Californians Own 10% of South Austin Rental Homes
I recently harvested thousands of tax records for marketing purposes. I pulled from the Travis County property tax records database all of the “absentee” owners of single family homes in South Austin, including area codes 78704, 78745, 78748, 78749, 78739 and 78736.
An “absentee owner” is one for whom the mailing address is different than the property address. This method of determining which homes are rentals is not perfect, but there is no better way.
Prior to filtering and deduping the raw data, I had 4,374 names, many of whom own more than one property. Of those, 3,487 (80%) have a Texas mailing address. Of the Texas addresses, 3,068 have a Central Texas (Austin area) mailing address.
So, 80% of the rental homes in South Austin are owned by Texans, and 70% are owned by local landlords who live in or around Austin.
Which state is the next highest represented by ownership?
You guessed it…Californians own 467 of the homes in my sample data, which represent 11% of the rental homes in South Austin. All other states were way behind, but the next highest was Arizona with 37 properties, Illinois with 26, Washington with 21, Hawaii with 20, Colorado and New Mexico with 16 each. The rest of the city would probably produce similar ratios and ownership breakdowns, though I would expect the California percentage to be higher in the newer outskirt areas than they are in South Austin.
Of the 4,374 names I started with, 955 were removed as duplicate mailing addresses. In other words, 955 rental properties in South Austin are owned by an investor who owns at lease one other rental property in South Austin. This means about 20%, 1 in 5, of the rental property owners in South Austin are multi-property owners. Indeed, Sylvia and I are in that category as well.
And thus is the answer to the question of why I market mainly to rental property owners. Our background and area of expertise includes much experience dealing with investors and renters. Many of the listings we take are either vacant or occupied by renters. It requires a somewhat different mindset and set of abilities to navigate the many issues that arise in helping a home make the transition from rental property to beautiful sales listing.
When selling an owner occupied home, the seller is, in most cases, a willing partner in the process (let’s not talk about divorcing sellers). The seller is a cooperative team player who will clean the house, keep it clean, put away dirty dishes, clear their clutter, take care of the yard, leave the home for showings, etc. Not so with a tenant.
Also, there is often a lot more deferred maintenance to deal with before listing a rental home. Tenants are often slobs and are uncooperative and unhelpful to the sales effort. This requires patience and diplomacy when determining whether it’s best to let the tenant move out before selling or if they might be converted to at least a tolerant and accepting player in the process. The yards on rental homes typical are not as well kept so there are “curb appeal” issue to address as well.
Selling renter occupied or vacant homes is a hassle. So why even mess with these kind of prospective listings? Why market to these owners?
Because an absentee owner, especially if out of state, is more likely to value the services of a Realtor than an owner occupant. They generally need guidance and assistance to a higher degree than the owner occupant. There are exceptions of course. Of the many shabby and worn looking listings I show, most have obviously been rental properties (the required “tenant” deadbolt gives it away sometimes) and the seller and agent did a poor job of bringing the home up to the condition needed to compete on the sales market.
These sellers needed better help than the Realtor they hired was able to provide. Or perhaps the Realtor was unable or unwilling to have the difficult conversations needed when listing a somewhat worn property, such as the “you’re going to need to spend $3,000 to $5,000 on new carpet, paint and landscaping before we can list it” conversation.
We enjoy those types of challenges because we are good at overcoming them and creating a good outcome. So, we LOVE absentee owners and their properties.