I have been seeing lot of questions with regards to people wanting to move to Austin and looking for good neighborhoods to buy their house in. I have been living in Austin for quite sometime and investing in Austin as well. So I think I can give a good overall picture about the places I think will be good areas to settle down/ invest in. So there are primarily 2 broad areas which are growing pretty fast in Austin (in terms of tech industries growth). 1. Downtown Austin and East Austin - Oracle HQ/ Tesla Giga factory on the East Austin side & Google/ Facebook and bunch of other companies in Downtown. 2. North/ Northeast/ Northwest Austin - This is primarily the area which I am going to talk about. So, to give some background, North/Northwest Austin initially had few tech companies circa 2010 mainly IBM, National Instruments, Freescale etc.. Fast forward around 2010, Domain got established. This is kind of like Austin’s 2nd Downtown. It is a mixed use community with shopping and lot of office space. It's primarily a software hub now. It's just not the companies in Domain. There are lot of software companies 5 miles around domain. The new apple Austin campus is also coming up in Northwest part of Austin closer to domain. So there is this placed called Robinson ranch which is nearly 7000 acres of undeveloped area. The owners just sold 133 acres to Apple. There is paypal, google, ebay, polycom offices right next to Apple HQ2 (if I might call it that way). That area is getting redeveloped to another huge office space/ mixed use development. The owners of the Robinson ranch have also put 193 acres for sale now, which is likely going to be yet another huge corporate campus development. So this place (7000 acres from Robinson Ranch) is such a huge piece of land that has humungous potential to be developed into a whole different city. Irrespective of whether all this potential development happens or not, even with the current set of companies already in place and plan for next few years I would classify the following areas to be good for personal residence and investment: 78727 - Very close to Apple campus. And right opposite to the Robinson ranch I am talking about. Has already appreciated a lot but definitely has room to run more. Schools are very okish. Might get better few years down, 78717 - This is going to be a very huge opportunity for appreciation. Great Schools (comes under both Round Rock ISD and Leander ISD. Both schools are great) . Well established neighborhood. Very close to new/ existing apple campus. 15 mins from Domain. Very close to other tech companies up north as well. And more importantly adjacent to Robinson Ranch. Very good for primary residence. Investment properties won’t cash flow much since the home prices are high and the rents haven’t caught up. So you might be cash flow negative. In addition to all these there are couple of huge medical complexes coming up right next to Avery Ranch as well. So you have great schools, excellent healthcare, very close proximity to tech companies and you can imagine the potential here, 78613 - Brushy Creek part of Cedar park. This is a pretty big zip code. The area I am referring to is called Brushy creek which is next to Avery ranch up north. Great school and excellent neighborhood as well. Very good for primary residence. Investment properties won’t cash flow much just like Avery Ranch. Those of you looking for scenic hill country houses up north you can take a look at 78750 neighborhood. Very good schools here as well. 78759 might be a good option too. But these two are for primary residences. Apart from this, take a look at this area called Tech Ridge. This has lot of tech companies moving in as well. Got some Mixed use development going around. Close to Domain/ New apple campus. Very good investment opportunities. Not that great schools. Those of you who are in for the long haul and ready to wait for 5 or more years, look at areas near Leander station. 78641 is the zip code but it is huge. Within 2 miles of Leander station is going to be huge. Metro rail is shaping up to play a major role as a mode of transportation in the future for Austin and this area is going to boom. This area also has lot of developments recently announced (Leander downtown development - called Northline project) and it's in the cusp of appreciation as well (has already appreciated 15 to 20% over the past year or two). You can find good deals sub 300K/ 325Kish for recently built homes in this area. There are lot of opportunities in East Austin and South Austin as well. Areas near Tesla Gig Factory is a good bet. Oracle New HQ is in the heart of East Austin. But schools are very very okish in those areas. Also lot of places in east Austin have appreciated really crazily. But you never know how much more it can go. West Austin is a totally different ball game. Multi million dollar homes with great views and great schools. You would be better off consulting some luxury realtor to look at these areas. P.S: I might not be able to respond to DM. But will try to answer some of your questions/ doubts in the comment section. Again this is purely my observation of Austin market. Others living in Austin might have a different opinion. #Austin #realestate #investment #appreciation #housing
I want to get a investment property and rent it out
Don't buy investment property with Dems controlling all houses of gov. There is a high chance affordable housing will increase and dent your investment. Just play safely in high liquid stock market.
Awesome, thanks op. Pls lemme know what’s a good zip code to buy a home worth 350-450k and rent out.
78660 - Properties near tech ridge 78641 - Homes near near Leander Rail Station 78717/ 78727 - you will find older houses in your price range, Just make sure you do proper inspection before buying 78613 - Houses close to Parmer corridor With 350 - 450K you will be able to find houses in all of the above areas I mentioned. But will it be cash flow positive is a whole different question. Austin has become appreciation play rather than cash flow investment. So when you are looking for investment properties keep that in mind
350K-450K range investment?? Even at 250K many areas in Austin are not break even due to property tax. Buying 300K+ for investment is -ve cashflow. Appreciation is the only bet as OP says, but remember as appreciation happens, property tax also increases the same % for investment homes.
How about 78723?
Areas close to mueller park are really good. Very family friendly. Love that neighborhood. Ones closer to US 183, there are few areas which I might avoid. It's on a street by street basis. Haven't done much rental analysis there though
Yeah, looks like it’s close to everything..
In case if you are wondering: Austin past the phase where you just buy a rental property and get a positive cash flow to begin with. These days, majority of the rental properties (new buy) are barely hitting the break-even. I still have few properties in Austin but I’m looking for other TX metro areas for now. Austin rental game is now really really long term - you need to wait few years to get the inflation kickoff at full phase, then only you see positive cash flow
Completely agree with you. But property appreciation has been crazy and ppl are anticipating more in the coming years. We can never predict what's going to happen though. If you want cash flow San Antonio is a better bet.
Appreciation wouldn’t be enough for now on. Folks who are buying 250k house(even hard to find house in this range) for rental wouldn’t ever cross 350k at max. I bought the same type of house few years back below 200k. So, folks who are planning to buy rental now in Austin, ROI wouldn’t be that great when comparing to stock market until inflation hits us pretty badly.
How about Round Rock/Manor? I see good homes in the price range of ~350k only in that area.
Manor schools are really really bad. Poorly run school district. Round rock is huge. There are some really good areas and very okish ones
Any thoughts on 78747 (south east) for investment?
Good pocket. Onion creek seems to experience really bad flooding on bad years. Have seen house foundation settlement issues there as well. Schools are okish. But closer proximity to downtown and east Austin developments.
Thanks. I'm looking at new homes off old lockhard road at vistas of austin. Rent to price ratio is around 0.7, the only downside being high inventory from several hundred new homes being built that could lead to long lead time to find renters in future
What about 78664? Some schools seem ok and plan to buy a 250K house (super old) and rent it for ~1.5K. Thank you!
Yes old schools. Make sure you hire a proper home inspector. 78665/ 78664 tends to have foundation issues as the land on that side of the town seems to be not so stable. Otherwise I don't have anything much against those 2 areas. Decent schools. Very well established neighborhood
Thank you! Appreciate it
How is 78665 teravista. Southern part of that , closet to round rock
Nvm saw your reply above . Thanks
Any thoughts on Hutto area? Thanks for sharing this
Hutto is a very fast developing town. It has access to TX-130 Highway which helps in traveling to downtown and airport. They are starting to develop industrial space of their own. If that kicks off, it would be great. Even otherwise it's a nice bedroom community. Prices have literally doubled from 2015 level there. So pick your house appropriately. The closer you are tittye highway the better it is
Whats the rental market like in 78717?
not great. you might be lucky if you get 0.65 - 0.7% (monthly rent = 0.65% Purchase Price). If you buy a comparatively older home you might be able to break even (not taking into account maintenance charge which an older home might incur)
Whats taxes like on a 400k home