Unknown Speaker 0:08
We just do local guys with so much to say.
Unknown Speaker 0:20
So, Episode 32, October 2021, the market update. This is the real estate brothers, where Today we are going to have a bunch of topics flying to Hawaii soon. We talk about that September statistics, picking your lender wisely. And I better run through on a high level of all the different asset classes and how things are doing it.
Unknown Speaker 0:44
Sounds exciting. And thanks for tuning in those everyone tuning in. Yep, I’m Dina widow, a former CPA now racy investor and realtor. And why don’t we just jump into our topics today. So as some of you may or may not know, October 15, is the day our governor has entered leadership has a notice so far to open up our doors for visitors on the 15th. And on top of that, the visitors are going to be allowed to not quarantine if they follow certain rules, which is the pre travel test, I think the solid credit safe travel. And there’s actually a website we’ll talk about later. But if they get the tourist get tested within 72 hours of I think it’s the arrival of or their last leg and they have a negative result, travel and also complete the declaration form, they will be able to have no restrictions, versus the ones that don’t do that are going to still have to quarantine for 14 days somewhere. So it’s kind of exciting times from the standpoint of us being able to open our doors to tourism, which is our main your main industry. But I think there’s a lot of questions of how things are going to be run and how much better things are going to be or is it going to open up, open us up to more exposure, I mean, which it will. But if you go to my next slide, and I think attending governor Josh green came on to today. And he had mentioned that he or he talked about the program for one and he mentioned the website because it’s it’s pretty clear. And so listening to this presentation was pretty good in the sense that he really spelt it out, told us about the websites for the visitors to go to and and walked us through what the program would mean. And he also mentioned that we could see up to 8000 visitors daily with this new feature with testing lunch. But just to give you guys an idea, around this time of the year, we would usually get on a daily basis 20, high 2020 to 30,000 a day. So now we’re hoping to get back to 8000, which is like one third, one fourth of what we typically have varied in terms of visitor counts from prior years. So it’s not going to get us it’s not it’s not gonna solve all our problems, but it’s gonna hopefully get us to a good start. And again, the risk is evident that we might see more spikes. So one good site that I’ve seen was Hawaii COVID-19 dot com. And lean I don’t know if you’ve been to that site, but it is kind of how the state is now capturing all their data. They’re posting live information or daily information, updating it daily. And there’s a lot of good information. I try, I haven’t been following a lot because I’m trying to focus in on my thing and trying to get away from the noise. But I mean, this is to me kind of like the one of the mean charts that is showing us our daily new cases that pop up. So as we can see, and I’m sure a lot of you guys are seen this one before, but over in between March and May we see that little hiccup over there. And then now we’re seeing this resurgence again, hence the second close. But there’s a lot of good data. I think on the next slide, I put some stuff. A few other things that I pay attention to that are that concern me the most. So I’m always looking at the new cases every day. So that comes out in in Hawaii news now and whatever. So today we were at like 108. So this was updated. Again, the site is updated daily. And then I guess the big thing. The scariest thing is how they see if we ramp up too quickly. with too many cases daily, then our hospitals are going to get over. We’re going to get flooded and it’s going to be a point where they’re gonna have to turn away patience. And if we don’t have enough, ventilators as you see right here where 19% capacity, so that’s good, but in some other states, you have to turn away. And basically you’re picking and choosing who’s gonna live in who’s gonna die. So again, not trying to build up the fear or anything, but based on looking at the stats for today, it seems it looks really good. So, but just wanted to point out this site that I like to use, that I just found out about recently, and I just saw peek at it. But again, just something for people to use if they want to.
Unknown Speaker 5:36
So let’s jump right into September stats, statistics. And keep in mind that the Board of realtors releases their public information 60 days after month end, so this is hot off the presses, I used a site called info sparks that realtors have access to. So the news is similar to the last few months where because interest rates are so low and inventory is also low. And we have a lot of pent up demand, we’re seeing a strong seller’s market and a lot of activity, especially on a single family. So the first three slides are going to focus on single family and the second three, we’ll talk about townhouse and condo. So as you can see, September, our median sales price jumped up to 880 compared to 839 in August. So we’re seeing a big jump in terms of the prices going up. And as you can look at the trend, it’s it’s going up up up. Next slide it kind of talks about what again, the what’s indicating that and this is the single family homes, monster supply. So in August, we’re 2.1 months and it’s already really low and we got even or lower in September at 1.8 months of inventory. Again, month’s supply of inventory is if we were to have no new listings are new inventory pop up today how long it will take us to run out of the inventory to sell off so and equilibrium point is around five to six months is what the benchmark is. So we are way below that equilibrium. And it’s showing how strong of a seller’s market is on the single family home side. And a lot of this is because on the next slide lien we have these on market Oh, these are market is also related. Right? So now we’re seeing an August we’re 15 days on market and September got even shorter to 11 days on market. And again, this is where from the point it gets listed to the point it goes into contract or goes into escrow. So I mean, it’s getting crazy tight for single family. On the condo townhouses, we see a similar story but not as, as strong for is a seller’s still seller’s market. So if we go to the next slide lane, we’ll talk about median price. For condos, townhouses, so it jumped up again, again, August was 430 430,000. In September, we’re jumping up to 445,000. So we’re bumping up and typically around this time frame is when cyclically and seasonal seasonally we would start slowing down, but it’s kind of the spring summer peaks got pushed back because of because of COVID. And so again, top 10 has a similar we see a trend going down 4.7 months of supply gone down. Sorry, September was 4.5, which gone down from previous month, which was 4.7. So we’re also seeing that creeping down on the condo townhouses side. These are market also going down from 25 days last month to 21 days in September. So it trending that way. strong, strong time for the sellers. And so with that said, it’s very competitive. It’s to the point or a lot of the on the buying side, you’re you’re expecting and assuming you’re going to be in a multiple offer situation already. It’s and you’re something pops up that your buyer wants or we’re already calling the agent and the question of the day is, when are you going to present and you’re not going to hear or we’re going to present at the comm as they call me. It’s for the most part or the sellers or sellers agents are seeing setting a date. Okay, please submit by this date to be presented on the following day. very competitive, ultra competitive, I’d say. So,
Unknown Speaker 9:48
what happened with that release or pre where they could pre listed that kind of helped out sellers. So their sellers right?
Unknown Speaker 10:00
Well, the thing is, it’s so darn hot now that like, so I have a listing. And I, it’s a coming soon it does have two listings that I use that coming soon, the pre lease are that what Lane is talking about, like where you’re talking about they’re coming soon function. But the challenge we have with that is it’s only going to the agents, it doesn’t get publicly transmitted or dispersed to the clients. So the agents have to be aware to set that auto filter on their MLS to check that coming soon button to get it. So I don’t know about other realtors. But I’ve used it in the past for all my listings, and I haven’t had much activity in terms of someone calling. And regardless though, if if one person was to call and say, Oh, I’m interested, the chances are, it might be better for the seller to wait till it’s ready to list it and just listed and then have all of these, not all of these, but hopefully you’ll get in into a multiple offer situation. So again, it depends on what the sellers intent is and what their goals are in terms of timeframe and to try to maximize the dollars versus just getting the sale so they can tap into the equity. But yet lane that function is available. And I don’t it just started in 2020. And so it’s been nine months, but it doesn’t seem to have been picked up by the industry so much anyway, that’s my experience, but we still try to use it and I still try to list or pre list my my listings month in advance with that coming soon option, but I haven’t get got much, much hits. So that’s better, putting up the coming soon sign and that that will attract the buyers to come in give you a call I happen to meet today, in fact where I got a call. And so the chat, the chances are though that I’m going to ask the seller if they’re willing to talk through this. But the risk is you’re gonna set it at this price. But if you’re to go live and list it to the public, you might have higher offers. Yeah. So again, it just depends what the sellers want. But good question, though. So being that it’s so ultra competitive. One thing I wanted to talk about in this episode was the importance of picking the right mortgage lender. I did a blog on this last week on my website, but what I talk about is the different types of vendors. We have direct lenders, which are the banks, the local banks that we all are familiar with. And there’s mortgage brokers and correspondent lenders, sometimes I blend these two together, because the difference between the mortgage brokers correspondent lenders are the correspondent lenders will actually fund the loan and create and they’re the lender. But there’s soon to set it off the mortgage brokers are actually the middleman to find the lender, so they’re not doing any of the funding. And then we have portfolio lenders who are our small credit unions as well as our savings and loans and they they have their own underwriting process that is unique from the other vendors and what was could be beneficial is you could do underwriting from portfolio lenders could pass a loan, that the other vendors may not be able to take you. And so it’s not not conventional. And of course, lane we have hard money lenders who lend out to people who can’t qualify for any of the other loans or maybe don’t want to go through the hassle of completing the lending underwriting process. Or they just have different terms and different needs but everybody’s
Unknown Speaker 14:08
going through like Fannie Mae Freddie Mac, back mortgages when she just go direct big bank or or or do the mortgage brokers undercut them on pricing.
Unknown Speaker 14:21
So the so that’s a good question. So the challenge is, direct lenders is And to your point is it is very competitive now. And because information we have the internet and you know, you can get quotes a lot quicker, it is very competitive in terms of pricing, But to your point, so if you go to one direct lender, one bank, they’re just gonna pretty much have their prices are set right based on their underwriting. So if you go to a mortgage broker or correspondent lender, they can shop around especially the mortgage brokers can shop around to see especially if you’re doing something a little bit more Not exotic, but something unique. So if you’re going to do a jumbo loan, they can shop around to lenders, they might even go to a local direct lender, because some of the local direct local banks have some of the best jumbo loan rates. But you, if you choose a direct lender, you might not have chosen that specific bank rate. So the mortgage broker can shop around. And another thing too, is sometimes direct lenders date, if you’re doing like a condal. I’ve seen situations where a direct lender has like a preset list of what they can or cannot do loans on. So if you go with one specific, their direct lender, you may find a situation where the the condo unit you want to purchase is on their no list. And so if you go to a mortgage broker, they might be able to find someone else who can can fund it. And they may even go to a portfolio lender, right? So they they may be to go look around and help you shop so it’s more flexibility. And But to your point, you’re adding a middleman, right, you’re adding the mortgage broker, you’re adding a middle person, so they have to get paid. So but the good thing is, mortgage brokers either get paid by the lender who they are selling it off to or buy the, the client so you can check with the mortgage broker to see who which way they get compensated, you know,
Unknown Speaker 16:20
I think but that’s I think important for people to understand like, it’s this world. It’s not like some mystified world of Wizard of Oz. Like wizardry like this is all the same Fannie Mae, Freddie Mac backbones. It’s all the same apples, but everybody’s selling the apples, the same apples, there’s white leaving the same apples and applying a different level of service or different level of markup to the right, right.
Unknown Speaker 16:46
Yeah, to your point, some people like to go to the direct lender, because even though that direct lender is gonna set it off, like to your point, they may keep the servicing and so some people want to keep the servicing portion same as their their financial institution so that they can move money back and forth.
Unknown Speaker 17:09
What about me? Like, I’m very disloyal, I just want the lowest price. I got five banks anyway, got five checking accounts, anyway, different banks, what would you recommend me to go non jump along? But
Unknown Speaker 17:23
I would say, go start off with a mortgage broker. And don’t tie yourself in, right? don’t tie yourself in and it’s okay to go to do your shopping. Right? So like, to your point is, you’re not loyal to one specific you want the best deal? So shop around and ask around and and and you’re good too, because you’re gonna find out who’s, who is charging you What? And when. Right. So to your and like you said, it’s like it’s not always behind the
Unknown Speaker 17:53
wheel, which is which frustrates me because like the direct lenders, all the big banks, right, like Banco Joe is second Hawaiian Bank, Central, Western eastern bank, they’re the ones charging the heavy prices, right? How’s he gonna build these damn like buildings, right? Like, that’s like, but people go to them because they have these nice fancy buildings that have coffee in your mortgage brokers, right?
Unknown Speaker 18:22
I’m not saying specifically go to this one or that one. But I’m saying shop around because the thing is, you can go to the direct lenders and shop around with them for free, you just have to go to each one. And sit down with a loan officer in each one. And that’s how that’s how you would press around. If you want it to go to each direct lender. So there’s no cost rate. The only thing
Unknown Speaker 18:41
is time is money. Right? So you tell me what to do. Right? I don’t want to I would deem do I owe it? Does it change? Does it change? Well, I guess
Unknown Speaker 18:51
I’m, I’m, I’m probably like you said time is money. So I’m, I would just probably go well, I’m gonna look at the where the loan is originating to right, if I’m not buying local than if I went to the mainland, it that’s a different thing, too. Right. So if I’m gonna buy in the mainland, you can get a big national broker. But
Unknown Speaker 19:11
this we’re just talking like, a residential boy. So yeah, if we’re going mainland, I got a guy, right. So my answer to audyssey investors. Don’t worry, Bro, I got a guy. Okay,
Unknown Speaker 19:21
so I have, I have a few mortgage brokers that I’d probably call first to chat with them. And at the same time I have because I work with a lot of the the independent guys as well as the direct lenders of a bank to banks. And so I would call those two banks as well as so I would shop I guess, is my point. And the other thing is, I have to check with my, my other half who is another, the 51% stake holder. So I’d have to see you know what makes sense, but she doesn’t care. So it’s, it’s easy. It’s free to shop around so it doesn’t take too long. If you already have relationships Yeah, so, but first I probably start off with, with my, my one or two mortgage brokers or correspondent lenders. And that really? Like you said the time Part Two Yes. So I don’t I don’t want to fuss around with it. Am I gonna save point two five points. So just is not going to nickel and dime in search that hard.
Unknown Speaker 20:24
Yeah I know like you’re buying an investment property non owner occupied especially on the mainland revolt, I would definitely not go direct. You know those guys they typically get the more talent level right out of college.
Unknown Speaker 20:36
Well okay, so this this is another thing if we’re talking about Hawaii, especially a wahoo. And which is a second part of this slide is my point is choosing a lender, in this ultra competitive market is super important. Because it could, it could temp, it could win you the deal, and it could also lose you the deal. has more clout, like if I’m a buyer, you’re showing me two offers, if I’m a buyer, are we more happier seen from Bank of XYZ? Are we seeing it from a mortgage broker who actually knows the client, you want the one that can, typically we’re going to want the one that can in this is very general statement, we’re going to one the one, what’s the one that can close quicker, and we’re more, we’re sure that they’re going to close. That’s it, you want them to be able to make sure they’re gonna close, but in timely, so certain lenders are still quoting at 45 days and other lenders are doing 30. So that difference could mean winning, potentially winning or losing a deal. And
Unknown Speaker 21:46
it’s not bank reputation. It is auto
Unknown Speaker 21:49
banker position to in fact, I’ve I’ve heard of situations where people would actually say, this bank or this financial institution, if we have a loan from there, it’s a no go. And and because the sellers can be more selective because if you’re getting a multiple offer situation, then they can say, oh, if this is from like you said XYZ bank, we’ve I’ve had situations where the seller or the sellers agents, they go we’ve had a couple bad experiences with this institution. So we don’t want to deal with that. So there’s been specific situations that that’s happened. So that’s why to your point, choosing a lender can mean potentially winning or losing a deal.
Unknown Speaker 22:39
I know if I was a seller and then I’ll select to an out of state buyer on the mainland is mainland so but I would if I saw Chase Bank, Bank of America and the big bank I know that buyers unsophisticated because they’re not working with experience how to state and investors so that looks bad to me. But and I find in Hawaii residential owner occupied not quite the case. But just
Unknown Speaker 23:05
yeah, and this may be unique to Hawaii too because and I’ve talked to counterparts in the mainland and in Hawaii news, the coconut wireless you know, bad news travels very quickly. So when word gets around that this vendor screwed up on this and that then that might mess things up. Yeah, for their name for that a while. And but nationally, the biggest problem that we have, I think is finding appraisal appraisals getting the appraisal done. So I’m seeing that on clients deals on the mainland, as well as here where it’s like everyone is just waiting for the appraiser there’s not enough appraisers and so there’s a couple lenders that I know locally that actually will call the order the appraisal upfront before even the professional inspection is done. It’s a little bit of risk for the lender but they’re willing to eat that in case it falls through so the typically the buyer pays for the appraisal but if they order it and it falls through the lender is actually gonna eat that and that allows them to offer a quicker closing term and it makes it a lot more attractive. So yeah, that’s a few brokers that have that those kind of tricks up their sleeve and so if you guys ever have any questions give me a holler and and we can like we can talk through what your situation is and I can let you I think might be good for you guys. But yeah, yeah, choosing the right lenders is important especially in these ultra competitive times that we’re in right now. It’s kind of kind of crazy, but
Unknown Speaker 24:43
yeah, it is what it means got a guy
Unknown Speaker 24:48
I got a guy
Unknown Speaker 24:51
so yeah, if you guys are interested in more mainland investing, check out my podcast simple passive cash flow, iTunes Google Play, but this bravas But the update we do is also on a podcast. Yay. Okay, so I’m gonna kind of start off high level here this is a lot it’s from a report that I like to read the IDI report. So they are saying encouraging signs of GDP grow some splurt spending so that’s pent up demand, which has been happening and I also think that this is to come ahead. I know you and I are definitely gonna want to get the heck out and move somewhere and travel right. A little bit. So I think unfortunately, like some people are hurting some people are doing pretty damn well right, staying at home. Life’s good. So I think Unfortunately, this pandemic has sort of split split people into different camps nothing new there are some threats to watch on the horizon like what is gonna happen with the next flu season? What’s gonna happen with once a month us total retail sales? What is going to happen at the Federal Reserve weekly economic index for Mac what’s all prices? What’s happening on us? intermodal rail traffic I used to work for the railroad for seven years. So that’s a big indicator of what’s being on the rails because that is whoops gets most first that gets put in service months later. But there’s always thought there was always threats, right? I mean, there’s always got to be something that news media has the latch on to have not been well watch. ITR says if you wait for a macro or the macro economy to enter a full fledged recovery, you may fall behind the curve. You’re gonna
Unknown Speaker 26:39
miss out right?
Unknown Speaker 26:40
Yeah. And then just something new from inside my circles. Most indicators we are not worried about the rumblings about the stimulus support burning off I think that’s the next thing that they’re saying that book events coming next. We are we’re much more worried about that April May 2020 collections of those came back pretty good the yardie matrix August 2020 or multifamily rents decrease by $1 and then the lifestyle asset class which is luxury stuff stuff that I don’t typically buy or dusty kind of state to the renter by necessity asset class which which what it sounds like is the those who have to read by necessity so the lifestyle asset class and luxury stuff is hit the hardest the director finance society asset class is doing pretty well and then also they had an article on the Bay Area’s die right sir expensive already and public tech before our work bowl or find a way because there’s no social things to do out there. Is this news now reports class the assets are the sweet spot in multifamily right now. resilient asset class but not saying like multifamily is the best thing out there at this point, right? If everybody all all the smart money is flowing into multifamily from more distressed asset classes like retail, then at some point it kind of goes the other way. And then here’s here’s an example Marcus and Millichap they kind of doom and gloom headline mark, won’t they Falvey fundamentals regresses government assistance wanes. But I actually read the damn article Dean. And I pulled out this thing on the bottom left in July 2020 available supply dropped to the lowest level since 1982. Meaning not everyone wanted to leave, make the leap into homeownership and do so. So for this reason, Marcus and Millichap believes Class A garden style suburban rentals with large square footage and Apple outdoor space will benefit in the near future.
Unknown Speaker 28:59
Unknown Speaker 29:01
So can’t just read the headlines. You got to read this stuff, right. But we are on our higher end apartments we had a lot of people about because they are buying houses. So that kind of sucks, but not really the case on the class or or C class. But for the B plus a minus that’s that that happened the loop bit are a business online is showing that the US economy adds 1.4 million jobs in August, and unemployment rates return to single digits. So it was at 10.2%. Now it’s at eight. So we are heading in the right direction. Some positive news.
Unknown Speaker 29:41
That’s good. We need positive news these days. I know.
Unknown Speaker 29:45
I know. But nobody cares about positive. Nobody cares. It’s true. Very true. So I know you’ve talked about like you watch some economics people. I follow like what the big hedge funds like blah Don’t do. So Blackstone bought half a trillion, half a billion dollars a mobile home park units that appealed mobile home park units is that they’re cheaper. They’re very affordable. And they’re spread apart. So great for pandemic living.
Unknown Speaker 30:19
Oh, interesting. So recession recession proof.
Unknown Speaker 30:21
Yeah. But at some point, right, like if everybody thinks it’s recession proof, there’s a point where the, the math gets too high. Right? Oh, you mean, the prices? You mean? Yeah. The Dallas developer says that pandemic has slowed demand from luxury high rise apartments. Right. So you got two things there the high density of high rises, and luxury, right. So he said before, here’s an article on office space, a different asset class that people will invest in. People normally think that office is getting killed. But really, it’s for the most part in the tech hubs, where a lot of those people are able to work from home. Most major cities, business core districts are not tech hubs. It’s just regular office people. And I don’t know what is your attitude, man, like my thing, my thought is like, people are just screwing off at home. Like office, they’re seen productivity is not what it used to be when people are stuck in the office able to watch people like little kids. no accountability rate. Right,
Unknown Speaker 31:38
right. Hey, I did see an article recently that said that, yeah, the productivity levels are said to be dropping recently, and maybe I was thinking, thinking out loud, that maybe people are happy to be working from home temporarily. So they’re gonna try to work hard to make it work. But then, as time passes on, it’s like, Okay, well, now Big Brother boss is not watching over their shoulder. So maybe they can get away with it. And I mean, I did a date, he’s got to get the job done. So I could see on, like, on the private sector, it being able to function a lot more successfully than in the, in the public sector, government or pseudo government.
Unknown Speaker 32:21
Yeah, I mean, most people are not managers, a director, right? They they take leadership from somebody and they’re maybe not the best that self self driven. I know I’m not I don’t work really hard if someone if I don’t have a big motivator myself,
Unknown Speaker 32:37
and there’s so much distractions at home right now. That’s the that’s the challenge. It is one of the biggest challenge especially people who are living in an in someplace that can that makes sense for them and they have a private working area they can close the door or whatnot. Might not be air conditioned, maybe hot for me I got kids running around or not running around while they’re doing their thing and I’m I’m the IT support in the teacher for them or not teacher but it support in their, their facilitator, I guess you could see so a lot of distractions. When you’re at home not Not to mention, you have the internet. Got me Got my guitar sitting on the side, I got my fish tank right next to me so so much distractions. You can just even just the refrigerator
Unknown Speaker 33:28
and then match it if you like your new worker, right, like you just graduated college and your first day of work is at home, right? You know, eating better. Yeah, you’re not or you’re not learning jack, right? Like that is not for career law.
Unknown Speaker 33:43
Yeah, yeah. To your point, right. You’re not getting any seed deck, you’re not getting any support, you’re not getting any, you
Unknown Speaker 33:51
know, I was talking
Unknown Speaker 33:51
to a family office guy, a family office, or like 100 million dollar fan base and above. And he kind of said exactly what this article is talking about, like some firms are doubling down on office space. Oh, interesting, that it’s kind of cheaper. They’re buying twice as much so that they can properly social distance. So they get their workers back to work, and comply with all these like laws and guidelines, CDC supply and
Unknown Speaker 34:17
so on. So, to your point, then office, they might actually need more space, because with the distancing, and if you want accountability, you might need more space so that you can bring everybody in as needed. But you have to spend some more.
Unknown Speaker 34:32
Yeah, I just think of it like it’s not binary. It’s not like people need it a lot or they need it a little bit. It’s always like normally I think 80% occupancy is most major cities is full occupancy. It’s kind of like having 90 95% on our apartment. By itself. some point you dropped below 60% Oh, yeah, it doesn’t drop. It’s not gonna drop like under 50%
Unknown Speaker 34:58
Unknown Speaker 35:00
Then here are the cities that are doing most of the Tilak. Working to San Jose, San Francisco, Los Angeles, San Diego. All those are California tech cups. I know that Denver Salt Lake Salt Lake is is tech. Right. Silicon slopes is what they call it. Yeah. Seattle, Portland tech. Yeah. Right. Sacramento,
Unknown Speaker 35:23
you in Denver is starting to get tech.
Unknown Speaker 35:25
Yeah. Boston, Austin, and then booked up the Washington DC, New York. Like these are all tech right? It’s like, tech, I think we get blindsided, like tech is not most of what jobs out there. Not all making the next Facebook’s or Ubers or whatever. like someone’s got to pay the insurance bills and push vapor. This article is talking about like hotel and more luxury type of stuff. Like I mean, hotel industry is getting killed right now. But I hear a lot of people who like a lot of more, these are more pocket deals like where it’s only available to high net worth families, like where they’re just buying up all the stuff that’s barely cash right now. So they can hold it now and cash flows so that when things get good, man, they’re Baghdad. Right? That here’s black stone, again, it’s gonna say black street are
Unknown Speaker 36:24
very, very different. Very, very different. Yeah.
Unknown Speaker 36:29
They went the other way, Blackstone is always going up and making more money. So Blackstone, the opportunistic group. They just raised $8 billion to go and buy more assets, a future soul. Follow the smart money. Blackstone is the smart money. They’re getting ready to end buying stuff right now. I really like this move Simon malls. They own a lot of malls, but they bought JC Penney, when JC Penney was on the street dying. That’s cool, right? Like, when blood is in the street, that’s when the real investors show up.
Unknown Speaker 37:13
I was wondering if they’re gonna try to go online, but if it’s a more company sounds like they might just try to keep it brick and mortar Hmm. In just $1.
Unknown Speaker 37:23
I think what it is, is like, say JC Penney, like, even if it runs like halfway decent, if you could buy it, there’s always a certain price where you can buy this stuff, or always a basis where you can buy them, you can make a lot of money to Yeah, I get it. Like if
Unknown Speaker 37:38
you’re at a super deep discount. And you can, like you said, you don’t have to get it back up to hundred percent pre COVID. But you, you get it back even 50% you’re gonna be like, cash cow potentially in cereal is what I’m doing.
Unknown Speaker 37:51
Right? Right. Like if if JC Penney was in the heyday running at 100%. And then the last decade it was running at 80%. And you buy it at a rate where you can have JC Penney run at 50%. Well, but all your economists say JC Penney can run at 60 to 70%. In the next couple of decades, you’re doing pretty good. You know.
Unknown Speaker 38:14
That makes sense.
Unknown Speaker 38:15
A couple other
Unknown Speaker 38:18
student housing not doing too well. This Big Read sold off. So assets, your housing not doing too well. A lot more operational costs, I’m assuming there. Again, I think just stick to the basics is my takeaway. And you see this commercial Dean David busters on.
Unknown Speaker 38:37
Unknown Speaker 38:39
Hello, you’re nice. Must Watch different channels.
Unknown Speaker 38:42
I don’t watch much
Unknown Speaker 38:45
basketball. Well, it’s this like, this is like Asian girl who like has low self esteem. And then she like goes that Dance Dance Revolution game. Like click the button it goes like perfect. And then and then she’s like, Who? He gets it again. It goes perfect. She’s like, I thought then after a while she’s like, she like embodies it. She’s perfect. Perfect. Perfect. Anyway, I haven’t seen David Buss ever in a commercial. But maybe they just did a really good at targeted me but like I was like, Yeah, I want to go that deep busters now. And then I thought oh, yeah, it’s, it’s in a pandemic. Why would anybody go to something like that? Right. And yeah, David busters reports 85% drop in quarterly revenue so maybe they’re just shooting out a whole bunch of commercials as a last ditch effort. Right?
Unknown Speaker 39:40
I was in Vegas is open a new figure David mustard should we would open
Unknown Speaker 39:45
Yeah, but people are freaked out right. But will they go to these I don’t know. 3d map the US cities with the highest economic output. Kind of a cool map just not saying that these people They are the places to invest. But sometimes you look at it from the perspective of where the money is. Housing wire reports that the Fed expects low rates through the year 2023. So they had on Wednesday, last week, they had all 17 members of the Federal Open Market, Open Market Committee called the full block. Do you want to sound cool? It was full mark. Like you go to your Well, I guess you don’t see your coworker sitting. Hey, oh, yeah, the full Mark said that they’re going to put the central banks benchmark rate at near zero, at least through the next year. So if you say like that people think what you’re talking about. So if you tell a client that Dean, they think what you’re doing. So anyway, last six months, the rates have been almost zero. And they’re saying that they’re going to try and keep it that way, at least through next year. And 13 of the seven team committee members said he would probably stay there to through the year 2023. Yeah.
Unknown Speaker 41:12
So even if there’s a inflation now, I think those that they’re trying to bump up inflation, and even if there’s healthy inflation that goes up, because the challenge is I think, so far, they’re putting so much money in they’re expecting inflation, but it wasn’t happening for the last 12 plus years. So and what the feds usually do, if there is a increase, or they hit above target, then they would typically bump up interest rates. But I think what they also Feds also said what or I think it was for mark or but he said they’re not. If they were to reach go above that target of 2%, they wouldn’t be increasing the interest rates.
Unknown Speaker 41:56
Okay. Yeah. That’s even more after being so yeah, no, very much.
Unknown Speaker 42:01
Unknown Speaker 42:02
Yes. Yeah. So you kind of tell clients you better buy now on interest rates. That’s not ethical. Feel. Oh, yeah.
Unknown Speaker 42:08
No, I believe so too.
Unknown Speaker 42:10
Yep. Yeah. Yeah. I mean, I’m seeing like rates like 2.6 2.8%.
Unknown Speaker 42:15
Yeah. And again, we’re not lender lending specialists. But that’s right. We’re at the lending specialist. But yeah, I’m thinking to your point. It’s going to be little for a while. So take advantage of it or take it as you will. But think think about that as you’re planning for your future investment.
Unknown Speaker 42:32
Yeah, don’t make hasty decisions thinking that now’s the time, right? Exactly. Don’t keylock the order. Don’t cash out refinance, right. That’s the lender trick right? Hey, you should be fighting. Do you see where right sir? Hey, he should be Ethan.
Unknown Speaker 42:49
Ti is I saw this
Unknown Speaker 42:51
article myself. I was posted on social media when I
Unknown Speaker 42:55
left. Yeah, he did go to jail. So I don’t know how cool that is. I don’t know he went to jail for but we I was like,
Unknown Speaker 43:03
This is the article or the article I saw was how he was pitching to buy real estate. It’s just that one.
Unknown Speaker 43:09
Yeah, yeah. Okay, or else? I had a practice at this earlier, but I’ll try and see my ti boys. all y’all getting all that money from the government ain’t more cardio ears. It ain’t more louis farrakhan. Go get yourself property. Please. Please, y’all go buy some proper word. You got to kind of cool voice. He’s a smaller guy, but he’s got kind of a bullhorn for voice.
Unknown Speaker 43:42
I was gonna vacuum with some beatboxing when I guess we’re good. Okay.
Unknown Speaker 43:45
Yeah. But I think that brings us to the end. Anybody got any questions for next time? Let us know. But check us out on the YouTube again, we are not giving any tax or legal advice here. So you’re professionals but any last thoughts there? Dean What are you up to the spot?
Unknown Speaker 44:05
I’m actually busy on the real estate sales side right now so I’m trying to keep up with that. Getting behind on the investing side and my personal finances so that’s a little troubling I gotta get get refocused and get rebalanced. How about you?
Unknown Speaker 44:24
I bought a pool table man. Oh, check it out when it when it comes in.
Unknown Speaker 44:31
Oh, I’m mazon or something.
Unknown Speaker 44:34
No, no, I I I know a guy
Unknown Speaker 44:40
or wishes it wish calm.
Unknown Speaker 44:43
One of my investors is like that’s its business sells that stuff. Okay.
Unknown Speaker 44:48
Yeah, I’m missing. I miss basketball dude playing basketball with you.
Unknown Speaker 44:52
Yeah, we’re allowed to do that. I got a basketball rub my back yard. No, I got you back. Well bought one back there.
Unknown Speaker 45:00
Unknown Speaker 45:02
okay, I might need to come up maybe with some two on tour or something.
Unknown Speaker 45:07
Yeah, yeah, but investing wise. Yeah. Going up to the mainland Aaron a little bit. Check it out. And yes, keep on truckin right. Search a cash flow can’t keep your your holster loaded for for the good deals coming up, right? Yeah, I mean if you can lock it up if you if you buy something that cash flows a little bit better than 1% rent to value ratio, net cash flows today. I mean, you can be an idiot and kind of run that thing at 2.6% interest rate. Friday like to me yet it’s a no brainer, no brainer. Yeah, all day long locked in that debt.
Unknown Speaker 45:46
Yeah. But anyway, I’ll see you guys next time. Bye.
Unknown Speaker 45:50
Unknown Speaker 45:55
Estate Investing group, check out our e i aloha.com.
Unknown Speaker 46:09
Just two local guys with so much to say. So listen to this.
Transcribed by https://otter.ai