Why rentals on the market for so long? (Austin, Georgetown: for sale, real estate) - Texas (TX) - City-Data Forum

XLadylawX · 09-03-2009, 01:54 PM

I'm planning to move to Austin the first half of October and have been keeping an eye on some rental homes on Austinhomesearch. A couple of the homes that I am seriously interested in seem to be languishing on the market. They've been available for more than a month. Should I be concerned there is something wrong with these homes.

They are in Teravista and appear to be pretty standard homes for the area.

How long are rental homes usually vacant?

passionatearts · 09-03-2009, 02:01 PM

I used to be a residential property manager, and I can tell you that it's not that unusual for a house to be on the rental market for over a month this time of year. May - August is the busy season for rentals. Landlords have a much harder time renting this time of year (once the students are back in school). Plus, with the economy down, the rental market has gotten really soft. I've seen some places on the market for 4 months. So don't worry.

austin-steve · 09-03-2009, 02:24 PM

Quote:

Originally Posted by XLadylawX

I'm planning to move to Austin the first half of October and have been keeping an eye on some rental homes on Austinhomesearch. A couple of the homes that I am seriously interested in seem to be languishing on the market. They've been available for more than a month. Should I be concerned there is something wrong with these homes.

They are in Teravista and appear to be pretty standard homes for the area.

How long are rental homes usually vacant?

The outlying areas rent slower. Teravista was oversold to investors so there are too many rentals in the neighborhood competing for renters. Length of time on market is a function of price and the skill with which it's being marketed. Picture perfect homes can sit on the market for 3 months if they are overpriced. It's no different than sales.

I wouldn't focus on that. But I would try to negotiate a better rent price if you have several to choose from that will work for you.

Steve

mark311 · 09-03-2009, 02:45 PM

You also have to figure that people can buy homes in nice neighborhoods just a few miles away from Teravista where the mortgage and property tax total per month will be about the same as what the asking rent price is for those homes. Since they're so new, the owners aren't willing to take a loss and rent them for cheaper, but most people would just prefer to buy if they are going to make the same monthly payment.

Another opinion is that people move out to the suburbs so they don't have to rent or so they don't have to spend as much as a mortgage on rent. I decided to just tough it out in a small apartment for 6 months to save money on rent before I bought a home. I'm sure there is nothing wrong with those homes for rent in Teravista other than the owners not wanting to take a loss per month on their fairly young mortgages.

Exiled Texan · 09-03-2009, 07:41 PM

Not a lot of people getting jobs and moving to Austin. At least, not in the numbers we are used to. Also, homes that are not selling are being leased. More supply, less demand.

Don't be afraid to trim their prices and bargain for the best place. Also, do a check in Austin Almanac to figure out who the owner is. At least do a simple google search on them. There was a too good to be true Pemberton Heights home I was considering renting. Googled the owner, and he had served federal time for being a crook, serial litigator, and in economic dire straights. i wouldn't have lived there if it were free.

CATXTransplant · 09-04-2009, 06:47 AM

Exiled Texan brings up a point that should be noted when renting. If the home is either A) a really good deal B)in bad shape and the landlord doesn't seem like they have the funds to make repairs or C) the landlord is more concerned with price than terms, the property could be in default and waiting for foreclosure. Lots of investors are giving up and figure, "why not collect some rent while I wait out the foreclosure process." Luckily for the potential tenant, it's taking almost a year for propertes to actually be foreclosed these days, but you don't want to get settled in a home, then get kicked out by the bank. They won't come and demand you out that day, but it's a pain to have to move when you're not planning to. I'm not sure what options the public has to check on these things. I know you can check a site called RealtyTrac to see if a property is in default, but it has a monthly fee (although you can get a free trial week if you're just checking on one property of interest). Even the tax records we use as Realtors aren't updated very quickly and we don't even know until there's an actual auction date set.

mark311 · 09-04-2009, 07:23 AM

It just seems to me that someone would need to be in a special situation why they wouldn't want to buy and would prefer to rent in Teravista. There are many homes for sale in Teravista for under $200,000 and even more just under $225,000. The homes for rent range from $1500 to $2200 per month. Because of this, I think the rental demand is lower there. If the rentals were priced lower, they would probably rent much more quickly. Why put $2000 towards rent every month when you can buy a house right next door to it and have almost the same payments every month? I just think there are less short term renters looking to get into a neighborhood like that. Most people want to setup roots there for their families in that type of neighborhood in my opinion.

XLadylawX · 09-04-2009, 08:27 AM

My husband and I are re-locating from California due to his job and we want to get the feel for Austin before we actually buy something. Teravista seemed to be the right location for now despite the absence of a grocery story. I think eventually we will move to the Bee Cave area. First though, I have to take the Texas State Bar and get a job myself. Also, we are seriously under-water on a house in California despite the fact that we put down more than 20% to purchase it. We will be coming out of pocket to the tune of $1200 per month between what we will get for rent and what the mortgage payment is. Still, I think things will be better for us in a year or two but for now, renting is for us.

mark311 · 09-04-2009, 08:53 AM

Quote:

Originally Posted by XLadylawX

We will be coming out of pocket to the tune of $1200 per month between what we will get for rent and what the mortgage payment is. Still, I think things will be better for us in a year or two but for now, renting is for us.

Right, so you have a special situation where renting is the right choice. I was just trying to point out that there is probably nothing wrong with those homes for rent other than a lower demand for them. There are less people with special situations like yourself where renting is the better choice in that neighborhood.

The HEB at 1431/Parmer is a really nice grocery store and isn't that far from Teravista. The HEB in Georgetown up I-35 isn't quite as nice, but isn't that far either.

XLadylawX · 09-04-2009, 09:05 AM

I agree. We looked into buying but we are still gun-shy given our current situation. Truthfully, not sure Real Estate is the American Dream anymore. Also, it seems that despite our intentions, we have moved every 5 years. Coming out of pocket to cover associated fees and costs seems to have wiped out any savings we have made in buying versus renting.