Real Estate Market State of the Union with Freddie P

Haha! This is episode number 177 of The Homeowner's Show. Whether you're DIY or looking to hire, we're here to help you find the best information and options for you and your home. My name is Kevin Hecken, and here with me is Craig Williams!

It was my fault. It was my fault. Hey, the slider was down.

All I know is that I had to get that in really quick there at the end because I was like, we're not going to get to the end of the action.

You're not going to get left hanging with no music, right?

Oh man, I'm sitting here going, okay, it's time, it's time. We're live. We're trying to do this here.

And should I, should I do my line? Is that— should I go back to my hello?

No, no, it's too late. We already did. We missed it.

That's fine.

We already, we already did the welcome to the show, all that stuff.

Is that gonna happen? Someone out there is like having a totally different homeowner show experience right now because like, what? Craig didn't say his thing.

Yeah. Yeah. They, they're, they're not sure what to do right now.

Suck it up, buttercup.

Hey, I got a question for you.

Yeah.

Why is half of your driveway in the street?

Because of that monsoon that came through last night.

I was, I was going, okay. I'm driving on Craig's driveway in the middle of the road. Let me tell y'all something.

I hate my driveway.

I do too. I think we all do.

That, that has been one of my biggest lessons in homeownership ever.

Yeah. And, and here's the thing. You've paid a lot of money to have that redone.

Yes.

Yeah. And more than once, right? Or just once? Just, just the once. Okay.

The guy— so I said— He's so pissed.

You triggered me.

I know. So I actually see the guy on TikTok that did my driveway, and he's, like, telling people how great a driveway is because he, like, he makes most of his money, like, resurfacing, like, commercial parking lots.

Okay.

But he came and did my driveway, and he just did a terrible job, and he did not represent what he was planning on doing properly.

Okay.

So I was, I was under the impression that I was paying for a new asphalt in my driveway. He, uh, said that he, anyway, he put down recycled asphalt and then sealed it.

Ooh.

And so like 2 days after he finished it, we had a heavy rain and I, I lost half my driveway.

Um, yeah.

Oh my gosh. And that was like 2 years ago.

Wait, did you find this guy on TikTok?

No.

Okay.

No, I don't.

Okay.

And I don't wanna go into how I found this guy because that's, that's an unpleasantness as well.

Um, men's bathroom.

That's right.

In the men's bathroom.

It was exit 43. Um, thank you.

But Wait, that's, that's way down in Houston.

I know, that's where you pay less.

That's, that's past 1960.

That's way down there. And when you want to save, you go south. Um, but anyway, it looked nice when he got done, but like the rain just constantly washes it away. And like whatever reason, yesterday it was just carrying it off and it's piled up in the street. I'm gonna have to go shovel it and Because otherwise, I'm gonna piss off my neighbors. Because that, that'll be fun.

Angry neighbors. I, I'm just thinking, like, what do you do to fix this? Is it, like, French drain time? Or what do you do to fix that problem?

Because here's the problem is the answer is $20,000 in concrete.

That's the answer. Well, get on it, buddy.

What's the $5,000 answer?

The $5,000 is the JA that I hired to do the last thing.

Yeah. JA.

You can use your imagination.

Okay. So, um, I mean, because, because, I mean, besides concrete, which I know would fix the problem at that point, but I'm afraid that would just wash out the sides of the concrete because you've got, you've got this, this rush of water that gullies right through kind of the center of that thing in the same spot. I mean, like, you could literally just put a French drain right there, cover it back up, and it would be level almost.

Well, yeah. And for those of you wondering, we got Freddie P in the studio who who's, who's been chiming in. So we wanna make sure that everybody knows who's, who's talking.

The Freddy P.

That's right. But, so I actually, I was actually talking about this 3 or 4 days ago with Jehu.

Okay.

And he was telling me, he's like, look, man, just not a French drain. I don't know what they call it, but it's like a concrete box with a grate on top.

Yeah.

Okay. Yeah.

I don't know what that's called, but I—

Drain.

It's a drain, but like, it's, it's like a commercial drain.

Okay.

And he was like, look, I just put one in on my property because he's got a really cool property just down the street from us.

Yeah.

He's like, I had to put one in to drain the water from the property.

Because it was pooling over here.

And he's like, look, if you put it at the spot where you can see it deteriorating the driveway the most, that's where the water's going to. So just put the box there and run everything else out to the street. So it just picks up the water, takes it off the driveway.

Okay. Um, which, it makes sense.

Reasonable idea. It's just gonna be like, it's gonna be expensive.

Yeah.

To rent the equipment to do it.

Yep. Yeah.

And, and take a, I mean, it's gonna be like a 2 or 3 day project.

Yep.

Which I don't mind, but like, I just don't have the time for that right now.

Okay. So here's, here's a question. Who out there has a backhoe that would let Craig borrow it so that he'd never have to deal with this again? Somebody out there has one.

I bet the guy, the TikTok guy that originally did it has a backhoe.

Oh, there ain't no doubt about that. Yeah. He, he's got one. He just doesn't use it correctly.

Yeah.

He is a hoe.

Use a hoe. Oh, use a hoe.

All right, well, hey, um, how about like a backhoe for 5 gallons of beer? I can make that happen.

Hey, that's fair trade.

That— I think so.

I mean, look, if y'all— seriously, we will even video it and like put you on the homeowner show.

Yeah, Freddie's drinking one. Is it good?

Yeah, it's good. It's a little— it's a little chocolatey peanut buttery.

Yeah, so it's good if that's your thing.

Butterbeer.

I can get you whatever you want, really, but okay.

Yeah, it's worth it.

5 gallons of beer, backhoe.

Deal. I mean, who doesn't want that? I mean, you gotta hope you have a refrigerator.

That's right. So I actually had a plan for, like, the show opener.

Oh.

Because we needed to put an asterisk on an episode that we did 2 or 3 weeks ago.

Okay, we're gonna start over, guys. All right.

Hang on.

Oh, okay. Yeah. What is the asterisk?

Well, so we, we did the episode on the Magnolia Network.

I remember the, the show's homework.

Did you hear about this, Freddie?

I, I did. I saw some articles on it too.

Yeah, so homework got pulled. Yep, they pulled them. However, they're back on.

They're back on.

Yeah, so the, you know, diligent team over at Magnolia, the Chip and Joanna crew, what they, they went in, they researched, and they determined that we still want to run the show. Yeah, and I I think it—

I—

the article that I read, I think it even said that the network agreed to help settle some of the disputes.

Okay.

Um, so they, they may have looked at it and said, this is not a situation where we feel like the couple is, you know, it's not a— it's not something that really could have been avoided or something that could have been prevented. It's just something that happened.

Yeah.

So we're going to help you guys out, resolve this, and just move forward.

Yeah.

So what I will be interested to know is if those episodes air.

Yeah, I would be shocked if they actually did.

Well, you know, I mean, who knows?

No, I mean, we— here's the thing. I would assume that the majority of folks out there watching the show are not watching it the first time. They're watching reruns, right? Eventually. And they're not going to know that this ever happened. Probably not. I mean, you know, I mean, I do. It was— it's not like this wasn't a big deal. It was a big deal, right? But at the same time, I feel like they're just gonna be like, yeah, who cares?

Well, the people that complained, they're— I mean, like, because this all happened on Instagram, their Instagram accounts blew up.

Oh, sure.

I mean, like, so they have tons of followers now.

So the— so for my people that are watching this for the first time, tell them a little bit about the story because I don't know the full story like you guys do.

Well, I don't know that anybody really knows the full story because episode number 175, I think it was.

That may be right. I can double-check.

That's a good place to start. Yeah. I'll tell you that. But that's not—

Just start at 170.

Yeah. Just keep going.

You're bound to hit it.

Yeah. Well, so it's, it's pretty simple. So Chip and Joanna Gaines, they've got their own network, the Magnolia Network, where they're—

Real quick. Is that like its own thing?

Yeah.

Like where you pay a subscription fee to the Magnolia Network?

I believe so.

Or is it part of something else?

Well, I think that, I think that it's, I don't know.

Okay.

But what I think is, I think it—

You tell the story. I'm gonna look it up.

I think it, it can be either or. Like, it's part of a, maybe a package.

Okay.

Like, I think it's like one of those, you, you ordered YouTube TV, and it's one of the things that comes on it, and YouTube TV is paying them.

Right.

I think.

That'd be smart.

But it would be. But he— so, so here's the deal. So they've got this network. Their very first show that they were gonna broadcast was called Homework. It was a really cool show about this family who bought a school and renovated it into their house. It's really awesome. I mean, go look it up. It's a sweet place. And so they are remodelers. And so they go in, remodel people's homes, but they're calling the show Homework, which is brilliant.

You know, here's— Right.

Remodeled their school. Okay. All that stuff. But the problem is that there was like 4 different families That came out and basically said they screwed us. Like, they did the— they didn't finish the job, or it took them months and months and months. We asked for a refund and they've only given us like a tenth of the refund that they owe us. Or they said it was going to cost $50,000, but it actually cost $100,000, like twice as much. Like, all of these accusations. And so Chip and Joanna, like, they're— I'm sure it was their people.

probably not them, right?

They, they've just pulled it and they're like, oh, we're not going to show it. Like, this was like the week it was supposed to air for the first time. And so it was one of those deals where it's like, okay, well, uh, I'm gonna air nothing. And so they just didn't air anything, you know?

And so Clara just let herself in the studio slyly.

Yeah, she just kind of like— yeah, go close that door, Clara. Hey, close the door behind yourself.

She has to open it. She don't know how to close it.

That's right. It's the opposable thumbs. So anyway, that's the story. And I, you know, a couple weeks later, they did more research. It's back on.

It's back on.

Back on. So that's what's going on.

So, so here's, here's what I learned from reading. Okay. So, which took me a while.

Uh huh.

So they are actually part of Discovery Plus.

Okay. So it is, it is a network. It's a network of, of show or, uh, yes. Which I think, I think network of channels.

Is Discovery Plus part of like the Disney Plus bundle?

I think so.

Well, Disney owns Discovery.

Well, that's what I'm—

so yes, that would be the case.

I think you get Discovery Plus when you pay for Disney Plus.

Yes, I think so.

Um, and it, but it also says that they have their own app where you can stream, um, all their shows. So, but interestingly enough, Homework is not listed right now as one of their shows.

Oh.

Even though they announced that they are, they are gonna have it.

It's just still not there. It's just still not there.

Okay. So there's, there's actually one, it's called Restoring Galveston.

So this is just— Oh, yeah, yeah, yeah. It's, it's, this is actually— Okay. I don't, I remember reading about this and I'm, I don't wanna butcher it, but, um, this is a guy that's local to where we're at.

I think so, yeah.

And I mean, I think he lives in the Houston area, but he's doing a whole thing down in Galveston.

Really?

As well. Really cool. I mean, there's a lot—

Galveston has a ton of history.

Yeah.

And a ton of old, old homes.

I mean, it's, it's a really smart thing to do. I mean, Galveston's a beautiful place, and like you said, the history there is really— and, and Galveston has spent millions of dollars on, on their shoreline to, yeah, to get it in better shape. And it's, it's gotten a lot nicer. Oh, yeah.

So, so we need to let our guest, like, let everybody know who he is. I mean, he's, he's had a brief appearance on the show at a live event that we did.

Yeah. I don't think you've ever—

I don't think you've been on the show other than that.

No, we did the show at, um, live at, um, Hmm, we were at that pizza place.

Yeah, RC's or something.

RC's Pizza. Yeah, yeah, I'm gonna give RC's an awesome plug. They have the best wings. OMG. So if you—

yes.

So if you go to RC's Pizza, Booty Road at Rayford, they have incredible wings. So if you want some awesome wings, go there.

So, um, worst spelled street ever. Because you tell me go to Booty, like, it's looking like B-O-O-T-Y.

Yeah.

You know, it's like, no, you know, that's not it.

It's B-U-D-D-E. Yeah, that's the one.

But, um, so yeah, so, um, we had— we did have, uh, uh, I did part of the show there.

Yep.

And, um, so now I'm back.

Nice. This— but this is first time in the studio.

Yeah, first time in the studio.

So let everybody know who you are, what you do.

Yep. So what's up everybody, this is Freddie P. Freddie Polymera is your real estate pro. And I'm a real estate broker here in The Woodlands and just staying really busy right now. Obviously everyone wants to know what's happening in real estate and there's always something going on. And right now we are entering another shift. You know, one thing that people have really did in 2021, which there wasn't a lot of homes for sale. There was— I think we were down like 50% of the inventory homes for sale. In a normal— in a normal world, it takes— let's say on June 1st, if no more homes were listed, it would take—

what'd you do? There was an emergency.

It's fine.

We said something that—

no, we just click off of it like everybody does. Emergency, emergency, stop, go away.

This one's all the way— this one's all the way in Buda, so It doesn't really affect me right now. Um, but in a normal situation, it takes about 180 days to sell all the inventory online. So like in our local market here, which is hard, it would take 6 months to sell everything that's, that's listed online. Last year we were averaging 11 to 12 days.

Oh my goodness.

To sell everything Like, at a snap, which is like—

That's unheard of.

Ludacris speed.

Yeah.

You've seen Spaceballs?

Yeah.

They have light speed. They have warp speed. And they have— yeah. When you go to Plaid.

Yeah.

Yeah.

Yeah. Yeah.

So I know what you're saying. So we were in Ludacris speed last year. Now things have slowed down a little bit. You know, it tends to slow down November, December, January. But still, I mean, anything that's listed for more than like 10 days is like, what's wrong with this property?

Yeah.

You know, we're still in that mode.

So clearly the dead body's still inside, right?

Yeah, yeah, yeah, they haven't cleaned— yeah, just throw the chalk line.

Yeah, that's right.

So, but here— so here's what I think everybody was predicting. Everybody was predicting that the market would stabilize as far as, you know, at some point we couldn't hold this pace forever. Um, mainly because the inventory was gonna run out, right?

Right.

Eventually, people are gonna get scared. They're, they're gonna, they're gonna sell their house, but they're not gonna be able to buy anything else because it's going too quickly. So they may get premium dollar on their house whenever they sell it really quickly, but then they're not gonna be able to buy anything. So the inventory was gonna run out. It's kind of the, the prediction that I was hearing from time to time. Now, here's my question. It slowed down a little bit. Right. A lot, but a little bit. But have the prices shifted very much? Is it— are, are prices coming down, or are we still seeing— because it's still happening quickly— that we're still getting over asking price, all that kind of stuff? What's, what's happening with all that?

Pricing has increased. So last—

increased? Yeah.

So last year, and then— and it's gonna be something something's gonna have to happen where it's like a cataclysmic event for the prices to come back down. They're not coming down because of mortgage fraud like in '07, '08, and, oh, you know, yeah, we— 12 years ago we addressed that. Yeah, so like those things are, are not gonna happen anymore, but, um, it's gonna take something huge, and I don't know what this could even be, for the prices to really drop like they did back then. So last year, the prices in some areas went up 20% in one year.

That's a ton.

From 2020 to 2021. So I actually had someone that bought a house in 2020, just a regular Lennar house, $180,000. They sold it for $245,000 in like 16 months.

Oh my goodness.

So they walked away with like $56,000 after closing costs, commissions, fees, title, et cetera, et cetera, et cetera, in months. And that's a low-priced home. And I mean, but that's just one small little example of what happened all over the entire country. I mean, this is— this goes on in every state. In almost 90% of cities, this explosion has, has happened, and it's caused— and it's, it's going to cause a lot of people to not be able to buy a home.

Yeah.

Because you're moving prices up so much. We went up 14% to 20% in some areas in one year. This year they're expecting another 6%. increase from 2021.

So in 2 years, we're looking at a 26% increase.

Yeah.

Which is nuts.

Yeah.

I mean, because, because the, again, it kind of goes back to my problem that, or the problem that I stated, which was people are gonna be scared of selling because they're afraid they're not gonna be able to purchase anything. They can't afford the purchase price of the thing they want, even though they're getting ridiculously top dollar for their home.

Right.

They're getting more equity out of their home than they ever could have thought about getting. So here's a question. How many people are you finding that are going, eh, I'm not gonna sell, I'm just gonna rent my house? Because the renter's market is ridiculous too, right?

Renter's market, yeah, it's, uh, it's also gone up, just not as fast as the sales. Now, something interesting Um, in 2021, just as you just said, a lot of people sitting on the sidelines, right? Okay. So all those people, millions and millions and millions of people sat on the sideline in 2021. Those people in 2022 are probably still buyers and sellers.

Mm-hmm.

They're still thinking about moving, right?

Right. Oh yeah.

Along with the new people that would traditionally be moving.

Okay.

So now we've created— we had the people from last year.

You, you mean the people who are, like, aging up into adulthood that would now become new homebuyers?

Exactly.

First or first-time homebuyers?

Well, either first-time homebuyers or the people that are just getting to that time.

Right? Yeah.

So, like, let's say last year.

They're finally ready.

They're finally ready to make a move.

Right.

And they're finally ready. Now they're also finally ready with the people last year that have been waiting for this year.

Yeah.

So now you have another situation to where you're gonna have a lot of people still that are still looking for homes. You have last year and now you have this year.

Yeah.

So it's created another situation where we're going to have another year of low inventory. We're not going to have enough inventory to fit the demand, so it's going to be bumping our prices up and up. And because you're, you're, you're— if the house is clean and the house is in decent shape, it's gonna sell. It's gonna sell, and it's gonna sell for more money than it's listed.

Because do you think a lot of that is because— I see a lot of these builders trying to be aggressive in building houses, particularly around here, right? I mean, like, we have multiple new developments, but it's hard to get like a new house in there because materials are short and it seems like labor is short. So I mean, like, you, you have that compounding the issue, right? I mean, like, these guys are like, look, we have buyers. But we just can't get the houses together quick enough in order to, to feed the demand.

Right. And the, the builders are in a, in a pretty good spot. One, they have plenty of buyers.

Yeah.

Plenty of buyers. But like you just said, they have a material problem.

Yeah.

You know, they have a, a not necessarily a wood problem like they did last year, but—

Yeah.

Wood's gotten better.

Wood's, wood's and lumber's okay. It's, it's all the small things. It's the hardware. It's the handles that goes on doors. It's, the little— it's the hardware that goes on your cabinets. It's all the extra little things that people don't even think about that we're having a problem getting. It's some of its appliances.

I was going to say appliances are huge. I mean, you can't get appliances for the house.

Yeah, I mean, you don't have the chips. You don't have the chips put in the— in the— for some of the high-tech, uh, refrigerators.

Well, I mean, it was— how many months ago was it that we had Megan on where she was Oh, I mean, it's, it's been a while, but she was— I mean, she was saying the other day that, like, they're still waiting. Yeah, some people are still waiting on things that they ordered from them, and they're months out.

Months and months and months. Yeah, it's nuts.

And it's like, it's not their fault, right? They just can't get the product.

Nope.

Yeah, they can't get it. They can't get it shipped from China. They're like, it's sitting in the South Sea somewhere.

What, like, did you, did you see the deal? I, I, I saw a couple people reporting on it this week that it Now it's, it's not necessarily that it's sitting on a boat out in the Pacific, that now it's, it's actually in train yards. But people have figured out that, like, and I think we talked about this a couple weeks ago, where like they're not getting arrested for robbery. And so they're looting the train yards because they know that those trains are just sitting there because they don't have enough people to move them. And so they're literally like just emptying train cars.

I saw it. It's, it's horrible.

You saw some of the pictures?

Yeah.

It looks like India with all the trash that's been— they just tore open tens of thousands of boxes and steal everything. And I don't know who's paying for that. Is Amazon giving them a refund for all those things that didn't ever arrive at their house? I mean, that is— I hope everyone takes a look at that and goes, there's a major problem here of train robbery. As weird as that sounds saying it.

What are we, like, in the—

we should note that Freddy went pretty hard on India right there.

Yeah, he did.

I'm just wondering. I've seen Slumdog Millionaire.

That's right. Are we, are we in the, like, the mid-1800s robbing street, you know, train cars again?

Well, they didn't do it on horseback.

Well, then I don't know. Did you see any horses?

I, I know the, I, the kinds of people that— yeah, it's just not— okay.

Did you see any law enforcement?

No, of course not. Well, did you—

they're not getting a if they are getting arrested, they're getting a, a $3 PR bond and then they're getting released.

So they're not getting— they're not getting— no, I'm just saying they're, they're, you know, robbing train cars. That's not something you hear these days.

It's, it's not happening, man.

It is. It's ridiculous.

So back to the story.

Sorry.

Yeah, so go back. It is hard to finish homes. Um, you know, builders are They're stretched as much as they can, but, you know, right now is their time because they have lots of buyers that need to buy homes. So do you think—

because I know this is something we were talking about before the show— do you think what's happening with foreclosures right now is going to provide— and I, I hate to use it like this because I, I hate the idea of anybody being kicked out of their home, right?

Right.

But We've, we've had a long pause on foreclosures, and it seems like they're, they're opening that back up now. Do you, do you think that could potentially provide some relief to the demand in the market? Because some of those— I mean, like, you know, some people like buying foreclosures.

Yeah, uh, I think it's going to help some. It's going to help the smart, educated buyers that have money, that have beans. It's not going to help 98% of your general first-time home buyer that's looking on Zillow to buy a house.

Right, right.

It's gonna—

so for, for people that are listening that may not know what we're talking— what, like, what's happening with the foreclosure market? Because, like, and you can probably explain this.

Yeah, so, okay, so they put a forbearance out. So if you could not make your mortgage payment then it was deferred. So you did— you basically went, I want to say it was like 8 to 10 months of not making a mortgage payment, right? But then that ended in September, I believe, or October. And so then they're saying, okay, we need to catch you up. But they kind of did it to where if you took that for if you didn't pay, they put all of that money and all that interest on the back of your loan. Okay? So it almost doubled like your year— like let's say if you would have made your yearly payment, let's just say your

yearly taxes, insurance, principal was like $1,000 a month. Let's just say, make numbers real easy.

Yeah.

So you paid $12,000 a year. Right?

Sure.

On those things, on your payment. Like, that bubbled into like, let's say about $18,000 that they put on the end of your loan. So not only were people not paying their principal and their insurance, but they weren't paying their taxes. And that's created another issue with people not paying their taxes because the tax authority, like let's say here in Montgomery County, they need those taxes to pay for roads, to pay for police, firefighter, all the basic necessities that we have here. And so they are going to foreclose on— the number came out the other day, I heard like 1 out of 11 homes right now are behind on payments. I mean, it's a big, big, big number.

I mean, that starts, that starts sounding like 2008 kind of stuff.

It, it, it kind of does, you know. So, so it— again, we're, we're almost splitting like like the middle class is like getting thin and you're either kind of be like on the haves and the have-nots. And it's kind of really like, like splitting that right now.

Yeah.

So, um, you know, I was telling people, if you can— this was last year— if you can keep making your payment, if, if you can.

Yeah.

Some people couldn't because, you know, your kids are at home and you work at a place where you can't work remotely. and you worked at a, you know, a store, let's say, and you, you can't be home with your kids that are home from school and they're 5 years old, so you have to stay home with them.

Yeah.

So you don't have employment. So, you know, it created a bubble. So we're— there will be a lot of foreclosures coming up, but most of the people that are going to be buying those will be big hedge fund company corporations.

Yep.

Um, companies like Opendoor will come in and they'll buy a bunch of properties. hedge funds like BlackRock will come in and they'll buy a bunch of properties. So there won't be as many like going around. There's gonna be like major corporations and hedge funds that come in and are gonna be a big, big buyer. Yeah.

And once, once they do, I mean, people living in those homes are gonna get a big wake-up call.

Yeah. Yeah. It's gonna, it's gonna suck.

Yeah.

There's, there's no doubt about it. It's, it's gonna hurt.

Well, like one of the things that you said in there that kind of freaked me out a little bit is the fact that when you're not— when people are overleveraged and they haven't made a sufficient down payment on a home, they have to pay the mortgage insurance, right? And if they haven't been paying that, what does that mean for the bank? You know, like this— like, that's why I say it sounds like 2008 kind of stuff, because if they're allowing people to live month after month after month, like, you're looking at like over 12 months now where they haven't been paying mortgage insurance which means that the bank can't recover any of that, right?

Yeah. Well, the, the bank's gonna— I think they're gonna recover most of their money because the prices of homes have gone up so much.

Oh, they're gonna get it.

They're gonna be able to get their money back.

Sure.

Because if you— if they've gone up 26% in 2 years, that's more than PMI. Then yeah. So, so yeah, so they're, they're gonna be, they're gonna be fulfilled. They're gonna be fine.

But, um, it's, it's, um, But not until they sell it.

But not until they sell it.

Yeah. Yeah.

So, uh, you know, it's, it's a situation that, um, is going to be hard to get out of for a lot of people. And you can't refinance if you, if you've, if you've taken that.

Have you taken forbearance?

Have you taken forbearance? And I, I've had a couple people reach me and say, hey, I wanna, I wanna, I have equity and I wanna refinance now. If you've taken that forbearance and you need to make, I think it's at least 3 or 4 payments back.

That's all?

Before you can start to refinance.

Oh, okay, I got you.

Before you can start to refinance, you basically got to show some history that you can pay it.

So before they're going to let you—

Exactly.

For most people, I'm guessing that's close to like $6,000.

I mean, yeah, yeah, yeah.

I mean, I'm averaging it out, but I'm not—

that's—

I'm guessing that's probably about what it's like, around $2,000 A month, right?

Yeah. So, well, it's just—

it's obviously everyone's gonna be a little bit different on that regard, but having access to that kind of cash though, I mean, like, for some people is just not doable.

They don't have it.

So, so now what they're— so now the situation is, is, okay, you've been in 12 months forbearance, you haven't paid anything, we're gonna redo your loan. So they're now redoing people's loans And obviously, if before you had a, you had a principal balance of $200,000, now your principal balance looks like $220,000.

Oh, so they're, they're going to be redoing the loans, but based off the valuation of what the house is now?

Well, appraisal.

They're, well, they're gonna— no, they're gonna do it whatever you didn't pay last year, plus fees.

Oh geez.

Plus, okay, et cetera, et cetera, et cetera, et cetera. Redoing your loan means more probably loan origination fees All the BS that goes along with it. So like, they're not making it real easy to like get caught up.

Yeah.

You know, just like before I was paying $1,500. Well, my new note is $1,700.

Yeah.

You know, and I owe an extra 5 years because I'm starting all over.

Yeah. That one year, that one year is gonna cost you 5. Yeah.

Oh yeah.

And, and at the new price, At the new interest rate.

Right now, interest rates are going up. So if you got a loan 2 years ago and you were at, you know, 3.25%, and now you haven't paid in 12 months, and now, now you're looking at 4%.

Yep.

So it's, it's, it's, it gets ugly. It gets ugly quick.

Yeah. Well, and like, you can't— I think most people are sort of staring down the barrel of a gun.

Right?

Because they can't walk away from the property because they probably purchased it at a much lower price than what they could afford to buy something now in the area that they're in. You know, like I was— you, you posted a listing today, right? It was a 4-bedroom, 2-bath in The Woodlands, right?

Right.

And I— what caught my eye about it is that you said this is a great price for this property, right?

Right.

Do you remember what the price was on it? $525,000.

Jesus. So go— The house will be gone tomorrow.

Which, you know, like, if you're listening to this show in California, you're like, that sounds amazing. But, like, for us, that's double. 2 years ago, what would that house have sold for?

Uh, that— well, that house probably in the— probably 4— probably high, high 4s. The thing is, that house is like— I feel like that house is, like, super cheap For the area that it's in. Like, I feel like that house will just like— it'll be like pending tomorrow.

What part of The Woodlands is it in?

Creekside.

Creekside, okay.

And it had a pool.

Yeah, and it has a pool.

So like, so it's a nice house, don't get me wrong.

Like, it's, it's, it's a nice house, but like, it's not sitting on 2 acres. It's not like, you know. Yeah, like to pay half a million for that house, like, I'm sorry, I'd never do that, right? And so these people who are in a tight spot, like if they were in a 4/2 in the similar area and they bought it for like, you know, $400,000, and they're looking at like 5.5% now. That's ridiculous for them. I mean, like, they can't, they can't afford that.

Yeah.

You know, especially if they haven't been able to pay their mortgage for like the last however many months or whatever. Like, and so like rock and a hard place, man.

Yeah.

How do you, how do you like— one, what do you even do if you've been in forbearance and you're like, I just want to sell it?

What do you even do?

No, you can sell it. You can sell it. The problem is, is like, you— most financial companies like banks, credit unions, they're giving you like, okay, you need to sign here.

Uh-huh.

And this— you have to sign there. They put— they've been putting a lot of pressure on these homebuyers to sign on the dotted line, to go ahead and, and approve this refinance.

Okay.

Right. As soon as they sign on that dotted line, your, your principal balance just went up $20 grand or whatever it may be in their area. So even if you try to sell it now— I was telling someone like 3 months ago, if you don't sell right now, like, I don't— it doesn't matter to me, but I'm just telling you, if you don't sell it right now and you want to sell it in 6 months from now, you're going to lose $20,000 waiting 6 months because they're going to refinance your loan.

Mm-hmm.

they're going to change your loan to where they're going to add all this money at the end of it. Like, you need to do this right now if you're going to do it.

Yeah.

And so she decided to stay in her house. Totally cool. I think she's going to be able to make her payments.

Yeah.

But I was just like, if you don't do this right now, they're, they're, they're going to get you. Yeah.

So they're always going to get their money.

Yeah. So it's, it's, it's— there's a lot of changes coming up in 2022. Um, it's It's gonna be an interesting time for sure.

That's crazy.

Yeah.

Yeah. So is there a point, is there a breakpoint in the price of a house or property to where it feels like it's not so much of a shift? Like, I would think anything between like $200,000 and $350,000 is just like, you can't buy those 'cause they're just gonna go and people are gonna pay whatever they have to pay, they're going to go quick and maybe even all the way up to $400,000. Is there a point, a number, is it $650,000, $700,000, $800,000, $1 million? Is there a point at which it slows down a little bit and it— and people are not going crazy?

Um, in— I would say within our, um, 10-mile radius of like The Woodlands or maybe even 10-mile radius of Conroe, the number goes up to $1 million, $1.5 million.

Wow.

To where—

You mean once you get outside those areas?

Like up, up to that. Well, I'd say like, let's say like Woodlands, um, Montgomery, most parts of the west side of Conroe, like on the lakeside. Um, I mean, there is no like safe zone, safe area to where like Those prices aren't just doing like this. It's almost like back in the day when you were trying to buy something on eBay and you put in your bid at $10 and someone came in at $10.50, then you went into it at $11. People are still doing that and it's everywhere. I mean, it's every property. It's because, like I said, you have all the people that sat on the sideline in 2021. along with those people that are ready, that just got married 2

months ago, and they're ready to buy now too.

Yeah.

And the inventory's low.

And the inventory's low.

But, but it also seems like the really expensive ones are still selling too.

Well, that's, well, that's what he's saying is like, all the way up to like $1.5 million, they're still selling.

But I mean, like, when, when you would see like, like a 5-bedroom, 3-bath house that was like $1 million, right? I mean, like, it used to sit on the market for a while because there's not that many buyers at that price point, right?

Right.

You know, but like now it seems like, well, that's just, just the way it is.

Well, it's— here's a funny— this is, this was last week. Last week there was a house that I would say 6 or 7 people had shared, that agents had shared. Man, this is a really nice house. So it was this nice house in, I want to say Montgomery or—

What do you mean by agent shared it?

So like, I saw one agent like share the listing.

Oh, share.

I got you.

They shared the listing on Facebook.

They weren't like all living there together.

Right, right, right, right. So I saw one agent share the listing on their page and another agent saw it and it was like, wow, that's a really nice house. They shared it on another page. So I saw this one house that was $1.7 million get shared like by 4 or 5 different agents.

Yeah.

That house, that house sold in 1 day.

Oh my goodness.

1 day. It was 1 day on the market.

That's crazy.

To get it 1 day on the market, that means someone has to either buy it sight unseen, uh-huh, or literally go to the house at 9 AM, spend the next 4 hours writing the offer, and then they accept at 10 o'clock that night.

Right.

One or the other.

Wow. Like that. Gone.

That fast. I mean, it's— $1.7 used to sit around for like 3, 4, 5 months.

That's what I'm talking about. Yeah.

That's very normal for anything over like $1.5 million.

A day.

Yeah.

A day and it was gone.

That's crazy.

That means like if I had a buyer that wanted to buy that house on the first day, I lost that deal.

Couldn't. Yeah.

Like, hey, we'll go see it tomorrow.

Nope. No, you won't.

No, you won't.

Jeez.

Gone. It was probably a cash buyer too.

Well, and like, there's— yeah.

Yeah.

And, like, I hope I'm not, like, you know, showing the man behind the curtain here, but, like, there's, there's other ways of doing that. Like, this, this place, for instance. Like, I bought it before it was on the market.

Perfect.

You know? But they put it on the market and then accepted my offer that we'd already talked about before it went on the market.

Smart.

And so you can do that.

I mean, you can do anything.

100%. Real estate, I mean, in real estate, there's 100 different ways to sell a house. Then obviously the most popular way that most people know about is putting your house on an MLS like Zillow or HAR, and then you— that's going to get your most views, right? Some people just stick a sign in the yard and says house for sale and their phone number.

Yeah.

And you can sell a house that way.

Yeah.

You don't have to pay anything. It's obviously a little bit more work and a little bit more knowledge of how to sell a home, but you can still do it that way. You could go to forsalebyowner.com, pay $149, list your house there, have people reach you directly, call you directly. I mean, you'll probably get 20 calls from real estate agents, but that's just another way to do it.

So is it online? And the one you're talking about, is that just a flat fee and they cover all the paperwork?

Right, right, right. So I want to say like there's like, there's a bunch of them. forsalebyowner.com, fsbo.com, which is—

yeah, same thing.

Yeah.

Um, but yeah, so you pay like a flat fee, they give you some like tips, they kind of like say they'll help you with— well, they do help you with some of the paperwork. I've never done it, but I'm just saying like that's kind of the service they say that they do.

Yeah, yeah.

So, um, yeah, there's— I mean, some people just word of mouth. I mean, that, that sells. I mean, you, if you have a nice property, you tell your neighbor, hey, I'm thinking about selling my house. Hey, I have someone that wants to buy it, right?

Yeah. I mean, well, and, and I mean, I, I don't know how many people I've known over the years who have said, I want to buy that house, and they'd go over and knock on the person's house. Can I buy your house? And every once in a while it works.

Yeah.

It's like, well, I mean, Legitimately, I had— I— this was back in 2005. I'd bought a truck in 2004, and I did all kinds of stuff to it. Put new rims on it, put a sound system in it, alarm system.

You're bumping?

With remotes. Oh yeah, with remote start. Like, I had duals on the back, right? Like, this thing was really, really nice. And, and I had a guy who's like, man, that's a really nice truck.

Is it for sale?

And I said, buddy, everything I own is for sale. Just depends on how much you want to pay for it, you know.

Numbers, right?

I mean, you want to pay me $50,000 for this, which at the time was a lot for a truck, you pay me $50,000, I'll sell it right now, you know. So I think if the price is right, you'll sell something. If someone walks up and knocks on your door, will you sell your house for $500,000? I paid $225,000. Heck yeah, I'll sell it.

Everything's—

Everything's for sale. Everything I own is for sale except like my family, right? Beyond that, everything I own is for sale. And so I think that on some level you're right. I mean, there's 100 different ways to do a deal. I mean, my sister, she bought a house and it was just an owner finance. She walked up, they said, hey, we want to buy the house. Said, sure. We want to pay this much. They said, sure. They said, we don't want to go through a bank. Can we just— can we owner finance? And he said, we'll pay you this much. And actually It wasn't, it wasn't even one of those, we'll pay this much for the house. It was, we wanna pay you this much money for 10 years.

Oh, yeah.

And, and the owner said, deal. That was the deal. I will pay. And I don't, it was, it was something cheap, you know? It was like, pay $1,000 for 10 years. And the owner was like, sure. And that was the deal. And you don't have to go through a bank.

Yeah.

You don't have to go, you don't, there's, there's no contract you even have to sign. It's a, it's a, it's like me walking over to Craig's house and saying, can I buy that guitar on the wall? Yeah. Okay. I wanna pay you 100 payments of 14 cents. I don't know, whatever it is. And he's like, okay, deal. And that's the deal. Not for my guitar.

Not for that one.

Oh, I didn't— I was—

that one down there.

The, the one on the floor, not the one on the wall. Yeah.

That one right there.

That'd be fine.

That's right. But, like, I think that that's the thing that we don't always understand is, like, most of the time you're going to go through a realtor. Most of the time you're going to put it up on the MLS. Most of— but it's not always.

Oh, you don't have to. Like, I'm in a bunch of—

a bunch—

I'm in one dad's group. Say I'm in a bunch of dads— I'm in one Facebook dad's group, and like, there's guys that ask real estate questions all the time. And I'll say, I'm a real estate broker, but you don't have to use a real estate broker or your real estate agent To sell your house, right? I mean, you don't have to use a lawyer to go to court. I mean, you can do whatever you want. I would recommend that you would do some research before you just jump out there, jump out and do it. But yeah, you don't need a real estate agent because people ask all the time, do I need one? No, you don't have to have one. I mean, I wouldn't suggest you perform surgery on your cat, but you could do

it.

Yeah. There's a lot of things you can do. Yeah. Yeah. But, you know, the— I think that's part of the thing though is like, at the end of the day, that house— so it was a mobile home.

Mhmm.

That house was moved to their property. And at the end of the day, they just stopped paying for it. What are they gonna do?

Yeah.

You know? So that's why you go through realtors. That's why you go through the, the mortgage lenders. That's why you go through— there's some protection.

Right.

That is, there's contracts involved and there's legal stuff that is done. And I'm, I'm sure on some level there was more than just a handshake on that deal that they did. Like, surely there was some sort of a lawyer that wrote some sort of a contract that probably would hold up in court, right? But it can be done on a handshake.

Yeah, sure. I could definitely do it.

Yeah. You can.

Like, well, uh, we stopped paying. Is, is that okay?

Yeah.

They're like, I just—

it's not, it's not okay, but what are you gonna do about it?

Yeah.

Nothing.

I'm gonna go get a big old truck.

Big old truck. I got an F-750 over here. I'm gonna pull this thing off the blocks.

Super duper duty.

It's super, a super duper doobie. It's the biggest. Big Daddy.

Alright, man. So one of the, one of the reasons we wanted to talk to you is because at, at an event that you and I went to not too long ago, we met this guy that was doing crowdfunding for down payments.

Oh my god.

Yes. So this is cool.

What, real quick, what's the, what's the name of the, the group that's doing that? Do you know?

It's CMG Financial.

CMG Financial.

Okay.

Yeah.

As far as we know, they're the only ones that are doing this right now.

Yeah. So as far as I know, and as far as they know, they're the only ones that are doing it right now. So CMG Financial has a corporate office here in The Woodlands, and so they are kind of innovative in different types of lending. Obviously, there's always, like we said, 100 ways to skin a cat. So they have come up with an idea that to do, you know, a GoFundMe style, um, down payment, right? So instead of you— and like we talked about, it's like if you're getting married, let's say, yeah, you send everybody a, a— what do they call that? Like your, like your marriage, um, your announcement. Your announcement, yeah, with a QR code, yep, to go to their

Um, crowdfunding page to help pay for their home, right? You know, or their down payment.

Down payment.

Yeah. So it's a really cool idea. Um, obviously there's stipulations to it and what they can and can't do, but it's basically an account that is made and you just have people add money to your account. Yeah. Which is almost like what you would do with GoFundMe. Yeah, right. GoFundMe's basically the same exact thing, but this is just for a specific type of, of loan. But, um, I think they can go up to like a $400,000 loan on, on a house.

Okay, so that's kind of cool.

So yeah, we were saying like, it'd be kind of funny, like you're, you're like getting married and you're at your reception, all of a sudden on the big screen a big QR code goes up there and they're like, hey, if you didn't buy us any presents, uh, just, uh, go to this website.

There you go.

And there you go. I mean, that's pretty cool though.

That's a really, really smart thing to do. I mean, because at the end of the day, um, I've found that people will pay for just about anything. Yeah, I mean, literally, people will pay or contribute to— or contribute, pay. Like, I, I literally think that— I mean, people buy stuff so flippantly.

Oh, yes.

I mean, it's just like, oh, I got $5. Yeah, I'll buy that. I got $10. Yeah, I'll— you need some help? I'll give that to you. Like, especially if you got cash in your pocket. Yeah, cash in your pocket will pay for anything.

There is something to be said about passing the hat.

Yeah, it works. Yeah. I mean, whether it's working out of guilt, or it's like, oh, I didn't Freddie put something in that I should probably put something into.

Like, whether it's that, right?

Or whether it's just, you know, you want to look, uh, yeah, look at what I just put in there. You know, whatever it is, it works. Yeah.

My, my best friend's kids always know who I am because they, they always had a photo up of me at their house from their wedding. And me, I was, I was the best man, and then the, the maid of honor, we went around the, uh, the reception dancing. getting people to stuff money into our—

into our—

Oh, into your suit?

Yeah, in my suit and her dress. And so, like, there's a picture of us with, like, just money just, like, sticking out all over us, you know? And so, like, that was our job, was, like, to go around and, you know, put a drink in somebody's hand and say, hey, you got any cash for the happy newlyweds? And nice, man, they were forking it over like crazy. Yeah, we should have gotten out of there.

Uh-huh.

Yeah.

Sorry, I paid for this tux. Right. But yeah, I mean, I, I think that it's smart. I, I know. I mean, there was—

when we were talking to him, wasn't there like— I think he was saying there was like a, there's like a max that people could give for like tax purposes and things like that.

I think, I think it was no more than 3.5% or maybe 5% of like the purchase price. I mean, it was quite a bit though.

Yeah, it was, it was.

So I mean, if they're buying a $300,000 house, then they maybe max out at $9,000 or $12,000. But that's—

but still, down payment, that's a— yeah, that's what it's for. I mean, it's a decent— yeah, I mean, it's help.

It's— oh, it's a big help.

Yeah.

So I mean, you basically could, could use that as your most of your down payment, and you're basically just paying your monthly.

Yeah.

After that. So I mean, it's a pretty cool little setup that they, um, that they've kind of evolved from, I don't know, you know, because mortgage companies are always trying to think of like the next idea, right? Of what can we do to separate ourselves? What can we do that's a little bit different from all these other mortgage companies? So they come up with all of these—

Yeah.

Ideas and all these different, uh, programs. And so CMG just happened to think of like this, you know, GoFundMe style Which, um, I was like, man, y'all should be like promoting this like hardcore because it is a good idea. It's easy. And like, hey, you don't have to buy them a wedding gift and just send them $200 on their— yeah, on their home or whatever.

I kind of wonder if it's like, if it's expensive for them just because they have to provide a lot of backend tech, you know, like—

But do they?

I mean, I don't know.

I would think that it's such repeatable— it's so repeatable for them that likely it's not I mean, unless there's just, like, tons of hosting, like, server hosting type stuff. I'm just—

I'm, I'm guessing that everybody that donates to it has to set up, like, an account. They have to, like, authenticate them. They have to, you know, all that payment process stuff on websites is just expensive to build out.

Yeah.

You know, but if they have it already—

Or if it's proprietary to them.

Or maybe they're, like, stealing it from Patreon or something. I don't know. But, you know, I— who knows?

Yeah.

Um, yeah, we tried to have them in here. They couldn't make it tonight.

I know, I know. I was— Joey, if you're listening, I'm upset at you.

Hey, come on now.

Had to go and be a good dad.

Yeah, had to do baseball thing.

Baseball thing? It's freaking like 20 degrees outside.

Commissioner thing.

He's getting his punishment right now because it's cold out there.

Yeah, I hope they're outside on the field talking about it. But yeah, that's like a— that's like the newest thing that, that has come out in the last couple months. And I was like, huh, that'd be really something to, um, I want to have someone do it just, just to see how it works.

Yeah.

You know, because, you know, I almost want to be like, hey, if you're getting married, you should use this type of program to fund your next— to fund your house that you want to buy after you get married or whatever. To me, like, getting married or getting divorced would be 2, 2 good times to do it, right? So usually people getting divorced, they, they, they buy a lot of houses too.

Yeah, I mean, they, they almost have to. Yeah, right. I mean, unless they're gonna move into an apartment or rental house, and they're gonna think they're— instead of one house, you gotta have 2.

Yeah, they're homebuyers.

There it goes. Yeah, they're homebuyers. So, well, okay, so let's see, we've covered price hikes. We've covered foreclosures. We've covered crazy things related to getting down payments. What else have we not covered tonight that we planned on covering?

The only other thing that we didn't talk about was, and it's not really my realm, but it's interest rates. Okay, so just with inflation and it very— it looks like they're going to raise interest rates 2 or 3 times this year, which, you know, we went down all the way to like 2.75-ish. And we're gonna be like, I would say we're back in the 4s. I could be wrong, but I'm probably not. Like, we're gonna be— which is 4 still not horrible.

Oh no. Yeah, I'm not like— my house, my house is at like 3.99, and that was 2017. And, uh, I feel really good about it still.

Yeah.

I, I intentionally didn't refi because we would like to, to move. And so we, we didn't refi. Um, but a lot of people did. If you're gonna stay where you're at, you should have. Um, but, uh, you know, 3.99%, that's still good. Yeah.

You know, I mean, when like, when like we were kids, oh, it was like 14%, 15%, 16%. I mean, like, and people would just like be You know, screaming in the streets if they thought they had to pay that right now.

Yeah. Oh.

Oh, yeah.

But that was— but that— okay. So there's a couple of different things. It was normal. First of all, it was normal. Second of all, the houses weren't as much as they currently are. Third of all, you could put most homes on a 15 or 20-year note instead of a 30-year note. So there's a lot that's different. But that being said, 4% still feels pretty good. Yeah.

You know?

It's not bad.

I heard a story about— do you know who came up with the American dream, about homeownership being the American dream?

Banks.

Banks. Oh yeah. Is this Cardone you heard this from? I don't know.

I want to say I heard it like—

That's who I heard it from.

6 months ago.

Yeah.

Maybe it was him. Maybe he was telling a story about— yeah, now that you say it, I think it was him that I listened to about the American dream was banks because banks needed something to loan on.

They needed a product.

They needed a loan.

Yeah. Yeah.

Interesting. I never, I, I never had thought of it that way. And that's when they started building out neighborhoods.

Yep.

Yeah. It's, I mean, like a lot of people lived in buildings. Mm-hmm. Even, even in small towns, you had buildings that people would live in, you know, like, you know, quadplexes and, and different things like, you know, apartments and, and things like that. So like it, he's, he's right. I mean, like, it's, it's sort of a new-ish phenomenon that the American dream is to own your own home.

Yeah. So, which, you know, is, is kind of funny because we all know that one of the greatest things about homeownership is equity, right? It's one of the greatest things about it. You're paying down something, you're paying interest, whatever, but that's normal. You're paying down something, now you own something. Like, that's— it's a piece of property that you own. It's yours. That's great.

Yeah.

But I, you know, seems normal to us, but we've also been living in it for quite a few years, you know? Yeah.

Exactly.

The, the, the, the point of this, the story that, that Freddie's talking about though, is that most people, in order to afford the kind of home that they want, that they love, have to put it on a 30-year note.

Yeah. Have to.

And, and so, you know, then, then you start seeing, by the time you pay it off, then you start seeing ads from Tom Selleck about how you need to, like, reverse mortgage your home. You know?

Yeah.

And it, like, because you've now retired and you really, you, you now you can't afford, right, the upkeep on the home. So like, even if you have all the equity in the world, you don't have access to that capital. And so you have to then try and get money from that. And so you sell it back.

Yep.

And, and so Cardone's whole thing was like, look, banks don't make money unless they're lending money. Um, a lot of people don't realize this. Like, I think the last time I heard, like, banks can lend $20 for every dollar that they have.

That's a lot.

Which that should disturb everybody.

Yeah.

That's, that sounds right too.

That they can just create money out of nothing to, in order to lend you money.

So that they can make money.

So that they can make money as you pay it back. They're, they're lending you pretend money that then you pay back with real money.

This sounds like—

With plus interest.

This sounds like Monopoly only with a weird twist.

Yeah. It, it, it, it is. And so he was— what the point of that story was that, like, look, they created this idea of the American dream in order to sell you a product so that they could loan more money.

Right.

Because banks primarily had loaned money to start businesses. But there's just, you know, a lot of people just don't have the temperament for that. So they're not loaning as much money. Well, how do you loan more money?

Well, create new product. Yep.

Well, see, you buy a house at— when you're 30, let's say you buy a house when you're 35, you do a 30-year note.

Which is when most people are financially stable enough to do that.

Right.

It's 35.

Yep.

At 65, they pay it off.

Yep.

Then at 70, do they do a reverse mortgage? Yep.

Oh my goodness.

They got 5 years of—

they got hosed.

Yep.

We'll get you hosed, man.

Well, and, like, let's say, let's say you turn 65 in 2008.

Oh my gosh.

Right?

And which was the reality for some people.

Yep.

Right? Like, I've been working all my life to pay off this house. I bought it when I was 35. I'm paying it off when I'm 65. And now it's worth half of what I paid for it.

Jeez. You know, you know, they were selling houses. I remember this because I was trying to buy this house in like 2010 or 2009. You could buy a house in Houston that was like 5, 6 years old for like $30,000. Yeah, yeah, $25,000, $30,000, like homes that were like 1,800, 1,900 square feet, like pretty good shape. And they would be sitting there for like months, 3 months.

Yeah.

Like $30,000. I tried to buy one. That's the only reason I really know that story, because I wasn't in real estate yet. But I was like telling my dad, Dad, give me $30,000 so I can buy this house. And by the time he gave me the money, that deal went they sold it to somebody else. And anyways, I never bought it, but like, that was an actual thing. Yeah. In Houston. Like, that house right now is probably worth like $270,000.

Geez.

And someone bought it for like $30,000, $35,000.

They look like a genius right now, right?

Yeah. And they probably bought 10 of them.

Yeah.

You know, well, it like—

I'll make a bold prediction. I think we're going to see that again. I don't think it's going to go that low, but I think we're going to see it again.

I—

we should. I just don't know when.

I don't— yeah, that's the thing is no one ever knows when, but I think it is gonna happen relatively soon.

We're supposed to be in like 10 to 12 year cycles.

Yeah.

You know, but in— oh, you know, '08 was like a, a weird one.

It was.

Um, just because it's manufactured. Yeah. Yeah. 500 credit score, sign right here, sir. Um, but it's, it's— I would like to, you know, because right now it's not, it's not really that fun to be a real estate agent unless you're only doing listings. Like, if you have any buyers, it's extremely hard.

Yeah.

I wrote probably 10 contracts for one buyer this last year. I mean, we would go see a house, write a contract, full price. I mean, it was never under full price, right? It was always full price. Plus, hey, how about 2 free weeks in your house after the deal closes so you can move our stuff out? Yeah, they took a better offer.

Of course.

Yeah.

Because there was 13 of them. 13 better offers.

Yeah. Yeah. So, I mean, I would rather— I like it when it's 50/50, you know, when it's, when it's even. Because when it's like, you know, 90/10, uh, it's, it's, it hurt. It's, it's real estate agents. People think, oh man, the market's great. Prices are going up. Oh, I'm sure you guys are loving it. And real estate agents really don't like that. Yeah, it makes our job a lot, lot harder.

Yeah. You know, so can they actually do that? They can, they can set up the— does the listing agent set the, the rate that the buying agent gets? Yes.

Well, technically the seller authorizes, authorizes what the listing agent and the buyer's agent are paid.

Okay, it's typically 3-3, right? Typically.

Yeah, in most scenarios, yes. But like, I have one that is, um, it's a new— it's a brand new house and it's for like $600,000 plus. And, um, we did all the paperwork, everything signed, everyone's signing off. At the very— the probably like the last 2 things that need to be signed off on, they're like, oh, they're only paying 2% on this house and not 3%, which was fine. I mean, it, it was for a good friend of mine from like elementary school, so I wasn't like gonna piss and moan about it, right? I just kind of was like, sure about that?

I mean, can we have a recount, please?

I mean, it went from an $18,000 commission, which is great, Sure. To a 12, which is still great, but it's $6,000. But it's still $6,000.

Yeah.

So I have to at least be like a little bit pissed. I mean, yeah, you know.

Yeah.

So like, and that was like the, the deal was already agreed upon, everything was signed, they even had 3% that they were paying on their paperwork. And then they're like, oh, by the way, I did that wrong. Oh, that's what the agent told me.

That's shady.

She goes, oh, I'm really sorry I did that. She goes, I'm really sorry I did that wrong.

Well, I go, you know what, like, you can pay me $6,000 out of your commission then. How about that?

And I'm really sorry I didn't twist that knife as I stuck it in your back.

Right.

The only thing that made me feel a little bit better, and not that it really did, but like, I went to some of her other listings for that same, um, builder, and those were at 2%. So It was more of like a clerical error, right? But I mean, still, I thought— so $6,000 error.

I thought you were gonna say she like fell and broke her arm or something. That made you feel a little bit better.

And the fact that my foot was out there made me feel better. But I mean, so some— yeah, 3 and 3 is what you— is what you normally will see. And I can't even say that because that's actually— for even me to say that that's normal is actually against the rules. You're not supposed to say, because there is no normal set, normal commission, because it could be 4 and 4. What if you, what if you told the seller, I'm going to do an extremely awesome job. I'm going to sell it for more than anybody else, but I need 8% because I'm going to mail every millionaire in Texas about your house.

Okay.

So I need 8%.

How often does that happen?

Well, I was gonna say, does that happen on, like, higher value listings?

Because they're harder to move.

Well, sometimes. Well, right now, no. But—

I'm talking, like, $4 or $5 million.

Okay. Did you see the listing in LA? $52 million?

Yeah. Whose house was that?

Well, it's the big— I don't, I don't know, but it's like 50— I, I think it's like, 50,000 square feet. It's an acre. That there's— but it's only— yeah, but here's the thing, it's only on 3 acres. Wow.

But it's— but it is the largest.

I believe it's the largest house in the country. It is the—

is—

and it overlooks LA. Like, it is— it's up on a hill, you can see the entire city, and it's, it's absolutely stunning. I think there's like There's something like 35, 40 rooms, like bedrooms in it. Um, it's, it's unbelievable. I don't even know who owns it, but it's serious. I think it's like $52, $53 million.

Wow.

It's probably like David Geffen or—

I need to go. All right, now I gotta go look.

It's probably— you know what the funny thing is, is like, and I'm sure that that house is just so over the top incredible in every single way, But like Elon Musk is like, I want to sell my— I don't even want a house.

Yeah, he sold all his properties.

Because I don't, I don't want anything that—

Well, he wants to live in it. He wants to live in a small home that's smart. That's what he wants to live in. Yeah, like a solar-powered— yeah, it's ridiculous.

So here, here's the—

I was—

when you guys were talking about, I was thinking about the story that I saw. I found it. So it is, uh, this home in San Francisco that just sold For nearly two million, and it's condemned. What?

So San Francisco will be the first domino, in my opinion, to fall, and it's gonna fall apart. San Francisco is so—I mean, the the the real estate price in San Francisco is so incredibly ridiculously high.

Have you have you seen this property that I'm talking about?

No, I haven't.

Yeah, let me see if I can. All right, y'all.

All right. I'm, I'm wrong. Are y'all ready for this?

It wasn't 54,000 square feet?

No, it was, um, it was a lot. It was a lot more than that.

Wow.

Um, so, so this house is, um, first of all, it's in, it's in LA. It is listed at $295 million.

Uh-huh.

It's 105,000 square feet. Holy cow. And it's— so it's got—

That's over 2 acres.

So it's got— yeah. So it's got, it— okay. So I was wrong. I was wrong about the, the 40 bedrooms. It's got 40 bathrooms, 41 bathrooms, 42 actually. 21 bedrooms, 42 bathrooms, multiple pools. There's a nightclub in it. A full-blown nightclub with a VIP area, a bowling alley, a 40-seat movie theater, a full-service hair salon, 30-car garage. And that's just part of the, the stuff that it's got. But it's—

Sounds like Chris's house in Minnesota.

Yeah, but it's $290,000. I mean, but look at this thing. I mean, that is a gorgeous— this is a gorgeous home. And it's $295 million.

But what do you—

what do you— what do you— see how it just— why?

Well, yeah.

Exactly. Like, like, do you wanna stay home all the time?

That's a cult. That's what that is.

A cult lives there.

I mean, yeah.

Yeah. Yeah. No. That would be okay. There's—

there's—

that would be okay. There's something—

As long as I'm the leader. It's like being an admin on a Facebook page. As long as I'm the leader, I'll do anything. But no, I think that I don't know what you would do with it. It's a status symbol. That's all this thing is, is the largest city in America. 105,000 square feet. Really? 100,000? 105,000? What?

How many women come with it?

Probably as many as you would like. Probably as many as you would like.

It's more than one. It's too many.

That's right. like, I hope none. But, um, 40-seat movie theater.

And wow.

Anyway, that, that I just— I mean, yeah, that would be cool, I guess. But like, it would be— I don't know. I don't know. I guess, I guess someone has to. But like, I don't even know why I know this. This is so embarrassing to say. And I probably saw this on a Facebook reel or an Instagram reel, but like Kim Kardashian says to Kanye, he says something about their swimming pool, and she looks at him and goes, you know, I've never used our pool. And he was like, huh? What? Like, she doesn't even use— like, when they live together or married, she's like, I never used our pool one time.

What?

But like, if you own something like that, like, how many times do you like go bowl?

Right. Yeah.