With an estimated $2.36 trillion economy and the fastest growth rate of 14.8% among all the states, Texas boasts one of the strongest economies in the US. Economic development has seen an influx of people (estimated 1000 people per day) moving to the Lone Star State from across the US. Texas has several great cities to its credit: Houston, Dallas, and San Antonio top the list of ideal places to live in the US.
But Austin takes the crown due to its flourishing economy and job market, excellent educational institutions, exciting entertainment opportunities, and overall quality of life. Within a year, Austin has seen a 2.79% increase in its metro area. With many people moving in, real estate in Austin is one of the most popular investment avenues. And If you’re looking for a new house or an outlet for passive income, this is the place to do it. We know investing your hard-earned money in real estate is overwhelming, as it’s hard sometimes to know where to start. But we have you covered; this article will highlight why you should invest in real estate in Austin.
1. High Demand
A booming economy creates a diverse and flourishing job market, high employment rates, and a population boost. Austin is expected to house 4 million people by 2040, and the demand for real estate is steadily increasing. Discerning buyers with a taste for luxury will be delighted by the amenities and stunning views offered by the Luxury Condos for Sale at The Independent Austin. These condos offer world-class amenities; a fitness center, heated pool, activity area for kids, mini theatre, yoga studio, and much more. With breathtaking views of Lady Bird Lake, The Independent offers the best of Austin and is the prime location for investment. But why invest in condos? According to the Austin Board of Realtors, condo value appreciated by around 28% between 2020-2021 than single-family houses. With a steady equity increase and an excellent value for money, this is the ideal time to invest. Moreover, the continued growth in population also creates demand for quality living spaces.
2. Stable Economy
Austin has a booming tech industry. Apple, Dell, Samsung, Tesla, and Google contribute to its economy. But that’s not all. 8,301 high-tech and more than 5,000 tech startups also fuel the growth momentum. The tech industry is expected to add 22,000 jobs by 2027. Austin is the hotbed of high-tech industries with the highest number of employees, and employee intake is estimated to rise in the coming years. Though a massive chunk of the state’s strong economy is due to the tech industry, other industries like tourism, food services, education, and defense contribute to the city’s overall economy.
3. High Rents
According to Statesman, Austin has one of the most educated cities in the country. Young, knowledgeable people are moving in for jobs with better wages and increased purchasing power. The employment rate in tech and professional services increased to 81% in 2017 with increased payroll. Census reports the median house income in Austin was $73,800 in 2017, considerably higher than the national average. The low unemployment rate and skilled workforce mean renters can pay higher rents for quality accommodation. Other industries like tourism and business travelers also require high-end accommodation options in the downtown area, which is also one of the many reasons why rentals returns are higher. Since Austin boasts a solid rental market, investing in real estate for passive rental income is also a lucrative investment opportunity.
4. Low Home Maintenance Costs
One of the contributing factors in real estate investment is the cost of property maintenance over time. While this depends on the type of house, location, and how old or new the property is, it’s still a significant consideration for property owners. According to NY Times, the post-COVID-19 era has seen a national increase in home maintenance costs due to a shortage of materials and skilled labor. Austin is still cheaper compared to other cities in the county regarding home maintenance.
5. Tax Benefits
Texas boasts the lowest property taxes in the country with minimum regulations. Austin, in particular, offers a business-friendly, low-borrowing cost for investment purposes. For instance, Texas’s ‘1031 Exchange’ rule allows you to reinvest your money into other property and defer the capital tax. Or you can get to write off your mortgage interest in a year. With no income tax in Texas, recovery of the original investment in real estate is quicker than other investment options. Austin’s real estate is the top pick to take advantage of the tax benefits in the state.
6. Property Appreciation
Big or small, real estate appreciates over time. In Austin, real estate prices have gone through the roof in the last 25 years. Neighborhood Scout data shows Austin’s real estate market appreciated 196.13% over the previous decade. The appreciation forecast for Austin’s real estate is optimistic, with ongoing growth. With a stable, long-term economy, the demand for real estate seems endless. Increased demand for homes due to high population rise appreciates the value of your property. Also, real estate investment allows you to add value to your property, appreciating the property. The latest amenities, like a new floor or paint job, can increase your rental income. Whether it’s your long-term or short-term investment plan, Austin’s real estate is a sound and safe choice.
In a Nutshell
With cryptocurrency and government bonds, investment options have increased over time. Still, real estate remains the ideal choice for long-term investment, especially in a city like Austin, where the ROI of real estate is higher than other investment options. Austin is an attractive investment location with a ripe economy and lower taxes. Moreover, as the job market in the ‘City of the Violet Crown’ continues to expand, you have more people willing to buy. We hope this article was helpful. If you want to add anything, please let us know in the comments below.