What is your rich life like?

[Dr Mantis Toboggan]

Whaaa? That's so many hours. Why? I mean, that's an absurdly unhealthy amount of hours. When I was fresh out of residency and trying to make as much as humanly possible I worked ~155hrs/mo. Now, I'm tied for most hrs worked in my group with one other person and we're both at less than 130/mo.

I worked 98 hours in June. It was awesome.

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[deuist]

Why are you working so many hours?

CMGs want their pound of flesh and there aren't lots of docs around. I'm a PGY-15 and slowly trying to cut down on hours, but the schedulers come calling every month.

 

[BoardingDoc]

CMGs want their pound of flesh and there aren't lots of docs around. I'm a PGY-15 and slowly trying to cut down on hours, but the schedulers come calling every month.

This really doesn't track. The CMG has their pound of flesh already with your contract. I'm sure there is a specified number of hours you're required to work. Work that many hours. Working more than that, whether the scheduler is guilt tripping you or not, is ultimately your choice. You don't need to "try" to cut down hours. You simply need to say that you're only going to work x hours/month and they can schedule around that. If they come back and say they don't have coverage or blah blah blah, you can offer to cover for a $1000/shift bonus on top of your specified hours, but otherwise you're not doing it.

I understand some people vehemently want to avoid confrontation, but it sounds like you are literally letting them beat the crap out of you for no reason other than an unwillingness to say no.

 

[WilcoWorld]

This really doesn't track. The CMG has their pound of flesh already with your contract. I'm sure there is a specified number of hours you're required to work. Work that many hours. Working more than that, whether the scheduler is guilt tripping you or not, is ultimately your choice. You don't need to "try" to cut down hours. You simply need to say that you're only going to work x hours/month and they can schedule around that. If they come back and say they don't have coverage or blah blah blah, you can offer to cover for a $1000/shift bonus on top of your specified hours, but otherwise you're not doing it.

I understand some people vehemently want to avoid confrontation, but it sounds like you are literally letting them beat the crap out of you for no reason other than an unwillingness to say no.

Agreed. I start nice, like "please remember not to schedule me for 130 hours next month" and if that doesn't work I email as soon as the schedule is out "it looks like I was accidentally scheduled for 2 extra shifts for next month, please remove me from 2 shifts."

That usually works and you can avoid out and out conflict.

 

[ERMudPhud]

And I burned out hard 3+ years ago. UPMC chewed me up and spit me out. They have my eternal animus. However, now, I'm finally back to work, and I'm working with veterans. Boy howdy, leaps and bounds above the ED clients that simply can't "adult".

Very glad to hear you found your happy place. If you ever want to try EM again. Try rural critical access. I've been amazed. So far the adults act like adults and the children act like well behaved children.

 

[ERMudPhud]

This really doesn't track. The CMG has their pound of flesh already with your contract. I'm sure there is a specified number of hours you're required to work. Work that many hours.

That's what finally did it for me. The contract said something like 120 hours with a minimum of 108 but an unwritten understanding that you could count your back up call day as 24 hours so 84 hours. I could have done that forever. I realized I was on track to finish the year with way more hours than I wanted so I asked for 80 hours one month. I was given 128. Then I was offered a $3000 bonus to pick up one more shift! I figured for that much I would take 8 extra hours. I was given a 12 hour shift at a place I hate working. Submitted my notice.

 

[Apollyon]

Very glad to hear you found your happy place. If you ever want to try EM again. Try rural critical access. I've been amazed. So far the adults act like adults and the children act like well behaved children.

That's what burned me out! Now, that hospital has booted docs out of the ED, and is staffed with NPs!

 

[ERMudPhud]

As an ER doc?

I have several friends who have switched to doing EM at the VA. They really like it. Some had a military background. Some did not.

 

[ERMudPhud]

That's what burned me out! Now, that hospital has booted docs out of the ED, and is staffed with NPs!

Again, though, very glad you are now at place where you can appreciate the bees in the sedum.

 

[ERMudPhud]

CMGs want their pound of flesh and there aren't lots of docs around. I'm a PGY-15 and slowly trying to cut down on hours, but the schedulers come calling every month.

You just have to tell them, "Next time you schedule me for more than 120 hours I quit." Then they have to decide if they are better off having Dr Deuist for 120 hours or zero hours.

 

[Apollyon]

Again, though, very glad you are now at place where you can appreciate the bees in the sedum.

The beauty is in the sublime, and the tiny!

 

[Splenda88]

Y’all are spending the big bucks 😂😂😂

my wife and i only spend 80-90k a year on all our expenses which essentially includes 30k on mortgage and insurance and 20k on day care. Which is probably why our net worth has gone up 50k per month for the last 1.5 years. If we pull our kid out of day care and just retire we are technically leanfire with expenses less than 4 percent of our net worth already.

Our last trip a couple months ago to Europe cost us right around 4k total for everything which included: 3 flights, a 7 night cruise on holland America from rome to sicili to pisa to tunisia to Marcelle france and then finally to Barcelona, all meals, 3 guided excursions through holland America, lots of taxi and uber use for sight seeing in cities we didn’t buy an excursion, and 1 night in Barcelona. It was a luxurious vacation - just didn’t cost luxury prices.

Iceland so far for next week is clocking in at $3650 for 6 days for flights hotel and rental car that are already paid for. Probably will end up spending another 1.5k for food, airport parking, and another 2 days in canada where I’m yet to get hotels. Total cost will likely land at ~5k for 3 people.

That is remarkable. What is your household income?

 

[Splenda88]

At what net worth people here people would consider themselves financially independent (FI)?

I would consider myself FI once I have 2 mil plus a paid off house.

 

[bravotwozero]

At what net worth people here would consider themselves financially independent (FI)?

I would consider myself FI once I have 2 mil plus a paid off house.

2.5 mil plus house. I do live in TX where your money will go a bit farther.

 

[Splenda88]

2.5 mil plus house. I do live in TX where your money will go a bit farther.

Homes are not that expensive in TX except in Austin, DFW but property tax is extremely high. Are the lawmakers doing anything about that?

 

[bravotwozero]

Homes are not that expensive in TX except in Austin, DFW but property tax is extremely high. Are the lawmakers doing anything about that?

Funny you mentioned that, my uncle just brought that up the other day.

Apparently Texas has quite a large budget surplus this year because of property taxes. There are several proposals on what to do about it, so there’s much bickering going on despite the state having a republican supermajority.

Some want to give the surplus money back to taxpayers. Others don’t want to give the money back but lower existing property taxes. Personally, I’d rather they lower property taxes and use the surplus to fix the electrical grid, but that’s me.

 

[Splenda88]

Funny you mentioned that, my uncle just brought that up the other day.

Apparently Texas has quite a large budget surplus this year because of property taxes. There are several proposals on what to do about it, so there’s much bickering going on despite the state having a republican supermajority.

Some want to give the surplus money back to taxpayers. Others don’t want to give the money back but lower existing property taxes. Personally, I’d rather they lower property taxes and use the surplus to fix the electrical grid, but that’s me.

I have been thinking about buying an investment property in one of these Houston suburbs (eg., Cypress, Sugar Land etc...) but the property tax scares me.

There is not that many places in the US these days you will find a house (3BR/2BA) in A school districts in a suburb from major city that cost < 300k.

15819 Sarasam Creek Ct, Cypress, TX 77429 | Zillow

15819 Sarasam Creek Ct, Cypress TX, is a Single Family home that contains 1464 sq ft and was built in 2008.It contains 3 bedrooms and 2 bathrooms. The Zestimate for this Single Family is $275,500, which has increased by $4,803 in the last 30 days.The Rent Zestimate for this Single Family is...

www.zillow.com

 

[cyanide12345678]

That is remarkable. What is your household income?

Household income ~ 620-630k from W2s. Plus 25k 401k matches for both me and my wife. Plus 20k ish rental income, some distributions however have been held due to unfavorable interest rate environment and the struggle for commercial real estate. Plus 180k YTD short term capital gains in my taxable account this year so far. Plus whatever the market has returned for my retirement accounts that has contributed a small amount to the increase in net worth this year. Throwing in a screenshot of my net worth trajectory, I very very very very closely monitor my net worth trajectory - if there are months where we only gain 30-40k, i start whining to my wife that we're spending too much Though all in all, in the last 2 years, we've gained exactly 1M in net worth - despite both myself and my wife taking a 3 month hiatus from working in late 2021 to visit Pakistan and travel.

The heavy lifting is our 2 salaries and my options. My options is currently on track for making more money than my wife's FM salary. I've pulled back significantly on the degree of risk, so probably only making another 50k for the remaining year in options compared to what I've already made. I'm starting to get into conservation mode. Also, important to note is that I haven't paid a penny of tax on the 180k YTD realized capital gains yet in my taxable account. So probably looking at a big tax hit next year April 2024 which isn't accounted for in the net worth trajectory.

Officially both myself and my wife are moving part time in 2-3 months so we'll probably just touch 500k in income after a few months - So the trajectory is probably going to slow down a little bit.

 

[Splenda88]

Household income ~ 620-630k from W2s. Plus 25k 401k matches for both me and my wife. Plus 20k ish rental income, some distributions however have been held due to unfavorable interest rate environment and the struggle for commercial real estate. Plus 180k YTD short term capital gains in my taxable account this year so far. Plus whatever the market has returned for my retirement accounts that has contributed a small amount to the increase in net worth this year. Throwing in a screenshot of my net worth trajectory, I very very very very closely monitor my net worth trajectory - if there are months where we only gain 30-40k, i start whining to my wife that we're spending too much Though all in all, in the last 2 years, we've gained exactly 1M in net worth - despite both myself and my wife taking a 3 month hiatus from working in late 2021 to visit Pakistan and travel.

The heavy lifting is our 2 salaries and my options. My options is currently on track for making more money than my wife's FM salary. I've pulled back significantly on the degree of risk, so probably only making another 50k for the remaining year in options compared to what I've already made. I'm starting to get into conservation mode. Also, important to note is that I haven't paid a penny of tax on the 180k YTD realized capital gains yet in my taxable account. So probably looking at a big tax hit next year April 2024 which isn't accounted for in the net worth trajectory.

Officially both myself and my wife are moving part time in 2-3 months so we'll probably just touch 500k in income after a few months - So the trajectory is probably going to slow down a little bit.

I can only say one word.... Remarkable!

 

[cyanide12345678]

At what net worth people here people would consider themselves financially independent (FI)?

I would consider myself FI once I have 2 mil plus a paid off house.

Realistically 2M for lean Fire. So probably by mid next year ~ 5 years post residency training.

On paper, I know with 2M in investment assets, I could very reliably get 100-200K through options without even taking much risk. Plus if both of us quit, our biggest expense, which is day care would go to 0, and our expenses would literally be in the 60-70k range. We'd literally be within the 4% rule. I mean conservatively I could put 2M in JEPI and probably get a decent 8-10% relatively reliable return.

Do I see myself quitting and calling it a day with 2M net worth? Nope. I'll probably need at least 3M in investment assets to feel comfortable mentally and psychologically.

 

[Splenda88]

Realistically 2M for lean Fire. So probably by mid next year ~ 5 years post residency training.

On paper, I know with 2M in investment assets, I could very reliably get 100-200K through options without even taking much risk. Plus if both of us quit, our biggest expense, which is day care would go to 0, and our expenses would literally be in the 60-70k range. We'd literally be within the 4% rule. I mean conservatively I could put 2M in JEPI and probably get a decent 8-10% relatively reliable return.

Do I see myself quitting and calling it a day with 2M net worth? Nope. I'll probably need at least 3M in investment assets to feel comfortable mentally and psychologically.

I will continue to work PT., at least 8-10 days/month, which will get me 200k+/yr in my current job as a hospitalist. I went into medicine mainly for financial security. I find it really strange that I really like my job.

 

[cyanide12345678]

I will continue to work PT., at least 8-10 days/month, which will get me 200k+/yr in my current job as a hospitalist. I went into medicine mainly for financial security. I like my job, which I find really strange.

I'm doing 10 days per month starting october 1st. Will drop down to 300k. My wife is dropping down to 27 hrs/week, 3 days a week, compared to her 36 hrs per week right now, so her income probably is dropping down to 170-180k, but this is a great unknown since she'll also switch from guaranteed salary to RVUs around that time too. So who knows what her salary will be. Though I'm excited about going part time. I don't like the fact that I picked Emergency medicine. I made a mistake. Even though no other specialty would have gotten me to this point faster, I still regret EM. Like if I had become a cardiologist, I would have finished fellowship 1 year ago and would have had barely any net worth, instead today I'm sitting at a 1.6M net worth and my portfolio is starting to do heavy lifting as well. But I'm looking for an out. I need a cushy gig where I sit at home and make money at my own time and am my own boss. I'm starting a side gig in concierge medicine in 1-2 months which should bring in some extra income doing very low stress telemedicine. Time will tell if that works out.

 

[Splenda88]

I'm doing 10 days per month starting october 1st. Will drop down to 300k. My wife is dropping down to 27 hrs/week, 3 days a week, compared to her 36 hrs per week right now, so her income probably is dropping down to 170-180k, but this is a great unknown since she'll also switch from guaranteed salary to RVUs around that time too. So who knows what her salary will be. Though I'm excited about going part time. I don't like the fact that I picked Emergency medicine. I made a mistake. Even though no other specialty would have gotten me to this point faster, I still regret EM. Like if I had become a cardiologist, I would have finished fellowship 1 year ago and would have had barely any net worth, instead today I'm sitting at a 1.6M net worth and my portfolio is starting to do heavy lifting as well. But I'm looking for an out. I need a cushy gig where I sit at home and make money at my own time and am my own boss. I'm starting a side gig in concierge medicine in 1-2 months which should bring in some extra income doing very low stress telemedicine. Time will tell if that works out.

Emergency medicine is great from a $/hr standpoint for people who want to FI as soon as possible. 3 yrs residency and you are out making 400k-500k/yr.

 

[cyanide12345678]

I have been thinking about buying an investment property in one of these Houston suburbs (eg., Cypress, Sugar Land etc...) but the property tax scares me.

There is not that many places in the US these days you will find a house (3BR/2BA) in A school districts in a suburb from major city that cost < 300k.

15819 Sarasam Creek Ct, Cypress, TX 77429 | Zillow

15819 Sarasam Creek Ct, Cypress TX, is a Single Family home that contains 1464 sq ft and was built in 2008.It contains 3 bedrooms and 2 bathrooms. The Zestimate for this Single Family is $275,500, which has increased by $4,803 in the last 30 days.The Rent Zestimate for this Single Family is...

www.zillow.com

Also, a single family home isn't a great investment property from a cash flow perspective. You are essentially relying on appreciation for any real gains. A lot of single family homes with interest rates in the 7 range are essentially cash flow negative right now after mortage, insurance, taxes, maintenance, vacancy, capex expenses. If you're going to do real estate yourself, you have to venture into small multi family - Duplexes, triplexes, quads or even more. For example, something like the following would be a better way to enter real estate.

120 Leflore Avenue, Clarksdale, MS - Real Pro | Investment Real Estate

TURNKEY INVESTMENT!!!! Beautiful 16 unit complex. Only $37k per unit!!! Great condition. New roofs. High quality hardwood floors. Low maintenance cedar siding. Separate electric, water and gas meters, tenants pay all utilities!!! Potential to generate 14.2%+ NET RETURN ON INVESTMENT!!! ONLY...

www.realpro.com

 

[Splenda88]

Also, a single family home isn't a great investment property from a cash flow perspective. You are essentially relying on appreciation for any real gains. A lot of single family homes with interest rates in the 7 range are essentially cash flow negative right now after mortage, insurance, taxes, maintenance, vacancy, capex expenses. If you're going to do real estate yourself, you have to venture into small multi family - Duplexes, triplexes, quads or even more. For example, something like the following would be a better way to enter real estate.

120 Leflore Avenue, Clarksdale, MS - Real Pro | Investment Real Estate

TURNKEY INVESTMENT!!!! Beautiful 16 unit complex. Only $37k per unit!!! Great condition. New roofs. High quality hardwood floors. Low maintenance cedar siding. Separate electric, water and gas meters, tenants pay all utilities!!! Potential to generate 14.2%+ NET RETURN ON INVESTMENT!!! ONLY...

www.realpro.com

I agree if you are financing with interest rate at 7% right now. I would buy cash.

Is that property in Michigan?

 

[cyanide12345678]

I agree if you are financing with interest rate at 7% right now. I would buy cash.

Is that property in Michigan?

It's in Mississippi I think. I haven't signed the NDA so don't know the address.

Cash purchase of real estate is NOT worth it. The math doesn't add up. 300k property - Lets say $2300 rent (very generous estimate), 92% occupancy, 1.5% real estate taxes, 1% maintenance cost,

So revenue = 27600 minus vacancy = ~25000 per year
Expenses: Taxes - 4500
Insurance ~ 1500
1% annual maintainance cost ~ $3000
5% of revenue towards capex (roof, windows, and large items) = ~1500/yr
Property management ~ 10% ~ 2500

So back of the napkin math says $12000 net profit on a 300k property. That's basically a 4% return. Lets add 2% appreciation, so 6000, then you're at $18000 on a 300k property, so 6% return if you add a 2% average appreciation rate. This is assuming everything goes well, you get a great rent, a tenant that doesn't trash your property or stop paying.

6% cash return is not worth it. Putting your money in a treasury mutual fund currently yields 5% risk free. I'd rather take risk free treasury return over a cash property. You need leverage in real estate to make any real money. Otherwise the math will never make sense.

 

[emergentmd]

I used to think fire was a number but now FIRE is if my post tax passive income equals 300K. Once passive equals my expenses, this is true FIRE.

 

[emergentmd]

It's in Mississippi I think. I haven't signed the NDA so don't know the address.

Cash purchase of real estate is NOT worth it. The math doesn't add up. 300k property - Lets say $2300 rent (very generous estimate), 92% occupancy, 1.5% real estate taxes, 1% maintenance cost,

So revenue = 27600 minus vacancy = ~25000 per year
Expenses: Taxes - 4500
Insurance ~ 1500
1% annual maintainance cost ~ $3000
5% of revenue towards capex (roof, windows, and large items) = ~1500/yr
Property management ~ 10% ~ 2500

So back of the napkin math says $12000 net profit on a 300k property. That's basically a 4% return. Lets add 2% appreciation, so 6000, then you're at $18000 on a 300k property, so 6% return if you add a 2% average appreciation rate. This is assuming everything goes well, you get a great rent, a tenant that doesn't trash your property or stop paying.

6% cash return is not worth it. Putting your money in a treasury mutual fund currently yields 5% risk free. I'd rather take risk free treasury return over a cash property. You need leverage in real estate to make any real money. Otherwise the math will never make sense.

I agree with Dave Ramsey on alot but buying investment RE with cash just makes zero sense esp with low interest rates. Now, I will say that if you get into RE, you better have some cushion to cover unexpected issues which is essentially what Ramsey is doing.

I rather buy a 400K house with 100K down and leave 300K in the bank than put all 400K when interest rate was sub 4

 

[thegenius]

At what net worth people here people would consider themselves financially independent (FI)?

I would consider myself FI once I have 2 mil plus a paid off house.

No debt and can make 30K/month off investments.
Or debt (e.g. house) and make 40K/month off investments.

it's a tall bar. Why set the bar at 10K or 15K/month? Why would I want to retire and not be totally comfortable? Even then I would be bored out of my eyeballs. I would still work.

 

[emergentmd]

2M is way tooo little. In texas a 1M home paid off is 20-30K/yr in property tax. @4% withdrawal that is 80K which you have to pay about 20% taxes on leaving you 64K. 20K property tax, 3K home insurance, 2K car insurance, Utilities 5K.

You will have essentially 25K left or 2K/month to spend on food/water/incidentals/entertainment.

No thank you.

We spend about 20k/mo now and I would need atleast this much to retire safely. Retirement means to have the same lifestyle.

Most people do not understand the cost of assisted living centers. The decent ones start 5k/mo and if you require more care, then its crazy expensive.

 

[miacomet]

2M is way tooo little. In texas a 1M home paid off is 20-30K/yr in property tax. @4% withdrawal that is 80K which you have to pay about 20% taxes on leaving you 64K. 20K property tax, 3K home insurance, 2K car insurance, Utilities 5K.

You will have essentially 25K left or 2K/month to spend on food/water/incidentals/entertainment.

No thank you.

We spend about 20k/mo now and I would need atleast this much to retire safely. Retirement means to have the same lifestyle.

Most people do not understand the cost of assisted living centers. The decent ones start 5k/mo and if you require more care, then its crazy expensive.

Wow. Here a one million dollar home is $2500 a year in property taxes. Texas, not so low tax, I guess.
Also, another reason for Roth conversions- fewer taxes.

Texas sounds pricey between insane property taxes, high utility rates (we spend half that, tops), high car insurance and home insurance. I didn't realize it was so expensive there!!

 

[bravotwozero]

I guess it’s all relative. I was paying close to $300 a month in car insurance when I lived in Detroit. I’m now paying less than that for both mine and my wife’s car with full coverage including rental car coverage.

 

[cyanide12345678]

Wow. Here a one million dollar home is $2500 a year in property taxes. Texas, not so low tax, I guess.
Also, another reason for Roth conversions- fewer taxes.

Texas sounds pricey between insane property taxes, high utility rates (we spend half that, tops), high car insurance and home insurance. I didn't realize it was so expensive there!!

No income tax though. They have to make their money somewhere to fund programs.

income tax on 500k at an average 5 percent for most states is 25k.

 

[bravotwozero]

No income tax though. They have to make their money somewhere to fund programs.

income tax on 500k at an average 5 percent for most states is 25k.

Plus that property tax is deductible up to 10k. Itemize and add things on like charitable contributions etc, of which I make a substantial amount, and I end up well north of the standard deduction.

 

[miacomet]

Plus that property tax is deductible up to 10k. Itemize and add things on like charitable contributions etc, of which I make a substantial amount, and I end up well north of the standard deduction.

Sure, but income tax is easier to avoid- mortgage tax deduction, retirement contributions etc. Besides, you don't have to pay as much if you are retired or working less. Property tax is always there, even if you aren't working. High property taxes also slow the growth of home prices, which is great if you are buying, less great if you already own. I'd take higher income tax over property tax any day.

 

[emergentmd]

Property tax is a big drain for sure. If you live in the big cities, you will pay 2.5-3+% every year. I do not understand how this is sustainable.

We built our home for 800K 10 yrs ago. Its valued at 1.5M and I still have a bunch of 10% cap hike left so not paying the full amount. But in 10 yrs, prob value will be 2.5M and there will be no exemption left. So I am looking at 50-70K taxes when I retire even if I have zero income.

Good thing about Texas is I know of areas like our Lake house that is taxed at 1.4% and over 65 drops to about .5% property tax. I see myself retiring there b/c I am in no way paying 50k+/yr

 

[doctalaughs]

2M is way tooo little. In texas a 1M home paid off is 20-30K/yr in property tax. @4% withdrawal that is 80K which you have to pay about 20% taxes on leaving you 64K. 20K property tax, 3K home insurance, 2K car insurance, Utilities 5K.

You will have essentially 25K left or 2K/month to spend on food/water/incidentals/entertainment.

No thank you.

We spend about 20k/mo now and I would need atleast this much to retire safely. Retirement means to have the same lifestyle.

Most people do not understand the cost of assisted living centers. The decent ones start 5k/mo and if you require more care, then its crazy expensive.

Agree 2M is too little unless you really want to live simple in retirement. My CC bill alone ends up 15-18k/ mo. Given a lot is spent on the kids but when they are out of the house I wouldn’t mind flying business or first with the wife (right now I’m too cheap to pay that much for 4 people).

Depends on the person- each to their own- but 10M is my right amount to shoot for if you are looking 10-20 years out to retire (don’t forget inflation means 10M will be worth less than now).

 

[alpinism]

Honestly I'm not sure how to even survive on 10 million these days.

I'm sure as hell not flying commercial to our yacht in St Barths.

 

[Splenda88]

Honestly I'm not sure how to even survive on 10 million these days.

I'm sure as hell not flying commercial to our yacht in St Barths.

Yeah

Physicians are out of touch with the average individual.

Only 10% of Americans retire with 1+ mil. So if you have 2.5 mil, you will likely be in the top 3%. I wonder where 10 mil will put someone.

Can You Guess How Many Americans Actually Retire With a Million Bucks?

Saving $1 million (or more) for retirement is a great goal to have. Putting that much aside could make it easier to live your preferred lifestyle when you retire, without having to worry about running short of money. However, not … Continue reading → The post What Percentage of Retirees Have a...

finance.yahoo.com

 

[Postictal Raiden]

It's in Mississippi I think. I haven't signed the NDA so don't know the address.

Cash purchase of real estate is NOT worth it. The math doesn't add up. 300k property - Lets say $2300 rent (very generous estimate), 92% occupancy, 1.5% real estate taxes, 1% maintenance cost,

So revenue = 27600 minus vacancy = ~25000 per year
Expenses: Taxes - 4500
Insurance ~ 1500
1% annual maintainance cost ~ $3000
5% of revenue towards capex (roof, windows, and large items) = ~1500/yr
Property management ~ 10% ~ 2500

So back of the napkin math says $12000 net profit on a 300k property. That's basically a 4% return. Lets add 2% appreciation, so 6000, then you're at $18000 on a 300k property, so 6% return if you add a 2% average appreciation rate. This is assuming everything goes well, you get a great rent, a tenant that doesn't trash your property or stop paying.

6% cash return is not worth it. Putting your money in a treasury mutual fund currently yields 5% risk free. I'd rather take risk free treasury return over a cash property. You need leverage in real estate to make any real money. Otherwise the math will never make sense.

Like you said, 2300 rent on a 300k property is very optimistic.

In my noncostal large metro on the West, a 300k would barely get you a 2b2br condo in a crappy neighborhood. Rent will be something like 2k. From that you’d have to pay about 200 a month HOA

For the records, I’m renting a 2000sqft single story nice house with a pool. I pay $3200 (which includes the pool cleaning fees) a similar house across the street just got sold for 750k. The ROI for the rental property I live in is something like 3% at most.

 

[emergentmd]

There is no way to make money in any decent city from cash flow no matter if you buy cash or finance at current rates. You would be lucky to break even. Its mostly an appreciation/park your money at this time.

Its a crazy time in real estate. Things just do not make sense

 

[cyanide12345678]

There is no way to make money in any decent city from cash flow no matter if you buy cash or finance at current rates. You would be lucky to break even. Its mostly an appreciation/park your money at this time.

Its a crazy time in real estate. Things just do not make sense

It’s crazy time, but i don’t know if real estate prices are going down anytime soon.

The US was always a little bit of an outlier in terms of home affordability.

Most of the world, homes are just so incredibly expensive. Look at Canadian real estate, European real estate. Everywhere is so expensive. You would think a third world country like pakistan where the average annual salary is $3600 that real estate would be cheap because people can’t afford crap - nope. You’re probably looking at 200k-400k USD for most homes. How do people afford that with an average income of $3600 a year? Who knows.

There are still plenty of cities with sub $350k homes that the US housing is still relatively affordable compared to the incomes here, as long as you stay away from a few ridiculous cities.

 

[VA Hopeful Dr]

It’s crazy time, but i don’t know if real estate prices are going down anytime soon.

The US was always a little bit of an outlier in terms of home affordability.

Most of the world, homes are just so incredibly expensive. Look at Canadian real estate, European real estate. Everywhere is so expensive. You would think a third world country like pakistan where the average annual salary is $3600 that real estate would be cheap because people can’t afford crap - nope. You’re probably looking at 200k-400k USD for most homes. How do people afford that with an average income of $3600 a year? Who knows.

There are still plenty of cities with sub $350k homes that the US housing is still relatively affordable compared to the incomes here, as long as you stay away from a few ridiculous cities.

Available land I suspect is a big part of it. We are just way bigger with more usable land than the vast majority of countries, especially when you look at our population compared to other countries.

List of countries by arable land density - Wikipedia

en.wikipedia.org

 

[Splenda88]

It’s crazy time, but i don’t know if real estate prices are going down anytime soon.

The US was always a little bit of an outlier in terms of home affordability.

Most of the world, homes are just so incredibly expensive. Look at Canadian real estate, European real estate. Everywhere is so expensive. You would think a third world country like pakistan where the average annual salary is $3600 that real estate would be cheap because people can’t afford crap - nope. You’re probably looking at 200k-400k USD for most homes. How do people afford that with an average income of $3600 a year? Who knows.

There are still plenty of cities with sub $350k homes that the US housing is still relatively affordable compared to the incomes here, as long as you stay away from a few ridiculous cities.

I am always amazed by the home affordability in the US compared to other countries.

Maybe part of it is the land avalability as @VA Hopeful Dr says, but I am not convinced that is the case. When you travel overseas, you realize that the life of a lower middle class individual or family in the most of part of US is comparable to the life of rich (not talking about ultra rich) families almost everywhere in the world.