It's Producer's Birthday! Real Estate Current Events

What's up, you guys? Welcome back to the podcast, the New and Experienced Investor Podcast, the real estate podcast that brings investors from all walks of life together.

I don't know how to play an instrument or else I'd be guitar.

That's okay.

Or something.

That's okay.

Whatever. Yeah, that's fine.

The snap just works. It's a little jingle I've been working on. But I'm one of your hosts. I'm Alex Burnett. I'm the new guy.

And I'm Joe Homs. I'm the experienced guy.

Yes.

And we're back here with another week. It's kind of fun because we don't have a guest here, only because it's producer's birthday.

Ooh, happy birthday.

That's right.

Birthday, birthday week, birthday month.

Birthday's turning in. It's each day goes by.

Each day, yeah.

It's just Building on itself.

Different people celebrate it.

Yeah. So yeah, we're gonna be gone for 3 months is what I'm trying to say.

Not 3 months.

Yeah, so got some fun stuff planned. Um, we're gonna keep it a secret for now and then we'll talk about it next week.

Nice.

Yeah.

So he said something earlier about Hawaii.

Maybe we will be gone for 3 months. I don't know. Wow.

Let's not go that far. Uh, we need these properties to close first, but, uh, my, uh, headset sounds different now. Oh, she's messing with it real time.

Oh yeah, something happened. Yeah, that's okay.

Yeah, that one's mine.

Whoop.

Oh, here she goes.

Yeah, that's— yeah, that's better.

And mine's gone.

Uh-oh.

Yep.

Oh yeah, it's, it's all good. There we go. It was working perfectly.

It's okay.

It's a work day. Sorry, I couldn't reach some of those buttons.

No wrong that you can do.

Nope, nope, nope. And get away with it.

I like this. Okay.

But, uh, before we jump into the regular scheduled show, let's talk about our meetup. Finally confirmed.

June 24th. Hangar 24 on June 24th. Hangar 24th in the Quad. Uh, please order some food or drink. And get your parking ticket validated. If not, it costs you $100 to get out of the parking lot.

Yep.

Just kidding. But, you know, still worth it. It's $20, I think.

I don't know. I've never paid.

Well, yeah, because you get it validated. But yeah, I've had people call me later, Joe, I had to pay $20 to get out. Well, I keep telling people, validate it. I even do that at the meetup.

I know.

It's like, hello, too many ideas. Order something and get it validated.

I know, they'll figure it out.

Yeah, so we're having a special guest and he's going to talk about novations.

Yeah, Trevor Ahing. So yeah, he's like the novation guy out here in Southern California. He's a veteran, um, and he found a way to basically partner up with the seller to possibly get them, you know, a little bit more money rather than just the typical Cash offer, so it'll be it'll be pretty interesting because he kind of focuses on working with wholesalers as well to bring dead leads. You know, maybe the cash offer didn't work, so he can show you how to restructure it to where you can get a get closer to the price maybe that they're looking for by partnering up with them through innovation.

That'll be very interesting.

That'll be cool.

And he's coming on the podcast next week, the week before or two weeks before?

Two weeks before.

Okay. Thirteenth. Yeah.

We got him on the 13th, and then we got John Shefsky back on, uh, June 20th.

Who's John?

He's a comedian from LA.

Oh yeah, yeah, yeah.

Real estate guy.

I remember him.

Yep.

Yeah.

Yeah.

So yeah, I'm still waiting for him to join, uh, Pelago.

Yeah.

He's still with some other—

We won't even speak of their name.

You know, broker.

Yeah, he's off in the— he's out in the desert.

That's true. He's out there.

Yeah, weird, weird stuff. The heat, yeah, gets to your brain. Yeah, but that's okay.

Yeah, make sure it's funny though.

Yeah, it makes for a good guest. Yeah, so that's who we got coming up, so make sure you keep it locked right here, 4 PM every Thursday.

Got it.

But anyway, um, yeah, we're kind of like free— um, I don't want to say freewheeling. Thank you.

Freewheeling.

So, um, let's go ahead and just jump into our first topic here, and maybe producer can let us know what it is because I put them all together and I forgot already.

We go into videos already?

No, we can do— well, we can do, um, their first— I think the first one is an article.

Um, okay, the first one I got is a YouTube, but, um, you want article.

At the very top. Ah, here we go.

Oh, she's at the bottom. Yeah, now she's back up to where we're at.

Okay.

Okay. Freddy and Fanny and the Coming Nightmare on Main Street.

Yeah, so this was sent to us by producer's mom. Um, they'll send us random Wall Street Journal articles about, I don't know, this and that, but—

My mom sends a lot of doom and gloom, so yeah.

But this is kind of detailing how, um, how Freddie and Fannie actually grew after 2008, and now they're getting back into offering social-based loans for like indigenous people and low income and all that kind of stuff.

Really?

Yeah. So, um, it's kind of—

Indigenous people? Well, Well, you have to live in a reservation or something?

Or just, you know, like ethnic. So yeah, but I don't— but that's kind of the government-sponsored mortgage companies are growing larger and riskier in service of social policy.

Ah, yeah, the DEI stuff.

Yes, the DEI stuff. So now they're creating certain— if you can scroll up, if certain loans that target that. And, um, I'm not logged in. Well, no, I— you should be able to refresh and it should, it should, uh, get you in there.

That's okay. I think we have the gist.

Yeah, we got the gist. But anywho, it's kind of the thing that you were talking about when they start making different loans.

Warm body loans? Is that where they're headed?

Kind of. Oh, here we go.

Yeah.

Yeah. So—

I did hear something about this the other day, that there was a bank that was just going to start offering 100% financing again.

Woo-hoo!

Yeah. And they raised the maximum dollar amount of single-family mortgage loans. So now it's up to $1.15 million. But anywho, they're just saying that they're growing bigger even though that, you know, these people may end up defaulting. And since it's government-backed, they don't care. And it's kind of—

Of course not. You know, the taxpayers end up picking up the tab at the end of the day.

I know, it's kind of crazy. So how do we— how do we rein it in? How do they— how do we stop them?

I don't know. I, I thought where you were headed was with this was the NAR lawsuit and, you know, that agents aren't gonna necessarily be paid a commission for representing a buyer. So they're kind of shifting that over to the mortgage companies. Freddie Mac and all these are the ones that buy all these things. And so they have to change their rules, laws, whatever, to allow the buyer at this point to pay for the buyer's agent's commissions.

Oh.

So that's where I thought you were headed. I didn't know this was mostly like specific groups, DEI stuff.

Well, I've just, that's just what the article was. But yeah, that is kind of interesting.

So they're picking winners and losers is what kind of I get out of this. It's like, if you fall into this group, then yeah, we're gonna accommodate you.

Right. Yeah.

Even, I mean, even loosen our credit standards and all that stuff, which is problematic.

Okay.

That's what happened in 2008. They were just giving out warm body loans and you remember what happened there?

Mm-hmm. Yeah.

Which is fine with me if it goes down that direction.

I know. I mean, well, and that's the thing. It's like all this stuff happens, but it never makes a crash anymore.

No, I know. Isn't that strange?

Yeah.

Yeah. I mean, I think if they lower the interest rate, the Fed lowers the interest rates, the property values are going to go up. They're going to shoot through the roof more than they are now. It's like, it's hard to even buy a house now.

Yeah. You know, that's what they say.

Tell me about it.

There's ways around it though. People are doing it every day.

So Yeah, but I don't know, not the masses, which is what the government is supposed to do. These companies are supposed to take care of the masses. Yeah, you know, yes, there's creative financing, seller financing, all that stuff, but this is, this is more for the masses.

Yeah, it's mom and pop. It says the primary goal of the proposal, the government says, is to create a cheaper version of the cash-out refinance. In other words, to allow consumers to pump more borrowed money into the economy At a time of persistent inflation, some estimate the proposal could add another trillion to consumer spending.

Who?

And what does that do to inflation? Makes it worse.

Yeah, it's ATM machine all over again.

That's crazy. You know, honestly, that's just nuts.

Nightmare on Main Street.

What they're trying to do.

Yeah, nightmare on Main Street. But if you hold on to property, it's like you can kind of ride the inflation out.

So inflation's good.

Yeah.

If you own a property, inflation's bad if you don't own anything.

Yeah.

I think if you have a fixed rate, even if it comes down, your equity, if you're still cash flowing, you're fine.

Yeah.

You just ride it out.

Yeah.

But I think in 2008, a lot of people had this adjustable stuff. So interest rates shot up. Now they're like, oh, it's not cash flowing anymore. I'm negative.

Unemployment.

Unemployment.

Yeah, there's different things that happened back then. Unemployment was a big one. Yeah. You don't have a job, how are you supposed to make your mortgage payment?

It doesn't matter if your rate's adjustable or not.

Right. And it doesn't, it doesn't matter if they went from 10% down to 1%. If you don't have a job, you can't make your mortgage payment, you know. So that's why loan modifications didn't work.

Right.

Right.

You know, they could be really nice, which they never were, but they could be— the banks— really nice, lower it from 10 to 1, but still you can't make the payment because you don't have a job.

True.

Yeah, that makes it tough.

Uh, what do you guys think about this? Is it a good thing? Is it a bad thing? Let us know in the comments down below.

Appreciate it.

I'm making it more interactive.

Yeah.

Good job.

Thank you. What do we got next?

Take a look here. Why have people stopped moving to Florida? Oh, hold on, hold on, hold on. I got it. Here, let me, uh, restart this real quick.

This is an interesting one, only because—

Technical difficulties.

We got to talk about a big problem in Florida right now, everyone. That's the fact that people have stopped moving to Florida. Way fewer people are now moving into the state, which is a big change of pace in 2024 and beyond, because only a year ago, 370,000 people moved to Florida. It was the number one migration state in America in 2022 and 2023. But that is no longer the case, everyone. People have started to leave this state. It's become too expensive. The real estate market here, it's hit a huge downturn. The inventory of homes for sale is spiking. In particular, the apartment vacancy rate here in Orlando, where I am right now, has tripled over the last 2 years because the cost of living here is just way too high, everyone. The typical rent in Orlando for an apartment is around $2,000 a month, while the price of some of these houses behind me, these new builds, is around $600,000 to $700,000. And retirees, local Florida residents, no one can So make sure to watch those migration trends in Florida in coming years. Head to www.reventure.app to see migration figures for every county and state in America so you can see the areas that people are moving to most.

Interesting.

Well, we sent everybody from California there to Florida, right?

You know, and that was a— it was sort of a backlash.

Yeah, that's the reason that the prices went up.

Makes sense, you know. Yeah.

So, and then they got there and the mosquitoes got them and they said, yeah, this is not for me.

They realized.

It's hot.

It's different.

Muggy. You know, it's not like the desert. They call it the dry heat in the desert. Yeah, but it's different.

Yeah.

I mean, I think the government is 100 times better than here. But yeah, when you send a lot of people in and they need to have housing and stuff, It drives the prices up.

Absolutely.

So if they're moving out, and I saw this clip the other day, but he doesn't say where they're moving to. If they're moving out, where are they going? Yeah. Are they coming back here or where are they going? I don't know. Are they moving into, uh, Trump Tower in New York?

Let's hope. Let's all pray.

I don't know. Where are they going?

I have no idea. But it was kind of interesting how like Texas was a big one. Florida was a big one. And now, as far as rentals go or buying out of state, those are becoming like not that good of a market because the prices went up.

Yeah.

Florida has the insurance problem, and then Texas has—

We do too.

Yeah, we do too.

Yeah.

And Texas has the state or the property tax problem. Their property taxes is insane.

Oh, in Texas?

Yeah.

Yeah, that's because they don't have any normal taxes. Yeah, but if they're taxes, if you're an investor, they have to get it someplace.

Well, don't do it with the houses.

Well, that's because you like houses, but yeah, you know, if you're a renter over there, you don't really care. True.

Could just— yeah, they don't have, uh, what about just sales tax?

How much is he saying normal rent is over there?

$2,000.

He didn't say for how big of a Apartment though.

Yeah, he just said that.

Yeah, but $2,000 is—

I mean, I think the average rent around here is what, $400 for a like 2-bedroom? Well, I'd say you could probably get like a 3-bedroom apartment for around $400. Um, if the— if it's like a single-family house, it's gonna be like $500.

Yeah.

Yeah, that's cool.

Around here, like, 2 is a steal for A nice studio or a small, like, one-bedroom.

That's a good price.

In the ghetto?

In the ghetto.

Where are you gonna get something for 2?

Hey, we're giving up, we're giving up our, like, 10-year rent, $1,600 by the beach, finally moving out. But—

How much do you think he's gonna raise it up to?

The new, the new apartments we've seen go from— they're probably about, like, $1,950.

Okay.

So yeah, but you, you were in a studio.

Yeah, studio.

A very large studio.

Very large studio.

Yeah.

Yeah. It's like you could—

it was 400 sprawling square feet.

Yeah.

You can be in the living room and then touch her in the kitchen and say, here, can I have my food?

Pretty much.

And then you're like, hold on, let me jump into bed.

And you just jump over.

Yeah.

Hey, just move over.

We had a full bathroom and a full kitchen. None of this hot plate nonsense.

Okay, so.

Oh, that was nice.

Yeah.

Yeah.

Did she cook?

Yeah, she does.

Yeah. Nice.

I made fish tacos the other night.

Yeah, it was good. Alaskan cod fish tacos.

Yeah.

Okay, well, I guess don't— the moral of the story is don't move to Florida, right?

I guess, unless you're— yeah, I mean, I mean, it's probably the type of thing where it's just all relative if you've lived there your whole life.

Or if you're an investor and you think You know, contrary any other way, if everybody's moving out, prices are going down.

Perfect time.

This is a jump-in point where, you know, you can buy a second home.

Yeah, absolutely.

Vacation home.

Yeah.

Airbnb it.

Yeah.

Whatever.

Because all these trends are mostly, you know, primary residences, I'm sure.

Yeah.

That's a good point. Joe thinks like an investor.

Who knows?

All right. What do you guys think is going to happen to the real estate market in 2024?

I think it's going to happen with interest rates.

I was just having this talk with Zuber, Michael Zuber. He thinks they're going up, and I believe him.

I asked Matt or Meet Kevin yesterday. He was here.

What did he say?

He said he thinks they're going to be stable.

You know, Zuber saying they're going to go up a little bit, and then we're going to have what's called stagflation. And stagflation is where Unemployment is through the roof, right? Opportunity is down. Unemployment shoots up. Inflation shoots up, right? And now we have a major problem. So what Michael Zuber is talking about is a thing called stagflation. And I think that's what's going to happen. And that's scary. We're going to see demand for housing and demands for jobs drop, and we're going to see inflation rise. So if we think we can't afford things now, or, you know, most people can't afford things now, it's going to get really bad.

What do you think's gonna happen with interest rates?

Stagflation was already a thing that they were pushing. Yeah, remember that? Yeah, to say that it wasn't inflation.

Yeah, that kind of happened in the '70s.

Is it gonna go up again, you think? We're gonna have another rise in interest rates?

I don't think so. I think if anything, we're gonna hold steady. I mean, if, if inflation numbers start ticking up, then Yeah, they're gonna have to. You know, I don't, I don't know that we're gonna go into stagflation because, um, the employment market is really good. You know, it's like, what is it, 3, 4%, somewhere around there?

If you believe those numbers.

Yeah, I thought something—

I believe everything the government says, don't you?

I thought something came out recently that they were fudging the numbers on this.

Of course.

No, they're not fudging them.

Oh, come on.

Don't you believe the government?

Yeah, they do have our best interests at heart.

Statistics, um, you can make it tell whatever story you want, but I'm sure, yeah, that'd be fine.

You know, figures don't lie, but liars figure.

Oh, nice. I like that.

Yeah.

That's good.

I think I stole that someplace. I don't remember where, but It's not something I made up.

Yeah. Well, you can claim it as your own because it's new to me.

I don't know. I don't foresee this. And, you know, not to get political here, but if we change regimes here, I think it'll start to turn back around. Yeah, I think things will get better if we continue with The sleepy guy, then we're gonna have major problems.

I know, right? There's no way.

But that's not political, by the way.

Yeah, it's not political, that's just facts.

Yeah.

Yeah, that's gonna be interesting. I mean, yeah, like you said, the job— you can get a job today, it's just people were not wanting to work. That's different.

That's Gen Z. Yeah, you know, it's like, I don't want to work.

Yeah.

Okay, I want to make YouTube videos. Yeah, which is fun, but yeah, you got to get out there in the workforce, people.

You gotta earn a living somehow.

I know. Well, we'll see. Only time will tell. And we do have the, uh, election coming up, so it'll be interesting to see what they start— what strings they start pulling on. I never really paid attention to that stuff before.

Until you hung around me.

Yeah, yeah. Oh, this will be my first election in real estate, so it'll be interesting. To see.

You haven't voted?

No, in realist, like, my first, like, paying attention to all that stuff.

Yeah, you've, you've turned from a Democrat to a Republican now because you're making money.

And I'm a God-fearing man that believes in the Second Amendment.

Oh, okay, got it.

So yeah, but still, I still like reggae music, so Whatever that puts me in.

Well, politics aside, maybe we should jump to like a conspiracy now.

Okay. I like conspiracies.

Time traveler caught in an Airbnb.

This is my buddy's Airbnb. He caught a time traveler on his Ring camera.

Really?

And it like blew up on the internet.

Seriously?

Yeah.

Was it Elon?

No, no, no. Because I don't know who else.

I think Elon's a time traveler.

I've heard a lot about this. I haven't watched it yet. So here we go. It's just a portion of the long video.

Damn, like, what is he looking for? Like, he's being super mysterious, and then he goes into the shed. So he's wandering around, then goes into the shed and closes the door there. So just for reference, this is what my backyard looks like. It is an Airbnb. I live 5 hours away. I can't go there and give you guys a tour of the shed, but I will be there in about a week, so I will do it then. But there's no windows, there's only one door, and the door latches on the outside. So there's only one way to keep the door closed. So a lot of people were commenting saying, you know, the door opened again, why is the door moving? And that's because the wind is moving the door, and it's been very windy in Florida. Let me know what you think he was doing because he was looking pretty sus wandering around like that.

A lot of people— So that was part 2 where I showed the same guy. And now a lot of people were still hesitant at this part because they're like, oh, you probably just missed it on the camera. You probably just missed him leaving on the camera. You know, just to let you know, I was live watching it. As soon as I watch my camera live, have a lot— I've had a lot of incidences at my house. I was live watching him. I was talking to him on the camera. I'm like, bro, what are you doing in my shed? Get out of my shed. Get out of my shed. I see you in my shed.

And then he wouldn't leave.

So that's when I called the cops and the cops went in. So that's just a quick little background. And yeah, he never left. And the cops came. I don't know what happened there. It is what it is. Okay, so this part 3 one is kind of like a joke one because a lot of people were saying that the guy looks like me. The guy. So this is part 3. It's a quick little one. It's like funny. It's like a joke.

A lot of people have been commenting saying that this guy looks like me and like, bro, you guys need to chill. Like, bro, come on. Come on, I don't see the resemblance.

Yeah, no, I don't either. Come on, bro, there's no resemblance between us, dude.

But wait till this guy walks out.

I put on the same white shirt in a backpack and I made my smile like that, like he was doing. That was just a joke. That was just a joke. But, um, yeah, let's go to part 4. Part 4 is the one that got, you know, probably 10 million plus views. So let's go to that one.

I have an update regarding the time traveler that went into my shed and disappeared, and this is gonna blow a lot of people's minds. It's not even sure this is real. And if you're still denying that this is real at this point, this is gonna change your mind. So just a quick recap, this guy walks around my backyard, goes to my shed, opens the door, goes inside, and disappears. Called the cops, the cops came, they went in the shed twice, he wasn't in there. They looked, I looked like in Same guy. The cops are like, what is this guy smoking? And you can see he never came back until the next day, right here. Notification on my camera that there's somebody in my backyard, and this guy leaves my shed, and he looks right at the camera too.

Yeah.

That guy left my shed. But here's the craziest part. This looks like the same guy, maybe glasses, whatever. Let's look at the other guy. This was the other guy. He noticeably aged. Looks like the same guy, but aged. So him again, and now him. Same facial features, whiter hair. So I don't even know what to think at this point. Somebody explain this.

Right?

He literally left the same shed. You saw the camera I put before. There was no movement that whole night. Then the next day, this guy leaves the shed, looks right at the camera like he knows, and he looks noticeably older. I don't know. Something's going on. Somebody explain what's going on in my shed. Be going there in about a week to give a tour since a lot of people are asking.

Yeah, yeah, yeah.

But so oh my God!

That's pretty nuts.

That is strange, right? Okay. So why does a young man go into a shed?

Mm-hmm.

And then come back as an old man.

Yeah. So, here—

That doesn't make sense to me. Why would a young man go into a shed? You know, let's say he's a time traveler.

Yeah, he goes into the future.

In the future?

I think so. Is that how it works?

Well, that's what I'm trying to figure out. If he goes into the future, you know, does he age? I don't think he ages. Why does he Why does he come back as an old guy?

I'm not sure exactly how it works. Yeah, because if you came back to the same point, you'd be the same age.

You'd be the same person coming back.

Not sure.

So who's— unless—

because who's coming back?

I'm trying to remember.

I don't understand this at all.

I don't understand the references to Back to the Future, but—

But like, what about like Interstellar and stuff? So maybe when you go, it's like 50 years pass and then you come back. Because there's like those movies where people go to space and they've only been gone a year, but everyone on Earth, it's been like 100 years or something. Yeah, but that would make everybody here old, not him.

He would still be the same.

Yeah, I don't know.

Right?

Yeah, I'm not sure.

It's very weird.

The only, the only, the weird part is— so everyone—

Let's, let's call Captain Kirk.

Okay.

And find out.

Exactly.

We'll get him on it.

Yeah.

William Shatner.

William Shatner will know.

Strange and unexplained things.

Right.

Yeah, we can make a full On movie or episode about this.

Exactly. It's like, it's interesting.

This is, this is a time travel box.

Well, and then people, what they did is they took that picture of him, like when he looks into the ring, and they Google image search it, and it's a guy who— it, it comes up with the one guy has the same features who studies time travel.

Seriously? Oh, come on.

And he's been dead since 2018.

Freaking—

what if, what if he like—

I don't make it up, I'm just saying.

What if he went into the past or future to like his young self to rescue like his old self and they like trade places or something? Maybe that's what it is.

There you go.

Maybe it's like a time travel experiment gone wrong and he like goes to save himself or something.

Yeah.

And that's why he's 2 different ages.

I watched a Bruce Willis movie the other day and I forgot the name of it where he's a young Bruce Willis Oh, they're sending people back. Yeah, from the future.

It's not like Jumper, it's something like that. Uh, yeah, something like that.

Um, anyway, so they shoot, they shoot him, they kill him. Okay, and then he gets sent back. Bruce gets sent back to the young, but Bruce is old.

There you go. Yeah, exactly. That solved it.

No, I don't think so.

Whatever the plot of that movie is, that's Bruce Willis.

Yeah.

So I don't know.

Looper.

Looper. That's the name of the movie.

Looper. That was a good movie. I watched it.

This is either a real conspiracy or your friend is a genius marketer for his Airbnb because I guarantee his vacancy is—

Would you like to go there and spend a night with Mr. Looper coming back?

I wouldn't personally, but I'm sure there's a market for that. People are about weird stuff. So I'm sure Someone saw that and was like, I'm booking this Airbnb. I'm getting to the bottom of this.

Yeah.

Yeah.

And go into the shed.

The shed and spend the night in the shed.

I don't think you're going to have very many, not to be sexist, but I don't think you have very many women do that.

Oh no.

Women love that stuff.

Women love it.

Oh, come on.

Yeah.

They'll stay in haunted places. Goth women. Goth women.

Yeah.

For sure.

Thank you. Goth women. No, there's ghost hunters and stuff.

Yeah, there's something for everybody.

Michaela, would you stay in a haunted Airbnb?

These girls aren't ghost hunters.

See, she says no.

You're asking the wrong type of girls.

Go to Santa Ana with the girl wearing all black and ask her, and she'd be like, of course.

And what'd she say, like, yeah, $10 or $20 for—

yeah, no.

Where are you guys going with this?

Yeah, like, no, just Yeah, no, but yeah, okay, it's interesting.

I, I hope, I hope he does do a lot of Airbnb business from this, you know. I, I do.

He definitely does. Yeah, he got a lot of, got a lot of, uh, views from that. But that was interesting.

Yeah, well, I hadn't watched it, so I was sucked in.

Yeah, he, you know, he will.

And then I look today, he's gone to the shed and like, you know, if you want to do a full-blown investigation of this You go and start door knocking all the houses around there to see if he got caught on another Ring camera. Right. Okay. To find out like if this guy live here, is he just walking by? Yeah. You know what's going on?

I'm sure it's somewhere in the comments of his other videos. That's amazing because yeah, brought a lot of attention.

Okay.

But yeah, funny, funny stuff.

What do we got next? Well, that was a fun one. Why is subject to?

Illegal.

Been misinterpreted a lot. So in your deed of trust will be a clause that says if you transfer the deed to somebody else without paying the loan off, the lender can call the note due. That's all it says though. It says if they want to, they can call it due. You've given them a new right, but you hear things like that violates the due-on-sale clause, makes it sound illegal. Doesn't violate the due-on-sale clause. You've given the lender a new right. There's nothing to violate.

You've done it.

The lender says, okay, now we can call the note due if we want. Want to. They never do, or rarely do, I should say. But you've given them that right, so be it.

Why do people think so? Whoa, true.

All of that true. I like that guy.

Yeah, he explains it well. Because you got to get— I've had a lawyer tell me subject to is illegal.

Well, yeah, because they don't know.

Yeah, but he's a lawyer, he has to know.

No, he doesn't.

He was a free lawyer.

Yeah, yeah, I know.

But yeah, you've given them a new right. That's what I should have said.

That's it.

Yes.

Giving them a new right.

Yeah. Whether they exercise that right or not, which is what he's saying.

Yeah.

That's up to the bank.

Right.

And I'm telling you, as long as a bank is getting their payment every month, their mortgage payment, they're checking that box off and they're moving on to the next month. That's all they care about. If you stop making the payment, then they're going to look into it and find out that, oh, wait a second, something happened here. Who is this guy? You know?

Yeah.

And then maybe they can call the loan due. But even then, you know, they're probably on the phone to the original borrower. And the original borrower says, oh, I sold that place to Alex. Did he stop paying? He told me he promised he'd never stop paying. Did he stop paying? Yeah, he stopped paying. I'm gonna, I'm gonna call him right now to find out. Straighten this out. Alex, can you start paying again? Sure, not a problem. I was in Hawaii. It was producer's birthday and it just slipped my mind.

Yeah.

So we're back.

We're back. Don't say Hawaii too much. The expectation's going to be way too high.

I know. Yeah. The due-on-sale clause is like the biggest— it's the biggest boogeyman. And whenever you start talking to people about subject-to, they think it's pretty normal.

There's a lot of boogeymen out there. You know, it's just like, quit listening to the boogeyman and just move forward. Get the deal done. I know.

And and peep, there's ways to cure it. You know, there's way. There's plenty of ways to cure it. I see people in the sub two group that say, "Oh, I got the due on sale clause like called," so I'll let you guys know what I do. But no one's really freaking out anymore.

Yeah, good.

That's good. Good stuff. See if we can get through these other two.

Okay, we got two more foreclosure auction.

President owner of JJ Manning Auctioneers conducting the mortgages foreclosure auction. Sale here today. We, uh, are here on Thursday, May 11th at 2 PM on site to conduct this foreclosure auction. If you are a registered bidder in today's auction sale, you showed us proof of your ability to make that initial deposit. You got a number, 3-digit number in yellow. We'd ask that you use that number as your paddle today when you make your bids. Can't get the $5 million, Ware. How about cut in half? How about $2.5 million? And go. How about two and a half? Where can I get a two point five million dollar bid now? How about two and go? How about two and go now? Can I get a two million dollar bid where? One point five. One five is what I've got over here. I've got a one five bid and two is what I need.

That's from the bank, by the way.

And two is what I need. Next, I get a one five bid and two is what I'll take. Third and very last call. Sold million five to my right.

Is that how that works?

Pretty much.

Does the guy talk like that?

They don't like to go— yeah, they don't actually— a lot better than that.

Okay.

They don't like to go backwards.

Yeah, that was weird.

And they don't go from like $1.5 million to $2 million, you know, they're gonna go like $1.6 million.

Yeah.

You know, $1.7 million.

That's strange. Like, he was like, can I cut it in half? Could I cut it? Can I cut it in half? Can I get it to $2 million?

No. Yeah, that's That's pretty much it.

And he just raised you?

Yeah, just— yeah.

Okay.

And then like that guy, you know, he's like— I know he got frustrated. He said nobody's gonna buy this for $2.5 million. I'm just gonna throw out $1.5 million and see if he'll accept it. And apparently he did, you know, because a lot of times they have like a minimum.

Well, he was saying— he was like, that's the bank. That— does the bank bid on it?

Uh, To protect, to protect their money, yeah, they have to be the bidder of last resort.

Oh, okay.

Okay, so if they're owed $1.5 million, then that's what they bid. But if you come in $1.5 million and a penny, you get the property.

Oh, interesting. Yeah, it must have— they must have owed more than what it was worth. Is that how it sounds like?

Yeah, that sounds like it. Yeah, I mean, he— that's his job to try to get more than, you know, what the bank is owed. And obviously not even—

Well, and then who gets the difference? The old owner?

The old owner, yes.

If they look for it.

If they look for it, yes.

And then if they don't, what happens?

Uh, it stays in the trustee's bank account for 5 years, and then it goes to the state after that.

Oh my God.

Yeah, there's a whole little real estate industry, um, you know, that basically calls the owner of the property and says, hey, there's surplus funds that were left behind, like half a million dollars. I can show you how to get that surplus funds.

There you go.

But I want half of it.

Oh, really?

Yeah.

Oh yeah, yeah.

Wow. Yeah, that's a steep price.

Yeah, you want to give me $250,000 and I'll get you $250,000.

Oh my gosh.

And it's very easy to do. It's not something difficult, you know, literally a phone call to the trustee. Oh, I'm the previous owner. I want my money, my surplus money. Okay, send us these documents to prove who you are and we'll send it to you once we're done.

That's incredible.

Yeah.

I don't know if we're gonna make this last one. It's a minute until Joe's call.

Yeah, that's okay. We can wrap it up.

Yeah, I'm good.

Oh, okay.

Go again?

Go ahead.

All righty.

Hit the last one.

Trailer park that nobody knows, coming up next.

There is a big, big secret that most people don't know about trailer parks, and that is there is no attached property, which means the property taxes are low, low, low. Yes, a 30-unit, you know, apartment complex will have thousands and thousands of dollars in property tax. This one's probably less than A year? Yeah, it's incredible. Dude, I've got one single-family property in Atlanta, Georgia, where my property taxes are $28,000 a year. There is a big—

And I'm sure that's because the owner of that property who's leasing out all these lots purchased it years ago. And so like, if you're in California, let's say he purchased it for $200,000, right? Your property taxes are based on that. $200,000. Okay, 1% of $200,000, so he's paying $2,000 a year. Where if he decided to sell it today to you, right, and he can get $10 million for it, right, then that's a different story. Then the property taxes are going to go up, you know, because the people who are renting the space, yeah, they're just like normal renters. They're not, you know, paying property taxes.

Yeah.

The owner of that property is. Okay, again, it just depends.

That's interesting.

When you purchase it, at least here in California. Yeah, it may be different in other states, how they value their property taxes, you know. So I don't know, but in California, it's the purchase price, 1% of the purchase price. So, you know.

When he made it seem like because the property wasn't attached to the thing, then Yeah, but he's kind of referring there to the person who owns the mobile home.

Oh.

They're just renters.

Right.

They don't own the land underneath, which is what he's talking about. That landowner is only paying $2,000.

Yeah.

But he's leasing out his space to everybody else, but they don't pay any property taxes.

Right.

So, that's what he's talking about.

Okay.

Yeah.

Wow. Yeah, I've been looking into, uh, getting a mobile home park myself.

Okay.

I don't know nothing about it, but we'll figure it out.

Hawaii?

Oh, I don't think they have any there. I looked.

Hmm.

Maybe they do.

I don't—

I think they just have—

I feel like they should go this week and check it out.

Honestly, if I could, I would.

We're moving instead. Okay. That's where our Hawaii fund is going.

No, I'll get her there. The future generations depend on it, if you know what I mean.

Are we, uh, are we good? Because I've got a call.

Oh, he's got a call here. All right, you guys, this is real life real estate. We have actual calls we need to make. So we're gonna hop off here and, um, come back next week where Trevor Ahing is gonna come in. He's gonna do a little preview, talk about novations before the big meetup when you're gonna meet him in person. On June 24th. So appreciate you guys joining in. We'll see you next week.

See you next week. If you want some more advice on real estate investing, reach out to us one-on-one.