2361: Delisting Houses and Unlocking Amazing Deals: 18 Months of 0% Interest Business Credit for Your Real Estate Portfolio

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This number doesn't make sense. Nvidia is now worth over $5 trillion. Let me try and put that in a way that makes sense to our brains. There are only two countries in the world that have GDPs that are bigger than Nvidia's value right now. GDP is gross domestic product, by the way, it's one measure of the value of what a country produces. France, the UK, India, Japan and Germany all have smaller GDPs than Nvidia's value from the other day, which was $5.04 trillion. Only China at about $19 trillion and the United States at around $30 trillion have GDPs that are higher than that. But as crazy as that is, this whole situation is much bigger than that because it's not just Nvidia. Microsoft, trillion dollars in value over the summer and Apple, you may not have heard this, became the third company to hit $4 trillion just the other day. It's the entire stock market. And I need you to understand just how big the stock market is getting. One way to measure how big the stock market is at any moment is something called the Buffett indicator. Named after Warren Buffett. It compares the value of the total stock market to the US GDP at any given time. And before we get to today's Buffett indicator, here are the values right before some of the biggest stock market crashes in recent history. Just to give you perspective, in October 2007, at the peak of the housing bubble, right before the financial CR crisis and the Great Recession, the Buffett indicator was 106%. So the total stock market value was more than the US's GDP at the time, 6% higher. And then afterwards it dropped to as low as 48% in 2009. But even higher than that. Let's look back to the dot com bubble. The Buffett indicator at the peak of the dot com bubble back in March 2000 was 143%. The total stock market value at the time was 43% higher than the US GDP at the time. So what do you think the Buffett indicator is right now? Would you guess 150%? Maybe 175% even. It's more or less been steadily climbing since 2009. It hit around 200% at the end of 2021 and then it dropped back a bit. But since then it's climbed back up and today it sits around 225%. The value of the total stock market is now well over double the US's GDP. And here's the most troubling part. To me, we can all agree that this looks like a huge bubble. But how do we know when it will end and how far it'll fall? What if it keeps going higher and higher? Will the crash be even worse? It's like a game of musical chairs. And right now the music keeps playing. As long as someone keeps shoveling money into these AI companies. That's what's driving this now. These companies that are building data centers, Nvidia's GPUs. That's why Nvidia is so valuable right now. And even though the music keeps playing faster and faster and it seems like it should stop at any moment, anyone who tells you they know exactly when the music will stop is lying to you. Except for me. Because I know that the bubble will burst on November 19th. That's Nvidia's next earnings call. I'm joking by the way. I do not know that this is not Financial advice. But if Nvidia announces that their earnings have not grown as much as Wall street expects, the cracks in the AI foundation could start showing. And that could be the start of of the bubble bursting. I'm probably wrong, but if I'm not. So you can say I was there when this man guy called it. Feel free to favorite this video, follow me, share it with your Grandma and after November 19th, come back to this video and tell me how beautiful my hair was, how tall I definitely am, and that I was right. Or more likely, make fun of me when Nvidia hits a new high of $7 trillion.

Greetings empowered investors, and welcome to episode 2361. To all of our American listeners and viewers, a very happy Thanksgiving to you and from all of the rest of you in 188 countries worldwide. See, there's 189 total. But I took out the USA because I already wish them a happy Thanksgiving. Anyway, welcome to all. So let's talk about a bunch of different things, not the least of which we have a very, very, very important virtual event coming up and you will not want to miss this virtual event. It's totally free and it is going to bring you money. A bunch of things have changed in the credit markets and this is very exciting. It's good news. I know we don't always have good news, but this is very good news and we're going to be coming up with that on our upcoming masterclass, Totally free. We're going to round out the year with a fantastic opportunity for you. Some new stuff, some really good stuff. Okay? People are taking their homes off the market. Sellers just aren't that motivated. You know, the market has been boring for three years. It's been just very muted activity. Down prices still going up nationally, but down in a few markets. And so these sellers that don't get their price, they're just saying, eh, I don't care. You know, it really doesn't matter to me. Why are they saying that? Of course, it is the lock in effect, the thing I predicted long before it happened and the media finally gave it a name. I should have given it a name first. But anyway, that's what's happening. They just don't really care. They're just not that motivated. I'll give you an example. There's one house that is here in the Scottsdale area. Actually, technically, it's in Phoenix. And I made an offer on this house, I don't know, months and months and months ago. And the owner is motivated. The house is vacant it's listed for four point. I think at the time it was listed for 4.4 million. And I like the house, you know it does need some remodeling. It's 25 years old but a pretty nice house, custom home, beautiful. I would love to live there. So I made an offer on it and then the seller just kind of went eh, came down like $100,000 just not that motivated. Right. And I came up on my offer, literally negotiated with myself, did not wait for a counteroffer. And the agents have called me back, talked with them a few times. She still didn't sell it and she took it off the market for a little while. Vacant house. Remember it's a vacant. So she's spending significant money every month to keep that opportunity cost on the equity. Utilities, maintenance, etc insurance, all property tax. Right. Probably adds up to about I don't know, $27,000 a month I'd say all in. Right with the opportunity cost. Right. I can't remember if she owns it free and clear or not doesn't matter. There's an opportunity cost on the money so you can never say that well I own it free and clear so I'm just going to sit here and not be motivated. You could be doing something else with that money. Right. Anyway, the agent called me back and I said look, your seller is just too stubborn. She's got to make a deal if she wants to sell that house and she just doesn't care. And this is the attitude of most homeowners in the market. Delistings. This is about delistings. They have their home listed, they take it off the market. This rate of delistings which we've talked about on prior episodes, IT has jumped 28% as sellers pull homes off the market rather than settle for what they think are low prices. They want their money and they're just not motivated. If they don't get their money it's like eh, they don't care. Home delistings hit the highest September level since 2017. The number of U.S. homes that were listed for sale and subsequently delisted are very high now. They were slightly higher in 2016 where we had 89880D listings and then it's been lower than that ever since and now it is that a rate of 84,278 D listings in the entire country. Now you know I always say compared to what? Right? Because a number doesn't really tell the story. We need to compare it to the overall size of the market. To understand how meaningful or not meaningful that number may be. Now, here's the problem. I'm going to share it with you in a moment, okay? If you're watching on video, you see this chart I've got up here? It says sellers are pulling their homes off the market at the Highest rate since 2016. Share of delistings of total US home listings as a percentage. Now, a percentage would normally be the number. I would say you gotta go with a percentage. That's the meaningful number. But there's a slight problem with it. Remember how we've talked about over many, many years how different surveys calculate overall housing inventory differently, Right? Because some count only active listings. Those are the ones I like. Some count active and pending. Some count active and contingent. Some count active, contingent and pending. Right? And so there are different ways of looking at these numbers. Some count new homes, some only count existing homes or really MLS listings. Right. Since not all builder homes are in the mls, the Multiple Listing Service, these numbers vary. And I always say use whatever survey you want as long as you compare it to the same survey from the past. So you have an apples to apples comparison in this case, since I don't know which survey they're using, this is maybe not as meaningful. Even though I would normally say percentages are the most meaningful thing. Even more so in almost every case than absolute numbers. Because when someone says to me, you know, they talk about a business opportunity, for example, you know, I'm always getting pitched, you know, whenever you got some money, right? People are always pitching you about their business deals, right? And they say, this is going to be a 50 billion dollar market. I'm like, what exactly does that mean? I don't know what that means. Compared to what? Right. It's a $50 billion market. Compared to what? The other trillion dollar market, the other 500 billion dollar market or the $10 billion market for this other opportunity, right? Like, I don't know what that means. I'd rather have a percentage. Okay? Anyway, you know, take that as it is. In 2016, 5% of the homes were delisted. Today, 5.5% were delisted. And in that period, the lowest point was during the COVID era where only 3.6% of the homes were delisted. Okay? So just gives you an idea for where the heads are of the sellers, right? They just. They're just kind of indifferent, right? They've got such a good deal on their existing home that they just ain't giving it up. And one more thing on this before we Move on. Uptick in delistings is propping up US Home prices, this article says. And then it talks about the numbers of delistings. So it says, quote, the frequency of delistings is keeping inventory tighter than it looks on paper. Many homes have a sticker price higher than buyers are willing to pay. But most sellers are unwilling to negotiate when tens of thousands of homeowners pull their homes off the market rather than accept a. And I'm going to say what they consider to be a low offer, right? Because they've got tons of equity in that property. They've made a fortune on it, but now they're just being greedy. Right. It effectively reduces supply of homes that are actually available for buyers. That keeps sale prices elevated. Note that many prospective sellers are deciding against listing altogether. Now, this is interesting because this is not delisting. This is just the dogs that don't bark. As I always say, you can't hear the dogs that don't bark. The dog not barking is the seller who just doesn't list their home at all. Okay, I'll give you an example. My mother's home, she. She sent me a message yesterday saying, and I won't say who it is right now, but it's a very famous person that you have seen in many movies and has a great voice. Okay, he's pretty awesome. Anyway, he is coming to look at her house. Her house is not for sale. But she kind of talked to some agents over the years and said, hey, I'll sell my house if I get the right price price. Now, my mom has a beautiful trophy house. It is literally the best home in the neighborhood, which, by the way, is not the home you ever want to own or buy unless you're just willing to, you know, light some money on fire because you usually won't get your money back for that. My mom has. For all her flaws, she's probably listening. My mom has very good taste. She is very good at interior design and architecture. She's never had any formal training in this, but she just likes it. And she's just a really good designer. She has really good taste in high quality everything. She built a gorgeous custom home for herself. Okay, Now a very famous person is coming to look at it and see if he wants to buy it. You know, we might reveal who that is if the deal goes through or something. Anyway, it's kind of interesting, but that's an example of the person who didn't list their home. Right. Note that many prospective sellers are deciding against listing altogether rather than putting Their home on the market and then pulling it off. Well, you know, kind of if they don't get their price. New listings in U.S. homes for sale are stagnant with many would be sellers taking note of tepid demand and just staying put. They're just kicking back and relaxing. They've got the world at their feet, no urgency. Their deal is so good, their mortgage is so cheap or their house is free and clear. Almost 25% of the homes mortgage rate at or below 3%. Almost 65% of the homes mortgage rate at or below 4% for their existing home. And what's the dog that's not barking? What I didn't tell you in those stats, 42% of the country has no mortgage at all. Like my mom and I have told her to refinance her property, pull the equity out and do something with it, but she just doesn't care. So there you go. Okay, let's talk about some other stuff. Money supply. Money supply. How much money is out there? Well, this is the M2 money supply and it has just hit a a new all time high of $22.3 trillion.

Now. Compared to what? Well, when you talk about numbers like this, you have to compare it to inflation, right? You have to adjust it for inflation. And so far as I know, this is not inflation adjusted. But it is still, even if it were, and it may be, but the chart does not say that. So I really don't know. Even if it were inflation adjusted, this is still a major high number. So what does that mean? It means that there's an awful lot of cash starting to float around in the world. More than the past few years and even more than the COVID era. What does that mean to you, my humble but either very rich or soon to be rich real estate investor? Well, what it means is there's a lot of money chasing a limited supply of assets. And I know the market's been boring, I know it's been muted, I know it's been just kind of stagnant, low activity. Only about 4 million home sales per year for the last few years. Whereas you know, we'd like to see about 6 million. But let me tell you something, the freight train is coming and all the data points that way. All the doomers have just been wrong, wrong, wrong and wrong again.

And they are going to continue to be wrong because there's a lot of money floating around and there is a limited supply of assets. So that's an all time high in money supply and it's going to Chase your properties or any properties out there on the market. Okay, so here is the money supply in terms of percentage change right? Now this is not the aggregate amount, but this is a percentage change over time. So we go way back to like January of 1960, okay? And we saw some pumping some money into the economy, right? And then we go into the 90s or there was recessionary time. I'm skipping a lot of years here obviously for time's sake. But we saw the money supply percentage change dip very low. And the lowest time in this entire chart, in this entire number of years from January 1960 to October of this year, the lowest time is the time we're just coming out of the post Covid era. Covid. We saw the percent change of 26.7%. I mean, they pumped so much frickin money into the economy, it was absolutely crazy. We were all there for it, we've been talking about it. And then they just tightened everything up. And when I say they, who do? I mean? Well, credit banks, central banks, government, all the sort of suppliers of money, right, that injected into the system or take it out of the system. So that's why activity in the real estate market has been so low and the market has been so boring. But guess what, this has radically changed. It's now up 4.6%, whereas it was down below the zero line for the last three years. It was down 4.7%. So the delta between negative 4.7 and positive 4.6 is very, very significant. And you are going to start to see this flow into the real estate market and other assets, to be fair, not just real estate. And they're pumping the printer again, okay? They are pumping the money supply. Now they don't just print, and that's even a metaphor because they're not really printing. It's digital money anyway. But they create money through quantitative easing. Okay? Anyway, we won't get into that. We've discussed it a million times over the last 21 years as to how the money supply works and how money is lent into existence. And it's a whole head game. It's really crazy. I mean, it's a very creative system to put it that way. But the money supply is starting to come loose and it is going to be chasing deals. So what does the smart investor do? They get in before it all hits the assets, before it all starts attacking the assets. They do it during the holidays when nobody's paying attention. They do it before that money hits the system. Remember the Cantillon effect? Okay, what Was it Richard Cantelon from 250 years ago, that economist? And they named this whole idea after, after him, right? When the money supply loosens, the people closest to that loosening. In other words, all the Wall street banksters and the banksters in general and the people in government, the people closest to the money printer make the most money, right? The people that act before, the people that skate to where the puck is going. As Wayne Gretzky, the famous hockey star, said, skate to where the puck is going, not where it is. You got to skate to where it's going. And that's exactly what you should be doing now is getting to where the puck is going. Because we can all see where it's going. It's right here on the chart. Okay, let's talk about something else. Look, you know, there are a few of my famous sayings that I really want you to remember and live by. Invest in places that make sense so you can afford to live in places that don't make sense. Many sayings, right? You know, I've got many sayings, right? But I really want you to augur this one that I've been saying most recently into your head, okay? Remember this, Live by it. And here it is. Nobody ever got rich investing in a syndication or fund. Nobody ever got rich doing that, except the person who set up the deal. They're at the top of the food chain. You're at the bottom of the food chain when you are not a direct investor. Nobody ever got rich investing in a syndication. Nobody ever got rich investing in a fund, okay? Now granted, they might have gotten a little return on their investment. You know, if they're just trying to preserve wealth and not grow wealth, you know, that's okay. You know, everybody has the right to do as Dave Ramsey says and love, hate relationship with Dave Ramsey, of course. But everybody has the right to kind of downshift and put it into neutral at some point in their life when they've already made it. Remember, focus creates wealth. Diversification perpetuates wealth. So it just depends where you are if you want to grow. You've got to concentrate. You've got to focus. You've got to be a direct investor. You are never, ever going to create a whole bunch of wealth as an investor in someone else's plot or scheme or plan or syndication or fund or stock. Remember, when a company goes public, that is the exit strategy for the insiders. It is not your make money strategy. It's them dumping their toxic crap on the market. Now granted, you know Obviously some stocks go through the roof long after they go public. Right? There are always, you know, phases and cycles in every business and so forth. We know that. But the people that really cashed out were the founders, okay, the insiders, the people that got there early. The Cantillon Effect. Same idea there. So this is from the Wall Street Journal. I just saw it this morning inside Marriott's disastrous bet on short term rental company Sonder. Now this is a company that provides short term apartment style rentals but manages them like a hotel, or I should say did because they went bankrupt. Investment added rooms for hotel chain but apartment rental firm collapse under high cost leases. Everything kind of went straight downhill. Marriott says. Now I looked at their stock charts and it is just, it's so painful to look at. I'll give you another example. One of our local market specialists that we basically made rich, we put them on the map many years ago. A company called Caliber here in Arizona. Chris Loeffler, or really John Loeffler is his real name. Some of you know them if you've been following my work for a long time, some of you may have purchased properties through them. And after a while, we just didn't like that relationship because they just didn't seem to care about the customer. They didn't seem to care about quality or doing the right thing. And we just got so many complaints. Well, they actually went public now. I think they did it by reversing into a shell. Okay. And their stock is like it's junk, like it is totally plummeted. I was looking at their stock chart and it is awful. Can you imagine if you would have invested in that thing? You would have lost your shirt. Same with Sonder, same with all of these deals. Remember, the public offering is their exit strategy for the people in the know, the insiders. And we tend to think of it as our opportunity. It's usually not. Okay, I want you to make sure you join us on our masterclass coming up. Okay? Just what are we, about two weeks away? Go to jasonhartman.com Wednesday this is going to be one of the most important masterclasses you will ever attend because a lot of stuff has changed with business credit and this is a phenomenal opportunity. We have new home builders that you can buy properties from right now. Contact your investment counselor, go to Jason hartman.com and click on the Properties page where you can get giant cash discounts. Now, I would never recommend paying cash for a property unless you can get a giant discount. And then you just do a delayed Purchase loan, it's not even a refinance, it's just a delayed purchase loan. So you get the same terms as you would on a purchase. We can help you set this up. We know the best lenders that offer this. And you can buy cash using business credit. Okay, now when I say business, of course some of you, many of you own your own businesses like I do, right? But you don't have to own your own business because your real estate investing portfolio, portfolio is a business. So make sure you're thinking of it as a business. The financing options, you know, typically you have hard money loans. I'm a hard money lender. I have been for many, many years. Short term loans, very high, very expensive, but you know, it's worth it if you're flipping a house and you need that money, right? And I loan it to those people. DSCR loans, much better rates but higher than typical. You know, Fannie Mae, Freddie Mac agency loans. You can get a HELOC, an SBA loan, but this is zero percent. Now on the screen it says up to 18 months. But I literally just talked to our partner about this yesterday and they recently got one of our people 22 months, 0% interest. Now if you know how to use this properly and not fall into the debt cycle, you can use other people's money, OPM to literally make a fortune. I mean, this is so incredible. It doesn't even show up on your credit report because it is business credit. Okay? Now if you default it shows up, but if you don't default, it does not show up. So it doesn't affect your qualifying for other loans. It is truly a phenomenal opportunity. We've been working with our partner here for about six years or so and many, many of our clients have done this program. They make it quite easy. It's pretty incredible. It's fast. It's 14 to 21 days. You don't need any collateral. It's zero percent interest. It's revolving credit versus traditional loans, which of course we use those right, for the long term financing. Other people's money is always the thing you want to do. But a lot of paperwork, of course you're using collateral. High interest, it's not very high if it's long term fixed rate, but you know, that's around what, six and a quarter now it's come down. But a lot of them are much higher rates than that. Let me give you some examples. Okay, Here is a not so well qualified client, okay? And they had a 680 credit score, not great. I mean, you know, it's not the worst, but it's not certainly not great, right? You want to be over 720 in that category. They got $95,700 funded at zero percent. Okay? Zero percent funding. This is phenomenal. It came in three different tranches starting in November of last year. Then another tranche. And this is a low qualified client. I'm going to show you what most of you are. A high qualified client. It's way better. And then a bunch in June and then a bunch in October. Okay, adding up to $95,700 here is a little bit better. This is a 690 credit score. $144,700 funded. By the way, you want to join us for this? This masterclass is totally free. Jason hartman.com Wednesday and then here is a client with a really good credit score. 770, $240,600 funded. This again was in three tranches, okay? And they got a quarter of a million dollars, zero interest. Now these interest free periods are staggered. So the first tranche they might get 18 to 20 months, for example, and then the next tranche, you know, that's on a different time frame. So this person gets almost a quarter of a million dollars in interest free credit. Now here is the best example of all. This is an 800 credit score. So that's a very good credit score, right? $351,700 in three tranches. $352,000 basically here, folks. Okay? And this program, they make it so easy. We've been working with this partner a long time. They're great. And the rules have changed. They've gotten more desirable. Look, the money supply is loosening. I just went over that. And you should take advantage of this because like you could just literally buy a $352,000 house cash, get a giant builder discount of maybe 30 to $50,000, okay, versus the non cash price. And then you can simply do a delayed purchase loan. You can pay all of this off and use this revolving line later. It's just so convenient. You must have credit lines like this available that don't show up on your personal credit, that are business credit lines. So check this out. Jasonhartman.com Wednesday this is going to be a great way to finish off the year and make your goals for next year come true. It's just a phenomenal program. So. Jason hartman.com Wednesday again for our American listeners and viewers, happy Thanksgiving. And until we see you next time, happy investing.

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