1565: Warren Buffett's House, Leaving San Francisco, Space X, Property Radar & Foreclosure Radar, Sean O'Toole

Welcome to the Creating wealth show with Jason Hartman. You're about to learn a new slant on investing, some exciting techniques and fresh new approaches to the world's most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine, self made multimillionaire who's actually been there and done it. He's a successful investor, lender, developer and entrepreneur who's owned properties in 11 states, had hundreds of tenants, and been involved in thousands of real estate transactions. This program will help you follow in Jason's footsteps on the road to your financial Independence Day. You really can do it. And now, here's your host, Jason Hartman with the complete solution for real estate investors.

Hey everybody. Happy Monday to all. Happy Monday. I just thought I'd do kind of an impromptu intro for the podcast today. And you know, sometimes it's just good to go do a quick live, do the intro portion of the show, then you can see the entire thing on YouTube or listening to the podcast. Either way, either one is fine. So first off, I wanted to say a big thank you to everybody for all of the birthday wishes. Unfortunately, it was definitely not my best birthday ever. My dog's birthday is right after mine. Hers is actually today. She has been sick and last night spent about two hours in the emergency room and, you know, she was throwing up and having digestive problems and all this stuff. And I don't know, seems to be a little better today. But I didn't get much sleep last night. Unfortunately, I had to wake up just about every hour. There were a couple sort of two or three hour spans there. But at first it was waking up about every hour to let her out. She was just having a really rough night. So hopefully tonight will be better. But thank you for all of the birthday wishes for me and for Coco. And there's Coco, by the way, if you're watching the video, there she is on the Today show. I was looking for some pictures of her just to share with you. And there she is with Al Roker on the Today show. By the way, if you're listening to this only later on, audio only, you can find this on our YouTube channel as well. And there she is as a little puppy. No, she did not actually drink that Guinness beer. If I had her drinking beer at what, what is that, about 10 weeks old? Got her at the animal shelter as a puppy, believe it or not. So occasionally you can get a little puppy at the animal shelter. She'd probably have a much stronger digestive system and probably wouldn't have been sick, but might have had an early demise. And there she is on the plane on one of our flights. So what a great pooch. And, you know, I. I know all of you who have pets and you love your animals and you just want to take care of them. And you know, veterinary medicine is really. That's got to be a tough slog in a way, because the animal cannot tell you how they're feeling. You get no feedback. It's a zero feedback loop. Right. You have to guess at how they're feeling. Yes, they look at you with their very expressive faces and you look at their actions and so forth, but you just don't really know. Whereas with a human patient, they can give you feedback. And that feedback is so, so valuable. So thanks for all of your well wishes for Coco and for all happy birthday wishes for both of us. Hey, something interesting. You know, a lot of folks have talked over the years about how real estate underperforms the S and P, the standard and poor's, the s and P500 index, which is really the most widely used gauge of really what the economy is doing or. Well, the stock market and the economy are definitely not the same thing. I think we've all come to realize that. So I won't say it's a gauge of the economy, but it is certainly a gauge of the widespread stock market. And since about 69 to 70% of the S&P 500 is consumer spending, and that is really its ratio of our entire economy, it is pretty significant. I thought this was interesting. This is a Business Insider video, and it shows you Warren Buffett's home, his very modest home for someone who has been the richest person in the world several different times over the years. And if not the richest are right up there at the top of the heap. And so he's obviously a Wall street insider in a lot of ways. I think Warren Buffett is a huge hypocr. Hypocrite. Yep, he is. But anyway, listen, I like his value investing philosophy nonetheless. And you know, there's some, like, every person there's good and bad, right? You got to take the good with the bad. But I am impressed that Warren Buffett lives in such a modest home, being such a rich guy. He has only one extravagance, he says, and that is his private jet. Otherwise, he drinks diet cherry Coke and eats cheeseburgers. He's. He's a pretty homespun guy, obviously. So he. Here's his modest $652,000 house and I just thought I'd show you this video because there is a good lesson here. So let's take a look at this. Okay, let's take a look at this. But it's a pretty good lesson because it really shows you the difference between inflation, house prices and the stock market. Here we go. So here's his modest home. Okay. Omaha, Nebraska. He's called the Oracle of Omaha, as you know. And just looking around the neighborhood, you know, he's got some security, right? Rightfully so. So he bought this house for $31,500 in 1958. 31,500, 1958. Obviously, it's on kind of a busy street. It's about 250,000 in today's dollars. Right. But it's now worth $652,000. Okay? So therein lies the lesson. A lot of people say, well, the s and P500. And that has determined to some extent Warren Buffett's success. Right. As a, basically a fund manager in Berkshire Hathaway. Essentially. I mean, you can slice and dice that however you want, but then you look at, you adjust for the official rate of inflation, which we all know is understated. Why is it understated? Because it's understated. Because there are three basic weighting, substitution, and hedonic indexing. So there you have it. It's worth $652,000 today, but the $1958, adjusted for inflation, are only $250,000 today. So the house increased faster than the rate of inflation. Faster than the rate of inflation, at least by inflation'.

Now, it depends who you talk to, but most experts will say that generally real estate nationwide, of course, you've got linear, cyclical and hybrid markets. The US is a big giant country. There's no such thing as a national real estate market. There are about 400 MSAs or Metropolitan Statistical Areas, about 3,3200 almost counties in the United States, and many more cities than that and many more zip codes than that, and many more neighborhoods than any of those. So it's a big giant country, very diverse, lots of different types of real estate markets. But if you ask the experts, they will say that nationally, real estate increases or appreciates at about 6%, maybe 6.7% annually. You know, you do this over the course of decades. And of course, it depends exactly what decades you measure. It depends what product types you measure. Are you measuring the luxury market, the entry level market? Are you measuring single family homes? Or are you including condos and townhomes? Or are you including the mall or just the condos and townhomes? You know, you can slice and dice this amazing million ways. That's why there's so much disagreement. There's so much disagreement because of that. But if you take the official inflation rate and if you look at the price of the house today, you can see that it has outperformed inflation. Yes, you can. You can definitely see that. So I don't have the official inflation rate handy from 1958 till today, but definitely this house has appreciated it. Almost triple the official rate of inflation. So when you hear people say, well, real estate is a good hedge against inflation, this is what they mean. But this is nothing to get incredibly excited about. Why? Because of course most people leverage their real estate. So when they use leverage, remember Archimedes, the famous mathematician, philosopher from antiquity, Archimedes quote, he said, give me a lever long enough and a fulcrum on which to place it and I will move the entire world. Because leverage allows you to do a lot more than you are capable of with your own strength. So real estate is the most debt friendly asset class in the United States. It's the most tax favored asset class in the United States, especially income producing real estate. And it's also the most historically proven asset class in the entire world. So you would leverage your real estate. Okay, let's say you put 10% down and let's say real estate. You notice I'm not, I'm sort of specifically not talking about income property because I don't like to call it real estate because it's really so much more than real estate. It's income property. Well, say that your real estate, just real estate, like Warren Buffett's home, obviously not producing income for him. He lives there. Right? The many times richest man in the world, many different years, lives in this modest home. And so say it outperforms inflation by 3% annually. Now the property is, is outperforming inflation and so you're making maybe double the rate of inflation. That's great. It's a good hedge, but it's nothing to write home about. Now some say it just keeps pace with inflation. And you know, inflation goes up, it diminishes the value of our currency, our dollars and real estate prices go up. So they keep pace with inflation. So you're not falling behind. That's good. But if you leverage the real estate and you do it on a 9010 LTV or loan to value ratio, meaning 10% down, 90% bank financing, then you get to multiply that return. So now you take that 3% annually and you multiply it and it becomes 30% annually without anything else happening. Just the 3 to the 30. Without having some terrific appreciation rate, without having inflation induced debt destruction. One of the hidden strategies that I teach, that's kind of my trademark term, inflation induced debt destruction. Well, not kind of. It is IIDD I know it's a mouthful. And you know, listen to the podcast or check out the YouTube channel for more detail on that. And without tax benefits and without rental income, so what if you're not paying for the mortgage? You outsource the responsibility for repayment to that mortgage to someone called a tenant. They pay it for you. Plus they decide they're going to give you a little bonus every month and they're going to give you an extra $250 per month. Right. Well, that really adds up. And that's why it is the most historically proven asset class in the entire world. That's just a little lesson on Warren Buffett's House. Now, today's guest is Sean o'. Toole. He's been on the show several times, but not for many years. And he's the founder of Foreclosure Radar and Property Radar. Okay. And he's got some great statistics on the real estate market and what's going on in different markets around the country. And, you know, are we going to have a foreclosure crisis? And a lot of the doom and gloomers I think will be pretty impressed with what he says because he says, no, you are wrong. Yep, you're wrong. Doom and gloomers. I know you want to be right. Doom and gloomers. You know, misery loves company. It's just kind of human nature. We all love to, you know, predict the end of the world.

And, you know, I just, I don't think it's going to be any big deal this time. I really don't. The economy is improving. You know, we'll see what happens. With the election less than 30 days away, we've got a pretty crazy election coming up. We know that we're likely to have civil unrest. I think real estate's going to be really hard hit in some of these cyclical, expensive urban markets. Here's one to talk about. How about San Francisco? San Francisco, here we come. Or is that just California, here we come? I don't know. Whatever. Nobody knows the reference anyway. That's a very old little song. But Patrick, one of our team members posted this in our content group and it's a great chart from Apartment List They've been on my show a few times and they've got some good data. And it says September ends. Another. Another fleet of moving trucks heading out of San Francisco as rent growth declines 20% over last year. Okay, so things are pretty bleak here. And just look at this and compare it. Compare San Francisco to the entire Socialist Republic of California, to the entire United States. And we're seeing negative growth on all these numbers. Now, why largely are we seeing that? Overall, it's a minor thing when you look at the US Stat, but why? Because everybody's buying. Now. One of the things I've taught over the years many times is an idea I call the three dimensions of real estate. And there are obviously more than three dimensions, but hey, it sounds good. Three dimensional. We all get the idea. It's not flat, three dimensions. And in the three dimensions of real estate, I talk about the counter cyclicality. It's a mouthful. Hey, folks, I didn't get much sleep last night, so give me a break. I probably am showing it, and I'm another year older, so I'm showing that too. I swear when I woke up on my birthday, I had more gray hair than before. I swear, it's weird. The gray hair kind of ebbs and flows. I don't know why can hair turn from gray back to its normal black color? It kind of seems like it does sometimes. It seems like there's more, but I kind of like it. Honestly, I think the gray actually looks pretty good, so I'm okay with that. Just keeping it in the head would be a good idea. Yeah. Not letting it fall out. Okay, so back to business here. So we see this. And when everybody is rushing into the buyer pool when they want to own properties, when the home buying market is really strong, when interest rates are really low, a lot of people move from the renter pool to the owner pool. So that actually hurts rents. Now, when the market is soft and it's more of a buyer's market, and that's usually the result of higher interest rates, lower home affordability, then we see upward pressure on rents. So isn't that great? Because as a good real estate investor, all you need to do is adjust your strategy as time goes on. So when you're in a seller's market, like we are now, you benefit from appreciation. Hey, that's great. And when we're in a buyer's market, you're not benefiting from appreciation so much, but you're benefiting from increasing rents. Cash flow goes up and rents improve. So you always have a Strategy because it's a multidimensional asset class and you play the given strategy at that time over the years that you own your portfolio. But foreclosures and declining rents and declining prices and civil unrest, all true of high density urban expensive markets. San Francisco, Seattle, Louisiana. Gosh, I'm really, I need, maybe I need another cup of coffee. Sorry folks, I'm a little not with it today, you know, not much sleep. And New York, oh, that's one Jason G. New York could have thought of New York. It's only the biggest city in America, you know, but all these high density urban markets with civil unrest are really not looking good. And I know there's been some debate on this. I've seen a few articles recently and they're just wrong. They're like these apologists for these overpriced urban markets that are left controlled. They've been chasing business out, they've been chasing people out, you know, forever. And they've, you know, they're, they've just committed urban suicide. Frankly. It's terrible. The government in these, in these cities, it's kind of all the same left wing, left leaning government. It's an absolute disaster. So yes, I do think there will be a foreclosure crisis in these markets, but in these good, solid linear markets, I just don't think it's going to be any big deal. And listen, don't take it from me, the data guy is coming up. Sean o' Toole is on in a few minutes. Another thing I want to talk to you about before we get to our guest and that is the commercial space program. This is an amazing time to be alive, folks. And with all the bad stuff that's going on in the world, there's a lot of amazing stuff too. Look at this. Let's take a look at SpaceX. Now when I was a kid, I was a space cadet. The one thing I really followed was the base program. I followed every Mars landing I remember. I'd study back and, you know, follow and study, you know, Apollo and all the old space programs like Gemini and you know, the original stuff and I, and the Russians and it was fascinating to me. I just loved that stuff as a kid, you know, and I used to watch Star Trek and of course, you know, Star wars and so forth as well. But look at the cost per seat. Like this is, think of this as an airline ticket to space. Right? The cost per seat. And you know, Richard Branson with Virtual Virgin Galactic is selling tickets for $250,000. I've thought about buying one, frankly, but, you know, it doesn't seem very worth. I mean, it. Listen, I'd pay 250 grand to do some. A few orbits in space and all that kind of stuff, but all this one does is it just goes up and comes down, you know, And I've already experienced zero G and my cousin's Cessna years ago as a little kid, you know, So I know what zero g is like. It was really cool. I was scared to death. I thought he was going to rip the wings off the plane. And all you have to do to experience zero G. I've also been skydiving is just fall as fast as gravity. Gravity will pull you. That's called terminal velocity. And when you're in terminal velocity, that's zero gravity. Okay? Now, you don't feel it when you're skydiving very much because the wind and such. But inside the Cessna 172 on the way to Catalina, when I was a kid, I was wearing a baseball hat. My cousin put it on my lap, and he says, want to try zero G? And he goes.

And sure enough, as I was freaking out, thought I was going to die, the hat started floating right in front of me as all of the stuff in the backseat of the Cessna 172 started floating as well. And then he pulled out of the dive and it all went so pretty cool. Anyway, but you know, when. When you really get to do some cool space stuff, It'll be worth 250 grand and it'll probably get a lot cheaper. Right now it's only $55 million. Yes. So if you go on Dragon 2, private SpaceX, we just sent them up there, and it's 55 million bucks a seat. Well, hey, it's a lot cheaper than $390 million. Now, it says here, and this is important, it says, estimates for historical spacecraft adjusted for inflation.

Yay. Good. At least they adjusted for inflation, because obviously Apollo 1961-1972, those dollars aren't worth as much as they are nowadays. So we need to adjust for inflation. Always. Now, that's based, of course, on the official rate of inflation, which is understated. Why? Because of weighting, hedonics and substitution. More on my podcast, if you don't know what I mean by that. Okay, so Brent posted, and he says he lives on the Space coast here in Melbourne Beach. Hey, that's in Florida. It's not too far from me. And you know, it's way cool to watch the rockets launch here weekly. And folks, I tell you something. Two of our markets really, really directly benefit from the commercialization of space. So reach out to us@jason hartman.com or at 1-800-hartman if you're listening. In the US that's a US phone number, 1-800-HARTMAN. And we can help you invest in those markets that really benefit from the commercial space program. And by the way, Robert says that San Francisco deserves to bleed. Get a taste of their own medicine. Get a taste of your own medicine. Well, hey, listen, that's not a very nice sentiment, but it's hard to disagree because the politicians there have just, just screwed it up so badly. They really, really have messed it up. By the way, do you like my dorky sound effects or should I just. Maybe I'm overdoing it. Okay, maybe I'm overdoing it. But look at this. Look at the amount of investment going into the commercial space program. It's truly astronomical. Pardon the pun. That's pretty funny.

Yeah, yeah, yeah. It's astronomical. Okay. The total value of investments in space ventures over five year periods since 2000 in billions of US dollars. So now we're up almost $17 billion. And just look at the graph. It's not the amount, it's the exponential growth in these investments that is truly amazing. So again, there is a bit of a real estate play there. So check it out. Reach out to us and we will help you benefit from this. Oh yeah. John Legend is going to leave the country if Trump gets reelected. Can I buy your plane ticket? Please do leave. All these stupid celebrities. Remember last time when they say, well, if George Bush gets reelected, they're going to leave the country. None of them left. And then they said, if Trump gets elected. Now Madonna actually really did move to Portugal. Thank God. So glad to see her go. Oh, and there's an interesting Morgan Freeman thing. I'll show that to you next time. I got a bunch of stuff to cover here that we don't have time for today because we've got to get to our guests. But anyway, also we've got our Pandemic Investing online conference coming up. This is going to be great. Lot of good information. Go to pandemicinvesting.com, get a free mini book there and join us for our upcoming conference. Now we are going to hear from Sean O', Toole, founder of Foreclosure Radar and PropertyRadar. And this is going to be in two parts today and tomorrow. So here is part one. And if you are watching on the live stream right now, check out the Podcast today's episode for the second half where you can hear from Sean o', Toole and he's going to talk about this looming foreclosure crisis that so many, well, not so many, I don't know, maybe half of you think are coming. I don't know. I think you're going to be a little disappointed. But let's hear his data. So we will go to that and check out the podcast and the YouTube for the full Sean O' Toole interview. Thanks for joining me for this quickie intro today.

It gives me great pleasure to welcome a guest back from a long time ago, maybe longer than I originally thought. And that is Sean o', Toole, founder of Property Radar, otherwise known in the past as Foreclosure Radar. And I said, you know, Sean, it's been years since you've been on the show. And he said, I think it's actually been about 10 years. I didn't think it was that long. But Sean, either way, welcome back. And a warm welcome from a decade ago, maybe. Wow, we got to get you back more often.

Well, thanks for having me. Thanks for having me back and sorry it's been so long.

Yeah, yeah, it's good to have you. And you're coming to us from Northern California, right?

Yeah, Truckee Tahoe.

Good stuff. Yeah. Beautiful, beautiful place up there. Taxes are a little too high, but, oh, well.

And maybe that's something we'll talk about as the migration out of high tax jurisdictions. Who knows? But, you know, just give us, and I know you've got some slides to share for those watching on video on the YouTube channel. And if not, we'll try and make those slides understandable if you're listening to audio only, of course. But what is your sense of what's going on? I mean, there is a lot to talk about nowadays.

Yeah, boy. Wow. There's so much going on all over the place. But we'll stick to real estate. And you know, on real estate, we've got this, you know, really incredible kind of cycle happening right now that, that we've not seen before. And it was really funny. Right as Covid was starting to pick up, I got all these calls from my past customers. All of the big boys used us to buy foreclosures back in the day. And I mean, hundreds of thousands of foreclosures. I think it was like.

A quarter million foreclosures. People used our platform to buy. And they all called me and said, hey, we're putting together a fund. We're putting together $100 million fund, a $500 million fund. And is your software still up and running? We're going to go buy all these foreclosures. And I said, yeah, we're here for you, we're ready. And I don't know that I'd bother, and we'll see how this all plays out. And I think it's going to take a little while, but I'm not sure we'll see a foreclosure crisis like we saw in 2008.

Okay, so I just want to go back. So are you saying now they're saying that or they said that back during the Great Recession that they're buying all this stuff or they're being opportunistic now, saying they're looking for the big foreclosure crisis that's not really going to happen?

Yeah. So in, really, in April, my phone started ringing off the hook from a lot of the players that raised big money last time, saying, hey, we're putting together a fund, we're gearing up and we used you last time. Are you going to be here for us this time? We know you changed your company name. Are you still doing foreclosures?

Right.

And I said, oh, yeah, we still do all the foreclosure stuff we did back then and we're ready to go if it happens, but I don't think it's going to.

Okay, good. I'm glad you clarified that. And Sean, you know what, I gotta say I agree with you. I think these bottom feeder vultures that are, you know, out there and listen, I want to be one too. I'm not faulting them. I'm ready to be a vulture at any time, but I just don't think it's going to happen this time around. You know, the financing has been underwritten pretty conservatively. Granted, unemployment is very high for certain segments of the population, but it's really uneven what's going on, which is very sad. But some people are doing great right now. They're doing better than ever. So I don't know, it's kind of hard to get a sense of it. But why, just in your own words, why do you think there's not going to be a big foreclosure crisis this time around?

History. I don't believe that history repeats itself, but I do believe it rhymes. It's not my quote, I can't remember whose it is, but. And I do think we learn something from each of these crisis. Not always the right things, but we do learn some things. And I think there's no question that the banks and the regulators Learned that pre September 2009. If you were a bank and you had somebody stop making payments, it was your job. And the regulators held you to that job to get rid of that bad asset and get it off your books as fast as possible. Going through the foreclosure process, taking that property back, putting it on the market and selling it at whatever price it would sell at at the same time that you're stopping lending. Right. So there's just no floor, there's no bottom there on that market. And I think universally the regulators realized By September of 2009 that was a mistake and they started shifting those policies to mark to model was the big talk of the day back then. Like, okay, banks, you can pretend this thing's worth more than it is worth more today, rather than forcing it onto the market, onto it. You can rent it out. Even that was really the beginning of the end of the foreclosure crisis. It still took quite a while. There was so much in the pipeline and I don't think we'll get back to that. We won't have that. Price drops. Price drops require a motivated seller. And yes, you have some motivated sellers in San Francisco, in New York, but even in San Francisco so far prices are flat versus I think statewide they're up 8, 10%. So that's still bad performance for San Francisco, but they're flat. There aren't motivated sellers, there aren't people willing to take a 20, 30, 40% discount.

Yeah. And the people that have money and can afford to live in an expensive place in San Francisco, for example, it's not like they lost their money. You know, they still have money and in fact some of them have a lot more. But then you've got to sort of go to the next layer of this discussion. I think it's not a matter of do I have to sell? Am I a motivated seller, Am I desperate? I have to get out of this property. And what you said was very poignant about, you know, the banks are thinking in a much more business like fashion this time around. In other words, they're going to do workouts, short sales, loan modifications or become investors, which I don't know if that's savory overall long term, but I would.

Only change that slightly is rather than they are thinking that way. A they're being allowed to by regulators and encouraged to by regulators.

Yeah, yeah, yeah, yeah. Well, however that came about, fair enough. The fact is there minor, minor knit. Yeah. But then the question Is, you know, do you want to live in a place that has civil unrest, that has a high density environment where you can get a contagion, you can get a virus and maybe, you know, maybe this is even post vaccine. I think really Sean, this pandemic that happened to us is, is going to cause a, literally a generational suspicion even after there's a vaccine, even after seven and a half billion people then vaccinated. And a lot of them won't agree to get vaccinated. We know that, you know, it's there, you know, there's a very strong anti vaxxer movement long before we ever heard the term coronavirus. Right. You know, there were things before this. There was sars, there was bird flu, swine flu, mad cow disease. You know there's little things have been out there or just the regular old flu. And then now people have really adopted this remote working. I mean it's certainly the technology was available 20 years ago, it's not new, but it's that it's been, the adoption has been forced upon us. Right, so that's the next layer of that discussion I think. Right, yeah.

You know, so we've been calling it the re realization of America and there's a couple of things that I think.

Reruralization.

Reruralization, yeah.

I just want to make sure we caught that because I haven't heard that one before. The reruralization. Say that ten times fast, folks. Okay, go for it. What were you going to say?

And I actually think there's a couple of things that are maybe coming together at the same time and I think there's still some challenges with this concept too. And I think this is maybe a 50 year cycle, not a 5 year cycle, but there's a few things happening. One is, you know, work from home. Right. So now I can be somewhere else. Why am I in this place that I don't really like when I'm a mountain biker and I could be someplace that's great for mountain biking and is a small town. Right.

For one third the price also.

One third the price too, for sure.

Right.

But there's a couple requirements there. Right. Like you know, a lot of people love this little town called Downieville, but it doesn't have Internet. And so the other thing I think that we're going to see is low earth orbit satellites, you know, like SpaceX.

Is working on Starlink.

Yeah, and star. Yeah, exactly. So you know that changes that where suddenly you can have gigabit Ethernet in the middle of nowhere.

Right.

So there's that. And then we have.

Or just have a 5G tower in the center of town. Right. And you kind of solve that problem, right?

I don't think so. I don't think 5G gets us there. And the problem with 5G is I'm a huge fan of 5G. I think it's super important. I wish it was a national priority to get a real Rollo out of what it's truly capable of, because I don't think the Karios will do it on their own. But the downside of 5G is it has a fairly short transmission span, so you need a lot of towers. So doesn't really work in rural areas at all. And I don't think it solves Internet in rural areas.

Yeah. Because it's such low density. But in a small town that's not necessarily rural, it could potentially solve the problem. But okay, so the re. Ruralization, what else? Any other part of this trend? I mean, I mean, you know, because that was already happening, like people were already leaving high tax environments. That trend has been going on for a while now, whether it be a city or a state.

But I think that's more of a. There are people leaving, but there are also people coming. You have. California is growing. Right. Like, so this idea people put out that everybody's leaving California. I mean, we'll see what this year's statistics bring. Right. And there's definitely with the wealth tax and some of the other things that are on the plate, all of which never got out of committee, by the way. Right. But if some of those things start to go through, at some point, that might come true. But right now it's just a talking point. It's not actually happening. There are people that are leaving, there are people who are coming. And largely that's gentrification.

Right. It's.

The state of California, for example, is getting stronger. It's now the fifth largest economy in the world.

Okay, so who's leaving and who's coming, though? Because a lot of middle and upper middle class people that I personally know, and I'm one of them, I left nine years ago, so moved to Florida. And I love having no state income tax. I think it's fantastic. It's a lot better than the 13.3% in California. And cost of living in general is so much lower. So, I mean, who's gonna be.

I've got a really good friend who's making that decision right now and moving to Austin and, you know, so I totally get it and respect it. There's a lot of people making different. You know, they want the beach, they want the mountains, they want. California is a pretty special place. There aren't many other places like it in the country or in the world.

Yeah, there's no question it's a beautiful place and we have the beach, but it's flat as a pancake here.

So. Yeah, I'm a water guy, so, you know, I like Florida and I like all the water sports and stuff down there.

So the highest altitude in the state of Florida is like 340ft. That's our biggest mountain. It's crazy. Yeah. This will be continued on the next episode. Thank you for listening and happy investing.

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