As for finding "deals" in the campus area, sure! They exist. Though, in limited quantity. It's not like the good ol' days where everything you were looking at was a phenomenal opportunity. It now takes a more narrowly focused consideration. Regardless, the #'s tell the truth. So an updated CMA can provide you with the majority of what you need to know to make an educated purchase, and protect your investment.
If you're looking at purchasing in the campus area, don't get overwhelmed by the amenities. i.e. - granite, stainless, pools, gyms, hardwoods, etc... It's not a need, though students claim them as such. They are easily updated prior to move-in/resale. 2-bed/2-bath condos are a dime-a-dozen for good reason . . . easiest to lease. Stay away from studio/1-bed units as an investment. A 3-bed is also a nice choice (because of their limited quantity), if your son will have roommates (let them pay the majority of your mortgage)!
Really it all comes down to your budget, your intentions. Simple answer: Hold longer than his remaining 2-year stay @ UT? Purchase. Sell after he graduates in just 2 years? Lease. Take a look at the site I've shared below. Will provide a better understanding of the potential.
Austin City Living/West Campus Living
Rent. There is a great likelihood he will be moving from Austin, or at least away from U.T. in 2 years. If he has to get out of the condo in two years he will need it to appreciate about 10% to cover fees to sell it. I would not recommend this type of "investment" at this age. His life will change a great deal in the next 3-5 years. If you are thinking cash, this cash may be needed for other things in the very near future. If he finances this may hurt him in the future with trying to buy a house. Investing in Real Estate can be fun and profitable, but it can also be inconvenient and a loss of money. Graduating in 2 years he will have a lot of doors opening for him, better not to close any now. If he is better than 70% certain he will be staying in Austin post graduation then buying is a great idea. If it were you who were making the investment I would have much different advice. When you are established and ready Real Estate can be a great investment. Austin rents are going up so now "could" be a great time to buy.
Texas Open Door Realty
VOX Real Estate, LLC
I have a house for sale on East 32nd St. which is walking distance to UT. Here is a link to it.
I think a house is better than a condo for resale and because of the HOA fees with a condo. Let me know if you are interested and I will give all the details.
Coldwell Banker United Realtors
I would say definitely, YES.
1.) The market is so far down, you should be able to find a great deal
2.) You've got two years for something to happen
3.) I would recommend looking at houses over condo's
4.) He could rent out the extra bedrooms for cash flow.
Good luck and may God bless
there are truly too many unknowns in your question to provide a truthful answer, but I would say that limiting yourself only to condos could be a mistake. As a broker and investor I would challenge you to consider all options (single family, condos, duplexes, etc).. Not knowing your long-term goals and your preferred exit strategy makes this difficult to answer.
Guy E. Gimenez ABR, CRS, GRI
Broker / Owner / Investor
The PowerHouse Group
Good day to you. It really is this simple and really does boil down to this premise:
You can buy and invest and build wealth for yourself and/or your son or you can rent and continue to build the wealth of someone else. This basic finance principle does not change.
If you have additional questions or need professional assistance please do not hesitate to contact me.
Stephen B. McClain, Broker Owner
Cornerstone New Home Solutions
Buying is a good deal for your son. The only problem will be is that since he is a student w/o income you will need to take out the loan in your name. He can be on the title. I have done loans on students and have found that a 5yr or 7 yr adustiblle rate loan is good for my clients. The rates are lower than the fixed 30 yr. loan. The rates or fixed for 5/7 years. That way you can either sell it when he graduates or refinance it into a 30 yrs. Most out of town people perfer to sell it. Just be careful on buying a condo that is not warrantable they present more problems on getting a loan. Also when comparing condos pay attention to the homeowner fees.
Austin Home Girls Realty
1601 W. 6th Street
Austin, TX 78703
Here is what I typically share with clients that are considering renting vs. owning.
Would you'll be OK with being a non-occupant co-borrower should your son not be able to qualify for the loan on his own merits?
Hope this helps.
It is almost allways better to buy than to rent. The UT area has been consistantly hot and prices continue to rise even in this challenging economy. If your son plans to remain in Austin after graduation I would say definately do it. Otherwise it is a fantastic area to own rental property as there is always a new crop of renters each year.
The condos in this area can vary a lot in style and amenities. Right now I have a lovely 1940's condo that has been beautifully updated completely from the studs up, listed for sale for only $235K. It is not typical as its in a small property with only 16 units and has dedicated coveredparking. Many of the new condos are in huge complexes with hundreds of units.
If you would like to see some comparable properties just let me know, I am happy to help.
Betina Foreman- Realtor
Austin Home Girls Realty
As is everyone else who answers this question, I am available for further discussion and would be happy to assist you.
Peace in your home,
With these and a handful of other questions, we would then compare the purchase vs. rent issue more formally. I like the idea of an investment in real estate, but it might be premature.
I am happy to sit down and do specific calculations, anytime.
Robert H. Nelson
Broker and Owner
The Associates Austin
There are so many options out there but as an investor purchasing a property I wouldn't commit to just condo's. Homes are a great option as well and just as easy if not easier to sell in the long run.
If you have any other specific questions I'd be happy to answer them. Feel free to get in touch at any time. I personally own some rental properties and have also flipped homes. I have many contacts in the construction industry as well.
Lee Ann Seitsinger - 512-762-7969