OCREIN Insider Shares 2025 Real Estate Market Predictions!

Now, if you can notice, there's like these blemishes on the TV, not on the actual presentation, okay? And the reason I'm pointing that out is because the next slide— I don't want you laughing, okay?

No laughing.

Yeah, I said no laughing. That's me. I grew up here in Orange County, started real estate in 1975. Broker, investor, mentor. He came up with that phrase. I'm regional broker for Pelago, founder of H&M Real Estate. I've done over 300, probably 400 flips since 1975. This meetup has been going on for 10 years now. This is the 10th year that it's been going on. Marcus started coming 5 years ago, and I know there's others that have been coming longer than that. We were at a pizza place 5 years ago, so we've, we've changed. Here's my contact information if you need my contact information. You can pretty much go to my website, joehoms.com, and get everything that you need there. Hopefully that's not hard to remember, JoeHoms.com. Just spell it correctly, okay? What we're going to cover today, and if you're one of those— what generation gets triggered by certain things nowadays? Where's my— what generation gets triggered? Is it the All of them. All of them. Okay, well, please don't get triggered because I am going to talk about the new president and presidency. I'm going to talk about tax cuts, and most of this is real estate related. So if I throw some stuff in there that's political, like, sorry, it is. Excuse me. Will the real estate markets crash? What will be crashing? My predictions for 2025. Preparing for 2025 and my personal team predictions.

Okay.

New president in office, are the adults back in the room? Oh my God, thank you. Yes. Money is green and woke has nothing to do with it. Please, I'm not speaking about any of that social stuff. I'm just speaking about money, green, and who can make more of it for you. Okay, uh, Doge, will it work? Gosh, I am like super, super hoping that it will work. I'm a little doubtful, but we'll see. We'll see what happens. And, and that really is upon, I would say, all of us. If we see them going in the wrong direction, then you should reach out to people and let them know You're going in the wrong direction. Just, just like— here we go, the trigger part— just like this last bill that did not pass. It's like, what were they thinking? And on top of that, I don't know if you knew, but they were going to give themselves a raise as well. It's like, really? What are you thinking? Will the Democrats get on board? That's a big question. It's like Immigration. You want to make your community safer, so they have to go back. I don't know. Will they get? Will they get on board with that? With Doge? With everything else that's going on? Or will they be politicians like they are? Like you know they were made to be. Who knows? I don't know. I'm not predicting yet, by the way. Yeah, that. Shouldn't have been in there. Title and escrow. Yeah. Tax cuts. The Trump tax cuts hopefully will be made permanent. They do expire at the end of 2025, and if you haven't been an investor and taken advantage of these tax cuts, then you'd have no idea what I'm talking about. But since he's back in office, I'm 100% sure that they're going to extend. No tax on tips, Social Security, and what else? I've heard that he doesn't want to tax the military under a certain rank. I agree with that. I mean, why are we taxing these young men that, you know, may get put in harm's way? It just doesn't make sense. I agree with that. Social Security, you know, old people that get Social Security, like there is a Social Security penalty because most people are still working when they are supposed to be getting Social Security. So if you get Social Security and you make over a certain amount, you get taxed.

Why?

Okay, I guess that's my opinion. BOI reporting, does anybody know what that is? Yes, sir.

Yes.

Okay. Okay, and who required it? The federal government, agency called FinCEN, Financial Crimes. Oh, Financial Crimes. Oh my God, what did I do?

Financial crimes.

Alex, oh, financial crimes. Anyways, if you had an LLC, if you have an LLC, you were required to file on the government website and tell them who the owner was of the LLC. Isn't one of the principles of having an LLC, especially not in California, in other states, is to keep it private? Well, no, they didn't like that. They put it under the guise of money laundering. We wouldn't go after money launderers. Like, money launderers? You're describing Congress, aren't you? They're the money launderers. But anyways, here I am telling everybody, don't file until December 30th. And what do I do? I file. The end of November, and and what happens? A federal judge says it's unconstitutional. You don't need to file. So if you haven't filed yet, please don't file. You don't need to. They're fighting it out in court, and I'm hoping with the new president he's going to say that's ridiculous. We don't need this information. Okay, but it was it was bit well now they have my stuff. You know what are they going to do? They're going to delete it? Yeah, right. No, they're not going to delete it. So I should have listened to myself, I guess, right?

You have to do it for every single LLC?

Every single LLC, yes. Every one. You have a lot of them?

I mean, I have one.

You have one?

I did it though.

You did it? When did you do it? A month ago, maybe 2 months ago. Okay, yeah, you're like me. I hate procrastinating, so I didn't want to wait. To the last minute, like I was telling everybody, and I'm hoping you know president gets elected, and he did. And then I'm like, geez, it's the end of November. I don't want to wait any longer. So I told everybody what I owned, and now I don't need to tell them. But they're not gonna send it back or anything. Proposed tax cuts. We just did that. No tax on tips. Social Security. Oh my gosh, I didn't go through this like I thought I did, I guess. Um, where the markets— will the markets crash? And I've always said, I'll move over here. The market is basically like a 3-legged stool. First leg is interest rates. So if It's a battery running out. Daddy, come in back. So testing. Yeah.

Ready?

Thank you, my technical advisor. Uh, interest rates— if you were buying a home right before COVID you're paying 3% on a million-dollar loan, that's $4,216. Today, a million dollars at 7% Is $6,653. So you can see the big difference there. It is a big difference. Employment is the second leg and the banks. Employment are— employment is really good right now. I don't know how good it's going to be after Doge gets in there and starts firing people, but, uh, it's really good right now. So we got 2 legs that are standing. So far, the interest rate's kind of wobbling. And then the banks, the banks make money when they can make loans. So they're hurting here because they're not making a lot of loans. So then they start getting tricky and say, well, we're going to lower the FICO score so you can qualify more people. We're going to do creative financing. Yeah, let's, let's do warm body loans again. If you have a warm body, we'll give you a loan. Okay. Yeah, none of that stuff works. So the banks have not gotten crazy yet. Hopefully they won't. I don't think they won't. I don't think they are. But do you live or own property in the DC areas?

Government downsizing.

If you don't think it's going to happen, I can tell you it's going to happen. The last one there, freeway therapy, that's, that's my explanation for— basically, they said that only 6% of the government workforce actually comes into an office to work. Everybody else is working from home. Okay, the first thing that Elon and Vivek are going to do is tell everybody, you've got to come back to the office. If you don't come back to the office, you're fired. Okay, and I— you're going to see a lot of other companies doing the same thing. The next thing they're going to do is what I call freeway therapy. Freeway therapy is, oh yeah, you guys are doing Social Security stuff in this office. Okay, we've decided to move this office to Texas. Freeway therapy, long distance. How many people are gonna go from the DC area to Texas to keep their job? Probably not many. That's another way they're gonna have people fire— basically fire themselves or quit. So remember, these are my predictions, okay? And he's recording this, so next year we're going to find out how, how close I was. What will be crashing? I would be very leery of anything commercial— high-rises, malls, large multifamily. However, if you look at the other side of the coin, If you're savvy on syndications and learning how to evaluate those deals, there was a large mall-type structure in San Francisco that was, you know, just recently sold. It was like $500 million when they bought it and they sold it for $50 million. Yeah, it's, it's that bad and it's going to get worse. It's coming. So if you're into commercial, you said you're into commercial?

Yeah.

If you're into commercial, that's probably a good place to start looking in 2025 and educating yourself. Commercial has nothing to do with residential. Totally 2 different animals. Something that I never decided to get an expertise on. I don't know if I wish I did because I've had so much fun doing residential, but if you're young and you're looking to make lots and lots of money, commercial right now is probably the best avenue for you. Okay, but again, it's not an easy, you know, hey, you know, you know commercial, can you teach me? And, you know, go from there. It's, it's more complex. What's happening now? We we still have historically low inventory. Obviously, new president changes are coming. What did what did he say in the last few days? I'm sure you all heard Canada is going to become the 51st state, and the prime minister he's going to appoint the governor. He was talking about Panama today, basically told Panama that you're charging American companies and ships too much money to go through the Panama Canal. You need to discount that for us. If not, we're going to take over the Panama Canal again. We gave it to you back in the Carter days. So young people, Carter was a president.

Sorry.

Carter was a president. Right before Reagan. Okay, we're up to date now?

Good.

He's still alive, right? He's still alive. He's 99. He's like real close to 100. Yeah, and he actually, I'm not kidding you, they rolled him out and he couldn't even say anything. He said, I'm voting for Kamala Harris. It's like, come on. I told my wife, if you ever do that to me, it's like, I'm gonna come back and I'm gonna haunt you for the rest of my life. Stock market at record highs. That's very concerning to me. I don't do stock market. My grandkids' 529 plan, which is a plan that you put money in for the kids, it grows. When they get to college, they get to, you know, spend it. It's like this last year it went up 30%. It's like that's never happened. And I'm like, what do I do now? Do we take it out or what? You know, it's like, I don't know. So I asked my son and daughter-in-law, both, all 3 of them. I said, here's what, you know, they have. What do you want to do with it? Because if I were to make the decision, like, to take it out and put it someplace safer right now, it's going to continue to go up. Okay, if I take it out, you know, it's not going to do the opposite of what I wanted to do. So I didn't, I didn't, I'm just going to leave it in there. I'm just let it roll, whatever. Seller's market will continue with more buyers in the market than homes available. My prediction, slight growth or appreciation will continue, and foreclosure rates are still down. So that, that's why I don't see that the market's going to fall apart. I, I really don't see that at all. I think it's going to continue to go up. I learned this word the other day, signal and noise. And who was it? Uh, oh, uh, Mr. Wonderful, Kevin O'Leary. was talking about signal and noise, and he said, I used to work for Steve Jobs. Do we all know who Steve Jobs is? Yeah, you have an Apple, right? Okay, good.

I do.

Which was surprising to me. But anyway, he worked for Steve Jobs, and he said Steve Jobs was 90% signal, which means he's paying attention, and 10% noise. And then he said, Elon Musk is 100% signal. I want you people to be as close to 100% signal as possible. There's signals out there. There's things that are happening. You just need to pay attention and then take action. Because if you don't take action, nothing's going to happen. You have to, you have to take action. Are you ready for massive change? So 2008 was the last one. Don't get left behind. If you purchased real estate prior to 2008, I'm sorry, but you lost. If you purchased after, then congratulations. Okay, hedge funds began purchasing and renting out homes, and I think they are headed back Next year to make us a nation of renters. Okay, without a doubt. I mean, they've got the money. They're going to come back in and start buying. Don't let them buy. You need to be there buying as well, uh, your investments, whether they're in another state, because I know California is very expensive, but you need to buy something someplace else. Because if you bought properties like I did in 2008, you'll be sitting pretty up here predicting things like I was. Okay, learn how to buy commercial properties. We talked about that. Learn how to do syndications. You know what syndications are? Anybody not know what syndication— you don't know what a syndication is?

No.

Okay, so let's say I wanted to start a syndication and I've got 45 years of experience and I start to go buy fixers and I don't obviously have Trump money or Elon money. So I asked this group of people if they want to invest with me because I know what I'm doing and then I offer you a return on the money that you invest with me. Anywhere from 10 to 15% or more, whatever, you know, I can get and you can be happy with. Okay, the— what I want you to be, if you're a syndicator, I want you to actually be the syndicator because you're not the one that's putting in the money, you're the one that has the expertise. But the syndicators get the most money at the end of the day, and then the rest of the profit filters down to the investors. And like I said, 10 to 15%. My properties, if I use the same money start of the year and I buy 3 properties, I'm usually getting— by the end of the year, I'm usually getting about a 30% return on the money that I'm using 3 times over. So, you know, if I'm giving you 10 or 15%, yeah, that's good for you for that You know, period of time. But for me, it's, it's better for me just to do my own thing. But anyway, as a syndicator, that's what you look for— somebody that's doing something, that has the expertise, that can give you a better return that you can get anywhere else.

Okay.

Partner with somebody who knows what they're doing. Like I said, I have no idea how to syndicate. Do you know how to syndicate? Not yet.

No?

Okay. Um, does anybody here know how to syndicate or syndicated before? No? Yes? Yes?

Yes.

Yes? What did you syndicate?

Um, project multifamily. Industrial, uh, like, uh, industrial, uh, park, couple things like that.

Were you the actual syndicator?

Uh, on 2 of them.

Okay, so you had the expertise. And then how much ballpark return were you giving?

Yeah, it was about what you mentioned. Depends on how many people, but I mean, as a percentage, it was about maybe 15%. Okay.

And then you could overcomplicate Yeah, but did I kind of describe it correctly?

Yeah, you're just pooling resources and a bunch of people investing instead of, you know, and sometimes you have a bank account.

Yeah, yeah. Well, we had a speaker— was it last month? Yeah, last month we had a syndicator here speaking, uh, but he went to jail for 10 years, but now he's back.

Mike Nelson.

Mike. Yeah. So my predictions for 2025, and I don't know whoop.

Okay.

So this isn't updated, but anyway, I'll update it. I'm predicting that interest rates are coming down to 5%. By the end of 2025? Yes. Okay, I'm old and I've seen, I've seen this movie before. We were talking about Carter. Carter, the interest rates when he was in office were 18%, which was way long time ago. And then who got into office after that was Reagan, and I call Reagan just like Trump. I call him. I called him the cheerleader of this country, and it made everybody feel good. And when people feel good, they take more chances, more risk, and interest rates came back down dramatically under his four years. And that's the movie that I'm seeing again. And that's what I think is going to be happening again. I know 5% is really low, but if he starts getting this economy going and Doge actually starts working and people start seeing that it's working, he's going to put more money in people's pockets. Investors— hello, investors. So I think interest rates are headed down. Not up. I don't think the Fed Chairman Powell is gonna last. I think he's on his way out, whether he knows it or not. He's like the FBI guy. Okay, I'll resign. Yeah, I think he's on his way out, and he can take his girlfriend Janet Yellen with him. Real estate. I think will go up 5%, but commercial will go down 40% or more. And a lot of that has to do with the loans that are coming due. So now commercial loans are totally different than residential. Residential are 30 years. Commercial loans are for a short period of time. What, 5, 7?

10.

10 max. And guess what? This coming year and next, we're hitting the 10 max. And if interest rates are still high, which they are going to be first part of the year, you can't afford it because you can't, you know, necessarily make the interest payment. The place I was talking about in San Francisco, they basically just gave it back to the bank. They said, here, we can't do anything. Everybody's Everybody's gone and a bunch of homeless people, whatever. Canada will become the 51st state. That's a joke, okay? That's a joke. US will declare war on Mexican cartels. I don't think that's a joke. I think we're headed that way. I think Trump's going to get real serious with these people that are bringing drugs and people over here. And he's going to say, sorry, this either ends or you end. And may go from there. My predictions for my team, my first one, I don't know why it's not there. I guess I pulled up the wrong slide. But it's Leo Guterres' group. How many people do you have? Does Leo have working now? Four people. Okay, you he's you just told me he did fifteen flips last year.

This year.

This year. Well, we're still okay. I'm in 2025. I moved on. Fifteen flips last year. Leo's story is I met him how long ago? Three years ago.

4?

Yeah, 3 or 4 years ago. He was working for another broker at another office, and he was doing work, and they were showing him what to do. But he said that the broker wouldn't let him do anything. I go, what, like, does he let you write an offer? Yeah, he'll let me write an offer, but he won't let me present it or anything. I go, what's that teaching about? You know, it's like, doesn't make sense. Come, come work with me. I'll, you know, teach you, take care of you. So he's gone from that to hiring 4 agents underneath him and Pelago both. So Pelago's the umbrella, and then he hired 4 additional agents and 15 flips. So I'm very proud of you and your team. You can tell him that because he's not here tonight. Alex behind the camera and his wife Lauren, who are not here, I have a special prediction for Alex. I see a young person in your future. Okay, all right. And this is not a typical I'm a guy. The first one has to be a boy. This is— I want a girl for you, okay? Because I want her to wrap you around her finger, because I know that's the type of dad you are.

Hallelujah.

Yeah, I know that's the type of dad you are. And so I think A girl to begin with will be perfect for you.

Okay.

And then however many other children you want to have is fine, but I'm predicting a girl child in Alex and Lauren's future this year.

Thank you, Joe.

On top of that, you're breaking out on your own. Not totally, but I'm pushing you out of the nest as quick as possible here. You're doing more independent stuff, which is awesome. I'm 100% behind it. Okay, knowing that you're still under my wing is fine. It's okay. But you know that you're doing what you're doing and also helping others is awesome, and I appreciate that. Last person I want to talk about— not the last, but The last one on my list there is Stephanie. Stephanie and I met a little bit over a year ago. We were at a meetup. It was basically a private meetup. It was supposed to be for active real estate agents that had what we call pocket listings. The only reason that I went, and I've told her this many times, I was invited by a title rep guy and I said, is there going to be food there? And he said yes, and drinks. And I don't drink, but yeah, you know, iced tea is good. And if you feed me, I'll go. But again, I've been doing this for 45 years and I know what those kind of groups are. Are basically just, you know, real estate agents just talking about whatever. Because if you had a pocket listing and you were an intelligent real estate agent, why would you share that with me? Okay, yeah, I'm sorry, you wouldn't. And Omar and I met for coffee earlier, and that's one of the, you know, things I asked real estate agents was like, well, you got a pocket listing? Oh great, you want to share it with me? Depends on their experience level. Some say yes, most of the smart ones say no. You know, why would I? I want to like double-end this transaction. I, I want to find a buyer. You have a buyer? You want to share them with me? Oh no, why would I do that? Okay, so it kind of goes both ways. So Stephanie was working for a brokerage, and I don't know if she was learning real estate, especially investment real estate. So she asked me if I take her under my wing, and my wing's getting full, by the way. Yeah, I've got all these people wanting to come under my wing. But anyways, I'm very proud of her. A year later, we've done— we've closed several deals, and she had a big one that closed here recently. She is Still afraid of writing offers, but I'm pushing her. She loves talking to people. However, she's a mother, and if you've ever been a mother, then that's what you do to other people is you mother them. And I keep telling her, do not mother these agents. Like, do not mother anybody. You're trying to get information that's going to benefit you and your client, you know. So why would you mother these agents? And you send an offer. And I told her, the first one that replies is the one that loses. Send an offer. Joe, should I call them? Should I text them? You know, like, what should I do? Nothing. Just wait. Okay, because the first one that replies is the one that's going to lose. Okay, so you send an offer and you wait for a reply. You know, it takes 2 or 3 days, fine, it takes 2 or 3 days, just wait. You can't tell them that you're like totally excited to do all this stuff. That's hard for her. That's hard. And, and I'm like telling her like, are you listening to me? And she keeps saying, I'm listening, but I'm not comprehending.

What does that mean?

What does that mean? You know, it's like, so I'm trying to continue to pound this into her head. We recently leased a place in Irvine, and there was like 3 or 4 pages of what you need to do to move into this place written out by the HOA, not me, by By the HOA. And she asked me, well, what should I do? Should I give this to the tenant? I said, yes. Well, should I walk him through all this stuff? And I go, what, you're his mother now? Again, it's like, no, just give it to him. He's an adult. He can read. He knows what to do. He needs to give them money to move in, and then they'll give him the money back. But you can't mother these—

Period.

People, period. Okay. And I don't know why it's so hard, but she has come a long way. And I'm hoping in 2025, by the end of the year, she'll be like out of the nest. But she keeps saying no, but I keep pushing. Hopefully she's got enough clientele and business that She don't need that individual help anymore. It's, it's not a big deal that she doesn't know how to do disclosures. Writing offers is a big deal. You need to, like, do it. That's the only way to learn, is to actually do it. Disclosures are a different story because you can hire somebody to do that. And I know you don't want to do those either. I don't blame you. After 45 years, I don't, I don't do them either. I just let somebody else do them. But you do need to learn how to, and, and we're going through the process, how to negotiate with other agents, not to give away the store, because she loves to give away the store. She loves talking to them, and it's like, stop. It's almost like Alex was was on a call for a wholesaler, and 45 minutes later he's still talking to this guy and they're talking about World War II. And I'm like, Alex, like, what's, what's the point? You're not trying to buy at this point. Oh, I'm just creating rapport. 45 minutes of rapport? Come on, you've got to cut it off at a certain point in time. So please don't give away the store. And she is learning. She is. I have to give her credit for that. But that's my predictions for my team. Thank you. Any questions? Yes.

You said that hedge funds will be going on a buying spree. Hedge funds, right?

Yes.

Why do you think so? Like, why hedge funds so much? What changed? Why would they be interested to buy right now? Is it because of—

One, they have the money. Two, they see who's president. Okay. And if the economy gets even better than it is now, then they're going to start buying again. You know, I don't see any reason for them not to start buying again. Do I think it's right? I, you know, I don't know. Somebody was talking the other day about, you know, passing a law that hedge funds can't buy single-family residence. I don't know. I mean, this is a free country, you know. You should be able to do hopefully what you want to do. And you put restrictions like that, then at the end of the day, it kind of punishes everybody. But I can understand the question. Yes. What's—

guys?

Yes.

So look, Trump, to me, he's a likable president, but he said he's going to mass deport illegal immigrants, which will reduce the demand for housing. Wouldn't that reduce the rent and potentially hurt the real estate market?

I don't mean to be disrespectful at all. How long have you lived in this country?

15 years.

Okay. The people that are coming right now, they don't have any money. If they did, they wouldn't be in subsidized housing, getting phones, living in $500 a night hotel rooms. They're different than, you know, anybody else that comes here legally with a visa. They're totally different. These people, you know, again, I don't mean to be rude or anything, but they're taking. They're not participating at all. And if you— I mean, if you have somebody that's participating, then that's great. That's what we're here for. This is the American dream. You can start from the bottom and, you know, be the richest person in the world. Okay, Elon did it. He's, he's not American. He's South African, I think. South African? Yeah, he's South African. So anybody can do it. It's that I don't think that the people that have been coming over fit that criteria at all.

They have not been paying rent.

They have not been paying rent. You and I have been paying their rent. Okay, and I don't think that's fair either. And you're starting to see a lot of people speak up, especially in New York and Chicago, where they're spending half a billion dollars on these people that have come here. And especially if you're, you're from New York or Chicago, you're Democrat, and they're saying, well, wait a second, that's my money. Why are you spending it on them? Rightfully so.

Okay. Question.

Yeah, I'm not interested in this whole demographic thing, but I am interested in like this deportation thing that's going on, right? So I'm curious because I'm wondering if there are any predictions about the amount of deportation versus the amount of housing available and if that'll change the market more, right? So I imagine they're expecting a certain amount of people. I'm wondering if there's been any numbers about what amount of people that is, what that can do to the market as far as people leaving, maybe that house becoming available to sell, and what changes that can cause.

I think it's a similar question to what she asked. I don't think these people are participating in renting single-family houses from, you know, investors. I just don't think that's happening. And then as far as the deportation goes, it's going to go, I would say, slowly at first. They're going to pick on the low-hanging fruit. The low-hanging fruit are people in jail. That's the easiest. It used to be where if you got arrested and you were not a citizen, you would go to jail for whatever crime they arrested you for, and then immigration officer would be in jail and he would say, Where are you from? I'm from Mexico. Were you born here?

No.

Okay, we are going to put a hold on this individual. When he gets done with his local charges, we will call immigration. They'll come pick him up and take him back. That's what's going to happen to begin with. Okay, that's the easy low-hanging fruit. Okay, then they're going to move into other stuff. How they're going to do that? I have no clue, but they're going to start with the easy stuff.

Do you know if there's been a prediction in other markets that may relay some kind of assurance, like maybe in the housing— well, outside of the housing market, maybe like in the employment market where they're expecting a certain amount of people to leave? Because I know that those dollars leaving the area, whether they're pennies or scraps, they're still affecting what we have on a macro level.

So in California, we've had an exodus of over a million people or more here in the last few years. And you know what, if, uh, what's-her-name wants to leave because President Trump got elected, I'm waving bye. Okay. The people that have been leaving for the majority are Elon Musk, and billionaires and millionaires like him because of what's happening here in California with whatever tax policies, woke policies, whatever you want to call it. If you have enough of those people leave, okay, let me put it this way. Are you predicting they will come back? No. There are 50% of the people in the United States do Do not pay taxes.

50%.

Okay, the other 50% pay, but I'm going to tell you that the richest don't pay because they have lawyers that get them down to the point where they don't have to pay. So who pays? The middle class. And they always have. And they— I'm sorry, but they always will. If you don't have money to pay, you can't pay. If you have enough money, you don't want to pay, you hire an attorney or, you know, tax attorney or whatever, or do a corporation. Okay, so the middle will pay. So that's what I'm hoping with Doge is they start getting rid of all this fraud, waste, and abuse so that it relieves a lot of the middle class from having to pay all this stuff. We're still, we're still going to have people that can't pay, and we're still going to have rich You go to any country and they don't have 3, they only have 2. They have rich people and they have the poor people. They, they don't have a middle class in other countries. Do you have a middle class in Turkey?

Yes.

You do?

Same problem.

Okay, so the middle class pays the majority of the taxes, the rich don't, and the poor obviously don't. Yeah, Mexico is 2, rich or poor. That's all there is, rich or poor. Steph. The only reason I have a small insecurity is because I know they've tried this in the past. But they haven't tried it with outsiders. So the small security is— I'm always very conservative, so I kind of have to leave a little bit of room. If you want me to take that off, I think they're going to do a fantastic job. I think once they start doing what they're doing, the American people are going to start applauding it and saying, keep going, keep going. Everything should be on the table. Everything should be on the table. military. Social Security should be on the table. I mean, if you're a young person like this, why, why would you expect Social Security to be around when you're of age? It just— to me, I saw that, okay? I saw that when I started, you know, getting into real estate and stuff, and I always invested in real estate and other products To support me when I get to be this age. So yeah, they give me Social Security, but so what? You know, it's like, whatever. I don't want to live on Social Security alone is my point. Okay, you need to be investing in yourself and in your future. Nobody's there to help you. Believe me, Social Security is not there to help you. Social Security is there to help the poorest in our in our country. That's it. I think the average check is around three or four thousand a month. It's like, how do you live on that? If especially if you're in California, how do you live on that? That's rent, right? That's about what you pay for rent. Three or four thousand. You know, unless. you're living with a bunch of people, but that's a different story.

Yes.

2 questions. First off, one of the slides, presentations, you said commercial is going to drop 40% as a prediction. Does that commercial include like apartment complexes, or is that considered commercial, or are we talking about just businesses?

Yeah, the apartment complexes, again, they've got 10-year loans and they're at 3%, and now if they need to refinance, they just, they They just can't do it. So what happens? You have to drop the price. Okay? So you need to be in the position that says, okay, this, this is a good complex and probably good because they haven't been pouring money in to fix it. And so now you need to negotiate to a point where it makes sense, even at a higher interest rate, to pour money into that, to bring it up to To the point where 3 or 4 years after, you can sell it. So yes, negotiation on commercial property is a big thing. Anything in real estate is negotiable, and it is a big thing. You just have to learn how to do that.

And so, so right now, obviously, with the holidays around, not a lot of people are listing their properties for sale.

Correct.

The challenge also now, we're coming up to an election. We're in an election year, so the torch gets passed on January 20th. When considering that in play, when do you see most people deciding to put their houses up for sale? And of course, more buyers come in the market. Does that usually start like mid-January, or do you think they're gonna wait a little more until like maybe February?

No, I would say mid-January. We've got a couple of flips that we took off the market For that reason, because it's just a slow time of the year, so why let it sit there doing nothing? So we took them off. We'll put it back on mid-January. And that was just unfortunately a real estate cycle for flipping. You know, I don't necessarily like to put properties in January for sale. I like to purchase properties in December and January and then finish them up. In the normal hot season for California, May, June, July, those. But it is what it is. So if you need to sell, then yeah, I'd say the second week in January is when you'll start seeing stuff come back on the market, you know. But they're like every seller out there. Joe, I want a million dollars for my property. Well, the last few sales have been $850,000 $850,000. Like, how do you expect me to get you $1 million? Well, because you're good. Well, no, it doesn't work that way. You know, it doesn't work that way. This is $850,000, is your neighborhood. You know, I know you have the heavy-duty nails on the house, but still, I can't get $1 million. We can try. I'll list it for you for $1 million, but if it doesn't sell, please don't blame me. Start dropping the price. And so the ones that you see coming in January are people that they're going to need to sell. So hopefully they price it correctly, they listen to their experienced real estate agents, they price it correctly, and it starts to sell.

So who's the Joe Homs?

I don't know. I don't know anybody. That's a great question. I'll have to think about that. I have a couple of agents that are commercial experts. I'm thinking about one right now. If you want, I'll text you their information.

Just to learn.

Yeah, but yeah, no, I don't, I I don't like— I don't have anybody directly on my team that just does commercial. I wish I did. You know, that would be very beneficial and helpful. Yes. Anybody else? Alejandra, you're quiet back there. You have any questions?

What?

Questions. You have a prediction? Okay. I can't hear you. Kind of what I said, right? 2025 will be the year. Yes, will be the year that you need to do something. If you're not doing something in 2025, I'm wasting my time and my breath up here. You need to do something in 2025. Things are going to change. He's going to be a cheerleader again. And by the way, here's another thought for those of you who weren't around. We just got out of Vietnam right, right after Carter got into office. We had the Iran-Contra thing as well. This country was at its lowest. Military-wise, like at its lowest. And so what did Reagan do? He decided to start a war. Not many people know about this, but there were some students that were in Ghana, I believe.

No.

Ghana. One of those little islands right around in Cuba, near Cuba. No, no, no, no, no, no. Anyways, one of the little islands there and Grenada. Yeah, sorry, Grenada. I've been there. Grenada. Grenada. They had a school where there was American students there. And then Cubans decided they were going to go over there and, you know, mess around, and they had guns and all that stuff. And Reagan said, yeah, not on my watch. And he sent the military over there and kicked their butts out of there. And that turned the military around. They had a success. They hadn't had a success in forever. Okay, they had a success, and that's what turned our military around. And I think you'll see a lot of that, okay, with this president as well. He's not going to send troops, but he's going to do things a little bit differently. So that's why I'm saying I've seen this movie before, and I, and I think, I think that's what's going to happen. And if it does, then believe me, you, you need to either start preparing to buy, buy, Work with partners who are buying, do something because the market is going to change. The only nice thing about— I shouldn't say it that way, but yeah, the only nice thing about Carter was when inflation was happening again, 18%, it was actually good if you owned a home because my home was going up in price. $25,000 to $30,000 a month. Yeah, $25,000, $30,000 a month because of inflation. So it was real cool, but I couldn't sell it to anybody. I ended up selling it because I needed to sell and buy the home I'm in now. I ended up selling it with creative financing. I actually took back a second on the property to be able to have the person who bought it And I took back a second on that property for 5 years, and then the guy paid me back because obviously the market turned around and then he could refinance at that point in time. So, um, a lot of this, a lot of that stuff may come back. It's, it's going to get down. I'm predicting it's going to get down to 5%.

Okay.

And if it does, then that's going to unfortunately shoot the prices of homes up, but at least you'll be able to afford the payment if it's down to 5% instead of 7% where it's at now. You know, and people back then say, okay, well, Joe, you were paying 18%. I actually was paying 14% on my loan for my house. The, the difference with, with back then and now, I was paying 14%, but the value of my house was $160,000.

Yeah.

So like, that's nothing. The value of my house is over $1.5 million now. If I'm paying 14%, I, you know, like, I can't afford it. So that, that's the difference. So when somebody tells you, you know, we've been, you know, through this TV show before, you have to put it in perspective. You know, 14% $160,000 versus $1.5 million, that's a whole different story. Okay, which is another thing I'm trying to teach Stephanie is like, don't believe everything that people tell you. You know, not that they're lying, but they're representing their clients. You know, Joe, how many offers you've got? I've got 3 offers. Stephanie, how many offers you got? We don't have any. We don't have it. How many offers do you have, Joe? I've got three offers. Send over your highest and best. Okay. Well, that's not right. I go, what do you mean that's not right? Who are you representing? You're representing your seller. Okay. You want to get the most money for your seller, don't you? Like when I. When I talk to agents and they're a listing agent and I say, okay, do you have any offers? No, I can't tell you that. Why? Is it against the law? Is it written down someplace? Oh, it's in the code of ethics. No, it's not. Why don't you want to tell me? Well, then that wouldn't be fair to everybody else. I go, what's fair have to do with it? I go, your goal is to get the highest price for your seller. If you tell me as an investor that right now it's $1 million and I'm willing to give you over $1 million, isn't that good for you? Should be good for you. So why don't you tell me? That's not fair. That's not fair to everybody else. I said, what does fair have to do with it? Okay, real estate agents have to take ethics courses every 2 years. It's a pain in the neck, but we are the most unethical people in this world. We're right above car salesmen. Okay, like, who are you representing here? Then please represent them. I'm just asking a question. If you're at a million and I can't go up to a million, then fine, thank you. Tell me and I'll go away. I'll leave you alone, you know. But if you can get a million for your property and that's what your client wants— Even though you put $800,000 on the listing, that's fine. Just tell me. Let's work out a deal here. You know, benefit me, benefits you, right?

Yes.

No, they don't work that way. Sorry, they don't. Any other questions? Yes.

Do you see AI Used in real estate currently, or, or I don't know, that's like—

Yes, I love AI. I love AI. The reason I love AI is I put the address, I tell it— on ChatGPT, I put the address, I tell it, you're a 45-year real estate veteran, I need a property description. I hate doing property descriptions, and it comes back with the best property description in the world. So I own condos in San Juan Capistrano. I want to tell you they're in a D area. Do you know what I mean by D-class area? A, B, C, D. Okay, A is Beverly Hills. Okay, D area. And I put the Give me a description for this property I'm selling in San Juan Capistrano, and it came back with the best description. Stephanie calls me; she says, "Are you kidding? You're gonna put that on there?" I go, "Yes, the purpose is for people to read it and then look at the professional photos I put on there, and then hopefully come out, you know, at least to see it. Isn't that my goal? Is for them to see the property?" Yeah, but that doesn't describe the property. It's not in a nice area. It's yes, it's like. 5 or 10 miles away from the beach, but, you know, it's not like it describes. I go, yeah, it's like, so what do I care? My goal as a real estate agent representing my client is to get people to come out there and take a look at it. If it's in the D area, that's not my problem. They're gonna come out, they're gonna go look at it, and they're gonna realize it. They're gonna either buy it or move on, or they're gonna be investors and buy it. Yes.

I just want to say something because I'm a big fan of technology, and that, uh, because I did some commercial, we were doing some factories, and when you take a picture and send it to ChatGPT, it can give you amazing technical details on the type of concrete, how it's working, the load and stuff, something you'll never, like, you know, maybe just figure it out on your own. So it also— you should use more The photo option to just like make it describe technical stuff for you. Yeah, it's as smart as you go, so as smart as you are. It has no limits to what you can do with it.

That's the extent that I'm using ChatGPT other than, um, you know, like if, if a Pelago agency decides to leave for whatever reason, they're getting out of real estate, which happens a lot this time of the year because they don't want to pay their fees. Their fees are not for us. Our fees are really inexpensive, but the fees like to join the Board of Realtors is like $1,300 now, and they just don't want to pay that. I have— I put down there, well, you know, this agent's leaving, write me something really nice. And so it writes something really nice about, you know, sorry to see you, You were a great asset to the company. We're going to be missing a lot. And, you know, something that— I'm sorry, I would not write. Maybe Stephanie would write as a mother, would write, you know, gosh, you're like leaving the nest, you know, don't want you to leave the nest type stuff. So that's the only other reason I use it. Um, if I know you do technology, but if you can find some way To incorporate AI into real estate, and I would say if you can figure out how to get agents leads, you'd be a millionaire. Okay? So an agent called me today. He says he wants to subscribe to Zillow Leads. I told him fine. It's your money, but you're wasting it. Zillow Leads are worthless. They're just, and they charge you like. Gosh, they charge you thousands of dollars a month for these leads that are literally worthless. They're just worthless. Okay, so if there's some sort of, you know, computing power in your head that you can figure out how to get leads for people, there are companies that are trying to do that. There's companies right now that We'll get all the statistics on a neighborhood. Joe's been there 40 years, he's probably not going anywhere, and why would he go anywhere? Okay, this person's got an interest rate on a loan, 3%, they're not going anywhere. Why, why, why would they go someplace? Figuring out everything that's going on in the neighborhood. Okay, this guy owns a property with his wife, and we see through public records that his wife passed away. That's a good candidate. Maybe we ought to put him on the list to call. If you can figure that out, more power to you. There is companies out there that, that do that stuff. PropStream, you can set up lists that will give you that information. And then, you know, put it in some sort of system that it's either going to call them. But you have, you have problems with the big phone companies now with spam and stuff. Alex was texting people. I don't know if you text anybody anymore, do you?

Not really.

Yeah, it's like they pretty much shut that down. You know, email's the same way. It goes into spam. You know, so again, if there's somehow your brain can, you know, figure out that I can get a bunch of leads if I do this, then you can sell them to real estate agents. Because you know what? The easiest people to sell something to are real estate agents. We get calls, I get calls 3 and 4 times a day. Joe, I've got the secret for you. I can give you a bunch of leads. No cost. Oh, hey, I'm calling about the no-cost leads. Oh yeah, there's a setup fee of $5,000. What's that all about? You know, I thought it was no cost. Oh no, there's a setup fee. Do I get that back? How about this? How about you send me the leads? When I close one, I pay you for it. Yeah, and it doesn't work that way, Joe. Yeah, you want your money up front. Okay, even though you're going to send me junk leads that aren't going to work. So if you can figure that out, then we need to talk because I'll, I'll try it out for you first. Yes.

Well, Joe, can I tell a little bit about Double Door, that what we use AI for seller listing agents? Thank you. I'm Amy Kwan. I'm the founder of Double Door. We test an AI product. It's called Virtual Agent. What it does is we take the picture of your face and then we record your voice, and then you will record anything about your listing, any information, and then we market your listing to foreign buyers. We focus on foreign investors or foreign buyers, and When a foreign buyer comes in to look at your listing, they could ask questions in 29 different languages about your listings, either in text— Chinese, Vietnamese, Japanese— or recording. So you don't have to work because you already record all the information about your listing. That's AI. So basically, we could help you expand your marketing area from domestic to global. You work less and have more potential buyers for your listings. That's one thing we could do. We're still testing the products. We are not launching yet, but that's one potential using AI. The other stuff we use AI is translation. So we list your property with Double Door. We charge Fees for 6 months, and then we could translate your listings and market to foreign buyers. So we don't focus on domestic buyers, but we expand your buyer pools to— from domestic to global. That's what DoubleDoor.io do.

Thank you.

Thank you, Joe.

Yes, she's trying to figure it out. Okay. Yeah, which is hopefully you can do, you know. I don't know, anybody can.

You already figured it out. Yeah, anybody.

Any, any other questions?