[00:00:05] Speaker A: Welcome to the Short Term Show. The show about short term rentals and long term wealth with real property owners hosting real properties who are crushing it in the vacation and short term rental space.
And here's your host, Avery Carle.
[00:00:29] Speaker B: Hey y'. All. Welcome back to another episode of the Short Term Show. I was in Austin recently my at my alma mater UT and I started thinking about, man, I'd really like to have a place here. I have. We don't ever go to Austin.
But I started looking around at real estate and then looking around at real estate in the Hill country, which I've always wanted. Something in the Hill Country. So I decided with my renewed interest in buying something in the Hill country or Austin area that we are going to have a podcast on the Hill country which is in my top five favorite places in the world. After 30 a New York City, New Orleans and then the Texas Hill Country. So we've got Stacy, the short term shop agent in the Hill country in Austin area to chat about this with me. How's it going, Stacy?
[00:01:23] Speaker C: It is going great. We need to get you something here, Avery.
[00:01:26] Speaker B: I know, I know. I gotta convince Luke he still is on this thing where he only wants to buy in markets where we already have a bunch of stuff so he doesn't have to build a whole new system. But I'm working on that. Working on it.
[00:01:38] Speaker C: Yeah, we got strong systems here.
[00:01:40] Speaker B: Yeah.
So maybe I just need to buy three or four is what you're saying?
[00:01:44] Speaker C: Yeah, that would work. That would solve that problem right there.
[00:01:48] Speaker B: I love that. I love that. I would love to come out there all the time to check on my properties and eat some Tex Mex and some Austin vegan food and hang out.
[00:02:00] Speaker C: Sounds like a good plan.
[00:02:02] Speaker B: All right, so tell me, what are we seeing in the Hill country lately? So we seeing most people buying in Fredericksburg. Is that still the kind of main area, what's going on there?
[00:02:14] Speaker C: Yeah, Fredericksburg is still kind of the hottest market in the Hill Country.
You know, there's a lot going on in Fredericksburg. They're about. Well, they're starting to build a Waldorf Astoria, which is the first Waldorf in Texas.
And so, you know, a lot of people are really excited about that. I think that's going to drive a lot of that's going to increase tourism to the area.
So it's kind of the sure thing. You know, Fredericksburg is what I kind of consider the sure thing.
But there's, you know, obviously great opportunities all over, even in Austin and San Antonio and some of the smaller areas, it's just that it's a little bit.
Not as, not as high of occupancy and maybe not as high as daily rate, but there's still great opportunities because the purchase price is generally cheaper than Fredericksburg.
[00:03:09] Speaker B: Gotcha. I really like Wimberley is still my favorite area. Fredericksburg is great, but I like Wimberley. Do we see a lot of people buying in Wimberley?
[00:03:20] Speaker C: Not so we do see some. And I think what stops people in Wimberley is the restrictions. So in city limits you are not allowed to short term rent unless you have a conditional use permit, which is not super common. So you have to be outside of city limits.
But you can find some great opportunities. Like city limits are not that big and they're kind of wonky. So you can still be five minutes from, you know, Wimberley Square and, and be outside of city limits. So there's a ton of opportunity. There's less turnkey short term rentals in Wimberley. So more than likely you're going to have to buy something and set it up and fix it up, which I usually recommend. Even in Fredericksburg you're going to do some stuff to, to really make it pop.
But yeah, there's definitely huge opportunity in Wimberley.
[00:04:13] Speaker B: And then the other main kind of area that I, I would personally look at would be New Braunfels. But again, I think there's some restrictions you have to navigate there. Right?
[00:04:24] Speaker C: Yeah, yeah, it's the exact same thing in New Braunfels. They don't allow short term rentals in city limits with a few exceptions. So there are some neighborhoods that they have kind of granted permission for short term rentals.
Um, they are a little bit easier to get a conditional use permit in New Braunfels, but they are kind of strict there. It seems like they're trying to peel that back a little bit and make it a little bit more short term rental friendly. But they haven't made any huge changes yet.
[00:04:56] Speaker B: Gotcha. So again, you kind of want to be in the county in these areas. Fredericksburg is going to be Texas wine country, lots of weekend type wedding stuff. And then the Wimberley and also New Braunfels area, you're gonna have some, some river floating situations. Also, we didn't talk about Dripping Springs. So Dripping Springs is a wedding capital of Texas. What's what springs like for short term rentals?
[00:05:21] Speaker C: It's, it's pretty good.
You are mostly going to attract wedding, you know, guests and attendees. So, you know, you got to keep that in mind from an occupancy perspective. But there's not a ton of really strong competition in Dripping Springs. And if you have a place that's kind of a destination all unto itself, you know, like someplace people really want to go to, it will do great. You know, you can hit some really good numbers there.
[00:05:52] Speaker B: Yeah, I love, I just love the landscape of the whole Texas Hill Country. Whether it's Dripping Springs, out to Fredericksburg, Wimberley, San Marcos, all of it.
[00:06:03] Speaker C: It's beautiful.
It's really pretty out there.
[00:06:06] Speaker B: Yes, one of my favorite places. As we have mentioned, this program has
[00:06:11] Speaker A: been brought to you by the Short Term Shop.
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We have a large following and we work hard to ensure our clients happiness.
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We are currently hiring in Outer Banks, Shenandoah, Virginia, Galveston, Crystal Beach, Texas and the East Tennessee Smoky mountains.
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[00:06:55] Speaker B: So tell me a little bit about. It's been a few years since we've talked about the Hill country on the short term show feed, guys. We also have a 10 episode podcast on the Hill country only. So if you're new to short term rental investing and you're like, hey, this Texas Hill country thing sounds cool, I live in Austin, I live in San Antonio, something like that, maybe you want to invest in the Hill Country. Definitely. Check that out on our YouTube channel. It's also on Spotify, it's also on Apple Podcasts where we have 10 episodes on exactly how to invest in short term rentals in this market. So if you want a deep dive, check those out. And if you want to work with Stacy, you can email
[email protected] and we'll get you set up. Anyway, so it's been a little while since we've talked about the Hill country on the podcast. What have you been seeing over the last few years in terms of trends, what people are looking for and what's working?
[00:07:43] Speaker C: Yeah, so the great news is it's a great time to buy because we are in a very, very strong buyer's market.
Um, so almost everything's sitting on the market and most of what's on the market is not.
They're pretty. We have a lot of pretty properties, but nothing that is really that wow factor that your guests are looking for. But it's, it's all simple stuff to add. People want, they want that experience. They don't want to feel like they're going from their nice house to another nice house in the Texas hill country. They want something that, you know, they can put on Instagram or TikTok and, and feel like it's kind of a special vacation, not just a nice house that they're staying at. So that does really well.
And that can be from a pretty modern property to a very charming historic property in Fredericksburg that are very popular. I had a client recently bought a 120 year old house, I think. But it's beautiful. It's been beautifully redone. It's pretty modern on the inside, but still has the original wood walls and stuff. So super charming.
People really gravitate to that kind of experience.
[00:09:01] Speaker B: Yeah, yeah. I think I feel like it does need to be an experience. You need to be able to see the landscape. And I agree. You don't. In any market, people don't want to just feel like they're making a lateral move to another house. Exactly. Like the house they live in at home to vacation in. They want to feel like they're on vacation. Like it's an expensive experience.
[00:09:19] Speaker C: Absolutely, yes.
[00:09:22] Speaker B: What are you seeing in terms of areas that people want to buy? People typically stick to Fredericksburg. I've seen with our client base.
[00:09:30] Speaker C: Yeah, Fredericksburg is kind of our main area. But you know, I have clients who've bought in Austin and San Antonio.
Wimberley is probably, you know, our second most popular market outside the big cities.
And you know, and then we've got some up and coming markets like Johnson City that more experienced investors are willing to kind of take a chance on that. I usually recommend kind of something more established for newer investors just because the vendors and everything. It just makes it easier when you have that whole system in place right off the bat where some of these up and coming areas are a little bit harder to build your team just because we don't have a strong list yet.
[00:10:20] Speaker B: Yeah, yeah. It's just a little more up and coming than like Austin proper. And Austin is interesting to me. If you're interested in buying in this market, you're gonna need, I would say a million dollar budget minimum to get something good in Austin. Austin. The regulations are, I don't want to say difficult to navigate. They're kind of clear, but they exist. But to get like a good South Austin short term rental, it's going to be on the expensive side. So if you're somebody who is really looking more for like the tax, short term rental tax strategy, I would say. And you need you have a large amount of income that you need to offset, then I would go Austin proper.
And Austin has become a buyer's market too. If you look at any of the lists that have come out in the last year or two about markets that were super hot during COVID in terms of the real estate just skyrocketing, I'm not just talking about short term rentals. I'm talking about just general market lists on realtor.com or Zillow. And Austin was one of the hottest and now it made the sharpest shift to being now one of the coldest markets and one of the most buyer heavy or buyer market centric areas of the country right now. So you're not going to see listings listed for super low. That's not what happens when markets change. People don't just go, oh, the markets change. Let me list it low. What happens is they list it where they're anchored still to those prices that, that they saw in back when it was a seller's market. But where you see the prices going down is in the number that sellers are willing to take. So you don't see the prices going down until you look at the sold data.
So you're not going to see price properties listing low. I'm trying to buy a property in a different market right now that they paid 1.5 for during COVID the next closest comp that's actually nicer than this property. It's identical. Same neighborhood, but it's nicer.
Sold for 1.3amonth ago. And we're negotiating with this seller and they will not come off of 1.5. So that's what I mean with the fact that they're anchored to the prices from previously and they sometimes they don't care where the sold comps are. So you don't know where their threshold is, where their bottom is until you start making those offers. So my advice, we're sitting here telling you Austin's a buyer's market, Hill country is a buyer's market. You're not going to go on Zillow and go, oh man, these prices are amazing. You have go in and make offers to find those deals.
[00:13:05] Speaker C: Yeah, and that's a great point because a lot of people bought at the height of the market and we're seeing that. And now, you know, they bought too high and they've lost value and they've got it listed and they're trying to recoup their money. But I've gotten several deals done, you know, in the last 12 months. Where I know we got it for less than what the seller paid for but it wasn't listed at that. We had to negotiate to that and they were in the position where they were ready to sell and willing to accept that price.
[00:13:33] Speaker B: Yeah, sometimes you just gotta wait em out a little bit, let it sit on the market for a minute, come back to it, come back to it. And eventually if they actually need to sell, they will.
[00:13:45] Speaker C: Yep.
[00:13:47] Speaker A: The real estate market is always changing.
Covid is long gone, prices are down and properties are sitting on the market.
The short term shop sells houses in all of the best vacation markets and we'd love to help you purchase your next vacation home.
Join us at theshortermshop.com theshortermshop.com let's find you a deal.
[00:14:15] Speaker B: All right. So what are we seeing Stacy in terms of being successful as a short term rental in this market over the last few years?
[00:14:24] Speaker C: So it's not, it's probably very similar to whatever we see in every other market. You know there's, there's a couple key components. Number one is how you're managing it. Are you managing it like a business? Are you actually paying attention to your pricing and, and seeing how you're trending with the market?
You know, as far as your nightly rates setup is huge. You know, like I said, we've got a lot of really pretty propert but they're just boring and so we, you know, you've got to have some personality in your property. You have to have a little bit of, a little bit of wow factor. And you know, I'm not talking pickleball courts and crazy stuff. I'm talking, you know, accent walls and wallpaper and cool funky art, things like that.
So if you have that, you know, you're going to get the guest and then the management part is making sure your, you know, your communication is strong and you're setting clear expectations and you know, I don't think we're that different than any other market in that aspect.
[00:15:33] Speaker B: Yeah, I agree with that. Do you think that the floods that happened with Camp mystic and all of that, that was in the news really heavily? I think that was two years ago, maybe last year. Two years ago?
[00:15:47] Speaker C: Last year, last July.
[00:15:50] Speaker B: Yeah. Do you think that that has affected sales in the area and or rentals in the area?
[00:15:58] Speaker C: I think it did for a very short time.
I know several of my owners in the area had told me that people were reaching out to them, saying hey, were you impacted by the floods? Is the property okay? And things like that. And Kerrville.
Kerrville is probably about 45 minutes from, you know, from Fredericksburg, and it's even further from like Austin and San Antonio.
So I have not seen that have an impact. Canyon Lake, I think was because the river flows into Canyon Lake, that flooded. And so I think there was a little bit more impact there from guest perspective. But it's fine. Everything is up and running. Nothing has been impacted at all.
Canyon Lake, the levels went back to normal and the levels have been low because it's been in a drought for a couple of years. So the, you know, those floods actually rose levels just a little bit. And, and everything's pretty back. Much back to normal there.
[00:17:05] Speaker B: Yeah, well, that's. That's good. That was really, really a terrible thing. But I'm glad it has not affected the area too long term in terms of getting back to normal.
Normal business.
[00:17:17] Speaker C: Yeah, I don't have any owners in Kerrville because there's not a ton of tourism demand in Kerrville. It's a very beautiful place to visit, but not a lot of people are going there. So, you know, I don't know of anybody who was personally impacted from a short term rental perspective.
[00:17:35] Speaker B: You know, my grandmother was telling me that my great grandmother. So my grandfather's mother did hair at Camp mystic back in the day, like 60s when.
I'm not exactly sure. I guess all the girls would get their hair done for like a. A party or something. But anyway, they lived in that, in that area and that camp has been around for a long time. That's.
[00:18:03] Speaker C: Yeah, a very long time. It's very sad. Yeah, we. We knew people who were personally impacted, which was really tragic.
[00:18:12] Speaker B: That's the worst. Well, let's change the subject because it's so, so terrible.
All right, so where do you see over the, you know, maybe this season at. We're coming into buying season right now, and we're coming into the high season for rentals. Where do you see this market going? You're seeing any trends in terms of bedroom count? You already talked about decor a little bit or location.
[00:18:36] Speaker C: Yeah, I'm seeing an increase in tourism, specifically in Fredericksburg. Like every time I go, even on like a Tuesday or Wednesday, it seems like it's packed. There are things happening.
Well, a couple things. So many people are moving to Texas that I think we're seeing that impact, you know, the tourism towns, you know, because people want to check out their new state and go close, you know, to local visitor spots and things like that. Fredericksburg in particular, they're building a Waldorf Astoria, which will be the first Waldorf in Texas that's coming.
It probably won't be until the end of next year, possibly 2028, but that's expected to increase tourism even more. As people come to see the Waldorf, they're going to have a really big spa area and I think maybe some shopping and other things other than just the hotel itself.
So there's some exciting things happening that are.
That I believe will continue to increase tourism to the area and make people just want to come here more.
[00:19:47] Speaker B: Yeah, I totally agree with that. As more and more people move to Texas because it's a no income state, just like Florida and Tennessee, we've seen so many people moving to those three states over the last four or five years that the more people move to Texas, specifically Austin and San Antonio, the more those are the main feeder markets for the Hill Country. Even though people come from all over Texas and outside of Texas. But the main feeder markets are going to be Austin and San Antonio. The more people that continue to move to these areas, the more population growth we have that feeds this weekend vacation market. Same thing with the Galveston Crystal beach market. Tons of people moving to Houston all the time from big cities to, to get away from income tax. So I think the more people that continue to move to these areas, the more these vacation areas will grow because there's just more people going on weekend vacations from Austin, Tech, Austin, San Antonio, Houston, Dallas, all those places.
[00:20:46] Speaker C: Yep, exactly.
Yeah. And bedroom count. I think Hill country may be a little bit unique because really all size properties do well. You know, the little one bedrooms do great for honeymoon getaways, all the way up to five and six bedroom for big girls trips.
But those, those tend to be a pretty penny.
[00:21:11] Speaker B: Do you have to be on one of the lakes or riverfront to do well in this market?
[00:21:16] Speaker C: No, not at all.
Now I would say if you're in a lake market like Marble Falls. Yes.
All the top performers are on the lake in those markets.
Canyon Lake, there's not a lot of lakefront property just the way the lake is built. So no, you don't have to there. Fredericksburg doesn't have a lake at all.
So.
Nope, it doesn't make a difference unless you're in a specific lake market.
[00:21:42] Speaker B: Gotcha. So Fredericksburg, the probably the most popular market is not a lake or river market. It's not waterfront. So not something you have to have.
[00:21:53] Speaker C: Right.
[00:21:54] Speaker B: All right, awesome.
So that's kind of it for the main questions that I had about the Hill country in Austin, is there anything that we haven't covered yet that you feel like the listeners would benefit from hearing about your market?
[00:22:09] Speaker C: Well, you kind of touched on it. Like, don't let the prices scare you. Like, if you get on, you know, Zillow or something and are looking at prices, you know, especially in Fredericksburg, they're going to seem higher. Or Austin, if you're looking in Austin. But I have found that the vast majority of things we've gotten under contract in the last two years we've gotten a decent discount on. So there's definitely lots of room to negotiate, depending on how motivated the seller is.
[00:22:37] Speaker B: Yep, always. And if you haven't made at least 10 offers, you do not get to quit. So I get. People say, oh, I was looking in such and such market, but the numbers didn't work. I'm like, oh, the numbers didn't work across the whole market? That's crazy. What. How did. How many offers did you make? None. Well, okay, then you have not done sufficient due diligence to see there is a number at which every property will work. Offer that number on a minimum of 10 and then come back to me 100%.
All right, thank you, Stacy, so much for coming on. Guys, if you're interested in learning more about the Texas Hill country, make sure you check out our Texas Hill country playlist. And then also, if you're interested in buying in Austin, San Antonio, or the Hill country, reach out to us. We'll get you with Stacy. It's agents, the ShortTerShop.com. thanks, Stacey.
[00:23:27] Speaker C: Thank you.
It.
