Every member of our team has had investment / rental property personally and has helped other investors find, purchase and manage cash flowing & appreciating properties.
As experienced and knowledgeable Investor specialists, we will help you with:
- Identifying potential rental properties
- Analyzing areas & homes for likely monthly rent amounts and cash flow
- Putting you in touch with qualified lenders, insurance providers and home warranty companies to purchase & protect the home
- Marketing your property and qualifying potential tenants to keep rent coming in
- Providing reliable & affordable contractors to maintain your home and still make profit
There is no better time to buy investment / rental property in Austin. As of the beginning of 2012:
- There are 32% fewer active rental properties on the market than last year
- Rental homes are fetching an average of $100 more rent per month versus last year
- Apartment occupancy rates have increased from 92.4% to >96% in the last year
- Expert estimates indicate 44,000 new jobs will be created in Austin from 2011 thru 2012
- Rental Rates increased up to 10% in 2011 and are forecast to increase another 5-10% in 2012
Therefore, in todayâ€™s rental home market, supply is WAY down and demand is WAY up, with time to lease a property averaging about 3 weeks! This makes it an incredible time to buy rental homes in the Austin area. They will rent fast, there are plenty of properties that will cash flow from the start and given the real estate market and the Austin projections, they are almost assured of price appreciation.
We keep an active eye on the market and always have 5 to 10 cash-flowing, good value properties identified and ready for investors. We evaluate properties based on area, likely rent, Gross Rent Multiplier (GRM) and likely monthly cash flow.
For those investors who are new to the market, here is a brief explanation of the 2 evaluation techniques:
GRM or Gross Rent Multiplier: The calculation is the price of the home divided by the full gross rent for 1 year. GRM can be used to evaluate single family homes, duplexes, fourplexes, apartment buildings or any type of rental property. Lower numbers are better than higher numbers. A value of 8 or lower for a property tends to identify an investment that will bring in more rent than total expenses. A value of 11 or higher tends to identify an investment in which the rent will likely not cover all expenses.
Monthly Cash Flow: The calculation is total gross rent minus all likely expenses. Expenses for a property can include the mortgage, property taxes, fire / flood home insurance, HOA fees, maintenance costs, etc. Higher numbers are better than lower numbers, in this case. The monthly cash flow allows you to generate a cash-on-cash ROI comparing cash flow to invested capital. While this ROI doesnâ€™t include income tax benefits or appreciation, it is a very good point of reference for the potential performance of the investment property.
There are currently some great properties in the Austin area that have low GRMs and have very strong cash flow. Many of these homes already have tenants in them with existing leases, which means the cash flow starts immediately.
If you are interested in an investment that brings cash in each month or have questions about GRM or other investment evaluation methods, please feel free to leverage our expertise by going to our Investment Property List Sign-Up.