Property Pulse - Your Real Estate Rundown!

What's up, you guys? Welcome back to the podcast. I just had a coffee.

You could tell.

The New and Experienced Investor Podcast. It's a real estate investing podcast that brings real estate investors from all walks of life together. I'm one of your hosts. I'm Alex Barnett. I'm the new guy.

And I can tell. And I'm Joe Homs and I'm the experienced guy without the caffeine. That's right.

Yeah, we had the midday caffeine and boy, is it good. Yeah, so today we're just going duo style, the old rookie and the Sarge, as I like to call it. And before we jump into our topics, we're gonna be talking about everything real estate, Current events, things that are going on now that you're going to want to at least have in the back of your mind going into the new season that could affect your investing future.

Wow. Crystal ball time.

Yeah.

Wow.

I mean, if the Wall Street Journal says it, it must be true.

Must be.

But before we do that, let's talk about our meetup we have coming up on April 22nd.

Oh, that's my cue.

Yeah, sorry, I was trying to do it without looking at you. That's okay.

Hangar 24.

Yeah.

And we have 2 guest speakers.

Yes.

That, uh, you have scheduled and they're doing subject-to deals.

Yep.

Correct?

Yeah, they do all creative deals.

And they're a group?

Yes, they're a group. They founded this group called Creative Vestors and they work with a lot of pre-foreclosure people Um, they'll basically turn deals that you would think aren't deals into deals. They can help you close, they can help you underwrite, and they're really big in the sub-2 community. They're regional leaders in the sub-2 community. And, um, yeah, they're really cool guys just in general.

Regional leaders?

Regional leaders.

Wow.

Yeah.

That's big time.

That's like, you know, Cartel has their— yeah, yeah, they're like up there.

Wow.

I know. So should be good. If you guys are into creative finance, definitely come out. But in general, just—

Hangar 24.

Hangar 24.

Irvine.

Irvine.

22nd.

6:00 PM. And, um, you should just make a habit of coming out to this because not only is the weather gonna be amazing, we do it outdoors.

Yes.

But you meet a lot of really great people. Last month we had Burton talking about lists and PropStream and how you can use that to Um, you know, come up with different ways to reach out to prospects, whether you're an agent or an investor or both. So, um, a lot of knowledge dropped, a lot of knowledge to be gained. And then the networking alone, um, is just something, you know, to be a part of. So make sure you're there.

They also have really good food.

Really good food.

Food and beer.

Beer.

We made sure of that for you guys because you know how much you love beer.

And parking validation as well.

Yep, free parking.

Free parking.

Yeah, so we've covered all the bases. We've thought of everything. You have no more excuses at this point.

None.

So if you're not coming, like, we can't do anything else for you at this point. The red carpet has been laid out there, ready.

Just walk on it.

There you go. So yeah, we're really excited. Um, Lauren found the soundboard today. Yeah, so it's gonna be, it's gonna be fun-filled day today. So if you're joining us, make sure you drop it in the comments, any questions that you might have, or if you disagree with anything that we pull up. It's gonna be a very controversial episode. Yeah, nice.

Okay. I'm gonna have too much fun with this.

Yeah, it's pretty good.

That's why she's the producer.

That's right.

She knows when to press that button.

She's producing. Yeah, excellent. Okay, let's go ahead and dive on in. What do we got? First topic.

First topic, let's see here. Um, should you refinance right now? Should you refinance your mortgage right now?

Well, according to CNBC, there's 3 signs it's time to refinance your mortgage. Now, it seems a little insane right now because there's still high 6s, but let's see what the article says.

Yeah.

What does the article say?

I mean, there's a nice lady on a swing smiling, so it must—

She just refinanced. She must have. What I'm thinking is this is probably written because there's been absolutely no refinancing. Nothing. It's dead. And so they're trying to make it up. They're trying to move the needle a little bit.

Are they giving you like the 3 things?

Yeah, Lauren scrolls down a little bit.

Sorry, if I can do it with my hand up in your face.

There we go.

Okay, yeah, pretend you're doing it.

So here we go, right here.

You can cut your rate by 50 basis points or more. Whoa, no, that's like, whoa, you need more than that.

If you can cut your rate by 50 basis points or more, it needs to be at least 1% or more. Okay, so that's just saying a half a point you should refinance and go through the whole rigmarole of getting a—

Why would you do that?

Make the lender money?

You know, they're already asking you for your firstborn refinance. They're going to ask you for your secondborn as well.

True.

That's crazy.

You better have a family.

That's not advice I would agree with.

Okay, so number one, wrong. CNBC, bad. So let's go ahead and go up, and then we have you can pay cash For closing costs. So right off the top, they're having you come out of pocket so you can get a better rate and save what, like $300 on your payment? Or how much would it be? Not that much.

I don't know. When you refinance a loan, what I would look for is, um, and I, I've always gotten a kick out of these lenders that say, uh, it doesn't cost you anything to refinance this loan. Well, yeah, no kidding, because you put it into the loan.

Yeah.

So I don't see it up front, but yeah, you're paying for it.

Right.

So the question is what your payment was. If you're saving $300, how much money extra have you put in?

Right.

So then you're going to divide that by that to figure out how long it's going to take you to pay this back. And if it's more than 2 years, Why are you refinancing? You know, most people move out of their home every 7 years. So, you know, you're chasing $300 lower on your mortgage for a short period of time. Just doesn't make sense to me.

I mean, what if your brother-in-law is like a mortgage guy and he just keeps bothering you about it?

Get another brother-in-law. You can't either.

He's already married into the family.

I will say, just quick story, my mom is getting like 10 unsolicited text messages a day from lenders telling her to refinance.

They're starving.

And she replies back, you need to beat 2.39% interest, because that's what she is.

Oh, nice.

And they're like, wait a— yeah, right, lady. They're like, can you believe what she just texted back?

We know that your mortgage is at 4% and we're offering you 6%. How's that sound?

Yeah. I mean, she did good. She refinanced right when the rates dropped, so she's locked in.

Yeah. That's crazy.

That is weird.

I don't think they're compliant with the texting laws.

They're thinking, you know, that people need money for whatever comes up in life. And that's a quick way to get some cash, you know, is refinance your house. The problem is, you go from a 3% loan to a 7% loan. So how does that make sense?

Yeah, it doesn't.

Unless you need the cash. If you need the cash, sell the house.

Yeah.

You know, give me a call. I'll sell it for you.

There you go. We'll buy it.

We'll buy it.

Yeah, there you go. Especially if it's distressed, we'll buy anything.

We're hungry right now. Let's take a look at number 3. This could be a good reason. You bought your home with an FHA loan.

So can be a good reason. You're going to have to make sure that you have at least 20% or more in equity.

Oh, geez.

Before you refinance. So FHA is 3.5% down. So if you don't have that equity built in, it's not going to do you any good to refinance this property. Yeah, you're going to have to, you know, if you only have 5% equity after a year or so, you're going to have to come up with the other 15%. It's like, why?

Yeah. And they're kind of touching on, and the reason you would want to is because you're going to have that PMI.

Yes.

And that's just going to be an extra $500 a month or more.

It's going to cost you another 15% down.

Yeah, true.

Buy the loan down.

Buy the loan down. I mean, and I'm noticing there's a lot of FHA offers like right now.

Yeah, absolutely.

And people—

why wouldn't you put an FHA offer in on a property? It's only 3.5% down.

But it's just so much extra work, isn't it, to get it like through the finish line?

No, no, no.

Okay.

No, if the house is, you know, financed or, or, um, for sale at a, you know, reasonable price, uh, it's fine.

Okay.

FHA offers work. There's nothing wrong with that.

Then your monthly payment's gonna be like 8 grand.

Uh, no, hopefully not that much. Yeah. What you, what you do see now is agents like, let's say I have a property for sale for $400,000 and agents sending me an offer for $450,000, but it's FHA and they don't care honestly how high they go because they're protected with the appraisal. If they don't remove that appraisal contingency, then, you know, your choices, if the appraisal comes back at $400,000, your choice is to kick them out of escrow.

Mm-hmm.

They come up with the difference or you lower the price to $400,000. So that's a big reason why FHA offers are not accepted right up front.

Okay.

It's for that reason.

I'm looking at a $1.3 million, 900-square-foot bungalow in Seal Beach.

Nice.

Can I put 3% down?

Yeah, sure.

Okay.

Cool.

Yeah, let's do it.

Then your payment's gonna be about $8,000.

There's no way to rent out anything. It's so small.

Good luck with that, by the way.

Oh God.

I mean, there was a fourplex for sale for like $5 mil on the boardwalk.

Yeah, I don't think you could do FHA.

There's a little bit of 5% down.

There's a limit on the loan.

BiggerPockets says 5%.

Not FHA.

Oh, okay.

No, that's conventional.

Oh, conventional. Okay, we'll do that.

All right, so what do we think about this, uh, this refinancing? Yay or nay?

I'm sorry, lenders.

Nice.

Yeah, right now.

Nice.

Well, and that's the thing, everyone's sitting on their sweet, sweet low mortgage rates, so that's what's gridlocking the whole system right now.

Absolutely.

So I don't know, you just gotta—

Don't refinance unless your rate's going down. You know what we saw the other day? Actually, Alex showed it to me. We couldn't believe it. An adjustable rate mortgage still in place from what, 2005?

Yeah.

And it said the interest will never be lower than 15.

No, it was— it will— it wouldn't be higher than 15. Yeah. And then lower than like 8.7 or something.

Nice.

Yeah.

Let's get that one. All right.

Yeah.

Was that pre-foreclosure?

No, that's the Vegas probate one I was talking about.

Oh, yeah.

So figuring that one out, but okay. Yeah.

Well, what about housing affordability? Is it just completely collapsed?

Well, Lauren, that's what economists say. According to CNBC, housing affordability has just completely collapsed. And, you know, I brought this one up because everyone's crying about housing affordability, but if there's a will, there's a way. You know, maybe you, you're not going on market. Maybe you can go off market. Maybe you can use PropStream. Maybe you can find somebody in foreclosure. Maybe you can buy it on seller finance.

You know, make that happen for us.

Let's go. There's lots of ways. Yes. Yes.

Yeah.

But I don't think that that article is taking into account California because there are lots of buyers there. I mean, we're still in a seller's market. There's multiple offers that are received once a seller puts their property on the market.

Yeah.

You know, and if you do it with the right agent—

Yep.

Hello. You do it with the right agent, like me, you're gonna get multiple offers. Yeah, you know, so this is, this is a different area, you know.

Well, what are they talking about?

They're, they're talking, you know, in the middle of the country, households, you know. They're not really talking about, uh, East Coast and West Coast. They're talking— I think if you go back down here, down— nope, the other way. Down, down. Yeah, down, down, down. Keep going down. Right here, stop. Yeah, there's a median sales price. Oh, $400,000. What does that get you in Orange County?

Nothing.

A garage. Yeah, you know, so that, that's Mobile home. A mobile home.

Yeah.

In fact, we will have one for sale in about a month or so after we rehab it. So if you're interested in a mobile home, you have to be 55 and older.

It's not in Orange County though. It's in Hemet.

That's an offshoot of Orange County.

Yeah. That's Orange County.

But it's gonna be fully remodeled.

Yeah. There you go. Yeah. Okay. Well, I just hear a lot of— well, I was talking to my cousin yesterday too. He's gonna be, He runs a print shop. Lauren's like, call your cousin, see if he can do direct mail for us for the old cousin hookup. And he said he could. So I was talking to him. He's like, yeah, he bought his house in Huntington. I don't know, maybe like 10 years ago. And so he's like, yeah, it's pretty nuts what it's worth now.

Yeah.

He's like, I just feel bad for young people today and, you know, giving me that thing.

Yeah.

And I was like, people can do it. You can still get a house if you go and look for it like some other way.

Creative financing goes a long way.

Yeah, it totally does.

It's just, what do you think, like, out of how many sellers are really willing to carry, you know, and then how many buyers are willing to do extra research besides— I mean, applying for a loan itself, like Joe said, is like giving up your firstborn child.

And well, yeah, exactly. So that makes me like, it's less work for me to try and find a seller willing to carry than it is like filling out the paperwork to get a loan.

Yeah. But if you're just like some starry-eyed retail buyer—

For 10 years you had no job.

That's actually a great question. So who are the sellers that you're finding right now that are doing seller financing? You know, like where are they in their life?

Yeah, they're older.

Exactly.

Tired landlords.

Tired landlords.

Exactly.

Yeah. Maybe they have more than one property.

Exactly.

Sick of it, you know, and—

They don't necessarily, you know, need all that money up front. They would rather have some cash flow.

Yeah.

You know, get the money a little bit at a time.

Yep.

And not have to take care of the broken toilets or anything else in the property.

Exactly.

Baby boomers are ready to sell and either downsize or just go into a rental, and they're a perfect opportunity for seller financing.

Or they're tax evaders and don't want to pay capital gains.

There you go.

With one lump sum.

Well, and the only thing standing in the way—

That's not evading taxes.

I'm just— I was just—

No, that's not evading taxes.

That's being silly.

Deferring.

Yeah, that's just Kicking the can down the road. Who, who else kicks the can? Oh, that's right, the federal government. That's what they do. They kick the can down the road. So yeah, why, why can't normal citizens do that?

Well, and I've talked to some buyers and the only thing standing in my way was these pesky children that they had. Oh, and they're like, ah, how old are the children? They're probably my age or a little older.

Oh, you're old.

I know.

Yeah.

They're like, I would, cuz I, we, we looked at an apartment and this one lady had, she has like 5 houses. 4 of them are in Seal Beach. One of them's in Huntington.

Huntington Harbor.

She's good. And they're all like multifamily. She's raking it in, all paid off.

Yeah.

And she's just like, I'm just so done with it. I was like, oh, well, if you ever think about selling, we buy properties. And she's like, yeah, well, my son's gonna buy.

My kids wouldn't like that very much.

Yeah, that's what she said.

But Alex and I, we were on a long walk on Sunday and just walking through Seal Beach and there's some beautiful homes there. And we were like, What if we take the angle, like, because Carlos got his property because the seller's son was kind of being a deadbeat? Like, what if we take the angle and send out mailers that are like, don't leave this to your, like, your spoiled kids. Let us buy it.

When was the last time they came and visited you?

That's something they would read.

When was the last time they even called you?

Those pesky children of yours.

They don't deserve this home.

You can't take it with you, you know? Come on. Yeah, at least enjoy it while you're here.

Exactly.

Yeah, I'm coming up with a few mailers in my head that I'm like, I might use it.

Gotcha mailers.

Gotcha mailers. Gotcha mailers. I like that. Yeah, gotcha mailers. That's different. Maybe it'll catch on. Yeah, yeah, either that or they're gonna call and say, I want to adopt you. Okay, that works too.

You can adopt me by signing over your house.

There you go.

That seems like a fair trade.

Yeah, I know.

Yeah, we'll see. We'll keep you posted on that.

I'm just kidding.

I know, we're just joking.

We're not kidding. But let's move on here. Yeah, where are we going next?

Um, hold on, let me catch up here. Okay, next on our tour of CNBC is, sorry home sellers, that 6% commission isn't going Anywhere.

Now, we haven't seen this side of the argument yet, and, uh, this is Bloomberg actually. And what he says, he being— oh, I mean—

Oh, is it paywalled?

Oh, okay. Well, just go up to the top.

Don't show anybody that. We don't pay for this.

Stephen Mim says the settlement by the National Association of Realtors fueled speculation about the end of hefty payouts for agents. History suggests That's a misread. So he's saying it's not going anywhere.

I agree. Oh, 100%.

My gosh. But everyone was posting feverishly about it leaving and the whole system collapsing.

It may, it may go away for a little bit because we are still in a seller's market. So if you advertise your property on the MLS, even if you offer zero, You're still going to get interest. And then at that point in time, it's up to the buyer's agent to figure out how they're going to get paid, period.

Yeah.

Or the buyer is going to come directly to the listing agent and work out a deal with them as well.

I mean, listing agents just might start charging 6% and offering a cut to a buyer's agent, right?

Which has always been the case.

Oh, okay. So they always do that.

That's the same.

They just can't advertise The 3% to the buyer's agent.

Okay.

That's, that's the model that we're headed to. But like you said, it's going to be in their hip pocket, so to speak. Like, yeah, if somebody reaches out to me, they're going to first thing— like, if I was a buyer's agent, which I hate to be, but if I was a buyer's agent, my first call would be the listing agent. How much are you offering in commission? What do you have in your pocket? I'd like to know. Joe, we're not offering anything. Okay, that sounds great. So I go back to my buyer and say, okay, they're not offering anything. How much are you willing to pay me? Right. Yeah.

That's not enough.

I'm worth more than that. That's not enough.

Or you'd show them something that looks similar.

Or show them something else. Yeah, absolutely. They're like, ah, go to the next one. Yeah. And in a buyer's market then, now that's totally going to change because Now you have sellers putting a property up for sale and they're not getting any bites whatsoever. And so, you know, even if they have it advertised, they better have something in their pocket at the end of the day when a buyer's agent calls and says, hey, how much are you going to pay me? Yeah, well, I've got an agreement with the seller to pay you 2%, whatever.

When was the last buyer's market? 2009?

Uh, no, that was a disastrous market, uh, for certain people, but for investors it was the best of times.

Exactly. Yeah, it's like, are we ever gonna have that again?

There's always two sides of a coin. Yeah, you have to make sure you're on the right side. Yeah, yeah. But, um, you know, since then I would say there hasn't been a buyer's market. It's been, you know, steadily just going straight up. You know, like right after COVID, they, you know, everything got shut down for just a little bit. But then the housing prices just start shooting up because crazy people, you know, were looking for someplace to go. They were buying stuff left and right in Joshua Tree and Airbnb stuff. And, you know, so it got crazy and the prices just kept going up.

So I don't know when we're gonna see those.

I've got a funny buyer's agent video for you guys.

You do?

Okay.

Okay.

Oh yeah.

So I think Alex posted this, um, a couple days ago.

It's a— so it says buyer's agent at the end of a showing in July 2024. That's when the NAR thing's supposed to go through. And she has that little tip, the little tip option, you know, when they give it to you at the shops.

I like that.

Yeah.

And she's like, how much do you think it's worth?

Yeah, I like that. Oh my God, I like that tip option. Yeah, because that's all you see when you go out to eat anymore.

Yeah, they're like, it's gonna ask you a question.

I'm a sucker, I'm a sucker. I tip, I tip for everything now.

Yeah, they say it's gonna ask you.

I feel bad.

We're at, uh, we're at $20 an hour for fast food. I've stopped tipping.

Oh, there you go.

Good point.

Yeah, true. Stop tipping.

Okay, stopped it all.

Yeah, no, no, no more tipping.

What about at coffee places, donut places? No, no. Oh gosh, I never tip there. Oh, all right. Well, they make their money on the sugar. Yeah, when you buy, on the buy. Yeah, gotcha. Okay, no, makes sense. I know, and they're like looking right at you. And I'm like, can they tell where my hand goes, which option they—

They can see it.

Yeah.

They know.

Oh, you know what I would do? I'd pretend I'm going to the high one and then—

I went out to eat the other days, and I, I know you guys are going to be offended.

Carl's Jr.

Denny's.

Alex always begs me to go to Denny's and I say no.

I'm a Denny's man.

Well, Denny's is the same thing. You have to be over 60 or 70.

No, no, no, no, no, no. When we were on tour, when we were on tour in the van, that would be the only place open after shows at like 1 AM.

Yeah.

And so we'd go there and eat.

This lady, 3 in the morning, the waitress— is that what you call them? Waitress?

Food server?

Yeah, I think it's still—

yeah. Whatever. Uh, brings me out a coffee because that's what I wanted, because I'm ordering off the senior meal.

Ooh. Cool.

You know, so I'm ordering dollar coffee, pancakes, and Eggs, sausage, and bacon. You know, the whole—

It's like $3.25.

Yeah, I wish.

It's up there now?

It's like $7 or $8.

Oh, so—

Yeah, it's way up there.

Okay.

She brings me out this coffee and it's literally cold.

Oh no.

So I call her back and I said, you know, this is cold. And it's so like, I'm really kind of turned off. Just bring me some water. Then she brings me the bill at the end. It's still there. With the coffee. Yeah, with the coffee there. Yeah. And you're like, it's like, okay, there goes your tip.

Yeah. I could have given you the—

I could have given you a dollar tip, but yeah, it's gone now.

Dang. That's rude. That's rude. And the point system too, when they don't count your points. Pet peeve.

That is— that is—

can they double charge you?

Does Denny's have point system?

Well, no, I was just thinking of that other donut place we went to.

Yeah, that's true. Yeah, but that's not good.

No.

Next.

Anyway, well, we all know about this. You guys kind of were talking about it, the Airbnb Joshua Tree freezing over.

Oh, so they finally—

cooling down.

They finally admit it. Wall Street Journal And this was it. And I wanted to show it because it's really funny. I want to show you guys like when we bought our flip. Um, so yeah, it's just saying was the hottest area in California for a while. Okay. So find on the timeline kind of when we bought ours, which was, it was probably—

It was the top. Yeah.

It was like here.

Yeah.

Yeah.

And then we sold it. There, like right there, and missed this whole thing because the contractors and I didn't slap a guy upside the head fast enough.

Yeah.

So yeah, I mean, it was—

that was your job. Yeah, your only job was to slap the contractor.

I know.

And you didn't.

I know.

That was a big lesson, wasn't it?

That was a big lesson.

Yeah.

Okay, sob stories.

It was a big lesson, but the timing was Well, we could have.

We could have in a different timeline.

Yeah. Yeah.

If it, it would've gotten done right, we could have right there.

Yeah, we could have.

And then it went right there.

Yeah.

Yeah. So anyway, it's triggering. I don't know why I brought that back up, but I don't know why either. Well, it was just like, I saw that.

I can tell you that I've lost money in real estate twice.

Oh God.

Oh no.

Yeah, once was in Joshua Tree.

Oh my God.

Okay, and you still talk to us. That's great.

And I still talk to you.

I'll make it up somewhere.

Yeah, but this is— this was like right down the street from our property, so I'm having like flashbacks right now.

Yeah, I know. Um, but well, and it was funny because while we were in the thick of it, um, Lauren's stepdad sends me a Wall Street Journal thing. It's like Joshua Tree, the hottest thing since Slice bread.

No.

And it like, at the time was—

But she didn't read it till like 6 months later.

Yeah.

No, they were sending this out like while we were getting the offers we were getting. Really?

It was like it had already peaked. Everyone was leaving.

Yeah.

The mass exodus. Yeah. There's people still making money out there. I mean, we talk about it all the time, but it's just funny to see a different way. Yeah.

Just not for us. Right.

They just, it's funny to see Wall Street Journal chiming in when they know nothing about it. Oh, and a part of the article was there's a family. It was like some tech guy from Seattle bought, bought an Airbnb, and then I forget what the story— yeah, right here. So, um, the family put it on the market for— no, go back to the other one. Go back one more. Okay. At first, the home typically rented for $200 to $250 a night depending on the season. McKinley said over the last 2 years they've had to lower their nightly rates to $125 to $185 to grow, to keep up with the growing competition. And that's what, like, you know, I mean, that's what is happening across the board.

Yeah.

Because everybody's Airbnb-ing out there.

And just looking at the photo, if this is a photo of their actual house, we know a few people running STRs out there and it's like minimum you have to put like $100K into the house. This is like, this is not going to—

this is below standard.

This is like teenager bedroom. Yeah.

Like this used to be like, wow, it's cool. Like if you go back, it says like funky on the—

There was one with a pool. Like you pretty much have to have something crazy. There was one towards the front like this. You need to have this to be getting anything close. And even this is becoming saturated. There's so many new builds where they're building this out.

But this is a nice place.

It's really nice. That's cool.

I doubt you're going to go out to the desert and burn yourself.

That's where you want to be. Yeah.

That's where you want to be.

Yeah.

But if you don't have the pool, you don't have the spa, you don't have this like futuristic adobe look with all the amenities. If it's just a regular house and you painted a mural, it's not gonna—

Right. So go, go to the house again. Like go back to the other way.

Yeah.

Keep going. And then, so he drops, he drops it and then they relist it.

I mean, you can tell this kind of looks like what our property looked like, you know?

It does. Yeah.

Single family home.

So they bought it for $470,000.

Whoops.

Yeah, no, it's fine. No, no, you're good. You're good. So, and then they, they, you know, they rent it out, they're making some money, and then now it's like probably barely breaking even, if that. Not worth the headache. One more. And then in, yeah, the spring, uh, the family puts the home on the market for $599,000. No way. And have cut the listing price several times. And that's just what everyone was going through.

There's no, I mean, this one looks like it's even smaller than the one we—

Right.

He is like, let's get funky. It was like, No. That worked for like a time. And then currently asking $480,000, but they aren't going lower. This is every seller.

Yeah.

Um, according to the listing agent, since they are at the break-even as a short-term rental. So it's just like, what do you do with it? You just hold onto it.

It looks like our neighborhood too.

Yeah. Yeah, it does.

You know? Yeah.

It's just, I mean, and even our street that we were flipping on, it was like every house was an Airbnb.

There were 2 houses out of, what would you say, 15 on the street that were regular residences.

Yeah.

Yeah. And then that brings up the other side of—

I think, I think our problem was timing.

Timing.

Timing on the rehab.

3 months earlier.

On the rehab.

I know.

Yeah.

I'm blaming you, by the way.

Yeah, I know. I'll take the blame.

I blame you too.

Timing on the rehab.

Yeah.

And we bought it at a good price. We had enough room that we were gonna make a profit for a flip on a short period of time, but it just was too long.

Took too long.

Period of time. And so we ended up, uh, not making any money. Only the second time— did I already say that? Yeah, second time in my life. Yeah, that I didn't make money on real estate.

I'm sorry.

If you look at all of them put together, maybe I think there's a positive.

Oh yeah, I just said that. I said you've made it up.

Okay, good. There we go.

So no, absolutely. There you go.

That's how you learn.

Yeah.

Well, and that was like the biggest lesson. It was crazy cuz we had contractors that we had used that were kind of like flaky. Well, yeah. And I was gonna say the previous contractors, it was like they did what they said they were gonna do in a reasonable amount of time. Frank, on the mobile homes?

Yes.

So I was like, oh, this isn't that hard. And then it was like, find a new contractor out there. And then I did. And then it was just like flaky.

Yeah. And there's nobody out there. I mean, Alex and I, we ended up going out there ourselves, spending like a week in a motel. Frank and Gabriel came out, and then we were like doing half the work ourselves too. So, um, crazy. It was wild.

Crazy.

It was definitely wild.

Good experience.

I'm telling you, good experience. It was a great experience.

Like, you know, firsthand.

You hate to go through that and then lose money at the end of the day, but You won't do that anymore.

Oh God, no.

I don't trust anything anyone says.

Exactly.

Yeah.

Yeah. You learned a big lesson, which is great. That's awesome.

And it's like the second I see any red— well, there's so many red flags, like down to like how he kept his tools.

The worksite was never clean.

Yeah.

The worksite was just trash compared to like the other guys. They keep it clean, like they'll work and then they clean up every day.

Yeah.

And so it looks nice even when it's—

Which is what they should do.

Yeah. Which is what they should do. And this guy's like, just his tools are everywhere, trash everywhere. And I was like, oh, that's kind of an unconventional way of doing things.

Yeah.

Unconventional.

But it's just like the biggest red flag.

But we didn't know.

We didn't know what we didn't know. So we didn't know walking into a job site like that, we were just like, oh, they must be working hard. Like stuff is everywhere. But now if I were to see that like with our crew now, I would be like, what is going on? Like I would be freaking out. So. This is bad.

Yeah. You don't do freak out very well either.

I don't?

No. You get stressed out.

Yeah, I do.

She does. She gets stressed out.

That's a good barometer.

You're the opposite.

Oh yeah. I'm like, it's all good.

It's all good. Yeah. Let's buy it. Let's, let's, let's buy it. How much you offer? A million? How much is it worth? $500,000? Yeah. Let's buy it, Joe. Let's buy it.

See, this is what I deal with. It's like a million. This is why I'm stressed out.

That's how come I only talk to her on deals.

That's all right.

I have to make sure that she's on board.

I'm the top of the funnel and then it goes through you guys. It's a good system. We got it down now.

It's all working.

We had a talk this morning because we were doing our last minute transfers for our 401 for tax time. And he's like, it's just sitting there. We got to buy something. I'm like, we're not just buying something to buy something. And he's like, why not?

I was like, no, we got to buy something though. It's just sitting there. It's just sitting there.

Yeah.

But the right thing.

Yeah, yeah, yeah. No, I know. That's what I said.

Yeah.

It's got to be a grand slam and yeah, all that stuff. But it's just sitting there.

He's just very optimistic, which is good.

Yes.

Well, yeah, I got to rein that in.

Very? He's like over the top optimistic.

Yeah.

It's good for morale, but bad for other stuff sometimes. You actually got to look at the actual reality.

All right. We got a couple friends in the chat. You guys know who's here?

Liz is here.

Liz is here. She says hi. Hello, Liz.

She was in my— I did a stream yesterday.

And she also asked, how is everyone doing?

Oh, oh, doing very well. Thank you.

Doing good. Um, you did a stream yesterday. I think I saw it, but I don't know why I couldn't log into it. Something it said, like, I don't remember what it said. Yeah. Yeah. It's like, I thought I saw it. Like it alerted me.

Yeah.

You click into it and it's gone.

But I don't know if I remember if it said something, but I don't remember what it said.

Yeah. Alex is doing so many streams.

Do you have permission to log in? Like, do I need to log in?

No, no, no. It should just go to the channel. I was just doing a breakdown of the Huntington flip. It was basically—

Oh, that's right.

Yeah. Like the list I pulled to make this much dollar.

That's right. I did see that, but I couldn't get in.

It's all good. Okay, who else we got?

I lived it.

Um, Stephanie is here harassing you like she promised, and she says, um, she says, Joe, would you like to lose money with me? Third time's a charm.

See, Stephanie, you need to start bringing in deals.

Get on the phone.

Let's do it Wolf of Wall Street style. Watch Wolf of Wall Street. What are some pump-up?

I've got a buyer for you for that $5 million property that's in pre-foreclosure. All you have to do is find the seller and put a deal together. It's not that hard.

Wait, what is this deal? Who's the buyer?

One of my longtime investors is looking for a property in Dana Point, and he texted me about this pre-foreclosure that's $5 million.

Let's do it. Let's work it. Yeah, there's gotta be some spread in there.

You think?

Yeah.

I hope so.

A lot of the pre-foreclosure— or not a lot, but a certain amount of them are these like $10 million, $5 million, $6 million houses.

And, and then the other 2 that he sent me are $3 and $5 million, both of them, that he wants me to go preview. Commission on those are 2.5%.

Ooh.

That's like a $100,000, you know, commission.

Wow.

Hello.

How do you get clients like that?

You have to be Joe.

You have to be Joe.

Okay.

I've been working with them for 10 years.

Okay.

Yeah. Started in 2008, 2009. 10 properties later, I've represented them on.

What were they buying back then?

How—

what was their price back then?

We bought some at, uh, $150,000. Oh, $200,000. The last one they bought, which was a few years ago, $525,000 in San Clemente. It's probably worth about $725,000 now. Yeah, that was a great deal. That was like that fast of a deal.

I remember that. I remember I think we were in the office and you like put in an offer and it was done within like hours.

Yeah, my wife got upset with me because she says, why don't you buy it? And I go, well, my client sent me the deal, you know, that wouldn't be fair if I went around them.

Joe and his ethics. Yeah, always getting in the way.

Come on.

We've also got Rami in the chat.

Whoa, hey, what's up?

He says, I am also saying hi.

Oh, okay. What's up, Rami? Rami flips mobile homes.

Yes.

In Hemet and the surrounding areas.

Yes.

Love that.

There's one, there's one that just came up on the market. I think it was $139,000, was it?

Yeah.

Yeah, but it looked like it was 1,000 square feet, which is— you'd have to get that for what, $90,000, $100,000? Yeah.

Yeah, less than that.

Yeah, the RVs come down a little bit out there.

Yeah.

And especially if it's older and you can't get the permanent foundation. Yeah, yeah. We got Peyton in the chat saying hello.

What's up, Peyton? Nice.

Hello everyone.

Hello.

If you guys have any comments or anything on these topics, please let us know.

Questions, concerns.

Yeah, drop them in here. Let us know what you think about the interest rates. What else do we got?

Um, we've got one more short, and I mean, this This rings home. We just sold a property with solar, and it says don't lease solar. I'm not sure where the volume isn't working for some reason. Let me try it.

Here we go. Oh, but that's over there.

Let me try this. Um, no.

Do you do the Ecamm or the Rode as the output?

Yeah, I'm trying that. Oh, oh, it's moving on to something else. Hold on, hold on. Okay, let me— sorry guys, let me try to troubleshoot this real quick and bring it back around.

Yeah, well, I think in the meantime And, and we cannot give value to it unless you own it. So if you're leasing it and somebody else owns it, we can't give any added value to it.

Okay, third time's a charm. Here we go.

Years from now, an appraiser will show up to value your home, and you'll be making this big deal about the solar system. And we cannot give value to it unless you own it. So if you're leasing it and somebody else owns it, We can't give any added value to it.

Totally agree.

Agree.

Agree.

What about— I mean, main question on everyone's mind.

Autoplay strikes again.

If you even own it, are you making a big deal about it? And is it worth anything?

If you own it?

Like, are appraisers looking at that and counting it now?

Yeah, I mean, if you, if you own it, all I can say is it's easy To transfer everything. If you have it leased, then you have a finance company or the solar company themselves have to approve the new buyer coming in. You know, there's transfer paperwork that's involved. It's just, it just makes it that much more difficult.

What if you own it and it's not paid off yet?

It's a nightmare.

How can you own it Or it's—

you're not leasing it, I guess.

You're not leasing it, but you're making—

You financed it.

Yeah, that's the same thing. You have to deal with the bank, you know. Are they willing to let the new buyer continue to pay that, uh, that lease payment, uh, mortgage payment, whatever you want to call it?

No, they're not, you know.

No, they're not.

We know firsthand.

Yeah, yeah. We went through that in escrow, and we tried to make it assumable for the new the buyer of the home, and the servicer was not cooperative. And we were supposed to close in like 2 weeks, and they were saying it could take up to like 8 weeks to even get the application reviewed.

I think I yelled at a nice customer service person.

They deserved it.

They did. I'm sure they did.

I was like, you're not gonna do anything?

And we got lucky with that deal because the buyer says, oh, I'll just pay it off.

Yeah, that was okay.

I think they asked us to pitch in like 5K. It wasn't very much though. It wasn't even half.

20-something.

Yeah, but it wasn't even half. She was just like, you can pitch in like 5K.

Yeah, I think they wanted to go half and half, and then we said we'll do 5, and they're like, okay. We're like, cool.

I think that's what it was. They wanted us to put in 15, it was 30, we settled at 5.

Yeah, they were— it was pretty easy to work with.

That was good.

Yeah, that was nice.

I liked it. I liked that one.

Yeah. Simple through and through.

Yeah.

Peyton's got a comment. He says, working on my second flip, launching PPC next week to start working on deal flow. What's y'all best marketing channels?

Okay. Yeah. So we've been switching everything up. We were doing mostly texting, some cold calling. There's been a giant movement with the— and laws put in place with the carriers and the federal government getting involved. Somebody, or actually someone explained it to me the other day. What happened is they passed the laws, um, saying that, that it was originally to keep, uh, like, uh, farms out of, in Pakistan from, you know, spamming here in Philippines.

Mm-hmm.

And then they put it all on the carriers and basically said like, okay, well we passed this law, but you guys have to enforce it. 'Cause they had no way to enforce it.

Mm-hmm.

And so now everything is blanketed as Spam. And what's happening is the carriers are one, marking your number as spam. So it's like you can't even get through sometimes. And then the— I forget what the branch of the government, it's like FTC or something, is coming down on the texting. And so we pretty much just squashed that. And we're doing similar to PPC, we're doing PPL, and then we're looking at direct marketing right now, as well as working with other wholesalers and some on-market offers as well. So a couple of free ones, a couple of paid ones. Payton, where's your deals right now?

Give it a minute because there's a delay between the broadcast.

But anywho.

If you need—

if you're working in California, we're definitely—

We'll buy them.

Yeah, we'll buy them. Um, so yeah, I think everyone's looking into the inbound channels right now. It's just expensive. It's very expensive.

I mean, it's funny though, with all this like regulation, it doesn't stop all the political texts that I get nonstop.

Yeah.

Political text. I still get random, like they're they're crypto.

They're all exempt. Well, yeah, not crypto, but politics. So when it comes time to vote, you notice that on every corner there is some person's name for Congress or the bandit signs. The bandit signs or senator. Those are exempt. Most cities don't allow that stuff. They put laws in place that say we can put them there and you can't touch them.

What if we made a bandit sign that looked like a political campaign ad?

It's like, vote for We Buy Houses.

Yeah, but somebody's— yeah, somebody's gonna look at that and just like—

Maybe they won't notice.

They won't even know what it is.

Oh yeah, true.

Yeah, someone around Seal Beach put up these bandit signs. They've been up for over a year on all our— we have the old school telephone poles. They put them up so high and with those, you know, the crazy bolts where you can't just like rip them out. And I keep telling Alex, we need to go get just vinyl stickers made and replace the phone number with our phone number.

I don't know how we're gonna get up there.

Because they haven't been taken down.

We're gonna hire Ryan to go up there. Yeah, we'll get a ladder for a day. A ladder for a day. Yeah.

You've never rented from Ladder for a Day?

No.

And then you get a hard hat and the thing and a clipboard. No one will stop you.

True.

You can get into any event if you have a ladder, clipboard, a vest, and a hard hat.

True.

Or a guitar case.

Yeah, or a guitar case.

And pretend you know what you're doing and that you're there for a reason.

Exactly.

Yes.

Alex, Alex and I, um, I've only successfully snuck into one concert, but he used to— he tried to sneak us into a concert and he walked right in and the security guard just stopped me.

Like, she's like, looks around all scared. I'm like, just act like you're in the backstage, didn't even— like you're playing the show.

Didn't even see Alex. He was like a ghost. Just walked by him. It was like, whoa, whoa, whoa, where are you going?

In the back. I was like, just follow my lead. And then I look back, she's— I'm like, oh God, she You don't look like you're supposed to be there.

It's not like you were going into, um, you know, a popular place to go drinking and dancing. I think it would have been the opposite.

Oh yeah, when they just let the girls in.

Yeah, they would have let you in without a doubt.

And no, this was like, we don't want this guy. No, it was like bands, so they probably don't want random groupies showing up.

Wow.

So the big question is, did you go back out?

Yeah.

Okay, so let me tell you a story.

Oh God.

My son, when he first got out of college, he was working for a high-tech company and they were flying him literally all over the US to do different jobs in different places. So he got a lot of air miles out of it. To the point where he would just show up to, you know, a plane and have like, you know, a regular seat. He had so many miles that they would upgrade him into first class.

Amazing.

Okay. He has the same name I do, except he has a middle initial. So I used to use his frequent flyer, you know, mile thing.

Nice.

So one day the wife and I were flying to, I believe it was Puerto Rico with my cousins. I know where this is going. And 4 of us were sitting, you know, one row behind each other. And they come up and the flight attendant comes up to me and she goes, Joe, do you want to come up to first class?

And he's like, of course.

I looked at my wife and she's like, you better not leave me. And I go, absolutely.

Oh my gosh. This was first class.

Come on. I go, I'll bring you back something. Yeah.

No, you let Lorraine go.

I'll do this for us.

And she brings you stuff back.

I left her there because my cousins were there as well. So she wasn't alone.

They're your cousins.

Well, we grew up together. The one cousin was the best man at my wedding. So it was like, I wasn't leaving her with strangers or anything, but I didn't hear the end of that for the entire vacation.

Of course.

Why would you leave me? I go, it was first class, you know? Come on.

This is a learning lesson, Alex.

Oh, I would never do that. I would be like in my head, like absolutely. I'd be like, no thanks. I'm good here.

Oh, you send the wife?

Oh, send the wife.

Yeah. Oh yeah. Yeah. I could have done that too, but you have to know, you have to know my wife. She would have been like really lonely up there by herself.

Yeah. She'd just be looking back like, I wonder what they're doing.

I don't have anybody to talk I was talking to my cousins here, but you're here.

You could have maybe talked her into 2. It's never too late.

You got to talk them into 2. You got to be like, I'd love to.

We have 1 seat available. Mr. Homs, would you like it? Yeah, I'd like it.

And they serve you the champagne and the ice cream and you're like, yeah, this is nice.

And I brought back some stuff, but they didn't want it. They said, just get it. I don't want it. Okay.

You're too, you're too hoity-toity.

I'm going back to my first class seats. You know, I've got a movie that I'm enjoying, so we'll see you guys later. I'm just checking in, make sure that they fed you. I don't know, they don't feed us in coach. Oh, I'm sorry. Yeah, we're having some good meals up there.

Bring some leftovers.

Everything else.

Oh, that's good. That is good.

Alex and I got to fly first class one time. To Japan because we tagged along with my mom on a business trip and it was hooked into like her business booking.

And so it was nice.

They upgraded all of us. It was crazy.

You like lay down, you have like the wide view.

It was crazy.

That's a newer plane.

Yeah.

Yeah. Wow.

It was so cool. I was like, I could never go back.

Yeah.

Wow.

They had a snack bar.

You could just walk up and grab some cheeses and meats.

Nice.

It was nice.

First-class real estate.

Yeah, exactly.

Back on topic. Here we go.

Okay.

Anywho, yeah, I think that was, uh, I think that was, uh, all the topics for today.

Okay.

Yeah, that was all the topics. I mean, you guys are right on time. You're at 54 minutes.

Perfect.

Well, thank you guys for joining into the chat, and yes, and we'll be here next Thursday. We have, um, a special guest. Um, hold on, let me just pull it up really. I should have— yeah, okay, I'm a work in progress, you guys.

That up?

Yeah, I mean, you were pretty organized with these.

Pretty organized, but then I should have this. Okay, so we have, um, Danny, uh, bait or, and, uh, yes, he has over 20 years of experience in residential real estate. He's helped clients purchase over 5,000 rental properties across 40 metropolitan areas in the US since before the 2008 crash, during and after. And his aim is to provide our listeners with practical, practical tips and strategies to enhance their investing abilities, as well as guidance on navigating complex investment scenarios.

You read really well.

Oh, thank you.

Yeah, that was nice. Okay, I'm interested in this guy. He's done all that in 20 years.

I guess so. Yeah, and he'll offer valuable resources to help our listeners develop the skills they need to succeed in their investment ventures.

Yeah, so hopefully he doesn't come on and say buy Joshua Tree.

Yeah, he's like, I got a new investment strategy, the desert. Joshua Tree, ever heard of it? Yeah, so we should be good. And, uh, we got, we got guests lined up, but this was fun today.

Oh yeah.

Do you want to show Joe the, um, the historical home in Riverside? The beautiful home that your mom sent us?

Sure.

Yeah. Okay.

Yeah, in Riverside, Joe.

First of all, I don't like historical homes.

No, this was my mom's fantasy of her living there. Oh yeah.

Yeah.

Yeah.

Historical homes are way Expensive.

This one was, uh, this one was like $850, maybe $850.

But then Lauren's like, but it's in Riverside. I was like, I know, my mom sent it.

I'm sorry, I'm a coastal girl.

Yeah, no, it was really cool though. Built in like 1928, Spanish style.

I'm trying to find the link, one second.

It looked really cool, but, uh, I think it had 2 stories.

No, that's not it.

We couldn't have looked all this up while I was flopping my gums.

Yeah, I'm sorry, I just, uh, we're going— I can't find it.

We're headed to first class.

All right, all right, sign off. I can't find it.

All right, well, yeah, maybe pull it up next, next time.

Um, you want to drop your socials?

Yeah, sure. Yeah, follow us on, uh, Instagram @JoeHoms.

Yeah, Joe's posting every day. You wanted me to post my Social Security number. No.

That too.

Steve Roushley. And, um, yeah, you can follow us. We're gonna be doing a lot of walkthroughs tomorrow.

Tomorrow?

Yeah.

Walkthrough day.

Are you gonna use the glasses?

Yeah. Ooh, that's a great idea.

That's right. Let's do that.

That's a good idea.

Yeah. So when we do the walkthroughs, Joe's got his glasses.

Look at my Instagram tomorrow. I'm gonna walk through the house and it, uh, it'll record up to a minute.

I think you can go live, can't you?

Oh, I can go live.

What are the glasses you got?

That's why. Ray-Ban Meta glasses.

Joe's like living in like 2050 right now.

Yeah.

So we're trying to catch up, but thank you guys for joining us, and, uh, we'll see you at the meetup April 22nd, and we'll see you next week right here, 4 PM Pacific Standard Time.

Bye.