More good news for the Austin investment real estate market. The 2010 Milken Institute's Best-Performing Cities Index is out and we're number 2 on the list. Basically this is an index that tries to measure how well a metropolitan economy is growing while creating and sustaining jobs. They look at a mixture of job/wage/salary data with heavy emphasis on technological growth. (The data is also taken as an excellent indicator of overall regional economic stability.)

Here are some of the highlights of what they have to say about Austin:

- Unemployment in Austin peaked at 7.3 percent, approximately three percent under the national average.

- Austin exhibits a number of positive and inter-related qualities: low cost of doing business favorable…

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So, if Central Austin is "the" hot spot for real estate investment, but you can't find something in your price point there, where do you go next? What looks good in comparison to all that downtown energy we talked about last time? Well, savvy real estate investors always follow the tenant base.

Let's say you have a couple of young professionals, newly married, renting near downtown. That's where everything is happening. There's nightlife. There's entertainment. There's excitement. That's the place to be.

And then, life changes. There's a new baby. Suddenly all the priorities change. The nightlife and entertainment get pushed aside in favor of a bigger home in a family-oriented area near good schools. Where does our couple go?

North Austin.…

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Central Austin is "the" hot spot for investment property. If I can have my pick for places to put my own money or a client's money, this is where I head. Around the capital, the areas adjacent to the University of Texas, the Mueller redevelopment, Town Lake, Zilker Park. That's where you get that downtown energy. That's where everything is happening.

The reasons I like Central Austin for investment opportunities are pretty simple and straightforward:

- desirability,
- good demographics (more on this in a sec),
- and rents that appreciate.

Demographics. You're going to be getting young professionals and students; middle-age professionals who are downsizing from a family home and up-scaling in terms of location (the so-called "empty nesters"), and a…

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Apologies for being a day late. Don't we all have weeks that get away from us? This was one for me, but only because the real estate climate in Austin is crackling with activity. At some point early in the week, I took the time to read Bobby Longoria and Tiffany Young's October 1 report from Community Impact, "City Offers Public Choice of Growth Patterns." (Due to a design flaw, in order to reach the link to the article I just mentioned, please open the blog post fully.) I recommend you take the time to read it s well. What they have to say about the city's efforts to develop its new comprehensive growth and development plan, Imagine Austin, is important.

The plan will likely be at the heart of real estate investing in our city for the next 30 years.…

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Southeast Austin just claimed the title of "next big spot" in town. The Austin Business Journal for September 24 includes a profile of the $250 million Formula 1 race track going in on the SH-130 corridor. That's exciting, but what's more exciting are all the big developments planned for the surrounding area to take advantage of the economic boom that will accompany the 417-acre facility.

 

 

From San Antonio to Georgetown, this whole metropolitan valley, over the next decade is going to explode with new developments both residential and commercial.The implications for Austin are enormous. The city is going to be recognized around the world.We're headed into a vibrant period of expansion with exciting opportunities for real estate investors. Read…

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All real estate investors need an education in location. Where do you want to buy and why? And what can you reasonably expect to be involved in the purchase, ownership, and ultimate sale of that property? There are four primary "rules" about buying:

- Go where vacant land is scarce,
- the demographics are good,
- the rents are $800 and up, and
- turnover will be low.

You can find areas with little vacant land in Austin near downtown, around the University of Texas, Town Lake, the Capital, or close to the better school districts. When you make a purchase in these spots, you're buying:

- location, and
- customer base.

One of the biggest draws to properties in these neighborhoods for me is a solid exit strategy. When these properties sell, they will…

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The type of property in which you invest determines the terms of your financing. If you buy a duplex or four-plex, you'll still be able to take out a residential loan. Five units and above moves you into commercial lending. Does that make a big difference? Yes.

Residential lending requirements are less restrictive. You'll benefit from:

- a lower interest rate,
- a lower down payment,
- less required reserve,
- greater lender competition . . .

and you won't be held back if your experience with real estate investing is reasonably limited.

Of course, the first question investors ask is, "Why would I want to fool with a duplex or a four-plex over a single-family home?" Good question, and one that bears exploring.

The percentages may run in your…

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In looking for sources of investment funding, you need to get one thing straight . . . cash is just cash.

Even if you don't qualify for institutional funding, which is possible, due to your credit score or your debt-to-income ratio, you most likely have a source of cash that can be used in innovative ways -- you just don't know it.

Most people are not aware that a Roth IRA can be transferred into a self-directed IRA and used for investment purposes.

That's right. You will be in control of where the money is invested and all proceeds of the investment will go back into your IRA.

When used to invest in real estate, the IRA owns the investment property. You can actually partner with your IRA.

(For that matter, your IRA can partner with…

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Forbes blogger Francesca Levy, in her popular real estate column "Crib Notes," has named Austin one of her top picks for "best bet" housing markets for residential real estate investors. Specifically, Levy cited:

- strong pre-recession population growth,
- a slowing of home-price drops, and
- jobs weighted toward growth in areas like government and education.

Now, here's what's exciting in light of our previous discussions about cash flow and appreciation.

The list was compiled by the real estate research firm Local Market Monitor and the basis for selection was . . . .

. . markets with the greatest chance for price appreciation.

Here's how they ran the numbers for Austin and they support our basic assertion -- now is the time to buy!

- Q2…

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In the journey to discover where your money will work best for you, start with these questions:

 - What are my investment goals?

- Do I need "cash flow" or appreciation?

- How much cash do I have to invest?

- How much cash do I have in reserve?

- What's my experience / comfort level?

So, out of that, when the seminars are planned and the books are written, where does the emphasis fall? Cash flow. Nobody goes to a seminar to learn about negative cash flow and positive appreciation. They pay $99 to learn how to get "cash flow."

And yet, at the end of the day, those investors that buy in areas that have good appreciation do better than those who concentrate exclusively on cash flow. Let's explore that.

Can I get both, you ask --…

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