Well welcome back to another episode of the Meet Kevin Pod. This is uh, where we're going to talk about real estate today. We've got the creator of the Channel one rental at a time here. Uh, we've got that up on screen right here.

one rental at a time which I think is actually a great way to get started. You are also the author of two books which I have right here. One of them is one rental at a time the Journey to Financial Independence to Real Estate which actually has incredible reviews 4.7 Stars here 1344 to great. Uh and then there's a newer book that you just released and that is 15 conversations with real estate millionaires presented by one rental at a time.

Welcome, thank you for being here. Thank you! Kevin this has been, uh, this has been something I've been looking forward to for a while so thank you for the opportunity my pleasure. So tell us, tell us about what's on your mind. Should we start with Crash or how you got started or what do you think? Would you tell me what's important to the audience? Because I Crash.

Everything. Everything's crashing right You You said you called the Crash What Crash did you call? So about a year and a half ago you know we were sitting at about 6.2 million transactions existing home sales Jerome Pal came out at Jackson Hole and said basically I'm going to kick the rich people in the nuts and he said these things about housing and everybody's like the crash is finally coming right? The Crash has been called every year since 2010. This is true. This is true Double Dip.

Back then, it was supposed to be a double dip recession. The banks were going to release the shadow inventory of foreclosures because they're trying to screw the little guy. Yes, Yes, yes, Um, I Didn't believe it. But I Went back and did some research because we actually had a time in history my lifetime not yours where interest rates had gone up 500 600 basis points from 1978 to 1981 rates Paul Paul Vulker right after Arthur Burns Paul Vorker comes in and does it.

so I said what happened to housing Yeah, so actually, if you go back and look at housing from 1978, this is a very interesting statistic that people need to realize. 78 1978 we did roughly 4.2 million existing home sales. Okay, guess what year we broke that number Because after 1978, we went lower because rates were going up right? So some kind of recovery. You know, probably before the Savings and Loans crisis.

So what? Mid 80s? Yeah, it was actually uh, 18 years later? 18 1994? Wow. So think about that. Yeah, because I would have guessed like okay, maybe seven, eight years or something. 18 years, 18 years until the transaction volume exceeded 1978.

Wow. now I ask myself what happened to price? Yeah, because again, if if prices or if rates go up 500 basis points, price are supposed to go down 10% for every one point, right? That's it's buying power. That's not value. It's buying power, right? And they didn't Wow on a nominal basis, For every all that time, only one year was nominally down.

it was fractally less than 1% down. Every year was up, and that's like 81 or 82 or something. They like 85 or 86. Oh, back there.

Okay, wow. that was the one year was nominally down. Interesting. So so in other words, during the Vulker era, uh, that recession was nowhere near effective enough to really cause any kind of housing pain.

People were able to look through that pain almost well. I don't know if I don't I don't know that I Think it's very similar to today. If you're in the housing business, yeah, it's a depression. Oh my gosh.

Well, if you're a lender, you're screwed. You're screwed. You're an agent. You're screwed.

You're an appraiser. You're screwed. So in which, again, if you look at housing as a part of GDP it's a significant portion somewhere between 8 and 12% that's in a depression. It has been negatively adding to G GDP for five quarters.

Wow. So again, it's a drag on GDP So it's a depression. But everybody wants to talk about price. And just like the 80s, people fought to stay in their homes.

Interesting, right? And oh, by the way, what do we have today? We have people fighting to stay in their homes. We have interest rate lock in I Like to say the FED broke housing. not because they kept rates too low at all, but for too long. Not only do we have all of those purchases in 2020 and 2021, we have all those refi.

Oh my gosh, Yeah. So if you look at everybody I don't know. you know depending on what Black Knight number you use something like call it 90% of loans or sub 5% Yep, it's not going anywhere. and if you don't have to sell, you're not listing.

And by the way, if you really want to break it down, a lot of people's payments today are less than rent. Yeah, no kidding. Yeah, because the rent's going up because of inflation. but people are locked in on these.

It's almost like the 30-year mortgage saved American housing would you? I Would totally agree. The fact that we have fixed rate lending is why we're okay and Canada's not. That's a good point UK is not. New Zealand is not right.

There's a lot of folks that most of the world doesn't have the 30-year mortgage. We are very uniquely position. Usually you're just like 10 year. You know? then you have to refinance.

it's five. usually in most places. Wow. Wow.

I think in Germany I think somebody was talking to me about 10. but most of the countries are five that I've heard of. That's incredible. So so if it's the 30-year mortgage that saved us, then uh, are do you just get? Do you ever look at the seasonality of okay, well now some prices are going up in the spring and they're coming down in the winter.

Like do you ever look at an a year and say Here's the best time to buy or what do you like to look at? So I've been buying for 22 years, right? one? until at of time started in 2001 when we bought 181 18 North Drive East you can look it up on Zillow wow it was 107 Grand what was it? Uh, 18 18 Norris N O R R I S Drive 93703 it's in Fresno California So when you pull it up and you look at the values, I'm the buyer that paid 107 Grand Oh that's awesome. Now this estimate I mean it's estimate for what it is, but it's like 307. But let's play this out because if you pull it up for folks, a I buy it for go feel free to show that up on screen I got it up on so I buy it for 107 About a year and a half later I do a cash out refi and I buy more properties with it and then about a year and a half later I sell it for 26 something? Yeah, but look at the next transaction. uh, 75 in I invested through right? So I started before I sold at the peak because I knew there was pain coming and I 10:31 into apartment end of 05 that was the top of the market because the market started turning at the end of 05 very slowly through 0607 and it wasn't until 0809 you actually had the drop.

Like the full drop. Wow, that was great timing. Good job Yeah! so we sold Eight houses we 1031 into 80 units. So we were in multi family when the crash happened.

Wow Wow Wow. Okay, well that also got hit uh to some extent did not. Rents rents went up. We actually had better quality tenants because people were losing homes.

Oh my gosh yeah that is interesting. Yeah you you almost rarely. It seems like something my in-law said too. It's like they didn't really see rents come down in ' 0809 because of the short sales and foreclosures people were forced into renting.

so it's almost like you're your pool of tenants actually. Uh, dramatically increased. correct? Uh, and it just it made the survivors capable of frankly being wealthier. It it created and gave birth to almost The Invitation Homes Oh no question 20, 9, 10, 11 I Remember the day So I was buying out of I only buy in Fresno it's my only Market Okay, I was buying out of the MLS because there was a process every Friday there'd be a load from the banks that would publish Monday morning and it was just a routine that I did for year and a half.

Wow every every Monday I'd write more offers and then one Monday no inventory. Wow. I'm telling myself it's a blip, right? Data corruption. You know all that stuff next week goes by nothing.

So I'm calling people because again, I'm I'm a known dealmaker and say Michael these guys out of out of you know the East Coast they're buying the entire book. Not only they buy entire book, they're paying list price I never paid list price for anything of course. Yeah, so they're buying it at list I'm like the world just changed. Wow when Wall Street showed up.

Wow, yeah, because that's that's back when what Invitation Homes was like 2011 or something like that. and that's when Warren Buffett's like, you know if I could home I'd buy every home I could. Yeah, Wow. invested through that? Yeah, that is really incredible.

Okay so so what's your take now then I mean like how long can you you go with a transaction crash? I Mean at some point people have to sell. or maybe institutions sell? maybe? Do they have to? We don't know. Uh, do do we ever get any kind of actual price? Discovery because that seems to be the difference between us and these other markets that are crashing is sure. prices came down from May of 2022 to December but they're basically already year-over-year even again.

Uh so so when when do we get this real Discovery Or does it take real layoffs? Like what does it take? Well, we need the whole key to how is you need Supply right? A Lot of people look at the supply demand curve of Housing and everybody who's a crash bro talks about demand. Yeah guys, affordability sucks I Get it, it's not a record though. A lot of people like to talk about it being record. 1981 is the record.

Wow if you really want to look and we still did 2.2 million homes. So again, most unaffordable ever. We don't never do Zero. There's always death.

Divorce cash buyers All of That So My answer to a lot of folks is unfortunately I Believe what happened is we had in two years we had all the appreciation for the decade. Oh yeah, yeah, just the last. Yeah, 2021 2022 Yeah, so we're GNA have eight years of flat. Yeah, it doesn't surprise me actually.

So again, affordability is bad. Yep, how does it get better? Yeah. wage inflation. Little little by little it takes time.

Thank you. It's we are not having a repeat of the Great Recession I am so sorry it's not coming. Yeah well I actually agree with you. but it's also interesting because it essentially you're also saying we're not having a repeat of the 2021 22 and I think there are a lot of people who had sort of the like the fomo of like oh I'm missing out on real estate that they're like all right well this will be my chance.

If prices fall 30% then I'll buy and then we'll get all this appreciation in two years I mean real estate turned into a meme stock it did uh so it was I remember it was 2022 was like March you know drone Po drops rates to zero First thing I did is I called my lender I go refinance everything yeah everything right uh and then we took Capital out out and um and we we thought okay is how is this going to affect real estate and we're looking at the week by- we transactions and we're like well things are still selling, prices are going up and everybody's like there's going to be a big crash and I'm like well the why is all the numbers going up You know the numbers are not going, inventory is going down, prices are going up right and rates are down. That was 2020. so uh I bought a bunch of properties in 2020 but it wasn't until 2021 22. Everybody went nuts because you had the convergence of low rates Airbnb uh like everything that just said go buy real estate It can never be wrong.

It was crazy. It was the closest thing I have seen a repeat of 2005. Wow and that's when you got out in 05 I got out in 05 in 2005 you would go to I live in the Silicon Valley and everywhere you went people were talking about the last house they bought. it was housing.

Never goes down. This is pre- Crash Housing never goes down. it always goes up and people were flipping contracts. that was the closest I saw was 2022 early 2022.

Was it? It just couldn't go wrong. Yeah and I start screaming right I was like guys, real estate investing is not easy. You all are financial speculators and you're going to get spanked. Yep and I actually think the most pain is coming to those poor LPS Limited partners and syndications.

Lot of bridge debt. Well because yeah, they have these shorter term loans because you're not getting Fanny Freddy loans. No, you're getting short-term interest only bridg debt. dfcr loans.

Yep and but that's how they pump the cash flow. You know that's that's how you get the syndications. Like like I look at of these syndication documents and they're like oh yeah yeah yeah, we'll give you a 6% cash flow and then you look at it and they're like oh, we'll charge you a 1% management fee per year on the asset value. but we're going to defer that management fee until we sell the property which basically temporarily pumps your net income on these projects on these syndications.

But not only that, uh, you're uh, you're you're looking at these interest only loans. You're not paying down any principal. You're going to have that refinance risk at some point in. I mean you're doing 200 units you're trying to do value at.

Are you kidding me? Moving tenant vacancies? There's no value. Add in these multi like my opinion, like these institutional investors are are plowing down like pension fund money and they're getting paid based on Acquisitions and uh, and basically deploying the capital. They're not getting paid. It's like you're not getting a bonus because you added value.

Now can you do value at a multi? Of course you go and find a low rent property. Raise the rents, Whatever right? But realistically like I Think of Grant Cardo and his value ad is putting his name on the buildings. That's his value. Something Yeah, yeah, yeah is 10x.

Living is is what he does and like to some degree. It's very like almost trumpian. It's like, all right, this this property is worth 200 mil. but now that it has the Trump name on it, it's worth $1.5 billion.

Which then you go Okay, like maybe Trump is bringing in a lot of revenues because he's doing events and stuff like that, but going to Cardone because that's a little less complicated. That's what he does. He puts his brand on it and now it's worth more. Well also, he's on record of bragging about buying at three and a half caps and all of that Now that you have a 10 year, roughly 5% what's the point? What's what's a three and a half cap? that's you know.

redo the value Of that It's it's not there. Yeah I Just in my in my email I have this: I have this email from from JP Morgan and uh, they sent me. Oh boy, it's It's one of these first ones A bunch of mores came in. Uh oh.

here it is. Okay, Uh. quick update Our treasure. Our JP Mortgage Treasury Market Fund yields have bumped again now up to 5.33% same day liquidity, no holding period.

Stable value $1 in $1 out 5.3% You do nothing, no risk, 100% liquidity. Exactly. It's insane. It's insane.

And now you're you. Now if you're a syndicator trying to refine to that, you're going to go get seven and a half 8% So you're massively negative, Massively negative. You can't afford The Debt Service The pain is real. So you have to sell, then you.

The bank's going to take it back. You have to sell. You may not have Choice The bank's going to say give it to me. You're right.

You might be right. Well, so isn't that possibly going to lead to this? This price Discovery over time or is that are you saying those sort of sales are what are going to keep a lid on prices? We have to separate commercial and residential. Okay, fair, Yes, yes. commercial real Estate Repeated the sends of 05 residential.

What do I mean by that? Go back and look at 2005. The ventages of mortgages 51% were arms. Oh, adjustable rate mortgages not only adjustable rate mortgages but I think it was 14 or 13 or 14% were pick a payment. Remember those, they're illegal now.

Well of course it's so the the The Neams that's one other. Pick a payment negam. Oh okay. I hadn't heard that version of that pick a payment was and everybody picked the payment which added debt to the end.

Ah okay, okay, that's okay. Got it. Same deal you did the same thing in commercial. So the pain that is transpiring right now is going to be concentrated in commercial.

It's just starting the first inning. Residential: Up until this year, 98% of loans were fixed. The Blended or What's called the effective interest rate is 3.6% It's nothing, right. Your payments less than rent.

You're not going anywhere. This is going to be like 1980 for residential. I Was my family not very rich fought to keep their home in like 8384 Dad was unemployed. mom was always stay at home.

It's always unemployed in 84. It's a bad time in the valley. We're one day away from being foreclosed on and we do everything we can to fight to stay there because we know if we have to leave, we're screwed. Oh gosh, because anything anywhere we go is smaller.

yep and cost more. Yep, because it's just where we were at the time. So that's what people don't understand. This is Not 0789 10 where you're walking away from a payment cuz it tripled.

Yeah, Yeah, exactly. These are people with 3% mortgages where the payment is less than rent. it's a third maybe or whatever where we live. It's the opposite right? It's like it's 0809 happened because people's the people who were in their homes saw their payments go skyh high where they're like I could rent this same place for a bargain.

So so of course you're walking away. you're you're please like they would do I Remember these the short sell incentives. It was like the bank if you agreed to do a short sale with them they would give you 10,000 bucks to as as like compensation for going through the process. 10 or 15 grand for moving expense says they would just give you money to not have to go through the legal process because it was cheaper for them in the long run.

So you were getting paid to go from a high payment to a low payment? Yeah, exactly. That's such an interesting point because now you're actually locked into a very low payment and a low rate. You are basically being paid to stay. No, And that's what people who are calling a crash in prices don't understand.

People will fight too the nail to stay like my mom and dad did in ' 84. They're not going anywhere. They will get roommates before they lose that house. They will lose their car before they lose that house.

Interesting, and that's what people don't understand about residential residential is pretty. St and I think it's going to have like I I I'm a big believer that we're going to have like this weird volatility over this next decade like I don't I don't know if it's I Certainly don't think we're going to see a 21 22 for a very long time maybe ever again because that was insane. The Confluence of of money Printing and low rates and everything I don't know that that we'll ever see that I Hope I'll be clear I hope we don't see it again. That was unhealthy.

it was UN I agree with that I just let speculative Mania it's crazy. uh it. I think it's going to leave a lot of people with a sore taste for Real Estate now too, especially people you know I went to I was in Vegas the other day and I go through an open house and I'm like so why are they selling They're like oh it's an Airbnb and I'm like okay oh they just banned airbnbs here and I'm like New York did the same thing yeah rip So uh and we should definitely talk about the Airbnb bubble. but in this price volatility, it is interesting because I don't know if it's because there's so few sales or what it is.

but this summer I'm out in markets and I'm seeing everything's multiple offers almost everywhere. So I think there's I actually think there's three markets going on right now I Look every day? Yeah, yeah please. So for the folks watching this, if whatever Market you're in I suggest you do the following: Draw a line called Media Home Sales whatever that is for you. Okay, right in.

Las Vegas I think it's like 440 Grand Yeah, just use pretty in line with America Almost. Pretty Pretty much so. Anything that's 2x the median or above is really slowing down 2x the median. So 440 time 2 is 880 mhm.

Crickets for that area. If you're 200 and it's 700, then it'd be 1.4 Got it? Okay, so wherever the median is for your buy box or your area, double it. That's the luxury. Market Crickets slowing down? Stay out of that stuff.

If you want a deal. Like if you're happen to be lucky enough to be shopping for a luxury home, Yeah, Go. do what Patrick B Davis says and write disrespectful offers, right? Go get 30% off. Seriously, you probably could in this.

Yeah, if they got a sell, he's not wrong. They got to sell. Yeah, Okay, now take that that same line and go the other direction. Okay, so if you're 75% of the median okay, and you're a clean property, which means passes FHA passes VA inspection.

there's none of that stuff. they can't build them. No, that's where you get your multiple offers so you're getting very noisy indicators. But that said, that's 525 on 700 By the way, there you go.

So if you so you know this Market go find a 525. oh it's multiples ex there there I Like this metric, this is good. but here's what you do right. you the wedge deals.

Okay, go find a 525 that doesn't pass FHA Right right then you can go get disrespectful. I Did this last year when everybody was saying you can't do it like Yahoo Finance 87% of the people last October said it's a horrible time. It just pissed me off. Oh yeah I mean what did they say? be be greedy when people are yeah So I said I called it on my show right I said I'm going to go find I'm going to go find one and I'm going to buy it out in the MLS wow I bought two 30% off, fixed them up, flipped them, made 90 grand total away I did flip them.

Wow you're like it's too much I did too well I it was what I called I had you know I had somebody I wanted to pay a little finders fee and all of that but it was just just annoying. Okay, but what you're trying to do with House Hack? Yeah, because you have the cash. It would have worked last year. It's going to work brilliantly this year because your competition is less.

Oh interesting Thank if you're competing with Owner Rocks Yeah, you shouldn't be like if you're going for the pretty stuff, ignore it. No if I see something in owner is okay buying out. Yeah, just don't even bother showing up. Yeah, you're right.

but I mean what did I buy I bought one on again which people can go look at the pictures. it had a shake Roof Oh my gosh, you bought a wood Shaker I did because well it's funny because the buyers can't even get insurance on those suckers. It's brilliant. So I I knew I was going to rip it off the first day.

I owned it of course. Yeah, put it on for 12. Grand Also, it had a four car garage I've been in the market for 21 years. It's the only fourcc car garage I've ever seen in the city.

Is it weird? like no, it's two car. it's a two-car and a two car. A hot rod guy owned it. Oh okay.

okay so he added on another. he added on another two car behind his and you have larger Lots out there. Uh, it was a corner lot so it had easy access off the alley so it was still like a 10,000 But the point was it had something that nobody else had. Four car garage.

The house was built in the 50s so it was a Ho H 31. Yeah right, just just classic. but it was listed for 230. We bought it for 170 I put 45 in.

We sold it for 270's Go in. 93 days, good for you and see you got the time frame down. I I Keep I I Tell everyone I Want these projects done in 45 days? They're never going to be done in 45 days 90day FHA Rule Well again, if you're going to keep them for flipping for flipping Yeah, yeah. okay.

okay well but that also can include your escrot time. You know all that. But this is interesting. So so I like this stat because I agree with you.

Uh, and that's interesting what you're saying about all that fear last year. So you're saying that you're seeing that similar fear now. Absolutely. we are repeating: Q4 of 2022.

Oh, tell me people are leaving the market. Tell me they're leaving in droves. Buyers are hearing it can't work. Last summer we were hitting seven.

Now we're hitting eight. Buyers are pulling away. Transaction are going down I Expect September existing home sales to be 3.85 million which will break the low of 4.02 million. Wow, we're going sub four.

Even though Red Fin CEO says we're at the bottom, he's wrong. Well, he says that all the time. He's clearly wrong. but we're going stocks at the B Oh, but here's here's the deal.

There will be more opportunity in Q4 and Q1 than last year. So uh, q1 M you think they'll So last year we had a miserable Q4 stocks were also horrible and then everything started booming again in Q1. Why do you think this Q1 it wouldn't boom in like Q4 will be painful. but q1, it'll be on rates.

so again last year I do this every day. so until the end of January it was rough. Okay, rates came down, you saw people like we. if you actually go back and look at the transaction volume, we had a bump in February because of all the flipper inventory was left over.

interesting and they sold. Yeah so so rate sensitive I mean Christian you could throw up on screen for a second Here this is and you could see it here. Uh, this is what if I throw in a 740 credit score which it always tries to default a 700 but I go for 740. Uh and uh, the 30-year fix not only broke eight, it is now At8 and a3d Y which is insane.

And then looking at the like I'll go to the 10e treasury I'm going to zoom out here for a second on the 10year treasury. Uh so I want to go to? let's go to the beginning. So oh so like this sort of drop. So as soon as you got that drop and rates the first quarter this is a downtrend.

This is and this will. this will happen again. This is what you have to watch Mhm We are building pressure in a pipe. Yeah that pressure is called demand.

Uhhuh. Everybody is sitting back waiting for rates. How many people are waiting for rates to come in? Oh everybody says as soon as rates are 3% again I'm buying Well I think a lot of people are saying it's 6% Again, they're are you serious? I do I talk to agents every week? Okay, across the country. Yeah and right now 7% is the barrier.

Oh my gosh, 7% eight because again, I've been studying the consumer cuz I have an Econ degree for 30 years. Nice. Yeah, the consumer psychology is rather repetitive. We get used to things a lot quicker than we used to.

You can go back and look at the mortgage chart. We hit 6% last. August crickets nobody shows up to everybody's like oh my God comes down, goes back up. 6% went through like a hot knife through butter.

Six and a half pulls back. seven pulls back. now we're at 8. It's going to build up.

Tomorrow's an important day as you know as I'm sure you'll be live streaming 530. If we get a number over 170 Mhm, we get an unemployment rate ticking down to 3736. Rates are going to rip. Oh yeah, of course.

but I think a lot of the economy is slowing down. We get a 155. We get a 38 39. Yeah.

Participation rate. Whatever it is. Yep, it's going to be a sign. The Fed's done.

I Personally think the FED is done. yeah. I Also think the FED doesn't cut next year. So I'm the higher for longer Camp W Really right.

It'll be the first time they haven't cut for 15 months. The record currently is 11 months. Yeah cuz I think pow wants to kill the Fed put I think he's tired of Wall Street and they're gambling punishing the little guy and he's going to hold uh for 15 months. Wow so that would put us 15 months would put us all of next year.

So maybe it's 18 months. but no Cuts in 24. Also, 15 more months? Yes. Okay okay okay 15 more months.

Uh so start hiking was what like March of 2022 end hiking? maybe basically uh, year and a half later and then you think basically a whole another year and a third of stay of stay. Wow yeah that would that's going to create opportunities for just years I Feel like of people not wanting to buy? no The other thing you know this. but for the audience is we have a a unique spread. Between the 10 year and 30 year, it's roughly 300 basis points.

Historically it's been 175 180. Sure. So we have 100 basis points. Easy that could come in once the banks think the FED is done until they think they're done, they're going to add the spread.

Well, it's also all the speculation going on in shorting bonds and stuff like that. Okay, okay okay all right, but once once the FED has made it clear they're done, you're going to see that come in. Which will mean rates are in the high sixes. Okay and again I think there's pressure in the pipe I think there's demand behind that we'll see, but we will not.

I Don't think we get back to six million existing home sales back to where this started for at least five years and probably eight years. Interesting. So my, my crazy theory is that uh, 10 years we're at 1.8% interest Again, is that possible or highly unreal? What's your opinion? So again, just so 1.8 10 year, 1.8 What are we talking? mortgage rate which is lower than what we've had before. I Uh, I would be afraid if that happens.

Why? Because something massive would have to break. Really? Because I mean like we have, Uh, you know we had the European sovereign debt crisis in like 2012 13 or whatever. But I mean right before the pandemic? their mortgage rates were like4 sure. Which is insane.

Yeah, yeah, well, because you, you're basically you can't You can't get inflation I mean right before Co our inflation was stuck at 1.75 a long time. Yeah, they were thinking about lowering the target. So so what's to stop that from coming back? I mean over time I Don't think you know, like over the next year or two. Obviously, 10 years is my 2033 is what I'm saying I Yeah, so again, one guy's opinion course.

I think the natural interest rates for mortgages are somewhere between five and 6 and a half% the natural. Wow. so you think like that long-term average. Back to that.

Not this because the the counterargument is. well, the the 40 Years of basically disinflation from the early 0s right to now is is the trend that we'll just go back on. that. you know we're on that disinflation path.

and then oh, we printed too much money and then okay, we back I think we've I think we tested QE H and I think QE led to the fed put. Oh and and I want the fed put killed. Well so maybe you want it killed. but or I should say Powell I believe Po wants.

Why would he want to though? Because I think deep down he doesn't like the fact that Wall Street wins. Either way. Interesting, right? Okay, Wall Street takes on overl leverage, no risk management. It gets a bailout.

We pay for it. Yep, Yep. I think he's tired of that. Interesting.

So punish Wall Street Look look at billionaire or Barry uh stern. Oh yeah dude, he's getting hammered. Well yeah, cuz he bought a bunch of real estate in the bubble of 21 or whatever and now he's dumping it. Well that and he has bad debt.

He's he's ill. He's a real estate guy. Yeah, he's got a bad debt structure. He sold 2,000 homes.

This is back to your question about will the big institutions sell? Yeah, so A If you look today, they are net sellers. Yeah, but what does that mean? Yeah, right. they bought 400, They sold 600. But they're net sellers, right? If you want to create a cash crash headline: Yeah, they sold 200 more than they bought I Mean that's a good point.

Yeah, it's nominal relative to would you say 4 million transactions or whatever noise, but factually correct noise. M Then what happens if Wall Street wants to sell thousands at a time? Do you think they're going to call their local agent and list all a thousand? Uh, yeah, you're right, probably not. No, they're going to call Five Buddies on on Wall Street Yeah, sure and say who wants them Barry did this. He called everybody around and Invitation Homes gave them the best bought it.

That's interesting. So they're not going to be dumping in mass and they have different structures and they're paying dividends. They reats. Now it's like a dark pool in stocks where they they trade it in the you know, off exchange, off exchange.

they'll sell onesie twosies. We want out of that market we want out of this. You know, whatevers. but the time it would take to sell a thousand.

Can you imagine the walkthroughs and the inspections? oh my gosh, Or the even the light? No, they're going to sell it to one guy. You know, one team. Yeah at one stroke of a pen. Wow.

Yeah. so then no price Discovery Stay rentals. So what about? Okay, well what about the Airbnb bubble? Then something's got to cost. What's going to cost prices to come down if you happen to be shopping in a market like around.

Dollywood Okay, you're going to have a good time to buy. Oh interesting because again, there are some markets that got a flood of out of state out of area money. Well that happened in O too. I mean Florida Vegas these were like your bubbly of bubble Market the towers right? Everybody was buying flipping condos until they weren't So anytime you had an outpouring of external Capital that was overpay because the beauty about real estate you know this traveling around the country is every Market you go to there are investors that are killing it.

Oh absolutely because they know their Market they Fresno go. let's go. So they know their buy box. They know their Market yeah.

but if you come in with external money and you're arrogant. oh my gosh, you overpay. Oh you get screwed over. well because all the contractors know oh out of area here.

they know the phone number right. They see the 408, whatever, your area code 949 or whatever. Well then they think you're not going to check on the work and you're not going to sharpen the pencil. Oh yeah right.

Oh yeah right. So um I do think there's some Airbnb pain, but it's going to be very localized. It won't be big enough to impact the country. Wow, it'll impact a couple of little pockets.

And if your area happens to become illegal, get ready. You know what they're going to do. Though, they're going to flip to midterm. Oh yeah, they're going to go midterm.

Furn. Is there enough demand for that? That's the wrinkle. I Don't know I don't know that either because I've been very tempted by that because obviously you can get a higher yield. Uh, it's not that much harder to manage.

It's more intensive obviously than longterm, but compared to shortterm, it's a joke. Easy. Uh, but I mean let me put it this way. I've never needed a midterm rental.

you know, like who has I don't know, like traveling nurse. but okay, how many traveling nurses can there be right? It's like at what point does a hospital have all traveling nurses versus just like two or three? You know? Yeah, it it. I Will agree with folks that there's a need cuz traveling nurses, construction workers. they do exist, right? Oil Workers whatever long-term contracts I don't know how much I don't know.

it's not where in my area is it's not where I I Don't think if I put a rental ad up and I I going to try it. but we'll put a rental ad up and be like you know, available for long or Med like at the bottom of the description you put also available for medium to rental. But here's the here's the wrink interest. It has to be furnished right right, right? Like will furnish or whatever we could advert.

I I Would guess if we advertise both possibilities. longm I'll rent it longterm in a day and the medium-term will take me months. correct? That's my guess as well. Unless you have to be right next to a hospital, right? Yeah, Good point.

Good point. That's really interesting. Okay, so that's Airbnb that's uh, that's race. Yeah, because we said what we had: 88.3% now.

So what about a first-time home buyer? I Mean like how did you get started? And how should a firsttime home buyer start today? Because people look at this, they're like this is insane I Feel for first-time home buyers today? It it is. It's remarkably tough today. Affordability is horrible. Yeah, um, you can't get around it.

Yeah, that said. um, you can make a choice you can make your landlord Rich Keep paying rent. You can live with your parents I mean there are options. Okay, that line is really funny I have to interject when I first became a real estate agent I uh printed like the sleaziest uh like landlord picture I could find uh, he was like on a sofa or something like that and uh, smoking a cigar.

uh and what I did is I I put some text under it and I'm like thank you for paying my mortgage and uh then I uh I stuck that up in uh, laundry rooms of apartment buildings. nice I I Got a phone call I bet you did from the property manager. very I bet you did. Uh, take this down son.

Yes, we're going to rip that off the wall, never show up on our property. Again In Fairness. looking back I'm like okay I get it now. But then it was funny.

It was funny. but yeah it, there's no question. it's hard. um there's no inventory.

Yeah, there's competition. You're you're bidding against landlords that are buying because again, everybody's kind of fishing for that sub median that's moving ready ready to rock and roll. Um, it's hard if I had to start over. the first thing I would do is house hack.

Yeah and I would probably house hack units. Y And just yesterday, so we're recording this on Thursday Just yesterday Fanny May released some new guidelines that you can get into a Triplex and a fourplex with 5% down which we were saying used to be what 20 something us to be 20% Yeah now it's sad because you think homeowner occupied should be five. but then you go What? Three units, four units and I have to put that much down? Yeah, so it's brand new. Guidelines goes into effect six weeks.

That's what I would do I would house act that? it's a really good idea. it's not for everyone I Understand Is it harder to get a wedge on multi family for for most people? Or can they find those low rents so you can find them? There's just less of them? Way less. Yeah, Okay, way less. Um.

Also, what? You can do what you did right. That second book you talked about at the opening has your story in it because the 203k loan. Oh my gosh, the renovation loan. It's a pay in the ass.

but it's great. I Mean for your first home? Yeah, you go. You got to go through. You got to work.

You got to do what you got to do to get in. Yeah, yeah, you got to get on the property ladder. Somehow Some way. So there are lots of ways to get in.

It's real estate. Investing in buying home is never easy. I've been doing this 22 years. That's why there's money.

If it was easy, there would be no money to make. I I And I Tell this to everyone. I Work with I Go look what. Buying homes and renovating them you.

It's going to be a headache. You're going to have to fire contractors. You're going to have to refine your contractors. You're going to have to work hard to find new ones.

Uh, there going to be material problems there. Going to be tenant problems. There's always something. M But that's why there's money to be made correct.

and that's why you should buy it. So okay, so how do you get started? So you get started? How I can rent out rooms or rent out other units? Yeah, okay and um. so I'll go back to my story. How I started right? So it's it's really weird.

Um, so I'm Generation X right? Gen X I was raised with the belief that you go to school, you go get a good job, you go back to school, you get a better job, and you climbed the corporate ladder I believe that until I was 30 years old. Okay, right. So I went and got a degree so you were on the path for a while I was on the path. Okay, um I happen to be investing cuz I'm that old in the Doom crisis.

So I turned s Grand into almost 200. Grand Oh wow. right. So much like the crypto stuff, but just stocks, right? So um, you start getting cocky and then I lost 80% Oh in like 10 or 11 days.

Oh no. 10 or 11 days days. So it took me three or four years to build it I lost it all in. you know, a weekend seemingly.

Oh right. Terrible. So I come out with 40 Grand you know it's more than seven, but I always I remember the 200 of course everybody everybody does. So then I go.

um and I read the purple book which is Rich Dad Poor Dad Oh yeah, and I'm embarrassed to say this. Kevin I have an advanced degree I'm an accountant I have an MBA and I knew no one that had rental properties I didn't know it was a thing. Wow Oh my gosh. So then I spend a year cuz I live in the Silicon Valley They don't teach it at school.

They don't teach it at school. Nobody in my family talked about it and I was looking for cash flow. Yeah, it didn't doesn't exist in the Bay Area I didn't know that you you Snicker but I I wasted 52 Sundays man 52 Sundays my head against that wall. So ultimately I find Fresno California 2 and a half hours away I buy I buy.

That's why you moved to Fresno I Cash here cash I invest there. Do you live in the Bay now I I've never. Yeah I live in the Bay Area oh hours I thought you would you lived in Fresno is well Mountain View California oh That's you. That is a beautiful area that is so nice Okay Very nice, very nice I'm jealous.

yeah it's a very you're coming down to Venturo. you're what is this poverty town I flew into S Gage Beautiful good one. All right All right Yeah so um so we go to Fresno we buy that property and but where I'm going with this is I was always an employee I always have an employee mindset. The thing that impressed me about you and why we did our first interview is I look at you as an entrepreneur born that way.

just freaking wired differently. Okay, but most people I talk to were employees and they don't understand getting on the property ladder. They don't understand that inflation is a feature, not a bug, you know. Cash flow.

Day One: I Think you can fundamentally change your retirement by getting to four. That was my goal after reading Rich dead Hes If I have four rental properties and I bust my ass until I'm 65, my retirement will be better than most. That was my vision. How many? How many retired people does anybody even watching know that has more than four rental properties? Crickets I bet 1% Maybe not many, not many, not many.

But when you get it's so attainable too. Every few years buy a home one every two years. That was my goal. That was my my grand plan.

There you go after reading one every two years. Wow. And then you get in. you start doing the work.

you start understand how to leverage Capital you get, you go from you know I had my 40 Grand was gone after three houses. Wow I never put another dollar in everything was Cash Out Refire 1031 Exchange Oh good for you. We built a portfolio of 170 some odd units. it's amazing from from three houses that's amazing and now you have a multi family building as well I have part of that I Guess yeah no it's probably 100 units in 50 units and homes and some duplexes and quads.

W that's amazing. Yeah wow. so you managed all this No. I I've had a manager I've two and a half hours away brother yeah I know I had a PM since day one.

yeah my job took I was often in three my last 10 years. I traveled almost every day. oh it's so airplanes. so I did every I bought everything out of the MLS Yep, no door knocking.

no none of this stuff out of the MLS My job was fine. deal secure Capital But people get mad when you say MLS you're not allowed to buy MLS and go on YouTube and say MLS oh I'm sorry that's what I did I mean I Think people think there are no deals to be had on the MLS there plenty of deals to be had on the MLS yeah and again I think today you just today if you what am I doing today? yeah I in my market if it's over 30 days on the market and it's in my buy box I write an offer. Oh nice, You're lowballing of course. Love I'm looking for a motivated seller.

Yeah, here's what people understand: Yeah, the 22 years of I doing this, this is the second best year to find a motivated seller. Oh I Love this second best year. 2010 was better. sorry 2010 was great because everything was short sale and the sellers didn't care.

No buyers dude, that's what it was. That's also true because nobody get a bank. That's so funny. You say that because I got in the industry in 2010 and uh I remember asking the community the real estate Community like so how did I get started and they're like find buyers Yes, exactly Yeah, that's what I don't get about everybody says the price crash.

we get a price crash. I'll buy. Yeah, no you won't Yeah, no they won't No, you'll be scared and keep going lower. Yeah so again, right you can look at North Drive you had it up earlier.

I buy for 107, sold for 265 or 263. Whatever it was, it ultimately goes to 300. Yeah, and then it crashes all the way to 75. Jeez! Lord there were nobody buying at 75 I was buying properties the whole the way down.

the cheapest house I bought was 23 Grand or 28 grand. 28 grand did did you lowball it? then I tried to buy that one for 55 somebody I'll oh oh oh Norris Norris Drive oh I tried to buy back cuz it was the first one and you know all of that interest. Want to look at the comps now? like what's the market doing? Now out there are are things sitting or like what do you see? Same deal for So Fresno California's median is roughly 400 395. Okay, if it's five, if it's 600 and above.

Crickets okay if it's 300 and below and moveing ready sells like hot Cas Interesting Yeah, see like here's one for $479 Just dropped 46,000 bucks. If it's below, if it's above, it's It's very repetitive. Here's one that looks new. 667 77 days on the market.

Crickets Wow Yeah, you're right. Oh, that's really interesting I look every day and uh, and so what's what's your hit box over there? So my buy box is uh, single family cuz I'm buying single family home. Oh but you can't scale single family. Yes you can.

if you buy enough of them and then you 1031 exchange into Apartments you scale just fine. Nice, Nice. Yeah with all the pain, come into commercial. That's what I'll be doing again.

Oo going from the single to the multi I did it once. Wait, so are you saying buy singles now and then as the pain comes for commercial, flip over. I will repeat what I did in ' 056 I will sell everything that's residential and 1031 into Apartments Okay and so what do you think about? Um uh. like is is do you like threes and twos? Like what's your favorite? My favorite uh.

rental is a preferably four bedrooms four bedroom rental. Okay, because they stay longer, they stay longer. Okay, let's turn over turn. Okay I like that? Yeah, I'm just looking at sort of the the the Fresno Market out here seems like yeah.

I mean three and twos all day long for like the low 3es or whatever. and so what are these things renting out for? Are you getting good? Like so depends on what part of town, but you'll get anywhere from like 1900 to 2500. Okay, okay and and like who rents this I mean are do you rent by credit score? What do you like? Yeah. So I have credit score and 3X uh, the rent for income and no evictions.

That's your rule of thumb as long as you have that you're good. So no evictions, 3x credit and you're running this through what software? Uh I have a property manager. so I give them my rent box, they give you the report done and you pay them what8 N% six 6% because you have volume. Got it? Yeah.

and and then you also have the building that they're managing with the units and okay and I have big unit so it actually has on site and right there's a salary for that or discounted rent or whatever it might be. Got it? Got it? Got Okay, Okay, that's fantastic. Uh, and so the goal then is are you. You're still buying right now because you flipped to, but you're still buying now and absolutely you'll buy these.

And how long when when do we flip to commercial? So my guess is the commercial pain is in the first inning. I Think most of the pain will be on the really big stuff which I Don't play in, you may have the opportunity to play in. I'm targeting 20 to 40 units 20 to 40. so I'm thinking 18 months is because again, what people don't understand again I Say this was experience.

They think residential and multif family operate in the same cycle. They say real estate and they think it's all the same. Yeah yeah it is not the same I mean I guess to in in some regard. If well it has to do with rents though because see if if rents like let's say values on the multi family fell because rents were going down well, then it would be more desirable for people to rent an apartment versus a house.

maybe. And then you could affect housing prices. but you're saying no, no, no, rents aren't going to come down. it's just the price is because of the loans and you don't have the Locking effect protecting you like you have on single families.

Correct, this is very complicated or rigged. Yeah the the beauty I Mean just do the math right. You buy a building, let's say at a three cap. Yeah and now you have to sell it at a six cap.

Yeah yeah. what kind of haircut do you take? Yeah, 50% all the equities so all the equity's gone. Yeah right. because the bank takes a hit.

Yeah, cuz you probably put 50% down. you prob put 25% down. 30% down. That's true Equity Gone Bank takes a haircut I step in as a new buyer at 50% off.

Oh yeah, yeah, that is so that now you're going to have some. But and and the interesting thing I think people forget too is that even if you have that I think a lot of people are worried that oh, it's the banks that are going to take most of the hit. It's actually the owners of the buildings who take the equity. Yeah, the equity WIP out first.

let's always. but let's play 06. Let's play 09 whatever year we want to take to today in the great Reset or the Great Recession or whatever you want to call it. The loans averaged 99% some were 103.

You know this, right? Yeah, cuz it was residential products in 90. 97% was a lot down. Yeah, so any haircut the bank took MH commercial loans which I have some got so loose that you could put as you could put as little as 25% down, but always 25 right? because on some houses you could even borrow up to like 110% Yeah, it's crazy, but you can't do that on Commercial because the debt service coverage ratio right? One quarter, Whatever. Whatever.

right? one and a quarter one? 1.3 whatever they say. So what people don't understand about what's coming is the equity. Which again, in a world where syndicators were over their skis doing fees and having teams and having deal flow to pay the bills, that's I would not want to be in syndication I Wouldn't want to be an LP in a syndication. Yeah their Equity Their money's gone and they don't know it.

Wow Really, you think it's that bad gone? Wow gone. I Mean read the real deal so you could make videos like Housing Crash except here it is not there You would say Real Estate Crash Real Estate Crash Okay I would say real estate crash not housing. Okay see I I need I need the title here. Yeah, it's real estate.

But yeah, there is a real estate crash. We've had a transaction crash in residential. We will have a value crash in multif family and office. You think that'll insulate office? I I Think everybody's like oh yeah yeah yeah, we know that.

the Multif family that's that's very interesting and you don't think that that will have much if any impact on the single families again. I Think rents on Multif family will come in, not single families. People want to live in single families. Yeah, they want the backyard.

Especially today. What did the pandemic teach us? Space is good. optionality is good I Want to put something in my garage I Want a backyard for my dog? Space is good I have I Can only think of the thousands of tenants I've had how many people moov from the house to an apartment. It was usually a divorce.

Good point: once you're in a house, yeah, stay in a house. Well, and the turnover on units is going to be a lot higher because people are trying to get to that house. My average: My and I've done the math several times. My average on apartments, right which are you know, just like W next to each other is two years.

Roughly two years. That's actually really good. Yeah, just it's just under two years. Like 22 months.

My houses are over eight years. Oh my gosh. Eight years Four bedroom bath. That's why.

I Like fantastic eight years? Yeah, because the expensive part is the turnover. but correct apartments are obviously less expensive to turn because carpet and paint quality stuff. Yeah, Yeah, exactly. Wow.

So uh, so you're writing offers on uh, on on on single families. Correct? What's the competition like on these over 30 days? Are they like, oh, screw you. I've already had offers like this or so. Um, I Run a very simple process.

Okay, so I find a a property I like my offer usually is 30% or more below listing. you just take the price and take off point. Yeah! I I run the math I Only write deals that produce a great yield. Okay, right.

Cash Flow Yield Cash flow y basically invested Capital Down payment repair cost cling cost numerator is expected cash flow What do you want? What's I want I so my average is six I only want nine Wow. I'm only doing great deals and every Market's different San Diego might be 2% this or that, right? but that's a problem like how do you? How do you justify that? Why is San Diego 2% of Fresno you could do seven or whatever. Well, some people only want to live in San Diego Some people only want I'm not going to I don't justify markets right CU If you want to go get a double digit, go buy in Detroit right? Correct Yes you're can grow broke broke buying cheap. My market where I know I will only get 9% So I write offers that will produce 9% but what's the difference between uh bu cheap go broke your market then and like like where's the line Well here's the deal.

I you and I live in California Yeah I'm sure you have heard the following statement I can buy a house in said City in the Midwest for less than the cost of my Tesla Oh yeah, Yes you heard of course. but who wants to live there? No jobs, whatever, schools, whatever. Even worse, why is that a good deal? Yeah right. Yeah, that's the problem.

Why? So it's cheap, but so what? Maybe there's a reason for it's cheap? Yeah, they give them away in Detroit Just pay the tax. Yeah, pay the back taxes. But here's here's the problem. We get a lot of folks at least I do in the Silicon Valley So I'll speak of my experience that have money from stocks or options or companies going public.

What they buy along the highway like crazy like look at Hayward Yeah Exactly right. Exactly. So what they do is they they find these prices. They pay cash so they think they think they're okay and and what they don't realize is they're being arrogant.

They're trying to jump the line because they have money. You have to learn the market. Like we talked earlier, every market across the country there are experienced investors. Yep and I hate it when I hear a brand new investor say I just bought something and pick a city Midwest Yep and they tell me I paid L price.

Yeah it was on the market 90 days. Yep and um they think it's a deal I'm like there's every every local investor kicked that rock three times. Yep and you paid list price cuz are arrogant or lazy or both. Yeah, you're going to lose your ass and most of the time they lose their ass.

Wow, you got to know the market man. 100% So uh, okay, so that's really interesting. So how and and uh, how many deals are you striking right now in these levels I mean is it, is it still too early or what? Do you think? it's probably still early? So I I expect because winter people have to sell all the time I did two last year I Expect to do one or two this year I'm only trying to do one or two a year. it is my Capital no Partners all of that.

Oh Partners Yeah, no. Partners Um, do that. So yeah. I try to do one or two a year.

Most of my deals are between Halloween and New Year's Eve Yep, Yep. November December I'm playing I'm playing the winter I'm playing everybody's on vacation. Yep, right? Thanksgiving weekend. For whatever reason, it's a great time for me to strike a deal.

Black Friday Black Friday Everybody's shopping. Yeah, Um, so I expect this year to be no different. So I expect to get one or two deals. Okay, what are your favorite markets outside of Fresno Is that it? That's the only Market I know in detail I happen to have just bought a big ass house in Vegas Okay, so I'll be spinning up Vegas next year.

prove I can Is this your your uh, um, personal residence? It's a personal residence. It's a second home. Curr Now your income taxes are going to Zero State state? Yeah, of course. yeah.

um. okay. so uh. why I mean you're going to go from the Bay Area which I I Want to be very clear about this if you were going from San Francisco to Vegas Yeah? Different.

Good for you? Yeah, Okay, that's a good trade. Yeah, that's a great trade. Okay Mountain View to Vegas yeah, what part of Vegas uh Henderson Black Mountain Okay, Okay, all right, all right. Okay so so this is why congratulations than well.

thank you. I've been retired for six years now. Okay I don't have to work. so why do you care about the state income tax? I don't Okay, and that's why I didn't move.

Okay, my vice more specifically my wife and I's Vice is eating out. We eat out 10 15 times a week. We're spoiled. lunch dinner the place for this.

but even worse, we had all our spots in the bay. We've been here. We've been together 30 years in the bay so we had all our favorite spots over the last. p is crushed that yeah.

sure gone. You can't afford it over there or the service is gone or the quality is gone. So you have a choice between Chipotle And speaking of Chipotle is there a Chipotle over there? Did you get a Chipotle I didn't But that's okay. but I'll take mine if you have it.

Oh look at that. So at the end of the day I'm spoiled I love to eat out I Love good food and now I can have great food we I spent a month in Vegas cuz I didn't know and um we had two meals a day for 30 days and only one bad meal. oh my Well I mean that's thank you for that. Uh is it? uh maybe you guys, you guys figure it out.

Um, but uh yeah. I'm starving I need like a bite of something? but um yeah. so I mean I'm a big fan I I Would love going out to dinner with but like do you ever run out of things to talk about with your wife like I Know this is more personal like because Lauren and I we sat down at a Macaroni Grill uh boy. we were together for like maybe six months and there was this couple probably in like their 80s.

uh and they're like oh we, um well we're watching them. They didn't say a word the entire time and I looked at L I go I never want to be like that and so every time we go out we just talk. The whole time we're like we were here for two and a half hours. What? Like we're together at dinner alone.

More than like when our company goes out to a dinner, it feels like uh, so so that's good. That's aw, yeah, you have to. You have to work on it. Relationships are just like health.

I Know you wear on a health kick, you lost a bunch of weight running and all that you got to work on your relationship. You have to. You have to be focused. otherwise it'll it'll go the wrong way.

and you have a daughter I Do That's awesome. Any other children? Nope. just one. She's 32.

So 32. That's awesome. She's uh, yeah. she's and you going to get her into R State I Did it wrong.

Okay, so we so she was um, 10 or 11 when we were buying all these trash foreclosures. Okay, so we we drove to Fresno with her in the car to see these dumps. She's scarred I Suggest never taking your kids to see ugly properties, only taking them to the pretty ones. I Made that mistake.

Don't repeat that mistake. so she's but she's had a good life. I Mean her education was paid from it. She's an artist.

She's having a good time. She's happy. That's all that matters to me. She's happy.

Oh that's great. This is really cool. So so advice to first timers now is just get in A is is that your suggestion. First advice is don't over complicate it I have this saying Create a Buy box.

Okay, so what is a Buy box? It is a uh set of criteria that produces between 20 and 40 active listings. That is it. Yeah, you don't need more than that. Then you look at that every day for 20 minutes and track.

And you track. you track the changes. Yeah, you don't need that many No in in 90 to 100 days you will be able to tell me or you or your wife or husband what an average deal is and then you just change the math for a great deal. I Had the same buybox in Fresno California for three freaking years.

Wow. A buy box is two things: Permission to focus and permission to ignore. Oh well gosh, because if you're looking at everything you, you can't focus. No, you go backwards and then you add other cities.

It's impossible. Come on man. No. like uh, you know one one, two cities at a time is what we're going to do with House Act a real estate startup.

Uh, otherwise it's just impossible because you need to. How do you scale construction? How do you scale the management? It's insane. Yeah, No you. you've got to certainly new investors again.

And the other Beauty about today is real estate is slowing down. Yeah, yeah, there's no rush. There's no rush. patience.

I Keep saying that. Patience You can learn, you can learn. and then the last thing is like I said earlier in this market is the second best Market to find motivated sellers. Yeah, so people are saying you can't do it.

Try. try. It doesn't cost anything to try. Yeah.

write an offer. makes sense for you. Yeah, the seller can call you all bad words could say nothing they could counter or they could say yes, boy you know I what do you make of this? So I'm going to find like this volatility we we don't have to put this on screen just because I don't want to piss these sellers off. but um I I was in, uh, a city in NorCal and uh, so you've got a fixer upper that comes on um 450.

Okay, multiple offers? Uh, you know people are like clawing like stepping over each other to try to get this thing matches. formula the 75% right? and uh, then you've got