The stock market is plunging, fixed income assets pay virtually nothing, inflation is rearing its ugly head and consumers are struggling to stay afloat. Not a pretty picture, but there is a bright side for investors.
Tired of Losing Money in the Stock Market?
Real estate investors are seeing better deals than at any time in the past four years. In sharp contrast to housing where 40% of the market are foreclosures or short sales, prices are low and apparently languishing, inventory is high, loan are difficult to secure, the rental market – particularly apartments – is especially bright, they are easier to manage.
Austin Rental Housing Market is Booming
Rents are increasing, vacancies are declining and investments are producing positive cash flow from day one. The demographics tell the tale: millions of young people now living at home will become renters as the economy improves. 160 people per day are moving to Austin – and most of them will need a place to live immediately. Millions are homeowners who face foreclosure or have been foreclosed upon need a place to live. This burgeoning rental market will continue to grow over the next several years. For a great many people, it will take seven years before they can improve their credit scores sufficiently to again qualify for a home loan.
Why Not Considering Buying Austin Real Estate?
So if you’re unhappy with the performance of your Wall Street investments, think about rental real estate – apartments and multi-family units.
Here’s what I look for:
- The property should produce a minimum 6% return on your cash investment (ROI) in year one.
- Expenses cannot exceed 40% of the property’s gross income.
- Look for the highest cap rate percentage and the lowest debt service coverage ratio possible.
- Property must generate a break even or positive cash flow from day one
Looking for an Austin Real Estate Rental?
As with all investments, utilize the expertise of a knowledgeable Austin real estate professional who knows in apartments and multi-family homes rather than an agent who primarily sells little pretty houses. Be fussy about location, it’s the most powerful influence on value. Be realistic about expenses and make sure you have a buffer to outset vacancies and slippage. Over time, with common sense and prudence, rental real estate in Austin can prove to be a wealth builder for you and your family.
We can help you find your next great investment so you can stop worrying about the plummeting stock market. Call us at (512) 827-8323 to schedule a no obligation consultation.