All Forum Posts by: Pretty Khare

I have turned less than 100k cash into a 15k net profit with a LTR house that is less work.

The first market numbers of 2023 are out from the Austin Board of Realtors. While the price of a single-family home in Austin is down nearly 18% off its May 2022 high, there are strong signs that the market is completing its normalization trend. Here’s an overview of the January 2023 numbers showing year-over-year changes for both the City of Austin and the greater metro area:

While the Austin area market produced another year-over-year decline in median home prices in January, pricing month-over-month has been mostly stable recently. Year-over-year declines will likely continue for the next 4-6 months, since we’re comparing to the extreme conditions in the first half of 2022. However, we still have very far to go to reach pre-pandemic price levels. Here’s a chart of the median single-family home price in Austin for the past 10 years:

With 2.2 months of inventory in Austin and 2.7 months in the metro overall, the Austin market is still very tight and very much a seller’s market according to that metric. This is relatively unchanged from recent months and shows that Austin is still in dire need of housing inventory. There are some tremendous opportunities at the moment with new home builder inventory as they roll out of the sometimes substantial spec home inventory they began building this time last year and transition into their more usual to-be-built sales process, where a buyer picks their vacant lot and goes through the whole months-long build process.

If you’re a buyer, then you’ll be happy to know that there are ~460% more active listings on the market now compared to this time last year. From an inventory, price, and negotiation perspective, conditions for buyers in the Austin metro are better than they’ve been in many years. Interest rates hovering in the 6%-7% range are higher than you’ve come to expect from the past decade, but they’re not outrageous (or even considered that high) from a broader historical perspective. Moreover, there are ways to mitigate these higher rates. For example, I’m seeing regular success negotiating interest rate buydowns at a seller’s expense. If interest rates are the primary factor holding you back from buying, then it’s important to talk to your lender and agent about rate reduction strategies.

If you’re a seller, then you’ll want to pay close attention to the market as we head into the spring. While it’s too early to say for sure, Austin's usual seasonal market pattern would suggest that spring will be better for sellers compared to Q4 of 2022. Going forward, you have to respect the available sales comparables, and strongly consider pricing competitively compared to other active listings in the area. Buyers have much more selection and can now be more picky about a property’s condition. Preparing a home well, staging when appropriate, and having strong marketing are crucial to help your listing stand out. Sellers often have less negotiating leverage compared to previous years. It’s becoming common for buyers to request a closing cost credit from a seller up front on an initial offer before any further negotiations related to inspection items or repairs.

Just checking in, if anyone has made some progress/received updates in the last few weeks?

 That's exactly his and my point regarding points vs. cash.  Points are often much more valuable than cash back, and can often be redeemed at much higher valuations than 1c per point like you get with cash back.

The highest value redemptions are usually on international trips.  International first class flights in particular.  It does require some shopping around and some luck, but you can find redemptions like Andrew was alluding to.  It's not nearly as simple as clicking a button and getting your money, and it requires some legwork find the best transfer partners, most valuable flights, etc.  But as Andrew showed, it can be worth the extra hassle.

This was 10 or so years ago, but I remember redeeming 100k points for 2 round trip first class tickets to Europe that would have been about $17,000 to buy the tickets outright.  100k points is only worth $1,000 in cash.  So those points were redeemed at 17c per point.

Hi, I have a subto + sellerFi deal off market from a wholesaler located on Lake Travis in a non STR restricted area.

I’m out of state and have never been to TX or this area. Wondering what people think of the vacation rental market on Lake Travis?

looks like it is between Austin, TX and TX hill country so seems like it would yield good ADR/occupancy for most of the year?

Any help would be appreciated!

@Jeffrey Ascough - I am the director of sales and marketing for Delta - I have reached out to the builder and we will provide you with updates on Monday when the office and the permitting team is back in.  We want to move projects forward just as badly as you do as it is the only way we make a profit in this business.  I will reply to you directly via email Monday.

@Marlo Lopez - nice to meet you.  However, what you are stating is a bit misleading.  The lender that you were working with isn't funding deals.  The deposit amount when working with a lender comes from the lender - it is basically the amount of skin the lender wants you to have in the game.  Typically we (the builder) require 15% down on our contracts.  For those investors using lending we allow 10% down - this is to help offset other fees you will have to pay - points, broker fees, etc.  You also failed to mention that the new contract price was exactly the same as the one you previously signed.  Construction costs have gone up in SW FL - but we still have not pushed that onto our investors - leaving you a very nice return on your investment.

@Pretty Khare - hello again - I have worked with you through this entire process - we have corresponded on several occasions.  We just updated you on 12/21/2022 that your project is at tie beam inspections and provided you with the photo of your property to show the progress.  If you have questions or concerns about the project, reach out to me!

@Mekail Grant - hello again!  I haven't seen any communication lately from you - however - I will have my team get an update to you on Monday as well!

Bottom line - there have been a number of challenges in Cape Coral over the last couple of years.  We can start with permitting - between software upgrades / changes - reviewers that have rejected plans because of a slope in a shower on a mastered plan, the sheer volume of builds the city has been dealing with - it's been taking much longer than anticipated.  Add Hurricane Ian and you're not making anything easier or more timely.  Our truss company got hit with the hurricane as well - they lost a portion of their building and had issues with power for 2 months.  This halts production for anyone that is that far along - you can't just pick up trusses at your local hardware store - they are engineered for the job via the plans.  They are up and running again, but this pushed jobs back.  Same with fill dirt - they can't deliver mud to locations, and we can't compact it nor test it.  Just trying to offer insight to what has been going on in our world.  Additionally, no investor has received an escalation - which is good for your investment and if you look at some of the rates of returns (some folks are into their builds roughly 60-70k out of pocket, and have over $150k equity - amazing return over most investments) - even though it took longer than any of us expected - there is a lot of positive to talk about.  Feel free to message me directly with any concerns and/or questions you may have.  We look forward to working with you and pushing these properties over the finish line - that's how we all win!

 Have you had any updates?

Hi Anna. Yes I did move forward with investing in FNRP deal and got my first distribution last month. With the interest rates rising, I'm not sure we'll be able to sell at targeted cap rate they advertised during the promotion, but making money nonetheless.

Pretty,  as others have stated here, the permitting process through the City of Cape Coral has been hindered by their ability to scale up their staff to handle the massive demands for all permitting including new construction but also anything else that requires a permit, home improvements, sea walls, alternative sea walls, pools and more.

From your post, I can see that you are frustrated, and I believe some of that is due to not understanding the steps and processes of new construction, including what must be done prior to submitting permits. Once your build contract is signed and the build deposit is received, it's not just a matter of filling out some simple paperwork to start the permitting process. See below:

Survey (8-10 weeks)

Request Permit Prints from Design Team (4-6 weeks)

Site Plan and Septic Design from Design Engineers. (6-8 weeks) Need survey back to start designs as this is site specific

Energy Docs (1-2 weeks) Need plans from Design Team to make request.

Zoning Review by Entity (typical 4-8 weeks) Need completed design package to submit.

Permitting (8-16 weeks) Need completed design package to submit.

Approved Septic System Design from Lee Health Department (8-12 Weeks)

The clock for the commencement of construction starts once the slab is poured and approved by the city inspectors, this is detailed in Section 8 of your build contract. Your slab was poured on 7/15/22. Keep in mind, we did have a 37-day delay due to Hurricane Ian which impacted the build timeline as well as the entire region. The area was without power, materials were delayed in reaching job sites and the city inspectors were not at full capacity as the City was shut down as well.

At this point, your build is coming right along as we are waiting on trusses – as you already know. You should also have mentioned that there have been zero escalations in your contract (Section 14). Please review the entire build contract to make sure you understand each section. Any time you are looking for updates to your build, we have a dedicated email for you to send requests to – we ask for 72 hours to respond because we have many builds, clients, permits, jobs, etc. that we are tracking and working with on a daily basis– and of course we value every relationship. If you have any questions, please feel free to reach out to me.