Austin real estate market is on the up—and so is rent

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The Austin housing market continues to grow at a dramatic rate. Since the subprime mortgage crisis of the late 2000s, home price peak values in Austin have increased 44 percent. Along with other Texas urban areas including Houston metro, DFW, and San Antonio, Austin is leading the nation in the recovering market trend.

 

The truth in the numbers

In February, the Austin Board of Realtors (ABoR) released a report detailing just how rapid the city’s housing market is growing. Single-family home sales have increased by nearly 3 percent from 2015 with a grand total of 1,783 homes sold. Along with rising sales comes higher prices; the median single-family home price reached $269,900 while the average price for single-family homes rose to $333,011. That’s an 8 percent increase since February 2015.

New properties on the market have increased 11.1 percent to 2,792 listings in February 2016 with active listings up 10 percent at 4,871 listings. And people are buying them: pending sales are up 12.3 percent for a total of 2,346 sales. This is great news for real estate agents and sellers… but there are other implications.

Growing pains

In a press release, ABoR president Aaron Farmer addressed the issues with such rapid growth in our city. “Austin-area residents are relocating farther and farther outside of Austin due to affordability issues and yet are spending more and more time stuck in traffic each year. With the rate our region’s population is growing, this is simply not suitable.”

Without a doubt Farmer is right. All it takes is an afternoon sitting in stand still traffic on I-35 to see that the population boom has created an infrastructure crisis. Traffic congestion isn’t just annoying and time consuming, it also puts stress on the local environment and air quality. When it comes down to it, you’re paying a lot to live in Austin whether it’s in rent for a place closer to your job or the gas you need to commute.

The bright side

But for those who are already invested in the Austin residential real estate market and plan to rent out their property, the future is looking bright. According to real estate investment management firm HomeUnion, Austin is 8th in the nation when it comes to the strongest investment home rental growth. With the lack of affordable housing options, renting is a more viable option for most. Demand for quality rental properties is up.

If you have investment property but aren’t taking advantage of renting it out, Ironrock Properties can help. With comprehensive marketing and tenant screen services, we do the hard work for you and ensure your property is leased fast with quality tenants. We make owning rental properties easy and streamlined. Call us today at (512) 807-7000 and one of our leasing professionals can help you get started.
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Austin Population Passes 2 Million With No Signs Of Slowing Down

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It’s finally happened: the Austin metropolitan area’s population has surpassed 2 million people. Most of us are not shocked. Merge onto I-35 at literally ANY time of day and you will experience the boom first hand.

Austin has been the fastest-growing region in the States for four years running. Between Williamson, Travis, Hays, Caldwell, and Bastrop counties, we are gaining about 60,000 new residents annually.  Projections estimate that by 2030, we will reach 3 million in the five counties.

While traffic is more of a headache thanks to the boom, the local economy has no reason to complain. According to a comprehensive study by WalletHub, Austin ranks first of the large-city rankings for fastest-growing economies, with Texas cities Fort Worth and Corpus Christi keeping us company. Out of 20 cities of any size, Austin still ranks high at #9, with our neighbor Round Rock nestled close at #10. Bryan, Texas is also there at #8, making it the only thing Aggies have beat us at since they left the Big 12 with their tails between their legs in 2011.

But what does that mean for the Austin housing market?

With so many people coming in, there’s bound to be a surge in pricing with fewer and fewer affordable options available…right?

Not quite. According to the latest Multi-Indicator Market Index—a propriety survey backed by Freddie Mac—Austin has the second-most stable housing market in the country. With a  composite score of 96.6, Austin is in a very healthy medium that means we aren’t set for a decline or the threat of a market bubble.

In October, Austin-area single-family home sales increased for the fifth consecutive month. This increase can be credited to our strong employment rate partnered with a developing population. The average price for single-family home is up 7% to $333,452. For more on the numbers behind the Austin housing boom, check out the October 2015 Market Report provided by the Austin Board of Realtors.

Barb Cooper, the 2015 president of the Austin Board of Realtors agrees that while the stable housing market is great for business, there are issues we need to address in order to keep the situation strong.

“We need to find ways to give more Austin-area homeowners access to that stability by increasing our density, preserving our existing housing stock through stronger code enforcement and creating more affordable housing options.” (via Austin CultureMap)

With the population projections showing no signs of slowing down and the housing market at its most stable, people interested in investing in real estate should get the ball rolling soon. If the statistics stay true, this may be the most affordable time to buy for years to come.

Questions about the Austin real estate market? Ironrock Properties can answer any queries you have on investments, taxes, leasing, and management so you can make the most of investing in Austin real estate.  Call us today at (512) 807-7000.
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1031 Exchanges For Investment Properties: Making The Tax Code Work For You

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When the time is right for you to start making large investments to increase your personal wealth and secure your future, one thing many people are not prepared for are the various tax codes that carry hidden costs. However, if you educate yourself and invest wisely, you can make the tax code work for you.

One of the many benefits of investing in real estate is Internal Revenue Code Section 1031. Section 1031 does not adhere solely to professional real estate purposes, but it is an extremely important code to know if you are interested in investing in property. You may of heard Section 1031 referred to as “the Starker” or a “like-kind exchange.” Basically, 1031 allows the taxpayer to swap one business investment asset for another, without having it be taxed as a sale. At most, limited taxes are due at the time of the exchange.

By taking any profits you make off your real estate investments and rolling them in to a new property, the IRS does not see your initial investment as having a capital gain… so they leave it alone. And believe it or not, there is no limit to the 1031. You can do this year after year, property after property. However, once you decide to sell for cash you will have to pay a long-term capital gain rate tax, but you know… death and taxes and all that.

It’s important to note that the 1031 can only be used for investment and business properties. You cannot take the dividends from your rental home and roll them over into a new primary home or vacation house for yourself. The 1031 is about giving a break to those who want to contribute to their economy through smart business investments.

Timing is key when it comes to the 1031. Within 45 days of the sale of your property you must designate your replacement. You also have to close on the new property within six months of the sale of the old. This does not add on to the 45 days you have to designate, the time periods run concurrently. If you wait until the 45th day to designate, you only have 135 days to close.

While useful, Section 1031 is not simple. There are various loopholes and exceptions that you have to look out for. Read up on the code yourself and if you have any lingering questions, contact us.  We have the expeirence and know-how to make sure you get taxed fairly on your investment properties.
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3 Austin Neighborhoods You Should Really Know About

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It’s no secret that as far as real estate goes. Austin is just about as hot as it gets. People are flocking here for job opportunities and our high quality of life, making property more valuable than ever. With the recent boom, many neighborhoods have already become unaffordable for most people… but there are still pockets in Austin real estate worth knowing about. Here are three Austin neighborhoods you shouldn’t pass on looking at when searching for a home.

North: East Anderson Mill

Yes, it’s a bit far north, but the Anderson Mill neighborhood is anything but inaccessible. Cut in half by US HWY 183 and running from RR620 through West Parmer, the East Anderson Mill area boasts large plots, aesthetically beautiful homes, and tons of old oak trees lining the neighborhood streets. There are also tons of great restaurants nearby and the neighborhood is just a stone’s throw from The Domain, the city’s answer to luxury shopping. Feeding into Westwood and McNeil high schools, this is a great area for people looking for a family home. Plus, while the areas around it have higher house prices, somehow the Anderson Mill neighborhood still has a median listing price under $200k.

East Riverside & Oltorf

Turn east on to Woodland from I-35 and you are sure to find some of the largest, coolest homes in central Austin you never knew existed. With the development of the South Shore District off of East Riverside, this area is seeing some long deserved development and improvements as far as amenities go. What was once an area reserved for discount student housing is now being praised for its accessibility. This area is minutes away from downtown and the hip east side. Plus, you’re walking distance from the new city boardwalk along Town Lake. Young professionals are already flocking to rent in the trendy apartments, it won’t be long until the low cost houses are bought up—get in while you can!

South Lamar

So repeat after us: nothing in West Austin is going to be cheap. Okay… glad we got that out of the way. Of course, there’s always exceptions to the rule! And some pockets of South Lamar really prove that. While you’ll see price tags increase at an almost unbelievable rate the closer you get to downtown, there are an abundance of solid homes at reasonable prices within the 04 zip code if you’re willing to look. However, with them being dab in the heart of Austin’s most bustling boulevard surrounded by amenities including the organic grocery co-op Wheatsville and the biggest, best Alamo Drafthouse in the city, these places get snatched up pretty quickly so you better move.
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Downtown Property Developments In Austin That Will Have The Most Impact On The Market

Austin is a construction company’s dream right now. You can’t seem to look around downtown without seeing at least two or three construction cranes in view. You might even now think that Austin has an official city bird, the crane. Austin’s downtown skyline is certainly growing, it seems like every month a new tower is completed.

We’re excited about all the growth and new opportunities continuing to emerge in the downtown area.  With that enthusiasm we’ve analyzed and broken-down the top downtown Austin property developments that will have the biggest impact in the downtown market within the next few years.
 

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The Independent

Developers have unveiled their plans to build a 58-story condo expected to reach 685 feet tall. When complete this the tower would become the tallest building in Austin, along with the tallest residential building west of the Mississippi River. Rhode Partners is the architect for this 950,000 total square feet construction.


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The Fairmont Austin

This 50-story hotel will be located at the northeast corner of Cesar Chavez and Red River. With its adjacent location to the Austin Convention Center a skywalk will be built connecting the two buildings. The Fairmont hotel will feature over 100,000 square feet of function space and over 1,000 guest rooms. With a rise of 580 feet, The Fairmont will become the second largest structure in downtown Austin’s skyline.  This project is headed up by Manchester Texas Financial Group and will cost an estimated $350 million to complete. This hotel is expected to open its door in 2017.


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Waller Walker Place

This development project is expected consist of three different towers. Tower A will be designed as a 30-story office building and a total building size of 300,000 square feet. Tower B will be a 47-story multi-family apartment building. Tower C will be a hotel and condominium tower expected to reach 55 stories with 200 hotel rooms and 200 condos. The three-acre development site is located between Cesar Chavez and Red River. This is the largest private development ever contemplated in downtown Austin.


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Colorado Tower – Colorado & Third

This is a 30-story office building, including 390,000 square feet of office space expected to break ground this year. The property will also include 6,000 square feet of retail space and 900 parking spots. Silver Ventures, a San Antonio company, and Cousins properties will partner on the tower.  The estimated cost of construction has not been disclosed yet.


5thwest 5th & West

This project will be a 37-story residential tower at 718 West 5th.  The new building development is expected to bring 163 upscale condos to the market. The building architecture is a triangular tower designed to manage the Capital View Corridor that’s across from the site diagonally. This building has a whopping target price of $740 per square foot.

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3 Reasons Why Having a Property Management Company Screen Your Tenants Is The Best Thing Ever

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You put your money and time into picking the perfect piece of investment property and in order to retain a healthy return, you need to be sure you are filling it with the best tenants possible. This is easier said than done. There are more bad-tenant horror stories floating around out there than tales of cleanliness and quietness. Suffice to say as a property owner, the odds are not in your favor.

Of course, the work necessary for screening possible tenant applicants is more than the average person can handle, especially if you own multiple properties. This is where an experienced, trustworthy property management company like Ironrock Properties comes in for you. They have the expertise to take the stress of picking the right person or people to fill your rental property off your mind. If you’re looking for further reason to hire a property management company, well, we’ve got three.
 
  1.  It will save you time and money

    You decided to invest in property because you believe in making smart financial choices… don’t stop there. By investing in a capable property management company now, you’re saving yourself the time of dealing with fulfilling an empty vacancy; as a busy person, you know the true value of time. Plus, your trustworthy property management company uses that time to expertly screen all possible candidates to fill your property. That means the choices they make won’t wreck your property and eat into your maintenance budget.
  1. No more awkward encounters

    For many property owners, their top referrers are friends and family. While we love them, sometimes their judgment is clouded by good intentions. When you have a level, third party doing the tenant screening for you, those feelings are not a factor. The right property management company will do criminal background and credit checks for you. So if a referred tenant isn’t the shining example your loved one initially led them on to be, your property management company can politely decline the application. Basically, even when the personal gets mixed in, having a good property management company keeps it business… always.
  1. A property management company knows the system

    You’re a smart person, but that doesn’t mean you know everything. When it comes to the intricacies of doing tenant checks, there is a lot that only time and experience can teach. An experienced property manager will know all the red flags to look for and the right people to contact to get the complete story on your potential renter. If you want the benefits of that time and experience even in the early stages of your property ownership, hiring a property management company will get you there. Benefit from the expertise of their knowledge for the good of your investment.

    If you own property in Texas, there are FHA enforcers that check tenant screeners to make sure no violations of the Fair Housing Act and property codes. There is actually an itemized list of criteria if a screener wants to decline a tenant. And that’s really just the tip of the iceberg. There are Fair Housing rules that most owners don’t even know about.
    For instance, asking a potential resident if the person or persons moving in with them is family could earn you a $10 thousand fine. Even though you were only asking an innocuous question, in Texas familial status cannot be a reason for approving or declining a tenant. By hiring an experienced property management company that knows the intricacies of the FHA, you’re sure to avoid these mistakes that could cost you big time. A company like Ironrock Properties not only ensures a comprehensive tenant screening, but it does so in as little time as a couple of hours while assuring your rental process complies with all state and federal laws.
If you made the smart decision of purchasing property in the Austin area, you definitely want to get in touch with Ironrock Properties. Austin’s best property management company will ensure that your investment is carefully looked after so you can spend your time doing what you want.
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Investing In Property In Austin Is The Best Thing You Can Do Right Now—Here’s Why

austin condo propertyYou can’t spin around twice in Austin, Texas without seeing something new happening. It seems like every day there is a new business open and it seems like every minute someone new moves to town. Residents are used to the change, sure… but smart Austinites are asking what the change can do for them.
Business-minded people all over the world consider investing in property a smart choice.  While it’s a substantial investment that requires maintenance, the costs always figure in to your return. Put that investing into a hot spot location like Austin and that return just got bigger.

While looking around town can tell anyone that Austin is a growing metro with culture and character to spare, it takes more than a look and a feeling to convince the smart investor that this location is perfect for property ownership. But hey, that’s why you’re here… for the facts.

The 2015 Emerging Trends In Real Estate report published by the Urban Land Institute and the PWC states the housing market has stepped “off the roller coaster.” The turmoil of the housing crisis has subsided and the market is stabilizing. The report says residential real estate is set to work within those golden economic principles of supply and demand.

So what does that mean for property investments in Austin? Well there is plenty of demand. A recent article in the Austin Business Journal says that no matter how you slice it, Austin’s population growth is not going to slow down.  No, not even the odious conditions of “plague and economic slump” are going to slow this train down. This small town is on the track to becoming a huge city… and all these new residents need somewhere to live. Plus, much of the tech industry in Austin brings in young workers looking for temporary housing to rent with their tech startup paychecks.

Furthermore, the Austin Business Journal reports that housing rental rates are still increasing. The report says rental rates rose 7 per cent over the year of 2014 while the median home value in the area is up 10.8 per cent. Other areas in Texas are also seeing rates rise, but none at quite the level that Austin is seeing. While these rates rise, the average home in Austin is still a more affordable choice than homes in other booming markets like Seattle and Miami.

So with the housing market breathing easy, the population in surefire growth, and the housing prices just in that sweet spot between rising and exuberantly expensive, the Austin residential property market is about as hot as it gets. If you have questions about investing in property in Austin, an experienced, local property management company like Ironrock Properties can point you in the right direction to a successful investment and a profitable future.
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Ask Yourself: Is A Property Tax Protest Service Right For You?

Under federal and state regulations, all property-owning citizens are allowed the right to protest the local appraisal review board (ARB) and their decisions/actions concerning your property. This includes their yearly appraisal of your property that determines how much you pay in property taxes. However, even though many people are of this right, they forfeit the opportunity and continue to bear the expense of high property tax rates and the various other property fees assigned to them because they don’t see how the savings are worth the time and effort it takes to put in the work to protest the “appraised value” of their home. In the same way hiring a skilled CPA can actually save you money on your income taxes, hiring a knowledgeable and skilled property manager to handle your property tax protest can save you money without sacrificing any of your time. If you are dissatisfied with the ARB and its decisions regarding your property, don’t just sit there and take it. Find the right tax protest service that will work hard for you so you don’t have to pay more taxes than you need to on your properties.   Still not convinced? Ask yourself these questions: 5520837_s

Do you want to save money?

Yes, death and taxes are the only sure things in life. But just as you can eat right and exercise for a longer life, there are actions you can take to make sure you aren’t paying more than your fair share in taxes. As a property owner, you have the right to receive a fair appraised value with no mistakes. Unfortunately, this is not always the case. Certain aspects like home damages and repairs are often overlooked and thus result in a wrong appraisal value. If you feel this to be the case, protesting your appraisal may be in your best interest. Though it is never a guarantee that you’ll save a fortune in any given year with a successful protest, you can at least rest assured you’ll save a tremendous amount of money in property taxes over time. Why throw your hard earned money away to the government when you could fight to keep it instead?

Do you want to save time?

You could put in the work yourself, of course. But your time is valuable. Having a company do the work protesting your property taxes for you means you can spend more time with your friends and family while feeling secure in your property investment. The right property tax protest service guards you with a solid defense. They are most familiar with your county’s Appraisal District and any information they put out to the public. Furthermore, they know how to set up an outline for a solid argument that will ensure you stay within the proper boundaries when presenting an appeal. A good property tax protest service knows where to find ample evidence to support their argument and will supply your appraisal board with indisputable evidence (home repair material receipts, contractor bills, etc.) to ensure that your board will see eye-to-eye with your argument.

Does the phrase “win-win situation” sound good to you?

Recent studies from University of Houston-Downtown found that within the last couple of years, property owners protesting property taxes have been highly successful. With property owners receiving a 70% larger reduction than property owners who hire companies to protest for them, it is no wonder so many property owners are making the choice to fight for their rights themselves. Not only do you as a property owner have a great chance of getting a reduction in your property taxes, but the right property tax reduction service isn’t going to charge you a thing unless you actually when your appeal. Quality property tax reduction services like those offered through Ironrock Properties don’t charge a penny unless you win. Even after that, their fee is a mere 33% of the actual savings you earn. That means more cash in your pocket and more time in your day. We said “win-win,” didn’t we? To get more information on how you can save big on your property taxes, contact a credible property tax protest service provider like Ironrock Properties in Austin. You really have nothing to lose… except that sky-high tax rate.    
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4 Tips For Choosing The Right Investment Property

For decades, property investment has been an excellent solution for people who want to solidify and enhance their financial future. Investing in the right property yields a great return on investment and with the rental rates skyrocketing across the country, you’d be bonkers not to cash in on this hot (and provenly profitable) investment trend.   investment property   Here are 4 great tips that will provide some clarification on the investment process and give you the momentum you need to acquire a profitable investment property.

#1 – Learn What Makes A Good Investment Property

Not every property is going to deliver a positive outcome. Some, no matter how beautiful or newly built, are just destined to fail. You can avoid this situation altogether by knowing what makes a good investment property. Factors to consider when evaluating a prospective investment property:
  • Appreciation: Will this property value rise? How much so overtime? What costs will the investor endure to ensure appreciation?
  • Cash Flow: When rented, will the income generated exceed expenses?
  • Principal Reduction: If you use a loan to acquire the property, how long will it take you to actually own the property? How will a tenant’s monthly payment affect the loan?
  • Property Taxes: How much money will you be losing to taxes? Are higher taxes justifiable if the property resides in a good neighborhood?

#2 – Do Your Research

Chances are, if you’re new to the real estate investment game, you won’t actually have the knowledge you need to properly utilize the factors listed above. However by doing your own research, educating yourself about the real estate market in your area, and talking to other homeowners, you can easily gauge what property will be the most sound investment for you.  For example, a commercial real estate investment may not be ideal for a first time investor. Or, a single-family condominium, may not yield the results a seasoned investor has anticipated.

#3 – Seek Professional Advice

Once you feel confident, and have narrowed down a couple of promising properties, it is always recommended to seek the advice of a real estate broker. Yes, the internet is a glorious thing. It can provide you with all of the information in the world. But if that information is not relevant or not even closely accurate, you run the risk of investing in a dud. Seeking the advice of a broker BEFORE you begin composing your list of properties is always a good idea too. They can answer your “first-time-investor” questions, lead you in the right direction, and assist in your evaluation. Professional advice plus your own research? Now that’s the formula to success!

#4 – Decide On Management And Upkeep Before You Buy

REALITY CHECK: this newly acquired property will need to be managed and maintained. If you plan to rent it out, you need a tenant screening process in place, a way to collect rent, an escrow account for the security deposit, a quick maintenance solution, etc. Luckily, by deciding who will manage and maintain the property before purchase, you can eliminate properties that will require a lot of maintenance and out-of-pocket costs and instead choose a property that will align with your personal management preferences. Some people take comfort in managing and maintaining the property themselves. For the rest of us, solace is found in the form of a property management company. So what are you waiting for? Get searching, researching, and asking. The profitable property investment of your dreams is out there, waiting to be found!
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