Currently living in South Florida. Love it here but looking to relocate to an area with a younger age demographic. Austin, TX is down 20-30% from peak asking prices and I don’t see it getting better with the current environment signaling higher interest rates to come.
Currently parked some capital in a high yield savings account that is yielding 4.05% returns risk free — FDIC insured up to 1 million! The returns are compounded monthly and payed out monthly, will literally pay for my renting expenses!
Cash buyers: Know you have options to get a pretty decent return that is risk-free! Don’t feel pressured to buy at these prices to interest rates. Just rent for free with your returns and once the price corrects — jump in and capitalize on the opportunity!
I like it! I sold most of my multis last year at a cap rate about equal to risk-free returns today. Crazy.
So I'm getting 3.25% or 3.5% in an FDIC mmkt acct with high limit and no gotchas.
Care to share whose paying 4%? Is it without must use your debit card 12 times a month or any other hoops?
I like it! I sold most of my multis last year at a cap rate about equal to risk-free returns. Crazy.
So I'm getting 3.5% in an FDIC mmkt acct. Care to share whose paying 4%? Is it without use your debit card 12 times a month hoops?
Hi Steve,
I’ve been following your journey for a few months as I browse BP often but do not post much! Congratulations on your incredible run and incredible timing with regards to exit!
Right now I am using Wealthfront. You begin earning interest the same day you transfer a deposit — even though the deposit takes 3-4 days to transfer. This is their cash savings account. There are 0 fees whatsoever (I called their customer service line and asked 8 different times in 8 different ways to be absolutely sure). You do not have to use any debit cards or anything like this, and you do not have to leave your money in their locked up for ‘X’ period of time like bonds.
PLEASE NOTE*** - They do also offer an investment product where you can transfer money in there, and they will manage your “portfolio investment” for you, and take a management fee for doing this. To be clear —- THIS IS NOT REQUIRED AND I PERSONALLY DO NOT RECOMMEND IT.
My intuition tells me that their cash savings account is a break-even or loss leader product for them, and where they make their money is getting people to sign up for the extra feature of the investment savings account under management. (Which I personally don’t recommend).
Currently living in South Florida. Love it here but looking to relocate to an area with a younger age demographic. Austin, TX is down 20-30% from peak asking prices and I don’t see it getting better with the current environment signaling higher interest rates to come.
Currently parked some capital in a high yield savings account that is yielding 4.05% returns risk free — FDIC insured up to 1 million! The returns are compounded monthly and payed out monthly, will literally pay for my renting expenses!
Cash buyers: Know you have options to get a pretty decent return that is risk-free! Don’t feel pressured to buy at these prices to interest rates. Just rent for free with your returns and once the price corrects — jump in and capitalize on the opportunity!
I just moved back to FL last week. I going to rent unless I can get a property for about 20% less than the ask. I am in no rush. I put in a verbal today 350k, ask is 420k, If I get it great if not, I am in no rush,
I like it! I sold most of my multis last year at a cap rate about equal to risk-free returns. Crazy.
So I'm getting 3.5% in an FDIC mmkt acct. Care to share whose paying 4%? Is it without use your debit card 12 times a month hoops?
Hi Steve,
I’ve been following your journey for a few months as I browse BP often but do not post much! Congratulations on your incredible run and incredible timing with regards to exit!
Right now I am using Wealthfront. You begin earning interest the same day you transfer a deposit — even though the deposit takes 3-4 days to transfer. This is their cash savings account. There are 0 fees whatsoever (I called their customer service line and asked 8 different times in 8 different ways to be absolutely sure). You do not have to use any debit cards or anything like this, and you do not have to leave your money in their locked up for ‘X’ period of time like bonds.
PLEASE NOTE*** - They do also offer an investment product where you can transfer money in there, and they will manage your “portfolio investment” for you, and take a management fee for doing this. To be clear —- THIS IS NOT REQUIRED AND I PERSONALLY DO NOT RECOMMEND IT.
My intuition tells me that their cash savings account is a break-even or loss leader product for them, and where they make their money is getting people to sign up for the extra feature of the investment savings account under management. (Which I personally don’t recommend).
Currently living in South Florida. Love it here but looking to relocate to an area with a younger age demographic. Austin, TX is down 20-30% from peak asking prices and I don’t see it getting better with the current environment signaling higher interest rates to come.
Currently parked some capital in a high yield savings account that is yielding 4.05% returns risk free — FDIC insured up to 1 million! The returns are compounded monthly and payed out monthly, will literally pay for my renting expenses!
Cash buyers: Know you have options to get a pretty decent return that is risk-free! Don’t feel pressured to buy at these prices to interest rates. Just rent for free with your returns and once the price corrects — jump in and capitalize on the opportunity!
I just moved back to FL last week. I going to rent unless I can get a property for about 20% less than the ask. I am in no rush. I put in a verbal today 350k, ask is 420k, If I get it great if not, I am in no rush,
Good luck Bob! I love it here but am single, and the majority of my peers are 15-30 years older than me :). It has served me quite well learning from those more experienced, but the dating scene is a bit difficult due to the age demographic so this is one big reason for moving.
South Florida is holding pretty strong compared to other places, but I am seeing 5-10% price drops. Keep at it, and I wish you the best of luck!! Hoping you find a great deal down here. This place really is incredible. I will come back in 20 years and get a place here.
Wealth front is 4% APY, so like .33% monthly. You're not making rent money on that unless you're doing like 750k -1million in there.
Their FDIC insured through other banks, so it's a pass through. There are other banks you can get great APYs like Bask, but I do not recommend.
Wealth front is 4% APY, so like .33% monthly. You're not making rent money on that unless you're doing like 750k -1million in there.
Their FDIC insured through other banks, so it's a pass through. There are other banks you can get great APYs like Bask, but I do not recommend.
Hi Jason,
You are right at the moment they are at 4.05%.
In Austin, TX I am seeing 2 bed 2 bath rents for ~$1600 month in prime areas around Zilker/Barton Springs. With 500k your returns are approximately ~20k annually. 500k is actually less than the properties in that area at the moment. Most are listed for 750-800k from what I can see. To me it’s a no brainer with our economic environment, even though no one can predict the future.
I am not familiar with bask, but would be interested in hearing your thoughts as to why you do not recommend them. Thank you!
Wealth front is 4% APY, so like .33% monthly. You're not making rent money on that unless you're doing like 750k -1million in there.
Their FDIC insured through other banks, so it's a pass through. There are other banks you can get great APYs like Bask, but I do not recommend.
Hi Jason,
You are right at the moment they are at 4.05%.
In Austin, TX I am seeing 2 bed 2 bath rents for ~$1600 month in prime areas around Zilker/Barton Springs. With 500k your returns are approximately ~20k annually. 500k is actually less than the properties in that area at the moment. Most are listed for 750-800k from what I can see. To me it’s a no brainer with our economic environment, even though no one can predict the future.
I am not familiar with bask, but would be interested in hearing your thoughts as to why you do not recommend them. Thank you!
Wealth front is 4% APY, so like .33% monthly. You're not making rent money on that unless you're doing like 750k -1million in there.
Their FDIC insured through other banks, so it's a pass through. There are other banks you can get great APYs like Bask, but I do not recommend.
Hi Jason,
You are right at the moment they are at 4.05%.
In Austin, TX I am seeing 2 bed 2 bath rents for ~$1600 month in prime areas around Zilker/Barton Springs. With 500k your returns are approximately ~20k annually. 500k is actually less than the properties in that area at the moment. Most are listed for 750-800k from what I can see. To me it’s a no brainer with our economic environment, even though no one can predict the future.
I am not familiar with bask, but would be interested in hearing your thoughts as to why you do not recommend them. Thank you!
There are other places asking $1900/month so it really depends on the individuals needs and property! But zoom in the Zilker area, there is quite a lot of inventory both for sale and for rents from what I can see. Will check out some of these reviews to get some further knowledge on what others experienced with bask. Thank you
Edit - Upon initial research, it seems some of the complaints for Bask are due to having to wait ~4-5 business days from the day the transfer is requested, to the transfer being cleared. After reviewing Marcus, it appears they offer 3.75% APY with next day transfer up to $100k.
Your return in Austin is holding the real estate. Now is a good time to buy something under retail value.
Currently living in South Florida. Love it here but looking to relocate to an area with a younger age demographic. Austin, TX is down 20-30% from peak asking prices and I don’t see it getting better with the current environment signaling higher interest rates to come.
Currently parked some capital in a high yield savings account that is yielding 4.05% returns risk free — FDIC insured up to 1 million! The returns are compounded monthly and payed out monthly, will literally pay for my renting expenses!
Cash buyers: Know you have options to get a pretty decent return that is risk-free! Don’t feel pressured to buy at these prices to interest rates. Just rent for free with your returns and once the price corrects — jump in and capitalize on the opportunity!
I was able to sell my home above June 2022 peak. 4 days DOM. This local market is still crazy. All house under 1 mil still selling peanuts. This area doesn't care about 8%, price is still going up for house under a mil as everyone sees the opportunity. There're few flips SF though, like one house I saw in 2022 that has potential of 1.4k but selling for 900k only *today* so I would join the bidding war for this house.
It's funny because if home is good, then you can sell it above June 2022, but if home requires repair, it goes back to 2018-2022 pricing.
Your return in Austin is holding the real estate. Now is a good time to buy something under retail value.
You may be right but I’m not convinced.
Last 30 days sales have zero units recorded around the particular area of Barton hills/bouldin creek/Zilker/Travis heights in the 200k-1.25m range.
Three units sold in all of south Austin during this time from what I can see. Zooming out to last 90 days, only three units sold in that particular area listed above. Now filter through inventory available there is currently 50+ for sale in that area.
Personally the risk to purchase currently is greater than the risk of sitting on the sidelines for 12 months sitting pretty, close to zero expenses accumulating more cash. That’s my perspective but who really knows how this will all play out.
Currently living in South Florida. Love it here but looking to relocate to an area with a younger age demographic. Austin, TX is down 20-30% from peak asking prices and I don’t see it getting better with the current environment signaling higher interest rates to come.
Currently parked some capital in a high yield savings account that is yielding 4.05% returns risk free — FDIC insured up to 1 million! The returns are compounded monthly and payed out monthly, will literally pay for my renting expenses!
Cash buyers: Know you have options to get a pretty decent return that is risk-free! Don’t feel pressured to buy at these prices to interest rates. Just rent for free with your returns and once the price corrects — jump in and capitalize on the opportunity!
I was able to sell my home above June 2022 peak. 4 days DOM. This local market is still crazy. All house under 1 mil still selling peanuts. This area doesn't care about 8%, price is still going up for house under a mil as everyone sees the opportunity. There're few flips SF though, like one house I saw in 2022 that has potential of 1.4k but selling for 900k only *today* so I would join the bidding war for this house.
It's funny because if home is good, then you can sell it above June 2022, but if home requires repair, it goes back to 2018-2022 pricing.
Hi Carlos,
Are you looking at north Austin? I see 19 sold units in the past 90 days. Then clicking how many available and it’s looking like hundreds. I’m not so sure.
@Steve Vaughan below is what I have found
Online savings at Citi 3.85% (Bread and UFB have 4.0% but I don't know anything about them)
Money market mutual fund 4.25% (most brokerages)
4 or 6 month US Treasury 5.0-5.1%
Capital One 11 month CD 5.0%
@Andre O. thanks for the heads up on the Wealthfront account...the extra FDIC coverage is great.
Currently living in South Florida. Love it here but looking to relocate to an area with a younger age demographic. Austin, TX is down 20-30% from peak asking prices and I don’t see it getting better with the current environment signaling higher interest rates to come.
Currently parked some capital in a high yield savings account that is yielding 4.05% returns risk free — FDIC insured up to 1 million! The returns are compounded monthly and payed out monthly, will literally pay for my renting expenses!
Cash buyers: Know you have options to get a pretty decent return that is risk-free! Don’t feel pressured to buy at these prices to interest rates. Just rent for free with your returns and once the price corrects — jump in and capitalize on the opportunity!
I was able to sell my home above June 2022 peak. 4 days DOM. This local market is still crazy. All house under 1 mil still selling peanuts. This area doesn't care about 8%, price is still going up for house under a mil as everyone sees the opportunity. There're few flips SF though, like one house I saw in 2022 that has potential of 1.4k but selling for 900k only *today* so I would join the bidding war for this house.
It's funny because if home is good, then you can sell it above June 2022, but if home requires repair, it goes back to 2018-2022 pricing.
Hi Carlos,
Are you looking at north Austin? I see 19 sold units in the past 90 days. Then clicking how many available and it’s looking like hundreds. I’m not so sure.
no way jose :-)
in our market inventory is zero.
in the whole bay area, 3/2 SF w/ price < 1mil and has price cut : only 3 houses. I wish I'm looking to Austin, my market is still continuing 2022 uptrend.
@Steve Vaughan below is what I have found
Online savings at Citi 3.85% (Bread and UFB have 4.0% but I don't know anything about them)
Money market mutual fund 4.25% (most brokerages)
4 or 6 month US Treasury 5.0-5.1%
Capital One 11 month CD 5.0%
@Andre O. thanks for the heads up on the Wealthfront account...the extra FDIC coverage is great.
Capital one 5% ? I will take a look.
Your return in Austin is holding the real estate. Now is a good time to buy something under retail value.
You may be right but I’m not convinced.
Last 30 days sales have zero units recorded around the particular area of Barton hills/bouldin creek/Zilker/Travis heights in the 200k-1.25m range.
Three units sold in all of south Austin during this time from what I can see. Zooming out to last 90 days, only three units sold in that particular area listed above. Now filter through inventory available there is currently 50+ for sale in that area.
Personally the risk to purchase currently is greater than the risk of sitting on the sidelines for 12 months sitting pretty, close to zero expenses accumulating more cash. That’s my perspective but who really knows how this will all play out.
if inventory is high you should expect to drop more.
In our market we continue 2022 uptrend trajectory because there's no inventory.
the inventory is really the key above the interest rate,etc.
btw i am going to rent for 6 months to one year also while waiting to bid for the correct house, 100% of flipped homes got multiple bid nowadays, it's funny when you have 10 rentals i am still renting, I also may renting to avoid tax. I'd rather renting for a yer rther than paying 250k capital gain tax.
Wealth front is 4% APY, so like .33% monthly. You're not making rent money on that unless you're doing like 750k -1million in there.
Their FDIC insured through other banks, so it's a pass through. There are other banks you can get great APYs like Bask, but I do not recommend.
Hi Jason,
You are right at the moment they are at 4.05%.
In Austin, TX I am seeing 2 bed 2 bath rents for ~$1600 month in prime areas around Zilker/Barton Springs. With 500k your returns are approximately ~20k annually. 500k is actually less than the properties in that area at the moment. Most are listed for 750-800k from what I can see. To me it’s a no brainer with our economic environment, even though no one can predict the future.
I am not familiar with bask, but would be interested in hearing your thoughts as to why you do not recommend them. Thank you!
There are other places asking $1900/month so it really depends on the individuals needs and property! But zoom in the Zilker area, there is quite a lot of inventory both for sale and for rents from what I can see. Will check out some of these reviews to get some further knowledge on what others experienced with bask. Thank you
Edit - Upon initial research, it seems some of the complaints for Bask are due to having to wait ~4-5 business days from the day the transfer is requested, to the transfer being cleared. After reviewing Marcus, it appears they offer 3.75% APY with next day transfer up to $100k.
Your return in Austin is holding the real estate. Now is a good time to buy something under retail value.
You may be right but I’m not convinced.
Last 30 days sales have zero units recorded around the particular area of Barton hills/bouldin creek/Zilker/Travis heights in the 200k-1.25m range.
Three units sold in all of south Austin during this time from what I can see. Zooming out to last 90 days, only three units sold in that particular area listed above. Now filter through inventory available there is currently 50+ for sale in that area.
Personally the risk to purchase currently is greater than the risk of sitting on the sidelines for 12 months sitting pretty, close to zero expenses accumulating more cash. That’s my perspective but who really knows how this will all play out.
Elliot's right. If there's a time to buy it's now probably until the fed stops hiking. Inventory should be slightly increasing, as rates go up. So this period is the time for buyers to step in. Austin will be a net long term huge boom. I'd be on the prowl and I'm only saying that cause I am. I don't think I'll find another opportunity to invest in Austin.
Your return in Austin is holding the real estate. Now is a good time to buy something under retail value.
You may be right but I’m not convinced.
Last 30 days sales have zero units recorded around the particular area of Barton hills/bouldin creek/Zilker/Travis heights in the 200k-1.25m range.
Three units sold in all of south Austin during this time from what I can see. Zooming out to last 90 days, only three units sold in that particular area listed above. Now filter through inventory available there is currently 50+ for sale in that area.
Personally the risk to purchase currently is greater than the risk of sitting on the sidelines for 12 months sitting pretty, close to zero expenses accumulating more cash. That’s my perspective but who really knows how this will all play out.
You are trying to catch a falling knife. Adapt and find ways to make money in any market.
When short bond return is 4.83% and home appreciation is less stellar than 5% eventually our strategy changes as well.
I'm busting my butt for 10% return on my rentals. It's very tempting to sell and get 5% for doing absolutely nothing. I just know I'll probably regret it after 5-10 years.
Everything in this theory hinges on the 1 assumption of "waiting for a market "correction"" meaning expectancy for home prices to drop sharply.
And they will NOT.
Go ahead, argue away against that BUT before you do I suggest doing some research of my "contrarian" market forecasts for the last 3 years, you just may change your mind given my track record. I seem to be something of an expert at predicting the "unpredictable".
There is such a mountain out there of messaging about the folly of "timing the market" that I won't bother reiterating it. If one hasn't absorbed that message of wisdom yet, they never will.
Interest rate increases do NOT create inventory. Any notion of such is moronic, it is. If anything it DECREASES inventory. People reside in housing. The only way to get ADDED inventory is either (A) less people. Or (B) Units built to ADD inventory.
When costs of purchasing a unit goes up, as rates increasing does, DEMAND declines because AFFORDABILITY declines. As demand declines, the manufacturers of new units DECREASE output, so to defend there manufacturing operation. There is nothing new here, this is how manufacturing has operated since Jesus was a pup. Every manufacturer does this from widgets to homes. And that's a common flaw in peoples thinking, seeing home builders as anything other than manufacturers.
You ONLY get more inventory when there is a profitable incentive for a manufacturer to PRODUCE units. How do you get that? Demand and consumer affordability.
So, this whole expectation of MORE inventory during LESS affordability is an oxymoron. As long as the Fed is burning off capital no, there will NOT be more inventory, and as we are in a significant net shortage thus supply-demand supports price.
Now if the Gov. REDUCED production costs, YES lower COG's facilitates a lower cost of new units which creates affordability thus affording more units to be added without holding to current pricing basis. Do you see our government doing this? Talking about this? Even rumoring of this? No, the opposite right, all talk is on INCREASING taxes and there in COG's.
Simple economics, as you raise the cost of inputs the finished product will be disproportionately more expensive. Look up this rule of economics.
It's a fools errand waiting for home prices to drop sharply in a shortage environment, with raised cost of inputs, raising cost of inputs, tight labor with all prospects of getting tighter and more short supply...... Every single factor is one of INCREASED price and here we have chanting masses "waiting for prices to come down".......
Every person who potentially sells a home MUST enter a new primary residence. This is NOT added inventory, it is SHIFTING inventory. This is why some markets have more and others less, the SHIFT of persons. Thus market deviations from the general U.S. market #'s but make no mistake, being so far into net unit shortage of the many millions as we are, this mirage of prices touching back to '18'/'19' levels is insanity.
And please, don't head my warnings, by all means exit the market, become renters, I am happy to have less competition and add you as a tenant, thank you thank you. But don't cry and complain in 18mnths when your still waiting and start to realize your great-crash happened Q4 '22' and you yet again "missed the market".
Lastly, if you think 4% is a "great" return, hit me up, I will give out 5% happily. Heck, I'll even go 6% if you ask nicely. Sure, I'll pay out interest monthly, no problem.