Never Sell DFW Homes

Dear Dallas/Fort Worth homeowners,

Are you considering selling your home? Before you make a decision, let’s explore why NOT selling your home might be a financially savvy choice. The plain fact is that rental demand for properties in DFW has never been higher so you might want to consider not selling but converting your current property into an investment property. Lets explore the once in a lifetime economic factors that have come together that can transform your family's economic future while creating generational wealth for your children. Before we get into the facts on creating generational wealth let me share some personal facts that just might make you want to listen to what I have to say.

1. Top 2% of ALL Realtors in America.

2. 2023-2024 Top 4% of all Coldwell Banker Realtors in the world.

3. Personally investing for over 20 years

4. At our peak my wife and I owned 52 rental homes at the same time.

5. I was named #1 Realtor in America for a Wall Street institutional investor

6. That Wall Street investment firm asked me to serve on an advisory board where I was one of the top 10 Realtors in America for that investor.

7. When is the LAST time a Realtor told you to NOT SELL?

1. Favorable Mortgage Rates

Currently, over 75% of homes in America with mortgages enjoy those ultra low rates of a few years ago and are typically averaging between 2.5% to 3%. This makes your current home very affordable in terms of monthly payments and millions of families are reluctant to sell and lose that huge financial blessing especially with the high inflation we are seeing now. Those low mortgage rates are in fact a buffer that has kept many families from having to make painful cuts elsewhere in their budget.

If you’re thinking of moving up to a new home, you will encounter interest rates that are significantly higher — sometimes up to 250% more. Now at the end of 2024 we are seeing rates around 6% for a typical 30 year conventional term mortgage. While these rates are better than this Spring it is a disaster for tens of millions of families many to shoulder that huge increase in their largest budgetary item. Understandably, many homeowners are reluctant to commit to much higher mortgage payments as no one wants to throw money away.

As a result, tens of millions of families are making the decision to stay put during this high inflationary times and not put their home up for sale. When this simple economic calculation is repeated all across our area then we see dramatically fewer homes coming onto the market for sale.

Simultaneously as we experience this once in a lifetime throttling of supply in homes for sale ; DFW is seeing a record breaking influx of wealth, jobs and millions of families looking to move here. As people flee places like California, New York, New Jersey and Chicago they bring with them their family wealth. Most relocations are coming from much higher price points so to them EVERYTHING in DFW looks cheap so they are less price sensitive to price increases.

Another point to consider is that Texas now is the #1 place for Fortune 500 firms to put their headquarters. The State of Texas offers huge tax advantages to corporations and the potential savings of hundreds of millions of dollars each year. The majority of these firms are choosing DFW because of our very strong economic base, educated work force and abundant natural resources.

So anytime you have limited supply and high demand in a place with a local strong economy and a significantly lower cost of living then you MUST see dramatically higher home prices in the near future.

2. Economic Boom in DFW

Dallas/Fort Worth has emerged as an economic powerhouse in the United States. Major corporations like Goldman Sachs, Caterpillar, Ameritrade, State Farm, Liberty Mutual, and Chase Bank are moving hundreds of thousands of well-paying jobs into our community. This influx of employment opportunities not only strengthens the local economy but also drives substantial price appreciation in the housing market. Additionally, DFW has one of the lowest cost of living of any major metropolitan area and very pro-business governmental policies which will only add more incentives for this to continue for as far as the eye can see.

3. Financial Benefits of Renting Out Your Home

Consider this: the average mortgage payment is paying down the principal balance, typically between $800 to $1200 per month — that’s about $15,000 annually building equity in your property. In contrast, market rents often exceed current mortgage payments by $500 to $750 per month, adding an additional $10,000 or more to your net worth each year. Those 2 factors alone total $20-25K per year for most properties.

The gain from NOT selling can be an increase of $30,000 -$60,000 dollars EACH year. I just leased a home in Windsong Ranch in Prosper in July 2024 where the Client will easily make an additional $60,000 per year by NOT selling. Ask and I can show you the home and the math!

4. Adding in Future Property Appreciation

Historically, homes in Dallas have shown robust appreciation rates, averaging between 3% to 5% annually.

If we take a median priced home of $400K then even with a conservative estimate of 4% annual appreciation, your home’s value would increase by $16,000 per year over the long haul. Then the appreciation is now compounding off of the higher value. Please look at the graphic to the side showing the anticipated price growth.

Please remember though that as the home appreciates in value the tenant is paying off the mortgage each month!! So as the value appreciates more and more of that is EQUITY to you and your family.

In addition since a rental property is treated as a stand alone business ALL of the expenses relating to that are now tax deductible. Things like homeowner's insurance, repairs, HOA payments, ever driving over to the property is 67 cents per mile in 2024 as is any other driving for business usage. I drove about 25,000 miles per year just on my work car as a Coldwell Banker Realtor and that means a tax deduction of $16,750 dollars so these things add up REALLY quickly.

Ever go back at the home you grew up in or sold in the past and were stunned at the home's market value today?

If you sold a home say 4 or 5 years ago then you likely LOST$200,000 dollars or MORE by not doing what I teach to Clients. Go back and look at the last home you sold and see what it is worth today and you will start to see the power of holding Real Estate.

This is the nature of real estate values as they go up with inflation and our government seems very fond of printing money these days. Your home will continue to appreciate in value and either that benefits you and your family as the current owner OR you give that equity away by selling it someone else.

Why give all of that equity to someone who buys your home? Keep the home and give the money to your children for a life changing event!

5. Follow the massive Wall St investors.

Take note of the billions of dollars being invested in DFW real estate by some of the world's smartest investors. When Wall Street investment firms pour countless billions into our area, it's a clear signal that DFW real estate holds significant potential for growth and profitability.

Following these institutional investors lead could prove advantageous for your financial future. DFW is projected to surpass Chicago within this decade as the 3rd largest metropolitan area and we are dramatically short of homes as I pointed out in the beginning part of this webpage.

Finally , I was named the #1 Realtor in America for an investment firm that was owned by that massive wealth manager Blackrock. If you remember a few years ago Blackrock and a couple of other Wall Street firms were vilified in the news about buying up all the single family homes. I was intimately involved with that program on many many levels. With that knowledge, which I share with my Clients; I am able to point them to the very neighborhoods and classes of homes that Blackrock invested in for a solid long term gain. As a side note... That program was buying single family homes in 82 metropolitan areas all across America and DFW was just one of those markets. However; every year there was a standing policy to deploy 20% of that years purchases into the DFW market. Most people will call that a CLUE! If it is good enough for BlackRock....then it just might be good enough for you!

Warren Buffet just invested over a billion dollars in 2023 into home builders because of our chronic shortage caused by the natural reluctance to sell from current owners with 2.5% mortgages These builders build predominantly in Texas and Florida and those are the two states that millions of Americans are moving to as we speak. As an example.... New York City just last year had a net population loss of 561,000 people... so that is after births and people moving into NYC! These are once in a lifetime changes to America and you can realize the gain by NOT selling.

6. Expert Advisor: Rick Baker

You’ll have the advantage of working with Rick Baker, an exceptionally experienced Realtor who ranks in the top 4% of all Coldwell Banker agents in the world! With over 25 years of personal investment experience and simultaneous ownership of dozens of rental properties, Rick specializes in building generational wealth through real estate for families like yours.

His guiding principle is simple: if a property is good enough for your family to live in, it's good enough to rent out.

Rick aggressively protects his Client's financial interests and routinely has any number of Clients each year changing their lives and their children's futures by going from renting to homeownership to landlord. Rick will be by your side as a non-paid consultant to advise you at any time on issues from tenant screening, lease negotiations, fighting property taxes, tips on how to save money on insurance etc.

He will never try to sell you some internet course or set of books. All he asks is that you tell everyone that you know about how he helped your family create generational wealth. That would be repayment enough to help Rick grow his business and serve more families.

Massive Tax Benefits.

Real Estate creates massive "paper losses" to save you on taxes!

The IRS has created one of the finest gifts to an investor that most people are not even aware of and the power it holds. The IRS allows what is called "depreciation" for the normal wear and tear that a property experiences. So even if the property is skyrocketing in value on PAPER you are "losing" money due to depreciation and other facts. Call and allow me to explain how that works.

Real Estate is taxed completely differently

The money you earn as an investor is foreshadowed by the fact that an investment property is regarded as a stand alone business by the IRS. Therefore you are able to deduct expenses that if you were living in the home could not legally deduct. Those include repairs, cell phone costs, HOA dues, insurance, driving for any Real Estate activity are but a few of the many expenses that can be deducted. So you make MORE money but pay LESS in taxes!

TAX FREE income.

As a property appreciates and the tenant pays down the mortgage each month your net worth skyrockets . You can easily access that by pulling some of that equity out of the property through a 2nd mortgage. Rents increase due to the effects of inflation, market demand etc and those higher rents can therefore support a higher mortgage payment. This allows you to pull out lumps of cash TAX FREE since a loan is NOT income. In addition; unlike traditional income, there is not a portion that goes to the FICA taxes as well! FICA deducts 15.3% of your income PLUS your income tax. Both do not occur when done in this manner. When you add 15.3% for FICA and say 20% for income tax... You are losing 35.3% of the money. Think about it!

Positive Cash Flow above the mortgage amount

Most properties will generate a rental amount well above the mortgage you pay monthly. This is especially true if your property has an ultra low rate from 3 years ago of 2.5% or so. This massive deduction in your holding costs is one of the huge drivers for so many today to NOT want to sell their current home. The lower inventory that results from this will further drive prices even higher. Meanwhile the tenants are paying off the property to benefit your retirement and children's futures.

Conclusion

Choosing not to sell your home and converting it into an investment property could potentially yield over $40,000 per year in increased net worth when considering mortgage paydown, rental income exceeding mortgage costs, and property appreciation. In addition each year these numbers compound on themselves because each year because the tenant pays off more of mortgage balance every month and the price appreciation compounds the market value. This strategy aligns with the unique economic trends in Dallas/Fort Worth, where low mortgage rates, unbelievable economic growth, a much lower cost of living when compared with other major cities and a tight housing market caused by once in a lifetime ultra low interest rates have created favorable conditions for current property owners. Look around and everywhere you look there are massive apartment buildings being built by savvy Wall Street firms who already know what I just showed you. Why sell the home and let the new owners brag to their friends about how much the home has appreciated?

Before making any decisions, we encourage you to have a conversation with Rick Baker from Coldwell Banker APEX who can provide personalized insights based on his 25 years personal investing experience that would create generational wealth for your children.

Take advantage of the current economic climate and consider the long-term benefits of holding onto your property. It could be a decision that significantly enhances your financial future.

By the way... When is the LAST Time an extremely experienced Realtor told you to NOT sell your home?

So now that you have the facts......Are you opposed to having a frank conversation with someone who is NOT trying to sell you something? If so please call or text Rick Baker with Coldwell Banker APEX, Realtors at 972-836-8880

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NEVER SELL DFW Homes