When investing in a real estate development project, the market can make or break your investment and overall return.
As investors ourselves, we utilize data-driven and traditional market and land analysis approaches to determine prime locations for our new developments to ensure we offer our investors the highest ROI possible.
We’re heavily committed to investing in areas where businesses, homeowners, and renters want to move. In today’s article, we’ll explain why we believe Austin’s one of the best markets for real estate development projects so you can better understand if it’s the right market for your next investment.
Here’s What Makes Austin A Great Real Estate Market For Investors
With a rapidly growing economy and booming real estate market, Austin is one of the fastest-growing cities in the U.S. and has been named one of the best places to live numerous times over.
According to Zillow, Austin is the 10th most promising real estate market in 2022. More than 50 people move to Austin every day, searching for robust employment opportunities, fantastic weather, and a highly sought-after culture that’s hard to beat.
Austin also rose to global fandom in 2021, when money.co.uk, a British personal finance platform, ranked Austin the No. 1 city worldwide for people hunting for a new place to live. According to their platform, Austin’s average temperature of 68.7 degrees, internet speeds of 87.5 Mbps, and an average monthly salary of $5,501 for workers were just a few of the many glaring positives of life in Austin.
With more people than ever moving to Austin and the surrounding submarkets, the demand for housing increases, making it an excellent real estate market for investors.
Austin’s High Demand And High Prices Show Exciting Return Prospects For Investors
With more people migrating to Austin and nearby cities every day, the housing supply has dwindled, leading to higher housing prices in the area.
While the Austin Board of REALTORS saw a decrease of 5% in housing sales across the Austin-Round Rock MSA for March 2022, it recorded a staggering increase of 22.6% in sales price, setting an all-time high record for the area.
In addition, the average number of days for MSA homes to be purchased decreased in 2022 to only 21 days from 27 days in 2021, proving that houses are selling faster despite the price increases.
Investors can expect promising returns, thanks to home values increasing by 42.7% in 2021 and promising similar, if not higher, returns in the future.
If you’re wondering why everyone’s moving to Austin despite inflation and rising interest rates, let’s look at some of the reasons people choose Austin over other cities in the U.S..
Three Reasons People Are Moving To Austin
Compared to other cities, buyers are more willing to pay higher prices for housing in Austin.
Florida Atlantic University and Florida International University found that homebuyers pay nearly 51% more than expected for Austin housing.
But, with the steady population increase in the city, the housing supply in Austin is still trying to keep up. Home prices are at a record high, but homebuyers are still willing to move to the city, and here’s why…
#1 Austin Offers An Excellent Quality of Life
With the overwhelming recognition from various organizations and outlets, home buyers from all over the country continue to be attracted to this dynamic city for many reasons.
As documented by various nationwide reports, the excellent quality of life in the city is one of the top reasons that Austin’s population is continuing to grow exponentially.
Austin has received recognition from organizations, including the FBI, which listed Austin as one of the most secure cities to live in. Forbes also ranked the city 1st in its list of cities of the future. And US News and World Report ranked Austin as 1st in cities with the highest quality of life.
#2 The Affordable Cost of Living In Austin, Texas
Another important reason people are moving to Austin is the affordable cost of living in Texas.
The cost of living in Austin is 3% below the national average, with the cost of groceries a surprising 11% lower than the national average.
In addition, while the sales tax in Austin is 8.25%, there’s no state income tax in Texas, which saves workers a great deal of money annually.
#3 Austin Offers A Preserved Natural Beauty
As one of the primary city centers in Texas’s Hill Country, Austin’s natural beauty plays a massive role in its appeal. And the many residents who enjoy hiking, biking, boating, and soaking in the beauty of the peaceful countryside have proven to be more than willing to pay a premium for it.
Austin’s commitment to preserving the riverfront and the natural habitats within the Texas Hill Country has prevented overdevelopment in these scenic areas and resulted in higher than average costs in housing compared to other cities within the state.
Although Austin’s prices are on the higher end within Texas, housing in the city is still 23% lower than the national average, making it an ideal central location for homebuyers relocating from other states.
Is it Time to Invest in the Austin Real Estate Market?
Austin’s attractive cost of living and quality of life is driving more people to relocate to the city than ever before.
As the city’s population continues to grow, the supply of housing overall still has a long way to go to keep up with demands, making Austin a premier location for real estate developers and investors alike.
The supply shortage promises new housing developments will be an instant hit for buyers, and the willingness of people to relocate to Austin despite the higher prices guarantees excellent returns for investors!
If you’re looking to invest in this dynamic and growing real estate market, now is the perfect time to invest in one of our four real estate developments throughout the Austin area.
Our trusted team at Red Oak Development Group brings decades of experience in land and real estate development to our investors.
We’d love to tell you more about our current and future projects so you can see if Austin is the right market for you. Schedule your zero-pressure informational call to learn more about our current investment opportunities today!
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