Buying an Airbnb in Austin, TX

Airbnb in Austin can be a great way to boost your profits from your property! When we talk about Airbnb's we really mean Short Term Rentals which we'll refer to as STR in the rest of this article.

STR's are an incredible way to provide amazing places for people to stay when travelling but have recently been under fire from municipalities and Austin is one of those cities making it hard to run an STR.

There are a few amazing reasons to want to figure out how to make STR work here in Austin:

  1. Higher cashflow than a typical rental property.
  2. You can make money off your home when you're not using it.
  3. You can provide amazing experiences for guests which is very rewarding.

Austin has made it slightly difficult to pull off running an STR. The simple fact is that you need a license. The complicated part of it is that a license can be hard to get and has a cost associated with it to get started. There are currently 3 types of STR licenses in Austin. Click this link to get to Austin's page about Short Term Rentals.

  • Type 1: Owner Occupied
  • Type 2: Non Owner Occupied
  • Type 3: Non Owner Occupied (Commercial)

Type 1 is pretty easy to get provided the property is your homestead. All you need to do is pay the fee and provide proof that this is your primary residence.

Type 2 is something that is very hard to do. They only allow a very small amount of these licenses and most people that have them were running STR rentals long before the regulations.

Type 3 applies to large commercial projects like Natiivo down on Rainey St. They are granting these licenses but this is a different kind of game that the residential investors we know and work with aren't playing.

Click this link to learn more about these in Austin.

Now that we've gone over the basics of STR in Austin let's cover how you can make an STR in Austin a reality for you! We help people with this all the time and it is possible despite what people say. We here all the time, "You can't Airbnb in Austin". The question needs to be, "How can I airbnb in Austin". 

What works!:

  • Get an STR Type 1 permit and rent your dwelling out when you're not in it.
  • Buy a duplex and get an STR type 1,A for the other unit
  • Buy a property in one of Austin's ETJ's (Extra Territorial Juristdiction) 

You are probably wandering why an ETJ would matter. From Austin's website: "Properties in Austin’s Full Purpose Jurisdiction and in Limited Purpose Jurisdiction require an operating license." 

An ETJ is neither of these! Hence operating in an ETJ exempts you from the requirements of other jurisdictions. Keep in mind properties in an ETJ also don't have many of the cities services. We've seen some of these properties have septic, propane and even wells in some cases. This is the easiest way we've found to run a non owner occupied STR in the Austin area.

If you're interested in more information about buying a property for short term rental purposes in Austin reach out to us! We have lots of great resources and even property manager referrals that will help you maximize income while minimizing your work.

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