Why Buy Investment Real Estate
In Austin Texas?
Instant Cash Flow and Growth!
While real estate in many parts of the country is still deep into buyers
market with big oversupply of housing inventory, slow sales, upside down
houses and depressed prices, both residential real estate and rental markets
in Austin, Texas are booming...
And now is a perfect time to invest in a piece of Austin's rapidly growing economy to capture this big upside!
According to Austin area Multiple Listing Service (MLS) the housing inventory in Texas capital is down from over 6.7 months supply in 2011 to only 4.4 months supply. This is a clear indication that Austin real estate has just made a turn from a buyers' market to the sellers' market.
Below are some of the factors driving UP the return on your dollars invested in Austin area real estate.
Forbes Lists Austin As 2013 #1 Booming Economy In The US For The 3rd Straight Year
Forbes recently published a list of US cities with rapidly growing economy and Austin has made the #1 spot. Of course, Austin has been at the top of countless city lists over the last decade. But it still kept his premier place even after the 2008 mortgage meltdown and economic downturn.
Click Here to take a look at Forbes article on Austin.
New Home Construction Is Well Behind the Demand
Builders are seriously behind on new home construction starts causing the new home inventories to drop to a low level seen only in the early 90s!
“I’ve raised prices three times in the last six months,” said Ken Swisher, Austin division president for David Weekley Homes, although he said the increases have been small.
With a low supply of homes and historically low interest rates, “the prices out there that are being offered are the best that we’re going to see in many, many years,” Swisher said. “I think people are taking advantage of a good opportunity right now, and who knows how long that opportunity will last?”
At Pulte Homes (the nation's second largest homebuilder), “traffic at our 20-plus Central Texas communities is up 10 to 15 percent from March of last year, and we’re seeing the pace of (contracts) exceed our initial 2012 projections across the board,” said Scott Eckley, vice president of sales for Pulte in Austin.
Warren Buffet's Take On Investing In Single Family Houses (CNBC)
A Look At the Resale Homes Market Data In Austin
Lack of new housing in turn has been driving up demand for resale inventory in the real estate market. The number of sales is up from a year ago. Houses are getting put under contract fast!
- 7,319 - Active single-family home listings on the market, 24 percent less than April 2011.
- 2,479 - Pending sales for single-family homes, 21 percent more than April 2011.
- 67 - Average number of days that single-family homes spent on the market, 21 days less than April 2011.
Austin's
Rental Market Is Also Booming
Vacancies are down to less than 10% and rents are skyrocketing. According to some experts rents are up by over 25% compared to the 2008 levels. Austin MLS reported that rents grew 8% during last year from May 2011 to May 2012.
As Austin continues to attract new employers and new workforce it has the lowest unemployment rate in the state, while state of Texas itself already has nations lowest unemployment rate. Current job growth rate in Austin metro is 3.5%.
Formula 1 Racing Comes To Austin
To top it off, the construction of the new $200 million dollars Formula 1 racing track facility is nearing completion in the fall of 2012. The Formula 1 event and other events that will use the facility with room for up to 200,000 spectators.
It is estimated to add about $250 million dollar per year
to Austin area economy and create thousands of additional service, retail
and hospitality jobs. 
First Formula 1 race is scheduled for November 2012. For now, the area around Formula 1 track consists mostly of farm land.
As the races go under way the land around the track is expected to be in demand for infrastructure to support hundreds of thousands of visitors attending events at the F-1 facilities.
Investors Perk Up
As Austin real estate pendulum swings, a combination of the still affordable, yet rebounding home prices and a very strong rental market presents an unusual short term opportunity for real estate investors who can get their hands on investment properties at still relatively low prices.
These real estate properties are already growing in value, and have a strong foundation for long term growth in the Austin metro area. Yet when well selected, they also immediately throw off strong positive cash flow and respectable double-digit can cash-on-cash returns for rental investors.
An Actual Deal With 17% Cash on Cash Return and $417/Month Net Cashflow
Here
is a little gem of an investment property in one of Austin's popular suburbs.
It offers an instant $417/month NET cash flow after loan
payments and expenses and 17% cash on cash return to boot.
With a rapidly increasing demand from both local and out of area investors, deals like these are getting harder and harder to find.
Purchase
Price: $117,000
Down payment: $29,250 (25%)
Conventional loan: $87,750 @ 3.25% fixed, 30 years
Monthly Payment: $381.89 (principal & interest)
Taxes & Insurance: ~$300/mo
Total Monthly: $681.89 PITI payments (principal, interest, taxes and insurance)
Rental Cashflow
Rent: $1,250/month
NET Monthly Cashflow: ~568/month (before expenses)
Repairs & Mgmt: ~$150/month (expenses are estimated, actual expenses
may vary)
NET Monthly Cashflow: ~418/month (after expenses)
Annual Cashflow: ~$5,000
Cash on Cash Return on Downpayment: 17% after expenses
And if you consider an upside potential from today's growing housing demand in Austin you'll understand why investors are flocking to the Austin metro to snap up deals like this. That's also why these deals are getting extremely hard to find.
Click Here to snap up a cashflowing deal on a rental home like this.
Want Your Own Piece Of Austin's Growing Economy?
During last decade Austin has been an unyielding contender for the top place on America's best cities to live in, and one of the fastest growing cities in the country. The city appears to be poised to continue with this trend in 2013 and beyond.
If you'd like to receive information about hot investment opportunities like one above in the Austin area please indicate so below.
