Buy Foreclosed House in Austin for Rental Investment

Investors planning to buy foreclosed house for rental investment can realize their dream in Austin, Texas after the foreclosure of three Class A-plus housing complexes that have a total of 1,417 units.

The complexes, which were purchased in 2007 by CNC Investments for approximately $190 million, are now being sold without an asking price.

According to Patton Jones of Apartment Realty Advisors, the housing units are luxurious. He added that the 583 units at Monterone Round Rock average about 1,200 square feet in area and feature a wide-screen surround-sound theater room and a wine cellar.

Jones however is realistic about his sales prospects for the units during the downturn. He said that renters now are more focused on saving money so they are looking at smaller units with fewer amenities.

Nonetheless, Jones said, the amenities at the three complexes which include the Monterone Steiner Ranch and the Monterone Canyon Creek, will make these luxurious buildings in demand when the market has already recovered.

Jones explained that because of the lack of financing for commercial development such as multifamily projects, there are only a few higher-end multifamily developments in and around Austin, making the Monterone assets very attractive to investors planning to buy foreclosed house in Austin that can be rented out for profit.

Additionally, despite the foreclosure, the three complexes remain attractive to investors because they are 92-percent occupied and the buildings are only ten years old.

According to Jones, who leads the team marketing the luxurious residential portfolio, the three complexes are being marketed as a single asset. The commercial loan covering the developments has an interest rate of 5.77 percent. Purchase offers are being accepted until the last week of October.

Jones is expecting private and public real estate investment trusts to look at the properties. He is also hoping that wealthy individual investors will now come out after 8 or ten years of waiting in the background to look at the Monterone assets. He said that wealthy investors often invest in a cycle, preferring to buy properties when the market is soft.

For other individual investors who are planning to buy foreclosed house not in blocks but in units because of their limited investment money, they can wait until bigger real estate institutions or wealthy investors buy the complexes and then resell the housing units separately.

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