ThenIn was a 35-year old tech worker. Long Beach, Calif., who purchased a house in Round RockLast price: $300,000. October. By JanuaryIt was worth approximately $400,000 in 2021; FebruaryHe purchased two more. HisHis agent, an ex-equities trader and now a specialist in individual investors, won two of the dozens of bids he made sight unseen. All of them were at least $40,000 more than the asking price. “I’m part of the problem,” the buyer acknowledged to me, though he was not your stereotypical speculator: DespiteHe earns six figures and drives a 2005 Honda CivicWhen I spoke to him, he was renting a room at $900 per month and prefers to save and invest. (ScarredBy graduating into the Great RecessionHe aligns himself with the Financial Independence, Retire Early movement popular on Reddit.) He marveled at how FaceTime, DocuSign and electronic transfers made everything seamless, but because real estate money can now move so easily, it meant what he had liked about real estate investing in the first place — its stability and relative slowness — no longer held true. “We’re gamifying real estate investment to the point that it’s almost like throwing money at the stock market,” he told me.
Some AustinReal estate agents are well-positioned to capitalize on this out-of-town cash. OnA humid 95-degree day in late June, Matt HolmHis winged door was lifted Tesla ModelX so I could jump in the back seat behind his customer. JonA man who worked in commercial real-estate financing. Santa Monica. (Jon asked that I withhold his last name because he hasn’t shared his relocation plans with his friends and family.) DuringThe pandemic, JonOriginal from Madison, Wis., began rethinking what was keeping his in. California. “I’m getting a little anxiety about making a longer-term commitment to L.A., just given the political climate, the tax climate, the homelessness problem,” he told me.
JonI had been to Austin three times in as many months and was getting a handle on the “resi” market. HeHe was searching for a home where it would be possible to declare his residency in order to take advantage of the benefits. Texas’ lack of income tax — but he also wanted to live elsewhere half the year, and so he was looking for a place he could easily rent out and make money on. AndHe wanted guaranteed appreciation. “I mean everything’s an investment, right?” he told me. A friend of his had just moved to AustinHe was introduced to HolmThe hairstyle was done in a sleek ponytail for a woman with a dirty blonde hair. HeThe foundation Tesla Owners ClubOf Austin in 2013 and proudly referred to himself as the “Tesla realtor” in town. When JonYou slipped in to view a short-term lease. MattThat was what they told me Jon would like to spend $500,000 to $700,000, “but he’s going to spend 1.3 to 1.5 by the time he’s done.”
“There’s nine million square feet of office being built,” HolmAs we drove through downtown, cranes, glass skyscrapers sparkled above the red-granite and yellow-limestone buildings. (The Austin ChamberOf CommerceThe lower, but still shocking figure of 6.2 million square footage was given. “And it’s being built, like, it’s not occupied. SoThese jobs are coming. Peoplethey are telling me, like OhYou know what? We peaked. … AsThe metrics are the most important. TexodusIt is not slowing. We’re about to get a tidal wave.”
“People haven’t even factored in the Elon effect,” he continued, “I can’t tell you the number of people that are saying, Oh, Elon’s building a factory. Like, no, Elon’s not building a factory — this is headquarters for everything Elon. He hasn’t officially announced it, and I don’t know anything behind the scenes, but I can see very clearly the people that are moving here, and they’re not factory workers.” (IndeedIn October, MuskIt was made official.
Holm JonThey spoke the same language. TheyWe analyzed each parcel to determine how to maximize profits, and shared tips on minimizing taxes. WalkingThrough a cavernous tiled and-carpeted two story in Travis Heights, HolmIt is possible to make a wonderful home with its many bedrooms. Airbnb. Although Austin and the state stipulated that owners could rent only their homestead and only for a maximum of six months a year, “that could be every weekend,” Holm said.
“The investor I know that’s killing it right now is a systems guy,” he continued. “AndFor four years, I had told him that he needed to go into the university. Airbnbbusiness and he thought he was B.S.ing on him on the numbers. AndFinally, he believed in me and now he has 13 Airbnbs.”
Source: NY Times
