What Investors Should Know About the Austin Real Estate Market

Austin has become one of the most desirable real estate markets this year, thanks to its ongoing growth. Many companies are relocating and expanding to Austin, which is causing people to relocate as well. More residents mean more people who need housing. This is the perfect time to become an investor in the Austin real estate market! Before you take advantage of the market, here’s what you should know about the local real estate market. 

Renters Can Afford More 

Since many people are relocating for Austin’s incredible job market growth, that means there are people with higher education and higher incomes coming to Austin. These individuals need a place to live, which means you can increase your monthly rent. According to Apartmentdata.com, the rental price for July 2021 was $1,422/month. But don’t go above the market average, then your property will sit vacant for longer. If you need help pricing your property, reach out to us! 

Occupancy Rates Are High

Occupancy rates have always been stable in Austin, but now they’re increasing. As stated in the Apartmentdata.com July 2021 stats, over the past 12 months, the rental rate growth increased by 9.4%, and occupancy is at 91.4%. This hot seller’s market makes homes unavailable for some due to low inventory or high price tags. This means they’ll continue to rent and renew their lease. This creates a unique opportunity for you. 

From that same data, areas all around Austin are popular for renters, which gives you several locations and price ranges to choose from. The most growth came from a combination of downtown Austin, South Congress, and Barton Springs. The other hot submarkets are University of Texas/Mueller, “outlying metro”, Round Rock/Georgetown, and Cedar Park, Leander, and Four Points. 

The Job Market Is Strong

The pandemic has made Austin an attractive home base for many big companies like Tesla, Google, Amazon, Facebook, Oracle, and more. Data from the Austin Chamber of Commerce show that in just June alone, over 20 businesses have relocated to Austin or opened their new business in Austin. More jobs = more people, and more people = more housing. 

Why Invest in the Austin Real Estate Market?

Some other reasons to invest in the Austin real estate market are: 

  1. Quality Education
  2. High Demand for Skilled Labor 
  3. Austin Has Plenty of Amenities
  4. Austin is an Active Community

 

If this all sounds good to you and you’re ready to invest, contact us today! Reach out to TALK Property Management– We are here to help: (512) 721-1094 or dbrown@talkpropertymanagement.com

Profits Rising for Home Flippers

While fewer property investors are flipping homes, those still active in the real estate market are earning higher profits. According to ATTOM Data Solutions 2020 U.S. Home Flipping Report, investment returns for house flippers climbed to the highest level since late 2018.

Profits Rising for Home Flippers TALK Property Management Dona Brown

The typical home flip gross profit (defined as the difference between the median sales price and the median sales price paid by investors) rose to $67,902 in 2020’s second quarter, up from $61,900 at the same time in 2019. This resulted in higher profits for property investors. The typical gross flipping profit ($67,902) equaled a 41.3% return on investment (ROI), marking the first year-over-year gain since the fourth quarter of 2017.

While profits are on the rise, real estate investors engaging in home flipping has dropped since the COVID-19 pandemic began. Fewer house hunters were looking for homes, which likely cut into investors’ likely buyer pool. 

However, investors who were able to bring deals to the closing table did far better than they had since 2018, likely due to historically-low interest rates that proved attractive to buyers who remained employed during the pandemic and who were willing to purchase homes despite social distancing requirements and the overall economic environment. 

Homes flipped in 2020’s second quarter were sold for a median price of $232,402, while approximately 6.7% of all home sales were flips during the same period, down from 7.5% from the first quarter.

Whether you buy and hold properties or if you prefer to flip, if you have questions about the local real estate market and how it impacts investors, reach out to me anytime. I’m always here to help: (512) 721-1094 or dbrown@talkpropertymanagement.com.
Graph courtesy of ATTOM Data Solutions.