Buying a house right now in Austin vs Buying a house in 4 years (Round Rock: rental, insurance) - Texas (TX) - City-Data Forum

akslp2080 · 02-09-2016, 01:34 PM

I am planning to get a house in Austin right now. However, I am not sure that I will be living there for more than a year as I have plans to move to bay area for 4-5 years. However, I am planning to be back in Austin when we are planning to have kids etc.
Do you guys think I should buy a house right now or wait for 4-5 years and then buy it. My main concern is the house with budget 400K I want to buy in 4-5 years will be outside Austin i.e Round Rock or Cedar Park vs right now as I can find houses in Austin with that price.

Ariel_Austin · 02-09-2016, 01:40 PM

You need to balance your use vs what you could rent it out for (and keep in mind you won't be able to have it on homestead once you move out of state -- you would likely get away with it being on homestead the year you move but it is legally required to come off the following year).

You'll need to calculate your mortgage (principal, interest, taxes, insurance) and also include property management costs (leasing, repairs, and re-let costs) and ensure you are within what you consider to be an acceptable range for a return on your investment during the rental phase.

There is no magic answer. Generally, if you can afford to buy now (and you can afford to be a landlord), I would buy now. If it is a stretch, you may have to wait. Just my two cents...

hts · 02-09-2016, 01:44 PM

I would have to agree with AA. And who cares about the homestead deduction--what's it worth--$300/year? So what?

Some good friends of ours bought (contracted) for a place in Westlake just today.

It's a pocket listing (not officially on the market yet).

There were four (4) bidding families. The asking was $800k. They contracted for $860k. It's 20 years old and will require another $100-$150k to get it up to their standards. Oh, and they also had to agree to rent it back to the sellers until June when school is out.

The reason I'm telling you all this is that I don't see the ATX market slowing down any time soon (I live out in Dripping, where there are currently approximately permits for 3k new houses under construction).

The market out here is not nearly as red hot as it is downtown or within the Eanes boundaries, but if you think you're coming back, I'd buy now and rent out until you return.

CT_ATX · 02-09-2016, 01:45 PM

I think you should plan to stop making so many plans.

akslp2080 · 02-09-2016, 01:49 PM

Thanks for the reply Ariel.

I can afford to buy now. And I would not move to bay area unless I know that with my salary in Bay area and my wife's salary, we can pay the mortgage and our rent in bay area and the management costs.

My concern is I would have to get a house atleast 100K more in 4-5 years in the place I want now. And hence, seems like buying now would be a good idea.

Any comments?

akslp2080 · 02-09-2016, 01:52 PM

Thanks for the reply hts. I am planning to buy a house in NW Austin in 4 points Drive which has really good schools (Vandergrift, 4 points and River place elementary ) and it a good location to go North and South and closer to Lake travis.

Hence I want to make sure I can live here , 4-5 years down the line.

Austin97 · 02-09-2016, 06:19 PM

I would absolutely not buy a house if I was planning to move in a year.

Ariel_Austin · 02-09-2016, 07:56 PM

Quote:

Originally Posted by Austin97

I would absolutely not buy a house if I was planning to move in a year.

Why? If you can afford the home and can essentially have someone else cover the payments, where is the downside other than assuming some risk if your PM doesn't help you choose good tenants?

riaelise · 02-09-2016, 08:14 PM

It all boils down to specific areas, not Austin as a whole. I'm pretty certain you'd find decent homes for $400k and below in Austin. In a particular area, maybe not so much. While Austin's affordability is under attack in the lower price points, someone affording a $400k home won't need to move to the suburbs if that is not what they desire. What I've found over the years is that you get less "extras" as time goes on in Austin for your $400k.

akslp2080 · 02-09-2016, 09:10 PM

@riaelise,
Do you think after 4-5 years that I would get a 3 bed and 3 bath house in Austin for 400K (NW austin or the 4 points Area/ River Place Blvd). Asking for your opinion.

My gut feeling is that looking at the way houses are being built and sold for past 5 years (5 years back, Lakeline Mall area was supposed to be far AFAIK while now a house there seems affordable). Right now leander/Cedar Park and Round Rock seems far but maybe 5 years down the line people want to move there because there are no more affordable houses in Austin.

Hence, I want to avoid this scenario later. What do you think?