas every bit as bad as what I saw in Detroit). So I'll need to partner with someone who does know the city.

So then I look at Austin but it seems to me like the market is a bit pricey with weak returns for rent. So them I start to wonder about driving an hour north to Killeen and the army base up there, or maybe investing in Michigan where I like to go for vacations anyway, or looking into a turn key investment in St Louis...

I could go on, but it's late and this isn't the right forum.

Good night all, 

Scott