Podcast appearances and mentions of rick sharga

It's time for a mid-year housing market update. In this episode of The Real Wealth Show, Kathy Fettke is joined by one of the most respected voices in real estate — Rick Sharga, CEO of CJ Patrick Company and a leading housing market forecaster. Together, they break down the key trends shaping real estate so far this year, including: How the housing market has performed vs. expectations Investor sentiment and why it's shifted Regional market trends — where the headwinds and opportunities are The state of foreclosures and what might be ahead Plus, Rick shares his expert outlook for the rest of 2025 and what savvy investors should be watching. If you want to go even deeper, join Kathy for a live webinar on May 29th at RealWealth.com/Webinars. LINKS CHECK OUT OUR NEW WEBSITE & BECOME A MEMBER (IT'S FREE)! https://realwealth.com/join-step-1 FOLLOW OUR PODCASTS The Real Wealth Show: Real Estate Investing Podcast https://link.chtbl.com/RWS Real Estate News: Real Estate Investing Podcast: https://link.chtbl.com/REN FREE RealWealth® EDUCATION & TOOLS RealWealth Market Reports: https://realwealth.com/learn/best-places-to-buy-rental-property/ RealWealth Videos: https://realwealth.com/category/video/ RealWealth Assessment™: https://realwealth.com/assessment/ RealWealth® Webinars: https://realwealth.com/webinars/ READ BOOKS BY RealWealth® FOUNDERS The Wise Investor by Rich Fettke: https://tinyurl.com/thewiseinvestorbook Retire Rich with Rentals by Kathy Fettke: https://tinyurl.com/retirerichwithrentals Scaling Smart by Rich & Kathy Fettke: https://tinyurl.com/scalingsmart DISCLAIMER The views and opinions expressed in this podcast are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action. For more information, go to www.RealWealthShow.com  

Keith Weinhold and Caeli Ridge discuss the benefits of a type of loan that combines mortgage and banking features. This loan allows deposits to reduce principal first, every deposit acts like a payment, minimizing interest accrual. And can be used for cash-out refinancing, providing flexibility and potential tax benefits.  Hear about the importance and the difference between open-ended and closed-ended loans. If you pay down the loan balance over time, you can have a spread that allows you to access that equity without having to requalify or pay additional closing costs. Resources: Explore the loan simulator at RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Show Notes: GetRichEducation.com/542 For access to properties or free help with a GRE Investment Coach, start here: GREmarketplace.com GRE Free Investment Coaching:GREmarketplace.com/Coach Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Invest with Freedom Family Investments.  You get paid first: Text FAMILY to 66866 Will you please leave a review for the show? I'd be grateful. Search “how to leave an Apple Podcasts review”  For advertising inquiries, visit: GetRichEducation.com/ad Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free— text ‘GRE' to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Complete episode transcript:   Automatically Transcribed With Otter.ai    Keith Weinhold  0:01   Welcome to GRE. I'm your host. Keith Weinhold a discussion about the future mortgage rate direction. Then there's a property loan type where you don't have to make any monthly payments, and if you do make a payment, it all goes toward principal, and nothing is lost to interest. It can save you lots in interest expense over the life of the loan today on get rich education.   since 2014 the powerful get rich education podcast has created more passive income for people than nearly any other show in the world. This show teaches you how to earn strong returns from passive real estate investing in the best markets without losing your time being a flipper or landlord. Show Host Keith Weinhold writes for both Forbes and Rich Dad advisors and delivers a new show every week since 2014 there's been millions of listener downloads in 188 world nations. He has a list show guests include top selling personal finance author Robert Kiyosaki. Get rich education can be heard on every podcast platform, plus it has its own dedicated Apple and Android listener phone apps build wealth on the go with the get rich education podcast. Sign up now for the get rich education podcast, or visit get rich education.com   Corey Coates  1:13   You're listening to the show that has created more financial freedom than nearly any show in the world. This is get rich education.   Keith Weinhold  1:29   Welcome to GRE from flaccid County, Oregon to Lackawanna County, Pennsylvania and across 188 nations worldwide. I'm Keith Weinhold, and you are back in for another wealth building week here at get rich education, just another shaved mammal with the microphone here, I have a real estate analogy for you. Growing up, my dad told me, whatever you do, do it well. And that was broad guidance for life. I like things that are easy to remember. Our simple home in Appalachian Pennsylvania was headed with a wood fired stove, so we couldn't just turn a dial and feeding the stove with those logs took time and work. It was a family effort. Dad split the firewood. My chore was to regularly move firewood from the wood pile into the home, and then Mom or Dad would start the fire and constantly tend to it and get it up to the right temperature. But you know, when that fire finally roared, it felt like it could have heated five homes. And this is like buying an income producing rental property. You can't just point and click to make income reliably appear. It takes time, and even some of this admin type of work before you feel hot returned the spark that can ignite the fire means first putting your financial house in order. Those are things like getting pre approved for a mortgage loan, and then they're stacking the firewood, which means finding a deal, making an offer, booking a property inspection, scheduling an appraisal, perhaps signing a property management agreement if you're not self managing, and then, of course, placing a tenant. But see when that investment property fire roars after a year or two that can create enough returns for five retail investors, just like our roaring wood fire could have heated five homes, even though you're only one investor getting like 5x returns, and by now, you probably felt, after a year or two of owning it, the profitable warmth of the five ways you're paid that you know so well. Those five ways are leverage, appreciation, cash flow. Tenant made principal pay down a tax benefit basket and the quiet, whispering fire of inflation, profiting on your loan, but you can't get over leveraged, meaning that you can't make the payments, or else you burn the whole house down. This means embracing the right level of debt rather than avoiding debt altogether. So yeah, you know, if you want to be in the top 1% or maybe even top 5% Do you know what that means? It means being misunderstood by the masses. And when you do this right, it's not about getting rich quick, but it's about building wealth. For sure, feel the fire and whatever you do, do it well, just like my dad told me, and oh, by the way, today, my parents still live in that same. House, but they now just turn a dial for heat.    Well, you know, there's been a lot of real estate and financial news lately, just this constant feed of news. And I really need to tell you something about that. I am not a news reporter. If some news just broke an hour ago. A lot of times people are only overreacting to something like that. So here at GRE I infuse the news longer term into our content of the show, because some of it is just too big to ignore. But often let it settle down for a little while and filter out what it really means to you as an investor. I mean, being an educational platform rather than a news platform is what it's about. So I want to make sure you understand the relationships rather than just reporting the news. I mean, for example, what tariffs can do to home prices and rents and inflation. I mean, that really impacts you and your real estate long term. Rather than just doing something like reporting that the tariff on this nation that looked like it was going to be 25% is now only going to be 10% or something like that, that really doesn't affect you so much. So now that you know more about what to expect here, which are the stories that really affect you as an investor? The last inflation report did come in at a hot 3% that startled economists that it was that high. And what that does is that makes bond yields rise, because bond investors need a real return net of inflation, and in turn, that soon makes mortgage rates rise, and also it makes Jerome Powell be in no rush to cut his Fed funds rate after this hot inflation report, either. And here's another long term relationship that can help you learn the Fed's dual mandate is, what do you know? What it is, the two things I've mentioned it to you before, the Fed's dual mandate is maximum employment and stable prices. That right there is inherently volatile, because when employment is maximized, well then employers, they have to compete with higher wages in order to attract workers, and that makes prices go up, destabilizing the prices will stable. Prices is the second part of the dual mandate. So that's why it always seems like there's this lightning rod attention on Jay Powell in the Fed. It is because the dual mandate is inherently volatile. Now, you know what I think about predicting mortgage rates. I don't like to do it because it's an almost impossible task, like the myth of Sisyphus, that Greek myth about rolling a boulder up a hill wells, Fargo says mortgage rates will go down to just six and a half percent by the end of this year, so not much of a drop. And also by the end of next year, almost two years from now, they'll still be just six and a half percent. And other C rates rising from here. So there is broad consensus that there's zero reason to think that artificially low rates are going to return anytime in the near term, perhaps even in the intermediate term, coming up on a future episode of the show here and soon, how to use AI in real estate investing today, let's talk about mortgages and a special loan type.   Today, we are back with the national leader in providing Americans with income property loans. She runs the operation at Ridge lending group. She's been doing this 25 years she's an investor herself. It is their CEO and president, Caeli Ridge,   Caeli Ridge  9:06   Keith, thank you for having me.    Keith Weinhold  9:08   There does seem to be one US president. That makes a lot of news lately, but Caeli is still the most noteworthy mortgage type of President, I suppose. And just like GRE Ridge focuses on education and Caeli mortgage rates. It's the topic that everyone wants to talk about. I don't predict mortgage rates, but I know that you'll Talk That Talk a little. And previously, many expected Jerome Powell and the Fed to drop the rate four times this year, then two and now more and more expect zero rate cuts at all this year, even opening the door for rate increases if inflation persists. So tell us about the propensities of this year's mortgage rate direction.    Caeli Ridge  9:51   I think that I agree with a lot of the volume out there related to interest rates kind of stay in the course. I don't think we're going to see too much of a decline. There's. Certainly, Keith, we talk about this at nauseum. There's all kinds of things that could derail that statement that we can't prepare for, we couldn't predict for, but I think overall rates are going to stay steady. I think that whether you like them or you don't like them, the tariffs tend to come with an inflationary tone. And if that's the case, it's going to put Jerome and his buddies at the Fed in a tough position to do what they had hoped to do with the easing, the monetary easing. So I don't expect to see it, but I'm hopeful who knows. Who knows?    Keith Weinhold  10:29   Now, for you, the listener and viewer here, when you really want to know what moves rates around, Caeli talk to us about this persistently high spread, and what that means is that historic difference between mortgage rates and the yield on the 10 year treasury note.    Caeli Ridge  10:47   I feel like a lot of what that's going to attach itself to is the inflation, and then, more specifically, when we talk about llpas, and I think we've talked about this in the past, loan level price adjustments, mortgage backed securities secondary market, right? This is an investment that is bought and sold on the New York Stock Exchange, right? These are investments that carry value. And while the Treasury is usually the one that people will look at to predict where interest rates are going to go, I feel like in this higher rate environment, the secondary market understands that these mortgage backed securities are going to be paying off in advance of profitability. Now this gets a little bit complicated, but the easy way to explain it is is that if you secure a loan today at, say, seven and a half percent, if the anticipation is that interest rates over the next three years, maybe not in the next year, but two years, even three years, are going to decline. The mortgage that was closed today will likely pay off via a refinance. In that event, it's not reached the maturity date, such that when that initial mortgage backed security was purchased on the secondary market, it will have to pay off before the investor has been made whole or profitable. As a result, the margins it's called on in my world, it's called YSP, yield spread premium will not be met. So they're baking in certain levers, or they're hedging, as another way to say it, so that they're not left with those negative balances when these things do pay off when interest rates come down, because interest rates are not a straight line, they go up, they go down, they go east, they go west. So as a result, they're planning far in advance into the future. So I think that has a lot to do with it.    Keith Weinhold  12:33   Real Estate industries are shrinking, and it's all related to the fact that back in 2021 the number of existing homes sold peaked at almost 7 million, but last year, it was only about 4 million. That is a huge drawdown. The number of US Realtors is dropping since it peaked in 2023 and Caeli, from what I can see, the number of loan officers, even operating has dropped precipitously over the last four years, it's a reminder that the strong survive and in the mortgage industry, top service is what savvy borrowers need. You go with the people that consistently advise you to take your time and look at your long term strategy and make the correct decision, not always the one giving like 1/8 of a percent lower and an interest rate, so any lender can get you the next loan, and few are going to help you with your long term strategy. With this overall lower volume of transactions taking place, what are your thoughts about how it's impacted the mortgage and lending industries?    Caeli Ridge  13:37   It's such a good question. I'm glad that you asked it, and I really do think it speaks to the experts in the space consumers, our borrowers, as we call them, have to be, I believe, a little bit more discerning about who they want to align themselves with and who they want to work with as it relates to the interest rate. We've had this conversation off book. Ridge doesn't sell rate or cost. Now we're competitive, but we're never going to be the lowest possible lender out there. There's always going to be somebody that can undercut for an eighth, like you said, a quarter point, a few 100 bucks here and there. And we just don't get into that, our value adds far exceed an eighth of a point in rate, which, by the way, you probably can predict what I'm going to say next, if you're not doing the math, just as a sidebar listener, the difference in payment, and that's really where the focus should be. The difference in payment on an eighth or a quarter percent in interest rate on $100,000 is all of 5,7,8, bucks a month. Okay, so make sure you're doing the math, but the value adds that come with the education that we provide the 49 states, large footprint and the diversity of loan product, I think, far outweigh any eighth or few $100 difference when you're comparing side by side. I'm not saying that you don't want to get comparisons and you don't want to be a smart, informed consumer, but it really does matter that your lender understands known, owner occupied understands how to. Or take you from point A to point Z today and five and 10 years down the road.   Keith Weinhold  15:05   you've been a mortgage industry leader for a long time with this lower volume. Have you seen mortgage companies implode close shop?   Caeli Ridge  15:15   Absolutely, we have access to those data points and the number of loan officers just the individual in the doing the transaction, not including processors and underwriters and funders and doctors, but just the loan officers. I believe, in 2024 reduced by a margin of 53% gosh, yeah, that's a big number.   Keith Weinhold  15:35   Yes, this is really hit the industry substantially. Are there any other interesting industry trends in this environment where we have persistently higher rates, I make sure not to say high, because historically, mortgage rates are still not high. The long term average being seven and three quarter percent on the 30 year fixed rate mortgage Are there any other trends that this loss in activity has created?   Caeli Ridge  15:58   I feel like the informed investor is still finding ways to profit in real estate. They're finding diversity is key, which I'm a big proponent of as are you. That means single family residence to two to four units, cash flow versus appreciation, the short term rental, the long term rental, the midterm rental, making sure that they have a good, rounded portfolio is key. And there are some which I think we're going to be talking about today. There are some mortgage tools that I really feel like, for an informed investor, are allowing them to continue and propel further, even scale into the 25 and 26 years.   Keith Weinhold  16:36   What's happened to the volume of owner occupied transactions versus investor transactions. I would imagine that investor mortgage transactions really aren't down that much.   Caeli Ridge  16:47   not that much. I'd say there was a small blip, but I feel like we've made those up with some of the burr strategy loans we do, of course, all kinds of mortgage related transactions specifically for investors. And one of those products is a short term bridge loan, which would apply to the BRRRR method by rehab, rent and refinance. So we've been seeing quite a bit of that, where the investor will find a good deal on market or off market, where they can put a little bit of lipstick on it and then refinance it at the ARV or after repair value. So anything that we might have lost in just a traditional 30 year fixed straight purchase transactions, I feel like we made up in the other but it wasn't a big margin.   Keith Weinhold  17:26   What if there was a mortgage product out there that just didn't work like other mortgage loan products do? For example, your deposits or the payments that you make on this special type of mortgage is applied to the principal first and only. There are a lot of other interesting characteristics about this particular mortgage product. We're going to discuss that when we come back. You're listening to get rich education. We've got the CEO and President of ridge lending group back with us, an investor centric lender. I'm your host, Keith Weinhold.   You know what's crazy? Your bank is getting rich off of you. The average savings account pays less than 1% it's like laughable. Meanwhile, if your money isn't making at least 4% you're losing to inflation. That's why I started putting my own money into the FFI liquidity fund. It's super simple. Your cash can pull in up to 8% returns, and it compounds. It's not some high risk gamble like digital or AI stock trading. It's pretty low risk because they've got a 10 plus year track record of paying investors on time in full every time. I mean, I wouldn't be talking about it if I wasn't invested myself. You can invest as little as 25k and you keep earning until you decide you want your money back, no weird lock ups or anything like that. So if you're like me and tired of your liquid funds just sitting there doing nothing, check it out. Text FAMILY to66866, to learn about freedom, family investments, liquidity fund, again. Text FAMILY to 66866   hey, you can get your mortgage loans at the same place where I get mine at Ridge lending group NMLS, 42056, they provided our listeners with more loans than any provider in the entire nation, because they specialize in income properties. They help you build a long term plan for growing your real estate empire with leverage. You can start your pre qualification and chat with President Caeli Ridge personally. Start Now while it's on your mind @ridgelendinggroup.com that's Ridge lendinggroup.com   Rick Sharga  19:48   this is Rich charga, housing market intelligence analyst. Listen to get rich education with Keith Weinhold, and don't quit your Daydream.   Keith Weinhold  20:06   Welcome back to get rich education. We're talking with a steady guest over time, because not only are they an income property centric mortgage loan company that do mortgage loans in 49 of the 50 states, but they're also centered on education and looking out for you, the investor, over the long term. And cheyley, such an interesting product that you offer is called the all in one loan. It's been a long time since you and I have really talked about this. What it is is a first lien HELOC. It's a way for you to use the equity in your existing properties. You can do it with either a primary residence or investment properties. There are just so many reasons why an all in one load just kicks the butt on a conventionally amortizing loan, including that all payments are applied to principal first and only, and a lot of other exciting things. So Caeli, why don't we back up and just describe what the all in one loan is big picture.   Caeli Ridge  21:05   Now there is a lot to unpack, so we're going to take our time. Listener. First of all, let me just explain. Why is it called the all in one it's called that because it doubles as both a mortgage in the form of an open ended revolving HELOC and checking and savings. Both of those two features are combined, hence the all in one as a way of diminishing the amount of interest that can accrue over time. Let me explain so any revolving account, any account, including a credit card, for example, but first lien HELOC, second lien HELOC, whichever doesn't matter, open ended revolving is the key. Any open ended, revolving account will accrue interest daily based on two factors, the first being that day's balance and that months, in this case, interest rate, fully indexed interest rate. I'll come to interest rate later. As a result, you now have control largely over how much interest can accrue. Now let's take that statement and transfer it and look at it against an amortized, closed ended mortgage. You sign up for a 30 year fixed mortgage today. Let's say it's 7% whatever the interest rate is, is really irrelevant. Your principal and interest payment are defined on day one. There is no changing that monthly payment. Now you could certainly accelerate the payoff of that mortgage debt by doing what applying additional extra principal payments, right? But what happens to that extra principal payment when you send it off with your 30 year fixed mortgage payment,   Keith Weinhold  22:34   it drops your loan balance, but your minimum payment amount is the exact same the next month,   Caeli Ridge  22:38   right? And then what happens to all that liquidity that you had prior, it's now illiquid. Right? Exactly that off   Keith Weinhold  22:45   you've just transferred your cash flow into equity. Financial freedom is created by doing the opposite thing and changing equity into cash flow,   Caeli Ridge  22:52   very illiquid, and not the way an investor typically is going to want to run his or her business. So hence the all in one. Now for those of you that have heard the term velocity banking or infinity banking, maybe whole life insurance policy has a similar tone to this. The all in one, I believe, offers even more flexibility for variety of reasons that we're going to get into. But if you've ever heard those terms, that's similar to what this is. So I want to start by I usually like to give an example, okay, and provide some visual aid so that people can connect the dots. Let's start with the 30 year or a fixed rate mortgage. Just because I feel like, especially in the US, this particular loan product, or its concept is widely used in much of the rest of the world, in the US, I feel like we're sort of preconditioned here to really only understand that closed ended, amortized mortgage. So I'm going to start with an example there that actually highlights or leads into the concept of the all in one. So I want you to imagine a 30 year fixed mortgage and a 15 year fixed mortgage. Both of these mortgages originated or started at $400,000 as the balance on day one. The 30 year fixed mortgage locked at an interest rate of 4% and the 15 year fixed mortgage locked at an interest rate of 7% now, when I go through this exercise and I give this example to people, I ask them the question, Well, which one would you choose? And without exception, if they don't understand amortization, they are going to select that 4% 30 year fixed mortgage, because they don't understand that it's about speed. When you run the math and you look at an actual amortization table, you'll see that you'll pay $40,000 more in interest on a 4% 30 year or 360 month, versus a 7% 15 year or 180 month. So the point here, and what I'm illustrating, is it's speed. Now let's segue back over to the all in one. It's all about speed and how much interest we allow to accrue over time. So as you had mentioned, to start the kick this off, Keith, every deposit acts like a payment. Now here's where I struggled with this in learning. And when this was first introduced to me years ago, this part of it really caught me off guard. I had to really dig in and try to focus on what are they talking about? What do they mean? There's no payment due on the all in one. I'm gonna say that again. There's no payment due on the all in one. Think about your 30 year fixed mortgage. If you don't make a payment, what happens?   Keith Weinhold  25:19   You're defaulting, you're in trouble. You become delinquent,   Caeli Ridge  25:23   right? So that is not how this loan is set up. And it's not smoke and mirrors, okay? It's nothing fancy. The deposits that you make from ordinary income from all sources really Okay, so we want to talk about this is really special for investors, because we have access to gross rents, the rental income that's coming in before we send it back out the door, along with our net wages and every other source of income, deposits that we're getting can be utilized to your advantage. One of the ways in which I describe this is, I like to say you've become your own bank, so you have this line of credit, and your gross rents and all of your net wages are going to deposit into your checking account, driving that principal balance down, dollar for dollar, so that the interest accrual is diminished. Because remember what I said a few seconds ago, the interest is calculated on any open ended revolving account based on two factors, the balance for the day and the interest rate, so the more you have in depository income, and you drop it into your checking account, the longer it stays there, the lower the amount of interest is going to accrue within a 30 day billing cycle. Now let me just paint one more picture, and then we can open up to what questions come from this. So I want you to imagine this is I'm going to use easy, round math. I want you to imagine that you have an unpaid principal balance on your mortgage, on your HELOC of $100,000 just for round easy mouth, and that you bring in $10,000 a month in income from all sources. And just to keep it simple, we're going to say that that 10,000 comes in on day one of month one. Okay, so here's our 100 grand sitting there. My $10,000 is deposited into my checking account. Now my balance is $90,000 right? That 10 grand is not going to be touched. You will not touch that $10,000 for 29 days out of a 30 day billing cycle. And I'm giving you optimal tricks. Okay, this is how you want to use it optimally, yeah. Day one, instead of paying interest on $100,000 you're paying interest on paying interest on $90,000 and you're going to pay interest only on $90,000 for 29 days out of a 30 day billing cycle. Well, how am I going to make all my bills? And how am I going to eat? And how am I going to pay my cell phone? And what am I going to do? You're going to use a credit card, or credit cards of your choice, the ones that provide the best points, or whichever you prefer doesn't really matter. To pay all those monthly living expenses now we don't want to pay any interest on our credit cards. Right? 18, 28% whatever it is. No thank you. So now we're going to go to day 30 of that 30 day billing cycle. Right? 29 days that 10 grand has sat in there. Our balance has been 90. Our interest has accrued on that 90. On day 30, the credit card has amassed $9,000 in expenses. You've spent $9,000 for the month on food, gas utilities, car payments, cell phone, everything goes on that card. Day 30, you go into your checking account where your 10 grand has been sitting, and you write a check to pay off the credit card $9,000 so for one day of the month, we went from 90,000 in a balance to 99,000 right. 9000 had to come out of the 10 to pay off the credit card. We had $1,000 left over. Now I want you to fast forward into month to day one our starting balance, because that $1,000 leftover was our residual income, our discretionary our savings, it's what was not spent, but I have full access to it. Should I need it? So day one, month two 99, 000 is my outstanding balance. I drop in my $10,000 of income. 89,000 is what I'm going to be paying interest on for 29 days of a 30 day billing cycle. So this should allow listeners to connect some dots. There are two components of compound interest savings, the first being daily. We've got our income dropping in there. It's just sitting so daily savings, compound interest savings. And then that leftover savings, that residual, that $1,000 is going to be left in there month after month 24/7, access. That's monthly compound interest savings. So those are the two components that make this product profoundly impactful in diminishing that interest accrual over time. Why don't I take a pause   Keith Weinhold  29:30   so with the all in one loan, we're really integrating our consumer accounts with our mortgage. Absolutely right? Is there a way to automate these payments associated with this?   Caeli Ridge  29:43   Yes, I'm glad you asked. So everything that you have become accustomed to today in your checking and savings is going to be exactly the same with the all in one this mortgage is housed by an FDIC insured banking institution. It'll be one of two places depending on which. Which ends up picking up the rights. It'll be North Point or merchants, bank, those are the two that service this loan. Feel free to check them out when you think about the automation of your checking and savings accounts with your B of A, Chase, Wells, Fargo, whomever, credit union, whomever you bank with. Now there will be no difference to that experience and this experience so online bill pay, debit cards, routing numbers, paper checks. Should you still use those mobile apps? If you get a paper check, you take a picture and it uploads to the account. All the same exact automation as you have become used to today will apply with the all in one   Keith Weinhold  30:36   and you described how the all in one loan is an open ended loan versus your plain vanilla 30 or fixed amortizing loan, which is closed ended. For those that don't know, what do those terms open ended and close ended mean?   Caeli Ridge  30:48   So amortized is predetermined over the period of time that you've gotten the mortgage for. So whether it be a 10 year, a 20 year, 2515, 30, whatever it is, it is closed ended, so the interest rate that you secured against the loan amount that you've taken, they have come up with the formula, the calculation that says, This is how much interest you're going to pay over this length of time. And the longer the amount of time that you have selected, let's say a 30 or maybe even a 40 year. Those do exist, in some cases, the longer the amount of time that closed ended amortized mortgages in play, the more interest you're going to pay. Now, it keeps your payment lower for sure, but they're going to make it up in the interest that you'll pay in the long time. Now the open ended revolving just means that it is available to pay down and draw up, and pay down and draw up. It is not closed   Keith Weinhold  31:40   and then with those conventional mortgages, typically, especially when you originate a new loan for years, most of your payment goes to interest, which would not be the case with the all in one loan.    Caeli Ridge  31:53   Exa  ctly. Yeah. So anybody that's looked at an amortization table knows the first 10 ish years, we'll just keep using the most common, 30 year fixed first 10 years or so, maybe even a few years past that, 90% of your payment is going to go to the interest. You won't start chunking down any principal until the back end of that mortgage, 180 or complete flip to the all in one every dollar that goes in there drives the principal down first.   Keith Weinhold  32:18   That is huge, even if you pay a higher interest rate on your all in one loan, you can see how you have fewer dollars out of pocket in interest paid, which is what really matters to you,   Caeli Ridge  32:30   exactly, right? So think about a 20% interest rate. If you're paying 20% interest on 50,000 then 7% interest on 500,000 you can see how the math will work in your favor, regardless of the number in the interest rate in comparing side to side. And one of the other things that we haven't touched on, and maybe this is a good segue, Keith, it's not just the daily deposits. We have clients that take out a, you know, a million dollar line of credit, but they have $500,000 sitting idle for whatever it is their business needs. And in the E commerce. It doesn't even matter, but they have this amount of cash that they're simply going to take from this vehicle a regular checking account over here, and drop it in here, and that interest is saved. That $500,000 that was sitting idle doing nothing over here is now saving interest at an incredible rate. So it's not just the daily and monthly deposits. If you just have idle cash, or you know you're going to be getting a bonus or a tax refund, or whatever it is, those monies that would otherwise just sit in a one to 2% maybe interest bearing checking savings account can now be applied over here, driving down that balance further, dollar for dollar saving in that interest.   Keith Weinhold  33:39   So we are opportunistic investors here, when we see an accumulation of equity in a property or cash in an account, we want to get that moving with this all in one loan again, which is like a first lien HELOC, I would imagine that would we get plenty of room to borrow more in there, and there's been plenty of pay down, we might want to draw against it again for another purchase, and let this thing be flexible like an accordion back and forth as you're drawing the balance down and you're extending it out again. So really, the way I see the flexibility with the all in one loan is that you don't have to go through another mortgage loan origination each time you want to buy a property. You can just draw against this account.   Caeli Ridge  34:20   And we're still just scratching the surface in what this thing does exactly right? And I've said this twice now, you've become your own bank. Yeah, okay, if you pay it down over a short period of time, let's say that you had half a million dollars and you were able to reduce that down to 300,000 there's a $200,000 spread there that, at your discretion, do not have to re pre qualify and pay closing costs. Again, you don't have to ask permission or get it approved, for some reason, those are your funds, your equity, your dollars to do what you want, when you want, how you want. The other thing too is probably a good place to point this out, safety net, as long as there is a spread between what you owe and the credit limit. Whatever that is. If something were to happen That was unfortunate, some unfortunate set of circumstance befell the family, whatever, and no income was coming into the household zero. What would happen if you didn't have money to make your 30 year fixed mortgage payment? You're going to ruin your credit and go into default. Well, the reverse is true with the all in one if there is a spread between the balance and the limit and you needed to not make any deposits, the only thing that's going to happen in that case is interest is going to accrue on top of that balance. The only time a payment deposit is mandated with the all in one is when the balance is about to exceed the limit. That's the only time. Now I'm not saying that that's the way people are going to use it, but that's the reality of it. So what if this? Let's take this down the rabbit hole for a second. If you couldn't make a deposit, you're not going to go into default, right? You're simply going to add some interest on top of the existing balance. But what if you needed to draw from it for living expenses for a couple of months? Yeah? What if you needed, you know, $5,000 a month for three months until you got back on your feet, whatever it is you have access to do that. There's your safety net. You just simply draw from it, as long as there's a spread between the balance and the limit, those are your funds to do with what you choose    Keith Weinhold  36:13   if one takes out a HELOC, whether that's in an all in one loan form or not, something that I've advocated with my listeners for years is that now you do have this line that you can draw against to your point Haley, it's effectively another layer of insurance for that borrower or investor. So if you're interested in keeping down your insurance premium, you can get a HELOC or an all in one loan increase your insurance deductible, which can lower your insurance premium and increase your cash flow.   Caeli Ridge  36:43   Good point. You know, I hadn't even thought about that before. That is a new one on me that is actually brilliant. Yes.   Keith Weinhold  36:50   now we had a listener quite a while ago, Mark from Granite Bay, California, right in Mark's a great long time listener. When he found our show, he wanted to go back and re listen to all the old episodes. And he listens to several episodes multiple times. And Mark wrote in because he heard you on the show quite a while ago. And Mark says, I've been using the all in one loans, amazing mortgage balance deduction. But as a GRE listener, I know I can't be lured in by that alone. I also need to utilize its leverage. I just used my all in one loan Mark continues to say, probably, like a lot of others, to buy a duplex for mid south home buyers in all cash and then refinance that loan into a fanniefreda 30 year from my all in one loan simulations, and Caeli has an all in one loan simulation on her website that she'll tell you about. But to finish Mark's question, Mark says, I have gathered in these simulations that as long as properties are cash flowing, the best use of the all in one seems to be to keep repeating what we did on our first duplex purchase, use the all in one loan, to buy properties in all cash, and then later refi it into better debt or leverage, and then continue to repeat the process. Is that a valid way to use it? That's Mark's question.   Caeli Ridge  38:03   Absolutely. Mark, Well done, sir. And there's a few points here that I want to take a minute and peel back, Keith, so one of the first things that I would say that's really great about that philosophy or that strategy is going to be that on a cash out refinance of the property that was paid cash, using the all in one we get to use the appraised value. So under the circumstances, if you paid $100,000 for it, and perhaps it valued at 110, 151, 20, whatever it is, then we as the lender are going to refinance on a cash out refinance using that higher appraised value, so you have a little bit more leverage there, and potentially get more in that loan to value when you're comparing what you're getting back versus what you put in. The other thing, obviously, is that when you're dealing with a turnkey or a seller, an agent, whatever, everybody knows that when you can come to the table with cash, yeah, right, you become the more desirable buyer. There's that obvious piece, and then in terms of that strategy and that simulation. So please, yes, that is absolutely the first thing that I'm going to do with anybody that calls in is I'm going to get on the phone with them, a teams call, and we're going to do the simulator together. But I encourage everybody to get in there and play around with it. If you're not quite sure what data points it's asking for, let us know, or we'll do one together. But that simulator is going to allow you to compare the all in one to either an existing mortgage on a primary rental property or a new traditional mortgage. Let's say you're thinking about buying an investment property with a 30 year fixed and you want to compare that to the all in one, or maybe you want to refinance one of your existing properties, so you can compare it to existing versus new. And then within that simulation, it will allow you to forecast additional spending. That will allow you to say, I want to take out $50,000 in month 22 and it'll reformulate where the simulation of saved interest, payoff time, all of those things will be available to you within that simulator. It's very slick.    Keith Weinhold  40:00    And now that you, the investor, have the ability to pay all cash, not only can you close faster, but a lot of times, sellers are willing to give you a discount, since you can close faster and pay all cash, and then it's up to you down the road to go ahead and refinance that into a conventional product, or however else you want to do it. Caeli, what else should we know about the all in one loan?   Caeli Ridge  40:24    Couple things I would share. First of all, the qualification metric for the all in one is going to be a little bit more restrictive than a traditional 30 year fixed mortgage, so be prepared for a little extra brain damage. I know that getting qualified for mortgages is not everybody's favorite activity. I get it. There's a lot that goes on to it. It's not like the good old days where some remember you could fog a mirror and get a mortgage, but the all in one does take it to another level, even beyond what you're used to now. So debt to income ratio, I'll give you the specifics really quickly, so just be prepared. I like to set that expectation. Debt to income ratio caps at 43% on the all in one versus 50% that we would have from a traditional Fannie Freddie, 30 year fixed. The reserve requirement is calculated based on the line limit. It's dependent on the debt to income ratio. I'll just leave it there. It'll either be 10% or 15% of the line limit. So if the limit was 100 grand, 10,000 or 15,000 is the reserve requirement, and then the minimum credit score requirement. Owner Occupied is 700 non owner occupied is 720 so a little bit higher on the bar for qualification for the all in one.   Keith Weinhold  41:33   Who is this for? And who is it not for?   Caeli Ridge  41:36   It is for anyone generally that has at least 10% discretionary income at the end of the month. Typically, everybody's circumstances are different. I encourage you to play with the simulator. Get on my schedule. Let's do it together. But more often than not, we find that 10% left over at the end of the month is generally enough for it to work for the individual, and for those of you that got 2% interest rates during the pandemic, I just want you to know that I'm running the simulator against those loans day in and day out. And I would say, I'll give you a 65% of the time the all in one is beaten the, you know, what, out of a two and a half percent 30 year fixed mortgage   Keith Weinhold  42:12   that is really interesting. Well, there's a lot of opportunity and flexibility with the all in one loan. Is there any last thing that we should know about it.   Caeli Ridge  42:22   Start doing your due diligence. This does take a minute to unpack. Don't get overwhelmed by all the information. We've talked about some real tangible stuff here, but there's quite a bit that there would be to uncover. So take your time. Call us. We'll walk through it step by step   Keith Weinhold  42:36   and get started on that simulator and really see what it can do for you to make that actionable. Caeli, Where should one start?   Caeli Ridge  42:44   Head to our website, ridgelendinggroup.com you can email us info@ridgelendinggroup.com and obviously we're always a phone call away at 855, 74, Ridge   Keith Weinhold  42:54   and again, you can find that all in one loan simulator, where you can plug in some real numbers and see how it can benefit you. A friendly representative from Ridge can help you. Go ahead and do that there. So there's a lot of excitement about the all in one loan, especially, or an investor that has a GRE mindset philosophy and thinks about the opportunity of dead equity. But now that we've talked about that, tell us just quickly about some of the other products that you offer in there at ridge.   Caeli Ridge  43:23    So I think one of the real value adds for us is that we're not a one size fits all. We have an extremely diverse menu, as I like to call it, of loan programs. The all in one is at the top of a short list of my favorites. For some individuals, you got the fanniefriddies. You've got non QM, which includes DSCR, debt service, coverage ratio, bank statement loans, asset depletion loans. We have ground up construction for those that are interested in that. We have our short term bridge loans that I talked briefly about, where if you need fix and flip fix and hold, potentially, you need shorter term money, commercial loans for commercial products, commercial loans for residential in a cross collateralization way, if that is to your advantage. So as you can see, it's quite diverse.    Keith Weinhold  44:03   It's been valuable as always, and I definitely learned a few extra things that I did not know about the all in one loan myself. JAYLEE Reyes, it's been great having you back on the show, Keith. Thank you.   Now a mortgage company, of course, they have overhead and employees that they have to pay and so on. And you know, from talking with Chaley some more, I learned that they don't even make much profit from all in one loans. We wanted to discuss it together today for your benefit. However, though there are some real fees with the all in one loan, you pay points of three to 4% of the draw in closing costs only, but it's a one time fee, not every time you draw against it. She also let me know that it does not make your taxes substantially. More complicated, if you think that it can help you clear a few minutes, learn more and get hooked up with that all in one loan simulator, where they will help you through it. Big thanks to Caeli Ridge today, they really make themselves available. You can just call 855, 74, Ridge. Or if it's more your style, visit them at Ridge lending group.com Until next week, I'm your host. Keith Weinhold, don't quit your Daydream.   Speaker 1  45:31   Nothing on this show should be considered specific personal or professional advice. Please consult an appropriate tax, legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own. Information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of get rich Education LLC, exclusively.   Keith Weinhold  45:59   The preceding program was brought to you by your home for wealth, building, getricheducation.com.    

We've got great news for investors, agents, lenders, and first-time homebuyers: housing inventory is about to rise…big time. After years of limited inventory, with homebuyers fighting tooth and nail to get into just about any home, the tide is finally turning. Rick Sharga from CJ Patrick Company brings new data and insight to the show, sharing why we could return to pre-pandemic housing inventory levels by the end of 2025. Why is that good news for so many of us? Because home prices could slow, if not drop, in some markets as buyers get a better selection of houses to choose from. Those “locked-in” owners with rock-bottom interest rates have waited long enough to sell, and 2025 could be the time they put their homes on the market. But if a new wave of inventory hits the housing market, are we at risk of a home price correction or a crash? Rick shares what the data shows and why investors are so pessimistic about the current housing market, even with the inventory forecasts looking so good. Will foreclosures rise again as consumer debt hits an all-time high? Could more off-market deals be in the pipeline in 2025? We're asking Rick and getting answers to all those questions in today's show.  In This Episode We Cover A historic housing inventory rebound and why this is great news for buyers, agents, and lenders Whether home prices will grow, stabilize, or crash with so much new inventory coming online The new Investor Sentiment Survey and why optimism fell off a cliff in Q4 2024  The single-biggest worry for rental property investors in 2025 and why it may get worse How to still find motivated sellers even with foreclosures at low levels And So Much More! Links from the Show Join the Future of Real Estate Investing with Fundrise Join BiggerPockets for FREE Find an Investor-Friendly Agent in Your Area Dave's BiggerPockets Profile BiggerPockets Real Estate Podcast 1065 - It's About to Get Good! (2025 Housing Market Predictions) CJ Patrick Company Investor Sentiment Survey Grab Dave's New Book, “Start with Strategy” Jump to topic: (00:00) Intro (01:15) Housing Inventory to Rebound in 2025 (06:27) Home Price Growth to Slow (08:45) Could Home Prices Crash?  (15:43) Investor Sentiment Falls (21:53) Top Rising Cost for Rentals (27:27) Foreclosure Deals? Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/on-the-market-288 Interested in learning more about today's sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com. Learn more about your ad choices. Visit megaphone.fm/adchoices

Investor confidence has hit a new low, according to the latest report from CJ Patrick and RCN. In this episode of The Real Wealth Show, Kathy Fettke sits down with Rick Sharga, founder and CEO of CJ Patrick, to explore what's behind the drop in the Investor Sentiment Index (ISI) and what it means for the real estate market in 2025. Discover insights on investor challenges like rising home prices, financing costs, and labor shortages, plus predictions on how the new administration could impact the housing market. Also, make sure to stick to the end. We ask Rick about his housing market predictions and best markets to invest in. Don't miss this deep dive into real estate trends and forecasts! LINKS ~~~~ Investor Sentiment Report: https://rcncapital.com/blog/rcn-capital-investor-sentiment-index-winter-2024  OUR GUEST Rick's LinkedIn: LinkedIn.com/in/ricksharga Rick's Website: www.cjpatrick.com Instagram: rsharga JOIN RealWealth® FOR FREE

Join our upcoming GRE live event right here! - ‘New Turnkey Properties with ZERO Money Down' on Thursday 10/24. On this week's episode, Keith shares how to vet and onboard a property manager, emphasizing the importance of their role in tenant relations and net operating income. He is also joined by our guest, seasoned investor and turnkey expert, to highlight the benefits of new construction properties with zero money down, leveraging builder incentives and portfolio loans. Learn the key qualifications to look for in a property manager, typical management fee structures and questions to ask. Hear about the benefits of new construction homes, including consistent income, quality tenants, and growth potential. We discuss the potential for 10% builder credits and 5% down portfolio loans. Show Notes: GetRichEducation.com/523 For access to properties or free help with a GRE Investment Coach, start here: GREmarketplace.com Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Invest with Freedom Family Investments.  You get paid first: Text FAMILY to 66866 For advertising inquiries, visit: GetRichEducation.com/ad Will you please leave a review for the show? I'd be grateful. Search “how to leave an Apple Podcasts review”  GRE Free Investment Coaching: GREmarketplace.com/Coach Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free— text ‘GRE' to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Complete episode transcript:   Automatically Transcribed With Otter.ai    Keith Weinhold  00:01 Welcome to GRE. I'm your host. Keith Weinhold, how do you vet a property manager and maintain an onboarding relationship with them over time? I just hired one, and I'll tell you how I did it. Then there's a trend to exploit in today's real estate market, with the opportunity to place zero money down on brand new build property today on Get Rich Education.   00:27 Since 2014 the powerful get rich education podcast has created more passive income for people than nearly any other show in the world. This show teaches you how to earn strong returns from passive real estate investing in the best markets without losing your time being a flipper or landlord. Show Host Keith Weinhold writes for both Forbes and Rich Dad advisors, and delivers a new show every week since 2014 there's been millions of listener downloads of 188 world nations. He has a list show, guess who? Top Selling personal finance author Robert Kiyosaki, get rich education can be heard on every podcast platform, plus it has its own dedicated Apple and Android listener phone apps build wealth on the go with the get rich education podcast. Sign up now for the get rich education podcast, or visit get rich education.com   Corey Coates  01:12 You're listening to the show that has created more financial freedom than nearly any show in the world. This is get rich education.   Keith Weinhold  01:29 Welcome to GRE Yeah. This is get rich education, the voice of real estate investing for more than 10 years now. This is episode 523, and I'm your host, Keith Weinhold, let's talk about how to vet a property manager. After all, they are what make your real estate investment mostly passive. I recently hired a new property manager. Of course, I have one in each geographic area where I own property. Now, instead, you can self manage from a distance, but sooner or later, you probably won't feel that's the highest and best use of your time. As friend of GRE and host of the real estate guys radio show, Robert Helms says, Life is too short for property management. And you know, when it comes to managing your property, still today, you can't just have an AI do that, and to be your property manager is the most important piece of your team, because they're the ones that handle all the tenant relations, collect your rent, and They control your occupancy rate too. I think you can make the case that a property manager is even more important in larger apartment buildings than they are in, say, single family rentals up to fourplexes, and that's for a few reasons. Number one, because managers drive your net operating income your noi in apartments. Okay, so that doesn't just drive your income. That drives the very valuation of the property, since apartments are the NOI divided by the cap rate. And secondly, one bad or noisy tenant can make other apartment tenants miserable. Yet if there's one noisy single family home tenant, well others might not even know about it or hear them. So a manager is more important in large apartments than smaller units. But let's not let the point be missed. They are crucial, just vital either way. And when it comes to qualifying a property manager, you know, before you reach out to that manager, do some research on your own. First, like first, I like to see if I have any friends that use that management company, and I like to get feedback from them. Also like to read reviews and see what current investors that use that property manager say about them in forums. And you know from real world experience, if you've been an investor for any period of time, it's a little sad to say, but getting reviews that are merely adequate or average, that might be good enough. There are many places in life where I accept mediocrity, although property management is probably one of them, because it's just a tough job where that manager has to adjudicate, use their judgment and walk a line between two antagonistic parties, and those parties are you and Your tenants. So adequate is good enough. Management is just one of those industries. It's kind of like airlines always seem to get bad reviews too. If there's a rating system out there for umpires and referees, it would probably be the same users only comment when there's a problem. Well. So when vetting a property manager next, I like to know how long they've been in business. I also like to know how many properties that manager currently manages, how many units they have in their management portfolio. And with this latest manager that I just recently hired, it happened to be 325 properties. That's a good number. And this manager also happens to be one in a network of a nationwide management franchise. So there are some systems and some economies of scale that I'm getting, and there are a lot of mom and pop managers too, and they can often do a good job as well of scaling and automation. A lot of managers, for example, they leverage a software like app folio, where you as an investor, you can log in and see your investor activity and your owner draws there. So this particular new manager that I hire, they have those 325, properties that they manage. But speaking to geography, I learned that their brick and mortar presence, their main office, it's a full 45 minutes away from where I have my properties all clustered. That's not ideal to have my properties far flung from their hub, because you want your properties to get adequate attention. And you can imagine, if your properties are too far for where most of their operations are. Well, then your properties might not get enough attention, but I learned that they already have 20 properties in the immediate area of mine, and that their maintenance man also happens to live near my property, so in this case, 45 minutes from the satellite office. Although it's not ideal, it did work for me. This new manager that I hired has the tenants rent be due on the first of the month, but they have a grace period to pay until the fifth and then the owner draws. They're made around the 10th of the month and the owner draws. That means when the manager makes their payment, to me, the investor, which is after they collected all the rents, minus their management fees and maintenance expenses. All right. Well, all that stuff is pretty typical, and let me tell you now about their management fee structure. And again, this is pretty typical. And by the way, I don't try to negotiate fees with managers in most cases, maybe, unless I have an awful lot of properties with them, they have a monthly management fee of 8% now 10% that's a pretty common fee out there as well, meaning that if rent is $2,000 they take $160 each month in a management fee. That's that 8% and then additionally their leasing fee is one half month, meaning that when they screen and place a new tenant for me, they get $1,000 at that time again, on this example of a $2,000 rent, and I pay a $150 re leasing fee, meaning If they release the unit to that same tenant after, say, their first year or two lease expires, ask your manager if they do markups on maintenance bills. For example, if they subcontract a plumber, and those plumber charges are $500 over to the manager. Does a manager tack on, say, 10% to that charge and then charge you $550 or not? Preferably, the answer is no markups like that can be another profit center for property management companies. However, what this manager does is instead, they have a trip charge of $55 for when their maintenance guy visits the property, and I was okay with that. That's reasonable. Also ask your property manager, if they do regular inspections of your properties, that means that they physically go inside the unit from time to time to confirm that everything is on right, that your tenant is trading a property with respect and that there aren't any deferred maintenance items cropping up, like delaminated flooring or some kind of water leak that needs attention. And this particular manager that I just decided to hire, they charge $75 a year for two of these annual inspections, so they physically go inside the unit every six months for a comprehensive check, which is a really good idea. And I love that they do that. Another tactic that I take when vetting a property manager is to ask them, you know, just a detailed question or two, really feel out their operations. It can be a good idea for you to do something like this. For example, I told this new manager that you know, in the past with other management companies or ones I still use, you know, I've seen managers they try to charge me for clearing a clogged sink drain. Well, I've let managers know I shouldn't. Not be seeing charges like that at all. In almost every instance, clearing clogs that should be charged to the tenant, not me. I mean, obstructions don't float up from water and septic systems. So in most cases, that is what's happening. So you know, the tenant is at fault for getting something clogged in there in almost every case. Now, one exception might be that, I don't know, tree roots encroach on plumbing or something like that. Okay? But the point is, when you ask about something like that, you're showing your property manager that you're savvy and you can't be taken advantage of. Okay? They have got to be the ones that pushes back on the tenant, sometimes not pushing on you every time, just because they feel like you're the one that can afford the expense more than the tenant. So that sets some expectations for the ongoing relationship. Also talk to your property manager about your communication preferences over time. Now, for me personally, I don't want an intrusive text message unless it's something that's pretty urgent. I prefer email communication, and the manager does not need to email me every time they need approval of expenses less than, say, $300 now, when you get more faith in your manager later, you might want to bump that number up to $500 or whatever your number is. Now, at times I do like to call my property manager on the phone. Sometimes you'll just get more information from them. This way, a better feel when I called a different property manager that I currently have, you know, one thing that they mentioned to be on the phone, they were like, oh, Keith, I've been meaning to call you. You've had a vacant unit for weeks, and we should probably lower the asking rent 50 to $100 All right. Well, I agree that we should do that, but I feel like the vacancy would have lingered longer at the higher asking rent had I not called. So really, this is the sort of light touch that you should give your properties over time, and it's the reason that why, even with professional property management, it's not completely passive. Instead, it's a little contact. And I also like to tell my property manager that I have mortgages on my properties. I have every property mortgaged, and always have. You can choose to have your manager pay your mortgage for you, or you can pay it yourself, and that's a bit about vetting and managing your property manager. And I hope some of those ideas go a long way toward helping you, really, they're the frameworks about what's important and establishing expectations with them. Up front this week a great guest and I will discuss trends in today's real estate investment market, and then we'll tell you about an event that you can join and how to specifically exploit an especially promising real estate opportunity that I have never seen before. That's next. I'm Keith Weinhold. You're listening to get rich education.  Hey, you can get your mortgage loans at the same place where I get mine, at Ridge lending group  NMLS, 420056, they provided our listeners with more loans than any provider in the entire nation, because they specialize in income properties, they help you build a long term plan for growing your real estate empire with leverage. You can start your pre qualification and chat with President Caeli Ridge personally. Start Now while it's on your mind at Ridgelendinggroup.com that's Ridgelendinggroup.com. Your bank is getting rich off of you. The national average bank account pays less than 1% on your savings. If your money isn't making 4% you're losing your hard earned cash to inflation. Let the liquidity fund to help you put your money to work with minimum risk, your cash generates up to an 8% return with compound interest, year in and year out. Instead of earning less than 1% sitting in your bank account, the minimum investment is just 25k you keep getting paid until you decide you want your money back. Their decade plus track record proves they've always paid their investors 100% in full and on time. And I would know, because I'm an investor too. Earn 8% hundreds of others are text FAMILY to 66866, learn more about freedom. Family investments, liquidity fund on your journey to financial freedom through passive income. Text FAMILY to 66866.   Rick Sharga  14:46 this is Rick Sharga, a housing market intelligence analyst. Listen to get rich education with Keith Weinhold and don't quit your Daydream.   Keith Weinhold  15:11 This week, we've got the privilege of hearing from a seasoned real estate investor. He himself is in single family, multifamily and commercial. He's also a licensed optometrist, and he practices on a volunteer basis, giving away his time and expertise there. In fact, he started investing in real estate while working as an optometrist and captain for the US Air Force, and that on the side, real estate investing allowed him to retire early from medicine, and today, he's an industry expert in real estate market analytics and how to use real estate as a means to create the lifestyle that you, the listener, desire for your family. Hey, welcome to GRE Zach Lemaster.   Zack Lemaster  15:54 Thanks so much for having me on again. It's good to be back, and always a pleasure to you know, talk real estate, I learn a lot from you in the content you put out. So I'm a big fan, and I appreciate you having me on.   Keith Weinhold  16:06 Well, thanks for saying that will. I'm sure we're going to learn from you today too. You've got such a great take and feel for the pulse of the residential real estate market. Tell us about your take, whether that's price, direction, rents, occupancy rates, supply, interest rates, demographics, whatever you think is important, tell us about what a real estate investor really needs to know in this era, Zach.   Zack Lemaster  16:30 man, and this could probably be a whole day conversation, Keith, I think you've done an excellent job covering this every time you put out information, so we won't belabor the point. But I guess my general take is that, you know, we're moving into a section in the the market cycle, I believe, where we'll probably start to see a little bit more of a normalization of a real estate market. I mean, it's just been so strange, right, to pull data points over the past two years, and actually, really four or five years of like, there's really some unique things happening, and there's a lot of people that have projections around how housing prices are changing and things like that. The only really thing, I think the big takeaway from the past two years is that home sales have plundered it. People talk about real estate crashes, real estate prices really didn't change that so much. And actually in a lot of the markets, like where we focused on they went up because, you know, supply and demand. These are areas where there's a huge discrepancy and there's an undersupply of housing, and those are kind of the areas you want to be in the path of progress. But one thing that we did see over the past few years is that there's a plummet in home sales, and that's both with less buyers because of the interest rates and less sellers holding on to their low interest rates. People are less likely to move in those scenarios. So I think we're going to see more of that as we start to see interest rates coming down over time, and we'll probably see more inventory hit the market, but also a new influx of buyers. So I don't know if there's going to be much of a change in terms of pricing, but generally speaking, I think there's from the investor side. A lot of what we talk about is retail, but with the investor mindset, which is your audience, I think what we will likely see is that there's probably a lot of people that were sitting on the sidelines that will jump into the market. There's going to be more buyer competition, of course, that drives prices. And one thing we know for a fact that we'll dive in deeper today about Keith, is that there are builders, because a lot of what we do is in the new construction, build to rent industry. And we could talk about why that is, but that's just a solid asset class to maintain consistent income, quality, tenants, growth and potential in both home appreciation and rents. But I think what we're likely to see is that over the past year, there's been a lot of builders giving out these crazy incentives because they've had excess inventory and they've had a slowdown on the retail sales, and it's been a really unique opportunity for investors to come in acquire good assets at with these crazy incentives of below market pricing, which we'll talk about, that is likely going to disappear over time, as they move more into the retail sales, and those channels start to open up more because there's more buyers and so in the niche that we work in, that's kind of the takeaway that I think is developing, really over the next, you know, A few months here.   Keith Weinhold  19:00 yes, this reduction in sales volume that we've had like you touched on which lower interest rates could help thaw. Almost everyone agrees that interest rates are going to fall more slowly than they spiked in rows in 2022 and you know what's funny, Zach, I can be in the front of a room talking about the condition of the economy in the real estate market, and I can say to the audience act, I can say, if you think there's uncertainty right now, a substantial amount of uncertainty, raise your hand. Adversely. Everyone raises their hand. But you know what? They did the same thing two years ago, and they did the same thing five years ago. So my point is, yeah, investors invest through the uncertainty. Because uncertainty always exists. It just shifts around as to where the uncertainty is. The listener might be trying to validate sort of one thing in their mind and get it to balance out right now. Zach, when we talk about this lowering of sales volume, and you mentioned builders that are sitting on some inventory yet we have a lack. Of supply. Can you balance that out for us and tell us how that is that some builders have inventory that they're sitting on that's supply, and yet we have an overall lack of supply.   Zack Lemaster  20:10 yeah, and I think the other key piece into that is lack of affordability, right? And so all those things kind of play together, just to tie up your last point. There's always uncertainty in real estate, but there's also the fundamentals of real estate. Keith, you know, this is a long time investor, investing all across the country, as long as you stay focused on the fundamentals, which, at the end of the day, is really investing in good locations with good teams, where you have positive cash flow, right? And you likely have a positive outlook from an economic standpoint for that market, to keep the house rent in to keep rents going up. Like that's really all there is to this to be successful long term that can exist in any market cycle. So I just encourage people to stay focused on that. But ultimately, your question about inventory supply, we talked about big things of like lack of inventory. I mean, we have a deficit of I think the last stat I saw was seven and a half million houses, you know, deficit or something like that, but that's really on the global economic picture for the US, right when we break it down to the kind of the micro economic scale with each individual regional market, because we work with regional builders as well as national builders, and we're also builder. We also put up our own houses as well to a somewhat small scale, but a lot of those builders started the houses that are now completed, you know, at this point, sometimes six months ago, more likely 12 to 18 months ago. And they had anticipation as the Fed was talking about interest rates lowering, you know, they maybe were planning an X amount of sales for those exact houses. However, from the retail standpoint, there really hasn't been that movement. So we still have a lack of homes that we need, but we also have a lack of people that can buy those houses, because there's a lack of affordability, right? And all these builders also have X amount of houses that they sell to institutional buyers, the blackrocks and some of these buyers that will come in in and we'll talk about why that's relevant to us and how we've pioneered our way into operating like one of those for the individual investor and bringing those same buying incentives to the everyday investor. But there's also been a large decrease on investor activity from an institutional level buying. So just because we have a reduction in inventory and we have a low supply does not necessarily mean that we're just gonna, you know, builders can just sell all their homes because of that. There's a lot that plays into that, and you need to look at each geographic market. But ultimately, if you're looking at the fundamentals of investing in real estate, where you can still be, and we try to be below the meeting house price point, below that $400,000 price point, again, that's where we have the largest demographic big affordability issues right now. I think that's a safe place to be, right? Because you don't see the fluctuations that you do on the more expensive homes, the more expensive markets. I think you have the large, large demographics for both renters and retail buyers, and you also have more runway, right? More runway for prices to go up. So that's kind of our the niche area that we're when I'm talking about excess supply. That's the area that we're really focusing on.   Keith Weinhold  23:03 Oh, that was beautifully explained in how to tie that supply story together there. Zach, of course, there are so many ways to divide up the real estate market, one of those being that price tier. And typically for us as cash flow real estate investors, we look at a single family home. Yeah, it's going to be under 400k in order to generate income, I have an announcement to make here to you the listener on Thursday, October 24 one of our GRE investment coaches, along with Zach here, are co hosting GRE 's live event for new build turnkey income properties with zero money down. Yes, I'm stealing some of your thunder there. Zach, zero money down. Registration is now open at GREwebinars.com and the momentum has been building for this event that you can attend from the comfort of your own home. Tell us about what you'll be covering at our live event. Zach.   Zack Lemaster  23:58 yeah, and I'm very excited to do that. Keith, I appreciate you having me. Han, again, I think all the investors, if you're interested in new construction or just creative finance and some ways to make some unique deals happen, like you have to attend this webinar just to at least learn. First, we'll talk about different markets right now where we see the best opportunity. So if nothing else, you learn about some of the best markets to invest in. But really what we're going to unveil is how someone, regardless of where you live, geographically or your investing experience, how you can make a creative deal happen on a turnkey deal that you can get below market value and possibly buy with zero money down, or at least have a good portion of your down payment cover to really skyrocket your ROI. So this is a scenario, Keith, we really get to have your cake and eat it too, because you get a brand new constructed house. It's turnkey, where everything is done for you in a great market that has appreciation book on rents and prices. But you can also buy it with low to no money down and really be a creative investor. And I know that we're going to talk about all the details with that.   Keith Weinhold  24:58 Yes, let's talk more about. Out the potential for zero money down here. I mean, I think that's the most compelling value proposition with what we're doing next Thursday.   Zack Lemaster  25:08 sure. So we'll just go through a numeric example so people can kind of wrap their head around like what this entails. We already set the stage for you know why builders may have excess inventory. And what we do with our business is we partner with both regional and national builders, some of the largest national builders as well as as I mentioned, we build our own homes as well, but we partner with some of these national builders that have excess inventory in markets that we know are productive investment opportunities. A lot of these happen to be in the southeast, because that's where the population is growing, and we're seeing that's where favorable landlord legislation is and federal taxes and growth potential, all the things right, positive cash flow, but we focus on those areas. And we can go to these national builders, because as a group, you know, we buy hundreds of houses every single year, and we can basically approach them like an institutional buyer and say, we want the same access to those wholesale deals that you would sell to BlackRock, but we want that for ourselves, and we can pass that on to the individual investor. That's kind of the value add. But specifically, what we're talking about is a scenario where some of these builders will offer up to a 10% credit at closing. That is huge. And just to I mean, for someone that is just new, the real estate game is kind of learning about this is I've been investing personally for 15 years now, I've never seen things like this in any market cycle that's through multiple different market cycles, but I've never seen anything this attractive. So this is not normal. I want to say that's to start. But essentially, you can get up to 10% of a credit on a house that you can use however you want to. And so there's a few different ways that you can use this key. So if you're buying a $300,000 turnkey new construction home, you could, in theory, get $30,000 off and buy that at 270 of $30,000 of immediate equity. That might be a good strategy if you're looking to lower the mortgage payment on that or if you're looking to, say, refinance that property or sell it quicker, you have that immediate equity in that house, right? The other thing you could do with that 10% is you could use it to buy your interest rate down we have and that will get you below 4% you could literally buy your rates down into 3% with that much, if you want to put that much money into it, it'll cover your closing costs and buy the rate down significantly. So no matter what the Fed lowers, the rate to you are back actually down to one, 821, rates by buying your way there with that huge credit that obviously causes, you know, cash flow to skyrocket near ROI, to go way up. The third option that you can do is you can actually take that money, just get it back as a credit at closing. So if you're buying a house, say a $300,000 house, you're putting 20% down, which would be $60,000 on that house, you get $30,000 immediately back. That means you're into the house for 10% or half your down payment. That also skyrockets your ROI. So the point is, is there's a lot of creative things that you can do with these type of exciting credits, and they vary between five to 10% based on inventory, but they go up to 10% on some of these new construction inventory options. One last thing here, Keith, and this is hopefully I haven't lost anyone, but this is where things get really creative. As a company, we also work with different lenders throughout the country to bring the best financing options to investors. And we have a group of credit unions. They're all local to that geographic area that have Portfolio loans. Meaning these are not Fannie, Mae, Freddie Mac loans. These are loans they hold in house. These are true investor loans. You still have to qualify for them, but if you qualify, you can put as little as 5% down, meaning the they will finance up to 95% of your property. We have tons of investors doing this consistently, and you can do this on up to five properties, five investment properties, if you qualify. And so that means, in theory, you could buy a brand new construction house with a 5% down loan. You get a 10% credit back at closing that covers your down payment, your closing costs, and likely puts money back in your pocket. So that's not only buying a new construction, turnkey house with no money down it's actually getting paid to do so now there's a lot of economics to understand and cash flow, you know, with a high leverage and things like that, but that's a concept, and it's very exciting.   Keith Weinhold  29:09 Yes,  that last option that you mentioned seems to be the most compelling. I know. You've got investors that are learning about this and have already taken advantage of that, and again, that last option is getting the 10% credit that you're getting from the builder, coupling that with a 5% down portfolio loan from a local lender, which effectively would give you 5% cash back at the closing table. However, your closing cost of prepaids might be something like 4% so really, in a best case scenario, not only are you zero money down, you're getting about 1% of the purchase price, or $3,000 in this example back at the closing table. Now, of course that's going to affect your cash flow, but you got to think about what's important to you. So when one thinks about what's important to them, as an investor, with some of those options that you laid out there, Zach, I really highlighted the last one. What are some of the trade offs, the pros and cons of choosing these different incentives that the builders are getting right now?   Zack Lemaster  30:05 I'm so glad you asked this, Keith, because someone could be very excited about the idea of no money down, but that may not actually be the most strategic benefit to them. The nice thing is that there's so much incentive to buy right now with these type of, you know, kickbacks, these these incentives that, like you can structure a deal that's specific to you in your goals. But I would really encourage the audience to understand what is your exit strategy, or what is the next three to five years? Why are you buying this property, and how to strategically apply that? And if you don't know, if you need some guidance through that, let us help you kind of understand the different scenarios, but I want to work backwards first and mention one more thing, the no money down option would be really attractive because cash flow is going to be limited. In that scenario, you still have a loan that's covering 95% of the house, right? You would expect it, and you don't have to only put 5% down, right? You can put six, 7% down. So it's, you know, maybe break even cash flow. It's up to you. But the investors that really like that option, including myself, is the people that want to grow and scale their portfolio and stretch their capital the furthest. They maybe don't care so much about cash flow right now at this moment, they know that cash flow will increase over time. But if you're someone who really takes advantage of the tax benefits of real estate, this is way to, like, honestly, without any money out of your pocket, just taking some action, you can create this huge tax benefit, right? Because if you're buying five properties with virtually no money down, and let's say those are each $200,000 properties, you could essentially buy a million dollars worth of real estate that you own and control 100% of and you get the huge, immense tax benefit. So if you're doing things like Cost Segregation studies, like we do, you can create hundreds of 1000s of dollars of tax deductions without any money out of your pocket, just being strategic this way. But let's talk about some of these other options, because that was a real question. Where would it make sense for people? So again, if you say that 10% on a $300,000 house, that's 30k if you wanted to take that as a price reduction right out of the gates, that would obviously lower your mortgage, that's going to lower the mortgage payment amount to allow you to cash flow more. But I think the real the strategy, or the play there, is that you have built in equity in a house. This means that if your plan is to maybe put a HELOC on the house, do a cash out refinance in a few short years, as that House continues to appreciate again, because it's in a growth market, you're just going to cut that time in half because you have built in equity or if you plan to sell it. I mean, there are some scenarios where you could turn around and almost like, flip this in theory. You could do it. If you really run the economics, they want to be hugely profitable. But theory could be profitable if you sold the house with, you know, even immediately, because these builders are still selling these houses at retail, setting comps at full market value. So if you have 10% and you're paying a realtor 5% commission, they're still closing costs. But you could, you know, net some capital, but better scenarios, probably, if you're holding it for two or three years again, letting it continue to appreciate, your option is to sell it, then you're into capital gains, or again, 1031 exchange it. You know that might be good option to have built in equity. Or if this is going to be a long term hold for you, and you're just like, I love this area where I'm investing, I want to maximize cash flow. I want to have a long term loan that has a really low interest rate, then actually applying the majority of that capital to buy your rate down. That's going to obviously maximize cash flow, and that's also going to lock you in on a 30 year fixed loan at a really low rate, maybe you want to buy the rate down. So that's really the two options. We see most investors either taking the capital back and using the zero money down option, or buying the rate down, because that's going to allow them to really cash flow well, and they're just going to hold that property for a long period of time and let real estate do what it does. Those are kind of the different scenarios. I think that makes sense for different investors and understanding where to apply this incentive.  Sure, if you go for a high loan, to value loan at 95% or even 100% you really then pursue the infinite return strategy, have maximum leverage, or complete leverage in the property, have all the inflation profiting benefits magnified because you're borrowing more, but that scenario is going to reduce your cash flow. So it's all about what's important to you as a real estate investor, was that before you go, just tell us a little bit more. I think the listener is going to learn more on next Thursday's webinar, but just give us a bit more on property types, whatever else one might want to know. certainly. So this is mainly in the southeast, okay, so these would be markets like Texas, Alabama, Carolinas, Florida. We have some stuff in Tennessee, but, I mean, this is really the growth markets right where we have landlord friendly legislation, low taxes, we have affordability, but we have huge population trends moving to these areas. Those are the areas we want to be. Those are the areas where builders are building in because supply and demand. Those are areas where we're positioned for strong growth over time. Overall, our average rental increase is 6% year per year, and that's going back on data over the past decade. He's really good then, yeah, usually double national average there. So those are because we're specifically positioning ourselves in areas where. Where there's increase in rental demand and in population and economic growth, average home prices. I mean, we have new construction homes as low as 200,000 by the way. Side caveat, we also have some rehab homes that are in that 131 50 range that you can still use the low money down. Those don't have as high up incentives as the new construction do. But average price for new construction, two to 300,000 give or take. I mean, just buying them, if we're buying them with a conventional loan, with 20% down, you know, you're still looking at eight to 12% cash on cash returns. Let's just talk about the cash flow. So they're really good properties that cash flow well, which is hard to find today, and they're in good locations. I think that's really the main point I want to drive home as we finish up here is, these are single family residencies in good locations. You guys, I've invested, as you mentioned, in the nice century gave me, I mean, real estate allowed my wife and I to retire from our career paths as optometrist through investing. That did not happen overnight, but it did happen over a period of time, and it did take a lifetime, either, though, that's the thing I want to mention, over a short few years of intentional, dedicated investing, we learned that really focusing on growth markets and new construction houses allow for the best quality tenants, the most predictable returns and the best growth and rents and appreciation of the houses over time. To build equity, those are the kind of assets that we want to hold long term and will help you build wealth in a short period of time. So that's kind of been the direction of our business model. Is focusing on quality inventory in good locations with good teams that still have cash, good cash flow. But you mix in some of these incentives, Keith, and it's just like, it's a no brainer. And I do think this is the biggest thing, is sense of urgency here. This is unlimited inventory. This is not something that's normal, as I mentioned, and this buying opportunity that we're so excited about is not going to last forever, as we started this conversation, talking about the market shifting as interest rates continue to come down over time, that will continue to bring more buyers into the market and just less motivation from builders to offer these incentives. So guys, now is the time to take action and make really good investments now that will set you up for success for many years.   Keith Weinhold  37:03 The time is now. This is one of the best deals I've really learned about here in the recent past at all this could be of any benefit to it all. You really want to jump in on this, because, like Zach said, this won't last forever. Well, Zach, before I ask you for your closing thoughts again, for you to listen or be sure to sign up for GRE 's live event. This is for new build, turnkey income properties, potentially with zero money down. It is Thursday, October 24 at 8pm Eastern. Register at GREwebinars.com any last thoughts? Zach   Zack Lemaster  37:03 Keith, I just appreciate all the information you're putting out there, we are all thrilled about real estate as an asset class. It's been an interesting past few years. But again, just going back to the fundamentals, guys invest in good properties and good locations with good teams. And I promise you, if you do that consistently over time, you will reach financial independence or whatever financial goals you are striving to achieve. There's more millionaires or main real estate than the other asset class, and it's the most predictable Path to Wealth. There's no secret about that, but it does take consistency in any market cycle. So Keith, thanks so much again for having me on.   Keith Weinhold  38:12 Oh, those are great parting words, and you the listener, are going to get to talk more with Zach and one of our investment coaches. Next Thursday, it is live at the end, you will have a chance to have your questions answered in real time, in case you want to talk to Zach more. Hey, it's been great having you here. There's something in the market cycle there that we can really take advantage of. Builders have some excess inventory and see the money that they have tied up in them is something that they're paying a fairly high interest rate on to. And we have now partnered with some of the biggest builders, Lennar DR Horton and others, to get you this institutional grade buying power buying at scale for lower prices and better incentives, like Zach and I said, new builds in the southeastern US for purchase prices of 200 to 300k offering you up to a 10% credit at closing. So in a 300k rental single family home, you can then use as much as 30k and choose what you want to do with that. You could buy your interest rate down to 3% that's probably better if you're going to hold it long term or use on your closing costs and have some to use toward your interest rate. Or alternatively, you could just take it as a price reduction. A 300k property is now 270k maybe you can even enjoy the discount and sell it in the next, say, two to three years for a profit. You're likely not going to be immensely profitable that way, but you don't know what the market will do over time. All right, so it'll typically be a five to 10% credit, and that depends on the property that you seek here. All right, so that is the builder credit bucket there. And then, in addition to that, if you qualify, you have some good, say, credit and assets where you can get a financing option through local credit unions, and that is local to the area that your property is in that will extend you a portfolio loan. If you qualify, you'll learn about how to do this. And this means you could put as little as 5% down, and you can do that on up to five investment properties. Okay, so with those buckets, or those two incentives combined, you could then get a 5% down loan with a 10% builder credit so that 5% bank could cover your closing costs and even just put a little money in your pocket. You should sort of think of all of that as a best case scenario. You might be pretty excited about no money down, and you probably should, but, you know, attend the event and weigh the pros and cons and see if that is the right avenue for you. A lot of it comes down to what do you want to optimize your cash flow or your leveraged equity? This is an action taking time for you to get a good chance at being set up for financial success for years. I mean, it is opportunities just like this. I mean, you learn about these concepts on the benefits of real estate investing here on the show. And now here's something really tangible where you can get ahead. I mean, personally, for me as an investor, I've never had an opportunity like what we're talking about here. Before. If you so desire, you can own new build property and learn how to get it tied up at the event. Make sure to sign up and put it on your calendar. That is next Thursday, the 24th from the comfort of your own home, GRE 's live online event for new build properties in growth markets, potentially with zero money down. It is free to register, and as of now, there are spots available at GREwebinars.com Until next week, I'm your host. Keith Weinhold, don't quit your Daydream.   42:10 Nothing on this show should be considered specific, personal or professional advice. Please consult an appropriate tax, legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own. Information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of get rich Education LLC, exclusively.   Keith Weinhold  42:38 The preceding program was brought to you by your home for wealth, building, get richeducation.com.

The multifamily market is going through some major shifts. New development has practically stopped, but the demand continues to rise… And since it takes at least 18 months to bring new apartments to market… We could potentially see a real shortage of apartments in 2025-2026, that's going to surge the prices up… Meaning, it's a good thing for investors who get in at the right time, which is NOW. I just talked to Rick Sharga about this upcoming supply crunch in today's episode… Listen up for his interesting insights on where the market is headed and how you can take advantage. Rick Sharga is the founder and CEO of CJ Patrick Company, a market intelligence firm for real estate and mortgage businesses. We talked about things like: Which cities might be good for investing How changes in the economy could affect apartment demand Why some apartment owners might need to sell soon What numbers to watch to spot market changes early If you own multifamily properties or you're thinking about buying some, you wouldn't want to miss out on this episode. Tune in below. Take Control, Hunter Thompson Resources mentioned in the episode: Rick Sharga LinkedIn Twitter/X Website Interested in learning how to take your capital raising game to the next level? Meet us at Capital Raiser's Edge. Learn more here: https://raisingcapital.com/cre

Rick Sharga, Founder & CEO, CJ Patrick & Co. Highlights include: future for housing is bright; follow population growth; back office productivity is key; work your database and more consolidation of the inefficient. Rick's firm is a market intelligence and business advisory that helps real estate, financial services, and technology companies develop a position of competitive advantage and use it to drive business strategies.

Jason welcomes real estate analyst Rick Sharga. Rick discusses the housing market and economic trends. Despite concerns of a crash, he suggests a slow period with modest price increases rather than a downturn. He dismisses crash predictions, highlighting historical data showing home prices generally rise during recessions. Sharga addresses factors like consumer spending, job growth, inflation, and Fed policies influencing mortgage rates. He acknowledges the possibility of a mild recession due to Fed actions but emphasizes it may not significantly impact real estate if inventory remains low and distressed sellers are scarce. Rick also dives into the NAR lawsuit and the current state of the housing market, highlighting mortgage rates near 20-year highs affecting purchase loan applications and pending home sales due to decreased affordability. He anticipates gradual mortgage rate declines attracting more buyers than sellers, likely resulting in increased competition and rising prices. Existing home sales show a 6.5% year-over-year price increase, while new home prices have decreased by 15% from peak levels. Investor purchases remain robust, primarily driven by individual investors rather than institutions. Flipping activity has declined due to pricing challenges, but gross profits are improving, indicating a potential resurgence.  #RickSharga #RealEstateTrends #HousingMarket #HomeSales #MortgageRates #NARLawsuit #AffordabilityCrisis #MarketAnalysis #FoxBusinessInsights https://cjpatrick.com/   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com  

Jason welcomes real estate analyst Rick Sharga. Rick discusses the housing market and economic trends. Despite concerns of a crash, he suggests a slow period with modest price increases rather than a downturn. He dismisses crash predictions, highlighting historical data showing home prices generally rise during recessions. Sharga addresses factors like consumer spending, job growth, inflation, and Fed policies influencing mortgage rates. He acknowledges the possibility of a mild recession due to Fed actions but emphasizes it may not significantly impact real estate if inventory remains low and distressed sellers are scarce. Rick also dives into the NAR lawsuit and the current state of the housing market, highlighting mortgage rates near 20-year highs affecting purchase loan applications and pending home sales due to decreased affordability. He anticipates gradual mortgage rate declines attracting more buyers than sellers, likely resulting in increased competition and rising prices. Existing home sales show a 6.5% year-over-year price increase, while new home prices have decreased by 15% from peak levels. Investor purchases remain robust, primarily driven by individual investors rather than institutions. Flipping activity has declined due to pricing challenges, but gross profits are improving, indicating a potential resurgence.  #RickSharga #RealEstateTrends #HousingMarket #HomeSales #MortgageRates #NARLawsuit #AffordabilityCrisis #MarketAnalysis #FoxBusinessInsights https://cjpatrick.com/   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com  

Jason welcomes real estate analyst Rick Sharga. Rick discusses the housing market and economic trends. Despite concerns of a crash, he suggests a slow period with modest price increases rather than a downturn. He dismisses crash predictions, highlighting historical data showing home prices generally rise during recessions. Sharga addresses factors like consumer spending, job growth, inflation, and Fed policies influencing mortgage rates. He acknowledges the possibility of a mild recession due to Fed actions but emphasizes it may not significantly impact real estate if inventory remains low and distressed sellers are scarce. Rick also dives into the NAR lawsuit and the current state of the housing market, highlighting mortgage rates near 20-year highs affecting purchase loan applications and pending home sales due to decreased affordability. He anticipates gradual mortgage rate declines attracting more buyers than sellers, likely resulting in increased competition and rising prices. Existing home sales show a 6.5% year-over-year price increase, while new home prices have decreased by 15% from peak levels. Investor purchases remain robust, primarily driven by individual investors rather than institutions. Flipping activity has declined due to pricing challenges, but gross profits are improving, indicating a potential resurgence.  #RickSharga #RealEstateTrends #HousingMarket #HomeSales #MortgageRates #NARLawsuit #AffordabilityCrisis #MarketAnalysis #FoxBusinessInsights https://cjpatrick.com/   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

Get our free real estate course and newsletter: GRE Letter Apartment construction is falling. It's not because banks are pulling back from lending. Projects aren't feasible for builders. Housing market intelligence analyst Rick Sharga returns to discuss the real estate market.  We discuss: real estate price movement, affordability concerns, expected mortgage rate changes, migration, price reductions, new homes vs. existing homes. Can anyone even find a new-build $225K detached SFH today? They're nearly extinct. Homebuilders are still buying down mortgage rates for you into the 4%s and 5%s at GREmarketplace.com. America needs more SFHs, especially at the entry-level.  Apartment rents have declined a little. SFH rents are up about 3% year-over-year.  Delinquency and foreclosure activity remains low. These have a strong correlation with unemployment rates. The volume of homes sales should increase this year, but only by perhaps 10%. A recession is still quite possible later this year and expected to be mild. Every region of the nation is currently experiencing residential RE price growth.  When mortgage rates fall, more new buyers than sellers are expected, pushing up property prices. Resources mentioned: Show Page: GetRichEducation.com/496 Inquire about business with Rick: CJPatrick.com Rick Sharga on X: @ricksharga LinkedIn: Rick Sharga For access to properties or free help with a GRE Investment Coach, start here: GREmarketplace.com Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Invest with Freedom Family Investments.  You get paid first: Text FAMILY to 66866 Will you please leave a review for the show? I'd be grateful. Search “how to leave an Apple Podcasts review”  Top Properties & Providers: GREmarketplace.com GRE Free Investment Coaching: GREmarketplace.com/Coach Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free— text ‘GRE' to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Keith's personal Instagram: @keithweinhold   Complete episode transcript:   Keith Weinhold (00:00:00) - Welcome to GRE. I'm your host, Keith Weinhold. Tons of new apartments were built last year, but that's abruptly going to change going forward. You'll learn why. Then a housing market intelligence analyst and I break down what's happening in the real estate market and the future direction of rents, prices, foreclosures, interest rates, and a lot more today on get Rich education. When you want the best real estate and finance info. The modern internet experience limits your free articles access, and it's replete with paywalls. And you've got pop ups and push notifications and cookies. Disclaimers are at no other time in history has it been more vital to place nice, clean, free content into your hands that actually adds no hype value to your life? See, this is the golden age of quality newsletters, and I write every word of ours myself. It's got a dash of humor and it's to the point to get the letter. It couldn't be more simple. Text GRE to 66866. And when you start the free newsletter, you'll also get my one hour fast real estate course completely free.   Keith Weinhold (00:01:16) - It's called the Don't Quit Your Day Dream letter and it wires your mind for wealth. Make sure you read it. Text GRE to 66866. Text GRE 266866.   Corey Coates (00:01:34) - You're listening to the show that has created more financial freedom than nearly any show in the world. This is get rich education.   Keith Weinhold (00:01:50) - Welcome to grow from Alexandria, Egypt, to Alexandria, Virginia, and across 188 nations worldwide. I'm Keith Weinhold, holding your inside get rich education. I'm grateful to have you here. A few weeks ago, I discussed all the apartment buildings that were constructed last year. One thing that you'll often hear out there today is that apartment construction is now falling because banks are pulling back on construction lending. But no, it's really not quite that simple. In fact, that's not even the top reason for construction delays now and going forward with apartments. The number one reason for the delays today is that the project is not economically feasible at this time. That's what the NMC tells us. All right. So what does that really mean? Well, it means that projects aren't penciling out.   Keith Weinhold (00:02:44) - In other words, apartment developers, they can't generate the returns that they need to justify the project to their capital partners, those that are funding the building. And this is, by the way, not about greedy developers, because contrary to some of the noise, it's the fact that developers do not self-fund their projects. They get the money from others. So yeah, it's the developer's job to convince investors and lenders to inject that capital. And that is just harder to do right now. Despite developer's best efforts and higher rates are obviously still contributing to the problem. It's not so much that the construction financing is not available, because for residential, it's often there. It's available. The thing is, is that apartment mortgage terms and rates are way less favorable than they were a couple of years ago, as we all know. So developers, I mean, they're paying a higher interest rate then. And you therefore need higher rent to cover that higher interest rate unless you can cut a lot of costs elsewhere and in apartments, you're also getting a lower loan to value ratio.   Keith Weinhold (00:03:55) - So that means developers, they therefore need to raise even more equity in order to cover that gap. And what's happened is a lot of the equity that's shifted away from brand new ground up apartment development, and instead it's gone over into chasing potential lease up distressed deals, properties that are already out there and are having some problems. So that's where the apartment money is moving right now. Not so much to new developers and builders also aren't building many apartments this year because construction costs remain a problem. Some materials got cheaper, others didn't. One bright spot is that construction labor that is getting easier to find. But yet the actual labor cost that really hasn't dropped. Property insurance is higher too, so these rising expenses, that means apartment projects are not penciling out for builders and then apartment rents. They're just not rising that much. That doesn't help. So it's hard for it to rise, since so many were built last year and the year before. They're in the apartment world. But obviously the long term demand is for just about all residential housing.   Keith Weinhold (00:05:11) - That demand. Is there loads of long term demand for apartments, condos, single family homes, co-ops, modular homes, mobile homes, duplexes, triplexes, fourplex container homes, row houses, farmhouses, penthouses, outhouses. I think you get the idea. The demand is there. Residential is the resilient spot, and it's all about where you want to get in. And speaking of homebuilders and finding a smart place to get in, it's important to share with you the good news that homebuilders are still buying down your interest. Right for you. Now the third year rate, it hit 8% last year. And Non-owner occupied property costs a little more. So it was nearly 9% on income property. It's come down off that as we know it's been around seven lately. But see here at GREwe work with builders that are still buying down your interest rate into the fives and sometimes still into the fours on new construction, single family homes, up to four plex and sometimes larger in Florida, Alabama and elsewhere. I mean, that is just the best deal going for you today to have an income producing new build property in the path of growth at 4 to 1, leverage to 5 to 1 leverage and.   Keith Weinhold (00:06:46) - Your mortgage in the fives or less, and we'll help you find the real deals within that. To connect with a great investment coach at great marketplace.com. I think you'll be glad you did. Now, today, if somehow I could use a time machine to write a letter back to my 2020 self and inform myself about what's going to happen in the housing market for the next 4 or 5 years? And I had to keep this note to myself short. I would have written that everything is going to shoot way up, rents up, prices up, interest rates up, expenses up, inflation up. Well, now that nearly all of those run ups have settled into place, we can draw a clearer picture of where we think the real estate market is going to be positioned in the future. Our guest has just freshened things up and he's got the latest in the property market all updated for us. I do two with my own research. You'll like this. It's our housing intelligence analyst guests and I. Straight ahead.   Keith Weinhold (00:07:55) - I'm Keith Weinhold. You're listening to get Rich education.    You know, I'll just tell you, for the most passive part of my real estate investing, personally, I put my own dollars with Freedom Family Investments because their funds pay me a stream of regular cash flow in returns, or better than a bank savings account, up to 12%. Their minimums are as low as 25 K. You don't even need to be accredited for some of them. It's all backed by real estate and that kind of love. How the tax benefit of doing this can offset capital gains and your W-2 jobs income. And they've always given me exactly their stated return paid on time. So it's steady income, no surprises while I'm sleeping or just doing the things I love. For a little insider tip, I've invested in their power fund to get going on that text family to 66866. Oh, and this isn't a solicitation. If you want to invest where I do, just go ahead and text family to 66866. Role under the specific expert with income property, you need Ridge Lending Group and MLS for 256 injury history from beginners to veterans.   Keith Weinhold (00:09:15) - They provided our listeners with more mortgages than anyone. It's where I get my own loans for single family rentals up to four Plex's. Start your pre-qualification and chat with President Caeli Ridge. Personally, they'll even customize a plan tailored to you for growing your portfolio. Start at Ridge Lending group.com Ridge lending group.com.   Kristin Tate (00:09:42) - This is author Kristin Tate. Listen to get Rich education with Keith Weinhold. Don't quit your day dream.   Keith Weinhold (00:09:59) - Hey what has not been a very long goodbye. Just like last week when we discussed the economy this week we have the return of the C.J. Patrick Company's Rick Sharga, an extraordinary housing intelligence analyst, as we more specifically cover the real estate market. And if you're on video, you'll have the benefit of seeing some charts as well. Rick. Welcome back. Good to be back, Keith. Long time no see. Yeah, it hasn't been so long. What are your overall thoughts with the housing market? Last week we largely talked about a resilient economy potentially with some headwinds. Yeah we did.   Keith Weinhold (00:10:32) - And I think we're one of the things we left off on was the impact that the Federal Reserve had had on the mortgage market and the housing market. We probably start there. When you look at what's gone on, and just to show you how random all of this can feel sometimes this is a snapshot of mortgage rates from March 12th. And mortgage rates were trading at about 6.92% for a 30 year fixed rate loan.   Rick Sharga (00:10:56) - The most recent number I saw was about 7.1%. And as I mentioned to you and your listeners last time, I expect until the Federal Reserve makes its first fed funds rate cut, we're going to see mortgages trade right around 7% between 6.75 and 7.25%. This has made a big difference in the market because it has limited affordability for literally millions of prospective home buyers. That's makes for a difficult situation for people looking to buy or sell homes, but it also presents millions of rental property opportunities because these people need to live somewhere and they've voted themselves off the island temporarily. They just can't afford to buy a house.   Rick Sharga (00:11:41) - And you see that in terms of the reduction in number of mortgage applications that are being made. So if the Mortgage Bankers Association tracks the number of people that apply for loans, if you went back to December when mortgage rates dipped just a little bit, we saw a run up of loan applications, and as soon as they went back up to seven, we saw that number fall off. It's a very, very rate sensitive market. We'll talk a little bit about some of the implications of that as we move ahead, Keith. But the weak affordability, the higher interest rates, the continuing high home prices led to a very, very weak year in 2023. In terms of overall home sales, we ended the year with about 3.9 million existing homes sold. That's the lowest number of homes sold in a year in a quarter century. Yeah, even lower than we saw in the Great Recession. And December was the 28th consecutive month where we sold fewer properties than we sold the year before.   Keith Weinhold (00:12:39) - So a contraction in the number of sales, although prices appreciated last year.   Rick Sharga (00:12:44) - Yeah, we'll talk about that this year. I'd been hopeful that we'd be a little bit of a better start. January and February were both up in terms of home sales on a month over month basis, but continued this trend of lower sales on a year over year basis. We're looking at 30 consecutive months where we sold fewer properties than we sold the prior year. As a result of this.   Keith Weinhold (00:13:05) - Supply crash, that really began about four years ago.   Rick Sharga (00:13:08) - It's partly supplied as partly costs, that affordability. We really can't overestimate the impact that affordability has had. But you're right in terms of inventory and in fact, a good segue, it's almost like you'd seen this before, Keith. Inventory is up significantly from last year, about 24% higher than it was a year ago, according to some data from Altos Research. But it's still only running about half of 2019 levels. So in a normal market, we would have about a six month supply of homes available for sale in our market today, we're looking at somewhere between two and a half and three months supply.   Rick Sharga (00:13:44) - That lack of supply with some pent up demand is one of the reasons we have seen prices continue to be very healthy, and we haven't seen the the price crash that all the snake oil salesmen on YouTube comments. As of mid-March, about 513,000 homes available for sale, again, about 24% higher. Than last year when the numbers were just dismal. We normally do see more inventory coming to market this time of year. We'll not get anywhere near where we were back in, you know, years like 2019, 2020. But it wouldn't be a surprise to see a little bit more inventory coming to market.   Keith Weinhold (00:14:21) - Now, Rick, for existing properties, we have the very well documented interest rate lock in effect. I think a lot of people understand that. But as far as bringing more supply onto the market, do you see anything from the builder side? You know, costs are up for builders and builders feel this lack of affordability from the buyer market as well. So therefore that motivates them to build somewhat less.   Keith Weinhold (00:14:43) - And they're also building smaller properties, some shrinkflation with new construction property to try to help out with that affordability. So what are your thoughts with builder motivations this year and next year?   Rick Sharga (00:14:54) - All that thought is we're going to get to new homes in just a couple of minutes. So keep that right forefront in mind. But let's just kind of wrap up on existing sales. I do want to point out to your listeners that the inventory growth is actually outpacing the number of new listings. So new listings are only up about 14% year over year, whereas overall inventory is up 24%. The reason for that is it's taking longer to sell homes once they get to market. So once those properties are listed, they're staying in the inventory numbers a little bit longer than they were last year or even a few months ago. So that's one of the reasons the inventory numbers look a little bit better than they did. You talked about the rate lock effect. It's still very real. About two thirds of everybody with a mortgage has a mortgage rate of 4% or less.   Rick Sharga (00:15:43) - And this is not home sellers being picky or having a psychological problem. This is math. If you sell a property today and buy a new one for exactly the same price as the one you just sold, you've now doubled your monthly mortgage payment and most people simply can't afford to do that. So the properties being listed or by by people who feel like they need to sell, there's a death in the family or a birth in the family. There's a divorce or there's a marriage. There's a job loss or job that requires a transfer, maybe some financial difficulties where the borrowers in distress so they feel like they have to sell the home, or somebody's been retired for a long time, has a lot of equity, and just says, oh the heck with it. It's time for me to downsize. But the people who would normally be making a decision that maybe I'd like to sell, maybe I'd like to look at a move up opportunity. Those people are sitting on the sidelines and rather than seeing a price crash, which is what people are breathlessly trying to sell you on YouTube, the most likely scenario, something we've seen play out in the 80s and 90s and is likely to play out again in the 2020s, which is several years of kind of lackluster sales volume and modest price growth.   Rick Sharga (00:16:54) - And it takes a few years to reset the levels so that all those people with the Sub4 mortgages gradually, slowly work their way out of inventory and are replaced by people with mortgages that are closer to today's rates. And we've seen that happen, like I said, in the 80s and 90s, and it's a very normal occurrence when you have a sudden shift in either mortgage rates or home prices, that's much more likely to happen than a 2030 40% drop in home prices to make things affordable. And I would just ask anybody who's skeptical, if somebody approached you tomorrow and you didn't have to sell, but they said, hey, sell me your house for 40% less than market value. How interested would you be in having that conversation?   Keith Weinhold (00:17:36) - Wouldn't last long.   Rick Sharga (00:17:37) - No. And then home prices are up in every region. You mentioned this, Keith. Across the country I'm sharing for people that can see it. I'm sharing data from the Fhfa, which is the entity that controls Fannie Mae and Freddie Mac. So all of those 30 year fixed rate conventional loans and a year over year basis, we saw prices go up 6.3%.   Rick Sharga (00:17:56) - They were up in every region of the country. And that's a little different than the prior year when the Pacific region was actually down. But every region of the country is seeing price growth right now. And whichever price index you look at Case-Shiller,, Freddie Mac, the Fhfa index, National Association of Realtors, everybody showed similar numbers were every region was up. But importantly for your listeners and I emphasize this enough, local results are very different than national results. So even within markets where we're seeing prices go up, there are going to be neighborhoods where prices are going down and vice versa. So it's much more important for you to understand what's going on in your local market than to listen to a lot of these national trends. I will tell you that some of the markets that overheated during the pandemic, as people were moving out of high priced, high tax or highly congested areas, are seeing a bit of a clawback. So places like Boise, Idaho and Saint George's, Utah and Austin and Phoenix and Las Vegas, we're seeing those markets with the prices clawing back a little bit, a lot of price growth continuing the southeast.   Rick Sharga (00:19:04) - So and surprisingly now in the Midwest as well. So we are still seeing a bit of a migration from high price, high tax areas into lower priced markets. I tell folks, Keith, I have two adult kids living at home. My son's getting married in September. He's a teacher. His fiance is a lawyer, and they took me aside recently and said, hey, you follow this stuff. What states should we be looking at outside of California to move so that we can own a house?   Keith Weinhold (00:19:31) - Wow, that is really, really interesting that that would dictate their decision on where they live, if they have that much of a preference to own rather than rent. Recently, a lot of us in the industry learned that the average age of the first time homebuyer is now 36, older than ever.   Rick Sharga (00:19:48) - Yep. And these are two kids with good heads on their shoulders. They know there are benefits to homeownership, and they also know that the median price of a home sold in California last month was almost $800,000, and the First National Bank of dad ain't financing that acquisition.   Rick Sharga (00:20:02) - So I'm sure these conversations are happening in New York, in Chicago, in Miami and in San Francisco, and it's just the reality of today's marketplace. We talked about prices going up. We are seeing slightly more homes having a price reduction before they're sold. That always happens somewhere along the lines of 30 to 35% of homes listed wind up with a price reduction before they're sold. We're up to about 31% now, so we're still in the normal range, but we're a little higher than we've been in recent months.   Keith Weinhold (00:20:35) - This is interesting, a statistic we don't talk about very much, the percent of homes experiencing list price reductions.   Rick Sharga (00:20:42) - And it peaked in 2022. The highest number we've seen in quite a while was over 40%. And that was right after interest rates doubled. And so it's probably not a huge surprise. People were anticipating they were pricing based on the prior market. And I think we're seeing more rational pricing today. But again, that combination of prices just being as high as they are and interest rates being as high as they are, are creating some affordability issues.   Rick Sharga (00:21:05) - And for people that have to sell, they're taking price reductions. Now, keep in mind these price reductions are often very, very minimal. In California, for example, the average price reduction is less than a percent. So it's not a huge reduction, but it's still a reduction from what the list price was. You asked about new homes. So now I'm going to make you happy. We'll talk about new homes. New home inventory levels are increasing. We normally want to see about a six month supply of existing homes for sale. The new home inventory is usually between 7 and 8 months. And we're back to that number right now. Some of those homes available for sale are still under construction, but they are nonetheless available for sale. And we've seen that inventory improve over the last year as supply chain disruptions have minimized as builders are now more able to find laborers for construction. Those are two huge holdups they had over the last couple of years, and we've seen new home sales increase. And one of the reasons for that is they're available.   Rick Sharga (00:22:05) - So if you're a builder and you put a home in the market at the right price, you're going to sell it because there just aren't that many existing homes available for sale. And to your other point, Keith, new home prices are actually down 15% from peak. Existing home prices are up, new home prices are down. And in fact, if you look at the most recent new home pricing data put up by the Census Bureau recently, new home prices are at the lowest level since June of 2021. So they've really come down pretty significantly and are not that far away from existing home prices in many markets. So that median price of an existing home and the median price of a new home for sale are closer than they've been in years, partly because the builders are building smaller homes, partly because you're using less expensive fixtures. And the other thing that the builders have been doing, and this price is a lot of people, but it's brilliant on their part, is they're coming to closing with thousands of dollars and they're paying down mortgage rates.   Rick Sharga (00:23:01) - They're buying points and dropping the mortgage rate for their buyers. I spoke to a group in Denver recently where there was a local builder advertising mortgage rates of 4.99%. So think about that.   Keith Weinhold (00:23:13) - We have providers we work with here that are doing similar things. We're still seeing the rate buy downs happening, and that's why I've often told people, Rick, like, this is potentially a good time in the cycle when you're adding more rental property to really look at new builds or build to rent while these rate buy downs last. Now, I talked to a builder in Houston yesterday, and I learned a few interesting things. You talked about the smaller square footages. They could confirm that often times this builder offers either a bedroom or a study. You can get an extra bedroom or a study like a little office space. And more and more people are opting for the study. So they're starting to build homes more with the study in mind because more people are working from home and one less bedroom because people are having fewer children.   Rick Sharga (00:23:57) - Exactly right. It's the combination of both of those two things, either having fewer children or having them later. And many more people working from home than they were prior to the pandemic. And those studies become very, very useful., rooms to have in the house. Rick, what.   Keith Weinhold (00:24:12) - Is the lowest cost, new build, single family home that you see? I mean, is anyone even building in any parts of the nation, like a 225 K new build home? I haven't seen one.   Rick Sharga (00:24:26) - I haven't seen one. But I wouldn't be surprised if you're in a market in a state like Alabama or Mississippi and some of the more outlying areas, maybe some markets in the Midwest where home prices aren't as astronomical as they are elsewhere. But look, the builders are building judiciously. They're not overbuilding., we had a cycle in 2008 where we had a 13 month supply of homes available for sale and building Irish building. They got caught with overstock. But what they are building, they tend to build as move up homes because they're more profitable.   Rick Sharga (00:24:58) - So you're just not seeing an awful lot of entry level homes being built. And the hope is that as they build that first move up level home, some of the people with entry level homes will opt to sell and bring some of that inventory back to market. We are seeing more construction. We are seeing building permits,, going up on a year over year basis., most recent numbers are around 1.5 million permits. So the builders are bullish on the future. And housing starts were up in both January and February. Most importantly they're up most strongly in single family owner occupied homes. We're seeing housing starts to decline dramatically in terms of multifamily starts, right. But that's because there's about a million new apartment units coming online between last year and this year. And we don't need a whole lot more apartments., we need,, more single family homes. So if your listeners are seeing headlines talking about housing starts being lower, it's really because we're seeing fewer multifamily starts.   Keith Weinhold (00:25:54) - Last year was a big year for multifamily construction.   Rick Sharga (00:25:57) - All time high in terms of multifamily units under construction. And a lot of those are still coming to market this year. There are going to be some markets that are actually still oversupplied. So again, you have to be paying very close attention. When we talk a little bit about the rental market in the apartment category, we have seen apartment rents decline year over year in pretty much all categories. Whether you're looking at studio apartments, one bedroom apartments, two better apartments on a year over year basis, rents are actually in negative territory, according to Realtor.com and according to some data I've recently seen from RealPage. If you're looking at the actual price of rent and I know that's a little different than percentage increases or decreases, you're still seeing that rents about it's below peak. It's about 1.6% below the peak we hit in 2022,, when vacancy rates were just about nothing. But we are still below peak, and the median rent is ranging,, somewhere in the neighborhood of $1,700 a year for apartments, single family homes, which I suspect more of your listeners are actually,, renting out than apartments.   Rick Sharga (00:27:03) - Yes. Are doing better. We're seeing year over year rents continue to grow. They're growing modestly. They have not gone into negative territory, and they haven't,, during this boom and bust cycle that we've seen in the housing market. And if you're looking at,, price gains, according to some recent data from CoreLogic, if you're at the higher end of the single family rental market, prices are up about 3% year over year. At the low end, they're up about 2.9%. So very little difference depending on your price tier and also very little difference depending on whether you're looking at an attached single family residence or,, detached family single family residence. All those are up right around 3% year over year. And that's a good sign. Again, you're dealing with a as your your listeners know, you're dealing with a slightly different tenant in a single family home than you are in a, an apartment. And a lot of these people who would have been buyers or opting to rent stands to reason that,, they'd rather rent a house, particularly if it's in a good school district or in a good neighborhood than an apartment, because they have needs.   Keith Weinhold (00:28:06) - Rents are extremely stable historically. They just sort of plod up slowly. What happened about two years ago, three years ago, with that 15% plus rent increase, that's an aberration.   Rick Sharga (00:28:19) - Yeah, that's a good point, Keith. If we're looking at 3% rental growth year over year right now in the single family rental market that tracks with historic normals, usually you're somewhere between 1 and 5% a year. So threes, you know, smack dab in the middle of all that. And the growth rates also vary wildly by markets., just kind of give you a range if you're looking at a single family rental property in Honolulu, in the city, year over year, you're up about 6%. If you're looking at a unit in Miami, Florida, you're down about 2.5%.   Keith Weinhold (00:28:50) - So rental growth rates.   Rick Sharga (00:28:52) - Rental growth rates. So really just depends on where you are. That's pretty much your range from a couple points down to I think Honolulu actually had the largest,, increase in the CoreLogic study. A lot of your listeners are probably interested in buying foreclosure properties.   Rick Sharga (00:29:07) - We're not seeing a lot of foreclosure activity. Still, we are starting to see a little weakness in consumers. When we met last week, we talked a little bit about the strength of consumer spending, but we also talked about increasing amounts of spending on credit cards. And we're seeing consumer delinquency rates increase in pretty much every aspect of consumer lending, whether it's a loan, whether it's a credit card debt, whether it's an auto loan, whether it's a home equity line of credit, whether it's a mortgage, a mortgage, delinquencies are up a little bit. The only category we're not seeing an increase in delinquencies right now is student loans. And my theory on that is that people have only recently had to start making payments again on student loans, and we don't have any data to show that they're going delinquent yet. But the delinquency numbers we need to take with a grain of salt, because many of them are most of them are early stage delinquency. So somebody missed a payment, but then they catch up before they get 60 or 90 days delinquent.   Rick Sharga (00:30:02) - But we are seeing trends that suggest more delinquencies. And if you have more delinquencies, that leads to more foreclosures. Mortgage delinquency rates, according to the Mortgage Bankers Association, went up to about 3.8% in the fourth quarter, the historic average going back to the 1970s, which is as far back as the NBA goes, is about 5.25%. So we're still way below normal levels of delinquencies. As I mentioned, most of those are early stage delinquencies, and they're being resolved before they get more serious. Because of that, we don't have a lot of foreclosure activity. So this is no longer Keith government intervention. It's no longer government forbearance programs and foreclosure moratoriums. It's the fact that the economy's been so strong. Unemployment rates have a very strong correlation to mortgage delinquency rates. We got together last time I mentioned the unemployment rate was at 3.9%. I just told you that word delinquencies are at 3.8. Can't get much closer than that. And because of that, foreclosure activity is still down almost 30% from where we were in 2019 prior to the pandemic.   Rick Sharga (00:31:07) - And I should point out, the 2019 wasn't a particularly big year for foreclosures either. So I don't see us getting back to pre-pandemic levels of foreclosure activity until sometime next year. And what's important for people in this space to understand is that even though we're seeing roughly the same number of delinquencies that we saw back in 2019, fewer of those delinquent loans are going into foreclosure. Fewer of those foreclosures are getting as far as the auction, and even fewer of those are going back to the banks as REO properties or bank owned properties.   Keith Weinhold (00:31:40) - Delinquency occurs before foreclosure. We have low levels of both, and I would imagine that one substantial reason for that are these low fixed rate payments that so many people have. Minutes ago, you showed us that 90% of those with a mortgage have a rate in the fives or less. And then oftentimes when we talk about these sorts of things, we don't even consider the fact that more than 4 in 10 homeowners are free and clear. They don't have any mortgage at all. So it's difficult for people to get in trouble.   Rick Sharga (00:32:10) - Yeah. And when they do get in trouble, what's really a saving grace for a lot of these people? And I believe the reason we're seeing fewer foreclosure auctions and bank repossessions is that there's $31 trillion in homeowner equity in the market, and 90% of borrowers in foreclosure have positive equity. A huge percentage of those have at least 20% equity. So what's happening interesting is that many, many of these borrowers are protecting their equity by selling their home before the foreclosure sale. If they get to foreclosure sale, they run the risk of losing all their equity, or at least the overwhelming majority of their equity.   Keith Weinhold (00:32:48) - That's a great point with how this really works.   Rick Sharga (00:32:50) - And so if you're looking to buy a distressed property, if you're looking to buy a foreclosure property, you really need to be working directly with the homeowner in the earliest stages of foreclosure rather than waiting for the auction. And certainly rather than waiting for the bank to repossess the home and resell it. And some recent data from a friend of mine@auction.com tracking some numbers from Adam Data.   Rick Sharga (00:33:15) - 55% of the distressed properties that were sold through from June through to September of last year were sold in that pre foreclosure period prior to the foreclosure auction. That's wildly different than we've been in in years past. So really important for anybody looking to buy distressed property, to consider moving upstream and working directly with that homeowner. And it's a win win. You can help that homeowner protect their equity, have some cash to make a fresh start with and, and typically buy a home in pretty good condition and a home that you need to be part of your rental portfolio. So just kind of recapping some of the stuff we talked about, Keith, both today and last week, I still think that from an economic standpoint, there's still at least a good possibility we might have a short, mild recession sometime later this year. I don't see unemployment going much higher than 5%. Even if we do have a recession, if we don't have a recession, we'll only see the economy slowed down a bit. It might be hard to tell the difference.   Rick Sharga (00:34:10) - I'm expecting the volume of home sales to go up. I think we bottomed out in 2023, but not by a lot. Maybe we see a 10% lift over last year, which would take us to roughly 4.4 million existing homes. I wouldn't be surprised to see 700,000 new homes sold, really just depends on how quickly builders bring inventory to market. But if I'm right and mortgage rates go down slowly over the second half of this year, we'll see more home buyers come to market more quickly than sellers. We don't see a lot of sellers come to market until we get interest rates down to about 5.5% or lower, which probably won't happen until 2025. So more buyers coming to market than sellers means the prices will continue to go up. We continue to see investors account for 25 to 30% of all residential purchases. So I think we'll continue to see a higher rate, partly because investors are active, partly because a lot of consumers are waiting for market conditions to improve, but that limited affordability in today's market conditions, I really do think means more demand for rental units.   Rick Sharga (00:35:14) - And I think foreclosure activity stays below normal levels for the rest of this year, and REO inventory bank repossessions are going to remain even lower for even longer. I don't think we see REO activity come back to more normal levels for at least a couple of years, so anybody looking to buy these properties really does need to be moving upstream in order to make those purchases.   Keith Weinhold (00:35:34) - Yeah, with low affordability, hence more demand for rentals. I've already noticed that the homeownership rate, which is somewhat of a trailing number here, has already fallen from 66% to 65.7%. And with low affordability, it seems that that homeownership rate could fall even more, meaning the rate of renters would be higher.   Rick Sharga (00:35:54) - A friend of mine always complains that the government's somehow beside behind all of these trends, one way or the other, and and wonders why, with all the government programs aimed at increasing homeownership, we haven't seen that homeownership rate increase much. And I think sometimes things said to the natural level and our homeownership rate, really for the last 30 years, has been somewhere between 64% and 66%.   Rick Sharga (00:36:19) - And that might just be what the natural level for homeownership is in the United States. Will it dip a little bit as people can't afford to buy a house? Probably. Probably will. When market conditions improve for buyers, will it go up a little bit? Probably. But we hit 70% homeownership back in 2006. And it turned out that was the bad number and that not everybody's ready financially for the kind of commitment that homeownership requires. And so I've always said that the key isn't getting everybody into a home. It's the sustainability of homeownership for people that that we do get into that house. One of the best days of your life is when you get the key to that house, and it has to be one of the worst days if you have to give it back. So I hope we all keep that in mind as we move forward.   Keith Weinhold (00:37:03) - That's right. Government incentives is in the past saying there's a $10,000 first time homebuyer tax credit. Oh, we're not in an era where we need help. On the demand side, all you're doing is driving up prices.   Keith Weinhold (00:37:14) - And I don't know that you're helping out anybody in that case. But I think with really overall, one big takeaway here, Rick, is that if you the listener, if you're waiting for prices to drop substantially sometime or for interest rates to drop substantially sometime, that might not be worth the wait. You could be waiting a long time.   Rick Sharga (00:37:32) - I do expect mortgage rates will decline. I don't really go back to the sub for rates we saw a few years ago, but they're going to decline slowly and they may not decline enough to offset rising home prices. I mean, you have to get your calculator out and and figure out how that math works for you. But you're absolutely right, Keith. And I tell people today, even with mortgage rates being where they are, if you find a house you love or you find a house that's a good investment and you pencil it out and the numbers work, don't wait because the opportunity costs can be severe and you could wind up missing out on a property that could either be a good cash flow unit for you on rental, or it could be a property that you wind up living in for the next 30 years.   Rick Sharga (00:38:13) - So don't be afraid of today's market. Just be very prudent and judicious in the way you approach it.   Keith Weinhold (00:38:19) - Well, Rick, get resuscitation of followers and the nation have been a beneficiary of your housing market intelligence expertise for quite a while now. If someone wants to engage with you in the CJ Patrick Company, who are those types of people and how could you help?   Rick Sharga (00:38:36) - I appreciate the opportunity. Most of the companies I work with or companies that provide services to lenders, anybody who has a business that's in the real estate or financial services markets, who would benefit from my coming in to share with them industry data, or has data themselves that they would like to get out into the marketplace? Anything data related really, I tend to specialize in. So market updates and market overviews and market. Analysis or things that I do on a pretty much daily basis for companies.   Keith Weinhold (00:39:07) - How can they engage with you?   Rick Sharga (00:39:08) - They can find our website, which is C.J. patrick.com. They can find me on Twitter. I hide there under my name, Rick, or reach out to me on LinkedIn.   Rick Sharga (00:39:17) - And if you reach out to me on on a social media channel, make sure that you mention you know me through Keith, and you're not some crazy Russian bot trying to hack into my personal information.   Keith Weinhold (00:39:27) - Well, then, Rick, it's been great having you back on the show.   Rick Sharga (00:39:30) - I'm sure we'll do it again sometime soon. Thanks for having me.   Keith Weinhold (00:39:39) - Yeah, terrific Intel there. In this episode, Rick said that to still expect a lower amount of sales going forward and expect modest property price appreciation. Every region of the nation is seeing price growth now. And by the way, you remember that late last year, I unveiled Gray's home price appreciation forecast for this year, stating that prices should rise 4% and here in Q2, I still like how that looks. There is not much distress with current homeowners, but if you're looking to scoop up a foreclosed property cheap, you better get aggressive and work directly with the homeowner in the earliest stages of foreclosure. Don't wait for that property to go to auction. Rick also said more demand for rental units is coming, and I encourage you to engage with Rick.   Keith Weinhold (00:40:30) - Let him know you heard about him through me. If you want to go deeper and engage with some of the services that he offers, perhaps you work for a real estate company or a demographic company. You can do that at C.J. patrick.com. But most of you, the listener is an individual investor. So check him out on X where his handle is Rick Sharga. He is Rick Sharga on LinkedIn. Big thanks to Rick Sharga today. Until next week I'm your host, Keith Wild. Don't quit your daydream.   Speaker 5 (00:41:04) - Nothing on this show should be considered specific, personal or professional advice. Please consult an appropriate tax, legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own. Information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of get Rich education LLC exclusively.   Keith Weinhold (00:41:32) - The preceding program was brought to you by your home for wealth building. Get rich education.com.

Get our free real estate course and newsletter: GRE Letter Our core formula here at GRE is simple, buy-and-hold real estate. Then where does your profit come from? I explain. Where will your next tenant come from? Essentially, market intelligence analyst Rick Sharga & I answer this today. We explore job growth, wage growth, and the condition of today's consumer / tenant.  Rick Sharga doesn't believe that mortgage rates will fall substantially until the Fed Funds Rate does. This isn't likely to happen until at least June. Consumers are exhibiting some distress signals. Credit card debt has swelled. We break it down. Many economic indicators still show that they'll still be an economic slowdown.  In most recessions, home sales and home prices both rise. Resources mentioned: Show Page: GetRichEducation.com/495 Inquire about business with Rick: CJPatrick.com Rick Sharga on X: @ricksharga LinkedIn: Rick Sharga For access to properties or free help with a GRE Investment Coach, start here: GREmarketplace.com Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Invest with Freedom Family Investments.  You get paid first: Text FAMILY to 66866 Will you please leave a review for the show? I'd be grateful. Search “how to leave an Apple Podcasts review”  Top Properties & Providers: GREmarketplace.com GRE Free Investment Coaching: GREmarketplace.com/Coach Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free— text ‘GRE' to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Keith's personal Instagram: @keithweinhold   Complete episode transcript:   Keith Weinhold (00:00:00) - Welcome to gray. I'm your host, Keith Weinhold. We aren't fooling around on April Fool's Day. How can you be assured of having rent paying tenants in the future? That's dictated by the economy, job growth and real wage growth above inflation. Well, how exactly does all that relate to the housing market? We break it down today with an expert guest on Get Rich Education. When you want the best real estate and finance info, the modern internet experience limits your free articles access, and it's replete with paywalls. And you've got pop ups and push notifications and cookies. Disclaimers are. At no other time in history has it been more vital to place nice, clean, free content into your hands that actually adds no hype value to your life? See, this is the golden age of quality newsletters, and I write every word of ours myself. It's got a dash of humor and it's to the point to get the letter. It couldn't be more simple. Text GRE to 66866. And when you start the free newsletter, you'll also get my one hour fast real estate course completely free.   Keith Weinhold (00:01:16) - It's called the Don't Quit Your Daydream letter and it wires your mind for wealth. Make sure you read it. Text GRE to 66866. Text GRE to 66866.   Corey Coates (00:01:33) - You're listening to the show that has created more financial freedom than nearly any show in the world. This is get rich education.   Keith Weinhold (00:01:49) - What category? You're listening to one of America's longest running in most listened to shows on real estate investing, the Voice of Real Estate since 2014. This is get rich education. I'm your host. My name is Keith Weinhold, and you probably know that by now. But what we never truly know is the direction of the economy and how it shapes the housing market. Well, an expert and I are putting our heads together for you today to give you the best indication that we possibly can. I'll be with us shortly. And he is coming, armed with all of his best indicators and statistics. Last week here on the show, I got somewhat philosophical with you at times when I posited the question, do you want to retire? And I helped answer the question, what is retirement today anyway? I had a lot of good feedback on that show, but today we're talking about more concrete indicators with some numbers.   Keith Weinhold (00:02:50) - For example, historically in a recession, what really happens to real estate prices? We're going to answer that and more questions like it today. Now, I like to say that wealthy people's money either starts out in real estate or ends up in real estate, but there are so many ways to do it, so many ways to do real estate right? Hence so many ways to do it wrong as well. Our formula that we use here at GRE more than any other, is something we use because it is so simple that I think some people overlook it. It is buy and hold. Yeah, mostly long term buy and hold residential rentals. Now, we sure talk about some other things too, but that's really a cheap formula, something that we focused on since day one here. Now there surely can be some other good strategies as long as you execute, right? Flipping, wholesaling, Oreos, the birth strategy, self-storage units, RV parks and a lot more. But with buy and hold, I think some people know the real estate.   Keith Weinhold (00:03:58) - They might then ask, well, well where's your margin on that? Where does your profit come from if you just buy and hold? Or they might even think that that strategy is really slow and a 40 year game plan. Well, then they learn about the five ways and that changes that. It's largely about buying strategically and then managing your manager. I think most people dream of a life where they can just spend their time remotely managing their investments here and there. Now, for me, most months, I don't have anything to do with managing a property manager in a certain market. I just get the cash flow and then I do browse the monthly property statement. Some months had only been do that because from the amount of cash flow received, I can often see that nothing really went wrong for the month because from the amount of cash flow received, I can often see that nothing really went wrong for the month. Tax benefits as one of the five ways you're paid. That takes some management to and you know this tax time of year with my bookkeeper.   Keith Weinhold (00:05:11) - At times she emails me and asks me for this and that scrap of information. The mindset that helped me manage all the generous tax benefits of real estate is not taking my bookkeepers questions as an occasional annoyance, but rather taking the mindset of tax benefits or something that you can manage throughout the year. And that way when my bookkeeper goes an entire month without asking me for something, it can feel like a short break. Sort of like something was turned off for a month. And hey, first world problems, right? Downloading a document and emailing it to your bookkeeper ten minutes a month., today is also talking about where your next tenant is coming from, which really, at the end of the day, is what a real estate economics discussion is about. Well, it's also about giving tenants the housing that they want, meeting their desired lifestyle and the set of amenities that are both going to attract your renter in the first place and then retain your renter over the long term every year. Building,, the property management software company, they ask thousands of renters which amenities and property layouts would motivate them to choose one rental property over another.   Keith Weinhold (00:06:33) - That's what they're asking tenants. And what you imagine that renters might want could be different from the reality. For years now, renters are prioritizing their neighborhood quality. In the amenities that are actually inside the rental unit. Those things are more important than they are the shared community amenities like a pool, lobby, clubhouse or gym. Renters are gravitating toward neighborhoods that are safe and quiet, but yet are still convenient to stores and restaurants. And that led to half of the renters surveyed to rental properties that are located in the suburbs. Now, when it comes to the amenities within their rental unit that they're prioritizing, renters want a space with kind of all those comforts of home air conditioning and a washer and dryer to the option to own a pet. And these are the feature types of single family rentals, although some newer apartments can meet that too. And some condos community amenities. Then like a fitness center or a pool. I mean, they still hold some appeal to residents in these surveys, but lately they're seen more merely as perks instead of necessities for today's cost conscious renters.   Keith Weinhold (00:07:55) - So the bottom line here with this survey is that it's what's actually inside the unit that's become more important. And maybe that's a little too bad as people tend to get less social. They're using community areas less, they're prioritizing them less. And hey, maybe they just want to lie on the sofa and scroll their phone in a nice, comfortable place. Hey, you've got a suit and fit the world as it is, not as the way that you wanted to be, at least when you're providing others with housing. Hey, coming up here both on the show and on our YouTube channel, why do Western US homes cost more than eastern US homes on average? This seems geographically paradoxical. It feels backwards to a lot of people, because almost two thirds of the United States lives east of the Mississippi River, and yet that area comprises just over one third of all the land. You've got almost two thirds of people living on just over one third of all the land in the East. So to some more people on less area, oh, that would have to mean that eastern home prices are more costly.   Keith Weinhold (00:09:09) - No, it is exactly the opposite. In fact, coming up on a future show, I'll share eight plus reasons why. This is why Western US homes cost more than eastern ones. And this is also why many of the best cash flow markets, they tend to be in the eastern half of the US. They have those lower purchase prices also coming up in the future. I'm about to have a talk. This talk isn't going to be on the show here, but a talk with a conventional financial advisor about my own personal retirement. I've got an appointment with this person and this ought to be interesting. We'll see what he says about my situation. I'll try not to lecture him on how financially free beats debt free or anything like that. We'll see if I can hold off doing that. And if that meeting produces some interesting takeaways or just humorous ones, I'm going to share that with you in the future. And if you want to be sure to hear those upcoming episodes on subjects like that, I invite you to follow the show here on your favorite podcast.   Keith Weinhold (00:10:17) - And that way you won't miss any upcoming episodes. I only met today's guest about two years ago. We enjoyed that conversation and now we collaborate regularly. He helps provide crucial market updates that straight ahead. I'm Keith Reinhold, you're listening to episode 495 of get Rich education. You know, I'll just tell you, for the most passive part of my real estate investing, personally, I put my own dollars with Freedom Family Investments because their funds pay me a stream of regular cash flow in returns, or better than a bank savings account up to 12%. Their minimums are as low as 25 K. You don't even need to be accredited for some of them. It's all backed by real estate. And I kind of love how the tax benefit of doing this can offset capital gains and your W-2 jobs income. And they've always given me exactly their stated return paid on time. So it's steady income, no surprises while I'm sleeping or just doing the things I love. For a little insider tip, I've invested in their power fund to get going on that text family to 66866.   Keith Weinhold (00:11:31) - Oh, and this isn't a solicitation. If you want to invest where I do, just go ahead and text family to six, 686, six. Role under the specific expert with income property you need. Ridge lending Group Nmls 42056. In gray history from beginners to veterans, they provided our listeners with more mortgages than anyone. It's where I get my own loans for single family rentals up to four Plex's. Start your pre-qualification and chat with President Charlie Ridge personally. They'll even customize a plan tailored to you for growing your portfolio. Start at Ridge Lending group.com Ridge lending group.com. This is Rich dad advisor Tom Wheelwright. Listen to get Rich education with Keith Reinhold and don't quit your daydream. You are going to get a fantastic real estate market update today, and you'll also learn lessons if you're consuming this 5 or 10 years from now. Our expert guest has been the executive VP of markets. Some of America's leading housing intelligence firms named it national lists of most influential real estate leaders. He's frequently quoted on real estate, mortgage and foreclosure markets, too.   Keith Weinhold (00:12:59) - He runs the real estate market intelligence firm, the C.J. Patrick Company. Hey, welcome back to Great Rick Saga. Always a pleasure to spend some time with you, Keith. Thank you for having me. Oh, same here, because, Rick, you've been with us here every six months for about two years now. You and I discussed the condition of the overall economy as well as the real estate market. I think of both of those as resilient today. Now, back when I was a new real estate investor, Rick, I didn't know to look at the broad economy at all. I was more concerned with if, say, on a vacant unit that I had, I had the drywall texture just right to try to attract a new tenant ASAP. Now that surely matters. But time gave me the perspective to know that what matters more is to have a local stable of tenants that are capable of paying the rent, and that's what matters more. So with that in mind, where would you like to begin? That's great counsel.   Keith Weinhold (00:14:03) - And it's really important for investors or even somebody looking to buy a house, understand what's going on economically, both across the country and in their region. So why don't we start by taking a look at what's going on in the economy? There's been a lot of conversation about potential recession. We can talk a bit about that, but if you're good to go, we'll start by just sharing some information about the US economy and some of the trends that we're seeing. Yeah, let's go ahead and do that. And yes, that dreaded our word may very well come up. That thing that we've all been waiting for but has never happened. Don't count your chickens just yet. But let's see what's going on. Because on average, recessions do happen every five years. It's just a normal part of the business cycle. Yeah, that's important to keep in context. I'm glad you brought that up. Recessions are a normal part of the business cycle and the economic cycle. We may be slightly overdue to have one at this point, although the last one that we had took very, very long to recover from, the Great Recession that started back in 2008 took a full decade to recover from, which is also very unusual.   Keith Weinhold (00:15:05) - So we'll take a look at some of these cycles and see where we are today. Keith, the basic metric that most economists look at when they're trying to figure out the strength of the US economy is is something called the gross domestic product, the GDP.   Rick Sharga (00:15:18) - We track that to see if it's growing, if it's declining. The technical definition of a recession is two consecutive quarters of negative GDP growth. And there's been a lot of talk about the GDP slowing down in the US. But really it's been mostly talk. In fact, if you look at the last quarter, we have data four, which was the fourth quarter of last year. You can see that the GDP grew by 3.2 3.3%, which was a much higher number than what most economists had forecast.   Keith Weinhold (00:15:47) - That resilient economy with a low unemployment rate, jobs being added and productive growth in the GDP.   Rick Sharga (00:15:54) - Yeah, we're going to get to all of that. And it's a great point. If you look at what makes up the GDP, about two thirds of it is comprised of consumer spending, right.   Rick Sharga (00:16:04) - So typically when you see strong GDP numbers, you're consumer is doing pretty well. And a lot of this probably has to do with consumers still having money to spend from the enormous amount of stimulus that the federal government poured into the economy to help prevent a recession or depression during Covid. About $15 trillion in all of the stimulus that was sent out to consumers and businesses alike. And that's probably helped us weather the storm of what normally might have been a slowdown in the economy. We are, however, Keith, in a globally interconnected economy, and it's important to note that not all of our peers are doing quite as well. Canada may already be in a recession. The UK is almost certainly in a recession. The eurozone barely escaped going into recessionary numbers in the last quarter, and even markets like China aren't doing as well as as expected. And I'm not saying that to gloat about how well the US is doing. I'm saying that is sort of a warning that if we do get into a situation where it looks like there's a global recession going on, it's very unlikely the US will come out of that untainted at all.   Rick Sharga (00:17:09) - So it's something to keep an eye on as we move forward.   Keith Weinhold (00:17:11) - Right. 100%.   Rick Sharga (00:17:13) - You mentioned unemployment a couple of minutes ago, Keith, and that's one of the other economic metrics we check. Unemployment went all the way up. And I say that facetiously. The 3.9% in the numbers, full employment is considered to be anywhere at 5% unemployment or lower. And we haven't been at 5% unemployment. Probably since about 2016, with the exception of the blip we had during the Covid pandemic, when the government shut things down and we had a huge increase in unemployment temporarily. But we are continuing to see very, very strong job numbers, both in terms of these low levels of unemployment and in terms of job growth. The January and February numbers again caught the economists who come up with these consensus forecasts by surprise. In January, about 350,000 jobs created. In February, about 250,000 jobs created. I should put an asterisk on some of these numbers. When you hear politicians talking about all the jobs they've created over the last few years.   Rick Sharga (00:18:15) - Keep in mind that during the Covid pandemic, we wiped out about 22 million jobs virtually overnight. A lot of the millions of jobs that have been created over the last few years were really those old jobs being refilled. We filled most of those within about two years, and we have continued to create jobs since then. We have more jobs than we have people looking for work. They're about 8.5 million jobs open, about 6 to 6.5 million people looking for work.   Keith Weinhold (00:18:43) - You can almost think that this is an over employed condition.   Rick Sharga (00:18:46) - And it almost is in most cases, not all cases, but in most cases, somebody who doesn't have a job right now just isn't looking for a job right now. And these are not all service level jobs. That's the other pushback I get when I'm out talking to groups sometimes. Oh yeah, but not everybody wants to work at Starbucks. Well, first of all, you get pretty good benefits of Starbucks free coffee healthcare. But let's not do a Starbucks commercial. These are government jobs.   Rick Sharga (00:19:10) - They're manufacturing jobs. They're construction jobs. They are some type of service level jobs. But these are jobs across the board. And because there are more jobs available than people are looking for work, we're seeing wages go up. The average hourly wage across the country last month was over $29 an hour, which is the highest it's ever been. And if you look at wage growth on a year over year basis, it's running at about 5%. And really, Keith, this is the first time in a number of years that we can say with certainty that wage growth is actually running at a higher pace than the rate of inflation, right.   Keith Weinhold (00:19:44) - And that really matters. That really helps pay the rent. One thing that detractors say with the unemployment rate, you talked about them not necessarily being consolidated in the low paid service sector area, is that a lot of people lament, well, aren't many of these part time jobs? Where are your thoughts there?   Rick Sharga (00:20:01) - There are a probably historically large number of part time jobs, but we also have an awful lot of people who have opted out of full time work for a variety of reasons, and are thrilled to be able to pick up some money working in the gig economy.   Rick Sharga (00:20:16) - So whether they're driving for Uber or Lyft, they're doing DoorDash or something else that's a part time job that they're doing just to either, in some cases, kill time or to make a little bit of extra money. This isn't an economy where the majority of part time workers are in part time jobs, because they can't find a full time job. That's simply not the case, and the data doesn't support that.   Keith Weinhold (00:20:41) - Now, if you, the listener and viewer here are wondering, well, this stuff doesn't apply directly to me. I'm good. I'm secure in my job. Maybe I don't even need a job. Keep in mind that we're talking about the financial condition of your tenant today.   Rick Sharga (00:20:57) - Yeah. When I'm talking to to real estate investors in general, I know that you were talking about drywall earlier, and sometimes you really can't see the forest for the trees. You're kind of overwhelmed or you're not sure where you should actually be looking. I tell them in many cases, to pay less attention to home prices and rental rates and more attention to some of the underlying fundamental economic conditions.   Rick Sharga (00:21:20) - Are you in a market where population is growing or declining? Are you in a market where there's job growth? Are you in a market where there's wage growth? If you're at a market where the population, jobs and wages are all growing, you're going to be in a pretty healthy market for real estate, whether it's owner occupied properties or its rental properties. On the other hand, if jobs are leaving your market, if wages are going down, if population is declining, those are warning signs. And it might be an indication that that's not a good market to start investing more in. So everything we're talking about really does get connected back to the housing market, whether it's rental housing or owner occupied housing. And it's important to see these trends for what they are.   Keith Weinhold (00:22:04) - And of course, we're talking about these factors on a national level. As we know, our real estate is local, and our audience is often interested in studying a metro market before they decide to invest there. So on that more regional level, Rick, or local level, do you have any favorite resources or websites or apps that you think are important for prospective investors to look at first within a certain region or MSA? Well, you.   Rick Sharga (00:22:33) - Can. Find a lot of local market data on some of the free housing sites that are out there. The Zillow's, the Realtor.com is the homes dot coms of the world. If you go beyond the basic home search, or if you dig deep into some of the information that they provide on local markets, within that home search, you'll find a lot of information there. There are third party companies. There's a company I'm familiar with it that works mostly with realtors, but has a lot of data that investors would probably be interested in. It's called keeping current matters. Yeah, they do an awful lot of reporting on this. But if you really want to do your own research and you don't mind doing a little bit of digging, I find that the Department of Labor and the Census Bureau and the Bureau of Labor Statistics, all government entities, have just copious amounts of local market information. You can find, you know, down to what does the local Pipefitter earn on an hourly basis in Peoria? There's all of that data out there for free on these government sites.   Rick Sharga (00:23:34) - You just have to be willing to do a little bit of research and dig through those sites.   Keith Weinhold (00:23:39) - Right. And sometimes the government websites don't exactly present their information in a beautiful, graphically rich way. But this is part of your research. Some people don't realize that, Fred, the Federal Reserve economic data has an awful lot of regional and local information, not just national information as well. Well, thanks for sharing some of those resources, Rick, and where you like to go and look, that can really help our audience. What else should a real estate investor know about today's overall economy?   Rick Sharga (00:24:08) - So we talked about consumer spending and the reliance our economy does have on consumer spending. And one of the things that I'm watching fairly carefully right now is an apparent disconnect between consumer confidence and consumer spending. So if you go back to when the pandemic hit and the lockdown occurred, consumer spending obviously fell off a cliff. There was just nothing to buy. And consumer confidence took a major hit with the announcement of the pandemic.   Rick Sharga (00:24:34) - Consumer spending as soon as the lockdown was over started to come back strongly and has never slowed down. It's hit an all time high today. Consumer confidence, on the other hand, was battered a little bit by subsequent waves of Covid, by threatened government shutdown in Washington, by the war in Ukraine, by the more recent war in the Middle East. And so the concern here is that if consumer confidence doesn't come back, we might see spending revert to the mean. And actually, as economists would say, and come back down, which would cause, at the very least an economic slowdown and at the worst, probably a recession. So it is something we're keeping an eye on. Consumer confidence has been improving a little bit lately, but historically it's gone hand in hand with consumer spending. And that simply hasn't been the case in recent months. So it is something we're keeping an eye on.   Keith Weinhold (00:25:25) - Now, one might wonder how do you measure confidence? Well, there are various surveys out there. And Rick, the way I think of it with consumers is that consumer confidence is more of a leading indicator, and then the actual consumption is more of a trailing indicator.   Rick Sharga (00:25:42) - I completely agree with you. The sentiment index that I follow most closely is one that's put out by the University of Michigan. Yeah, and it's been out there for decades. So there's an awful lot of history that goes with it. And generally speaking, on any index, you're looking for a number that's around or above 100 because that usually is your baseline. And some of the more recent months we've seen numbers down in the 50s and 60s. Now they've been trending up, as I said, in recent months. But that's something that's reported on very widely by the press. We were talking about sourcing things for investors. And I have to tell you, the just doing a basic Google search for something like, what's consumer confidence like today? You'd be surprised. The rich information that you can pull just from Google, that you can start to find some of these sources online. But that is one thing that we're watching. And, Keith, I think it's important to break out a little bit in more detail how consumers are spending or what they're spending with.   Rick Sharga (00:26:44) - And these are potential red flags for the economy, consumer credit card use. The amount of debt on credit cards surpassed $1 trillion in the third quarter of last year for the first time ever, and it got close to 1.2 trillion in the fourth quarter. That's an awful lot of credit card spending. Regardless of what you want to talk to me about, with inflation adjusted dollars, it's still $1 trillion. And that happened at a time when credit card interest rates had soared because of what the Federal Reserve was doing. So you're talking about people spending 1 to $1.2 trillion on their credit cards, when the average interest rate on a new credit card issued was between 25 and 30%. Gosh. Which, by the way, is a high enough number that it used to get you arrested for usury. And apparently now it's the new. Normal and it's okay. But this is concern. And one of the big concerns is because the cost of living has become so high and it's so difficult for so many families. The worry is that people might be starting to use their credit cards to make ends meet, to buy basic necessities, and that historically has not been a story with a happy ending.   Rick Sharga (00:27:52) - So we are watching credit card use. We're also watching personal savings rates. When the government stimulus came out, we saw a savings rates at all time highs. We then saw savings declined rapidly to all time low levels. They've recovered a little bit, but they're still on the low end of things, historically speaking. So the same worry here, Keith, which is that we're worried that families might be dipping into personal savings in order to make ends meet. And that combination, there's some research that suggests that, on average, the US household has more credit card debt than they have savings, and that's just not a healthy ratio for anybody to have.   Keith Weinhold (00:28:30) - Yeah, America has very much so they live for today mindset I think. So therefore it was a pretty predictable that after the Covid stimulus payments that savings levels probably would drop.   Rick Sharga (00:28:42) - Yeah. It's just that they drop further than what we had hoped they would. We're going to talk about inflation in the second. I have a bit of skepticism about some of the inflation numbers that we see reported from the government because of what they include or exclude, or some of the data is trailing by a long time.   Rick Sharga (00:28:56) - So I out of frustration, I created my own CPI. It's not the consumer price index, it's the Costco price index. And I look at one of my leading indicators is salmon because I buy my salmon at Costco. And a year ago that salmon cost 999 a pound. Today shopping a Costco, that salmon costs 1299 £1.30 percent. That's a 30% lift for all the talk we hear out of the administration about gas prices going down, I can tell you that where I buy my gas at Costco, it's a couple dollars more a gallon than it was just a few years ago. And I say this with a little bit of a chuckle, and I say this knowing that it's a nuisance for me. But I've been blessed. And it's not a life or death decision for me. But there are families out there who are deciding whether or not they can buy salmon this week. And I would submit that on average, your rental family's income is lower than your owner occupied houses, families, income. And so for all of your listeners who are landlords, this is something to be paying very close attention to, despite the fact that inflation is coming down.   Rick Sharga (00:30:02) - Keep in mind that these inflation rates are on top of very high prices that we have as a result of the previous cycle of inflation. So it's going to take a while, even with wages going up for those households to catch up here. And the hope is that wage growth will continue to outpace inflation growth long enough that they'll be able to do that.   Keith Weinhold (00:30:23) - Yes, that's a positive trend. Yeah. Rick, as long is in your Costco price index, Costco doesn't try to skimp, inflate and replace your wild elastic salmon with Atlantic farmed salmon. I'm sure you're going to be paying attention to that as well as you fill your own shopping basket and come up with what's really happening with inflation. Because for those that believe the CPI, it's been reported in the low threes lately and CPI peaked at 9.1% almost two years ago in June of 2022.   Rick Sharga (00:30:55) - And what the Federal Reserve has done is unprecedented. We've only ever seen rates go this high this quickly, once in the last 50 or 60 years. That was back in the 1980s, when inflation was really in runaway mode and out of control.   Rick Sharga (00:31:10) - And normally what the Federal Reserve does is very methodical, very thoughtful. They'll raise the fed funds rate a quarter of a point. They'll sit back and wait to see what happens. They'll raise another quarter point and give it some time to take effect and so forth and so on until they feel like inflation is under control. And then they'll then they'll drop that fed funds rate. In this case, they've admitted a few things that probably took a lot for them to say out loud. They admitted that they underestimated how high inflation would get. They admitted that they underestimated how quickly it would rise. And they also admitted that they underestimated how difficult it was going to be to get it under control. So what it did peak at about 9.1% a couple of years ago. They took unprecedented steps in terms of the size of of rate hikes and the rapidity with which they raised the fed funds rate. And now they're in a position where inflation is trending more or less in the right direction. It's in the low threes, as you said, it has not come down as much in the last couple reports as they would like.   Rick Sharga (00:32:10) - And that's probably going to result in them holding the fed funds rate at its current level for at least the first half of this year before they start doing rate cuts, because the last thing they want to do is cut too soon and see inflation start to come back up.   Keith Weinhold (00:32:25) - About one month ago, I did an episode titled Why the Fed should not lower rates. Rates are. Normal and the economy doesn't need the help. So if we do have this dreaded R-word, this recession, the most convenient tool for the fed to use is to cut rates. We don't want to use up that ammo while we're still in a good position like we are today.   Rick Sharga (00:32:47) - Yeah, I don't disagree with you. And there were some economists and mostly Wall Street, who had been predicting a fed rate cut as early as March and over the course of the year. And I thought they were all crazy great. And I've been saying at the earliest, May now I think it's probably not until June. The rates are a little higher than historic averages.   Rick Sharga (00:33:05) - I could see maybe three rate cuts this year, maybe four if the economy slows down significantly. We're not we're certainly not going back to the zero rates that we had for a few years. I think the fed will be very cautious and reserved in its approach to scaling back the fed funds rate. One of the the side effects of what they did is they cast a lot of uncertainty and doubt into the financial markets, which have caused mortgage rates to skyrocket, which have caused private lending rates to skyrocket. For your listeners who borrow from private lenders. And I don't think we see those rates start to come down significantly until after the fed does its first fed funds rate cut, I suspect, and so far I've been right, that until we see that rate cut, we're going to see mortgage rates on a 30 year fixed rate loan kind of bounce back and forth in a very narrow band between about 6.75 and 7.25% for the next few months. And that's really where they've been since January. And I think that will continue to be the case until we see that first rate cut, at which point the market will probably say, okay, they're serious now we can have that sigh of relief, and then we'll see a slow and gradual reduction in mortgage rates.   Rick Sharga (00:34:21) - I did want to touch on two things related to the fed actions and the current economic issues. Keith, because I often get the question about likelihood of a recession. If you go back in history all the way back to World War two, not counting this cycle, the Federal Reserve has raised the fed funds rates 11 times in order to get inflation under control. Eight of those 11 times, they've wound up over correcting as they raise the rates right. And that steered us into a recession. The three times that didn't happen, the three times they executed a soft landing, not a recession. All three of those cycles had something in common, and that was that the fed didn't have to overcorrect because they started early. They acted proactively when it looked like inflation was getting started, and they were able to keep inflation under control without a drastic increase in the fed funds rate this cycle. They've already admitted that they waited too long and inflation got higher than they expected. And because of that, they've had to raise the rates more quickly and more dramatically again than anything we've seen in the last 40 or 50 years.   Rick Sharga (00:35:25) - So historically speaking, it would seem more likely than not that we'd see at least a mild recession. The people who say, well, if we would have seen one through this cycle, we would have already seen it often overlooked the fact that it can take 24 months after the Fed's rate hikes are done, to see the full effect on the economy.   Keith Weinhold (00:35:45) - Economies are complex and cycles move slowly. They do so, historically speaking.   Rick Sharga (00:35:50) - That's one thing. I look at the other and without getting to Inside Baseball for your listeners, is something called a yield curve inversion. Yeah. And that's when when the bonds markets sense a disruption in the force and think that Darth Vader may be hitting the economy, but basically it's when the the yields on longer term investments like ten year Treasury bonds switch places with the yields on shorter term investments like two year Treasury bonds. So the yield on a two year investment is actually higher than the yield on a ten year investment. And when you have that inversion, that's what they call a yield curve inversion.   Rick Sharga (00:36:23) - And the last eight times that's happened we've had a recession follow not always a long drawn out recession, but there's always been a recession. And this particular yield curve inversion cycle is one of the deepest and longest ones we've had in a long time. And again, using history as a precedent. That doesn't seem to be really good reason for this cycle to behave differently than the last eight half. Having said all that, we may get lucky. The fed may pull a rabbit out of its hat and actually execute that rare soft landing instead of a recession. If they do, we'll still feel the economy slowdown that's almost a given. And if they don't, if we do have a recession, every economist I speak with tells me the same thing that it's likely to be a very short, very mild recession because all of the economic fundamentals underneath are still very, very strong. And, you know, employment, wages, productivity and so forth and so on. So likely to see some sort of slowdown this year, Keith, whether it turns into an actual recession or is just very, very slow growth, that's the most likely scenario for the rest of 2024.   Keith Weinhold (00:37:30) - Well, Rick, as we wind down here, the. Last thing I'd like to ask you about is in a recession, what typically happens to real estate, because you and I both study history and something that I often say here on the show is oftentimes you need to look at history over hunches, for example, I think it's easy to have a hunch that when mortgage rates rise while home prices are definitely going to fall. No, actually, if you look at history, when mortgage rates rise, home prices typically rise because rising rates typically mean the economy strong. And another one is when home prices are up. Well, a lot of people think that others want to then jump into the housing market and buy when they see that prices are up. So then when home prices are up, well, that means rents must fall since everyone's buying. But no, these two things typically move together home prices and rents. It's about history over hunches. So with that in mind, talk to us with your historical research on in recessions, what typically happens to the real estate market?   Rick Sharga (00:38:28) - Typically, home sales go up from the beginning of recession to the end of a recession.   Rick Sharga (00:38:33) - And in fact, with the notable exception of the last recession, the Great Recession, housing is very often helped the economy recuperate from a recession and recover. And that's particularly true in the new homes market. Home prices also typically go up from the beginning of recession to the end of a recession. So you could have some short term disruption. You could see home sales volume or home prices dip slightly at the beginning of a recession. But historically speaking, in every recession except the Great Recession, we've actually seen both home sales and home prices go up. And to your point, higher mortgage rates do not historically equate to lower home prices. What they do equate to is home prices going up at a slower rate. And this last cycle has been very unusual because historically, we've never seen mortgage rates double in a single calendar year until 2022. And in fact, that year rates didn't double in a calendar year. They doubled in a couple of months.   Keith Weinhold (00:39:33) - And tripled overall.   Rick Sharga (00:39:34) - And they tripled overall. So if you look at that, we did see home prices actually decline in some markets, although nationally the number never went negative.   Rick Sharga (00:39:44) - And we saw home price appreciation drop off pretty dramatically but still stay positive on a year over year basis. So it's been kind of interesting. This has been a very unusual cycle for a lot of reasons, but historically speaking, your spot on a recession does not spell doom and gloom for the housing market. Whether you're talking about owner occupied homes or rental properties.   Keith Weinhold (00:40:06) - Rick and I talked about the general economy today. Next week, Rick is going to join us again, and we're going to focus squarely on the real estate market. So no long goodbyes, Rick. We'll see you next week.   Rick Sharga (00:40:18) - See you soon, Keith.   Keith Weinhold (00:40:25) - Yeah. Strong insights from Rick, as usual. To help sum it up, recession or not, expect some sort of economic slowdown later this year. It's expected to be mild. That's what Rick shared with us. And if that happens, expect less rent growth. Then in a recession, home prices tend to go up. That's what really happens. Wage growth keeps outpacing inflation. Now the longer that trend continues, expect more rent growth in the future.   Keith Weinhold (00:40:57) - But of course the real rate of inflation is slippery to measure. I think you could still make the case that wage growth isn't really higher than inflation. So to me, that part's actually not that bullish. Rick believes mortgage rates will stay near 7% until the fed makes their first rate cut. We discussed monetary policy today. And you surely know that's what the fed does. They control the flow of money and interest rate policy. We did not discuss fiscal policy. We're not going to next week either. Fiscal policy is something that Tom Wheelwright and I often do together. And what is the difference? Well, fiscal policy is the tax and spend side. When you think of fiscal think tax and spend, and it's often congressional committees and elected officials that make those fiscal policy decisions, not the fed. They're making the monetary policy. That's the difference. This is get rich education. So after all, we do often have these learning moments. There's more of Rick Saga next week as we pivot from talking about the broader economy this week.   Keith Weinhold (00:42:05) - And then next week, we'll really drill down on the housing market, including more on property price growth prospects, which regions are growing or shrinking, rent growth prospects, and any warning signs that investors should take notice of today. Hey, what? I'd like to think that I don't ask much of you, the listener. I'd like to ask you if you can help me out with one fairly quick thing today. I'd really appreciate it if you get value from the show here. Whether that was, say, last week's episode on what is retirement anyway or from, say, a few weeks ago, why inflation is actually an immoral force, or the latest trends like the content of today's and next week's show, or my upcoming breakdown of why Western US homes cost more than eastern US homes and other content like that that you just aren't going to find anywhere else. I'm simply asking you for your feedback. This takes the show from one way communication to some two way communication. Please consider leaving me a podcast rating and review, whether that's on Apple Podcasts, Spotify, or wherever you listen to the show.   Keith Weinhold (00:43:17) - Just do a search for, for example, how to leave an Apple Podcasts review so you can see how to do it. And then I'd be grateful for that. Rating and review more next week on the future direction of the housing market I'm Keith Weinhold. Don't quit your day dream.   Speaker 4 (00:43:37) - Nothing on this show should be considered specific, personal or professional advice. Please consult an appropriate tax, legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own. Information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of get Rich education LLC exclusively.   Keith Weinhold (00:44:05) - The preceding program was brought to you by your home for wealth building. Get rich education.com.

Jason discussed various topics related to the housing market, including current and forecasted mortgage rates, the ongoing inventory shortage, and the state of the multifamily housing market. He also addressed the issue of housing affordability, arguing that it is not a necessary condition for a healthy market, and shared his own experiences in the market. Lastly, he touched on the impact of climate-induced inflation on food prices and overall inflation rates, and endorsed his inflation-induced debt destruction strategy with income properties. And in part 2 of Jason's interview with Rick Sharga, Rick  delves into the housing market, highlighting mortgage rates near 20-year highs affecting purchase loan applications and pending home sales due to decreased affordability. He anticipates gradual mortgage rate declines attracting more buyers than sellers, likely resulting in increased competition and rising prices. Existing home sales show a 6.5% year-over-year price increase, while new home prices have decreased by 15% from peak levels. Investor purchases remain robust, primarily driven by individual investors rather than institutions. Flipping activity has declined due to pricing challenges, but gross profits are improving, indicating a potential resurgence.    #altosresearch #corelogic #CJPatrick #HousingMarket #MortgageRates #HomePrices #Inventory #Investors #RealEstateInvesting #RentalMarket #MarketTrends #PropertyMarket #Homebuyers #HomeSellers #EconomicIndicators #InvestmentOpportunities #HousingInventory #MarketAnalysis #HousingTrends #RentalProperties #FlippingProperties #MarketShifts #HousingAffordability #NewConstruction #RentalDemand #PropertyInvestment Key Takeaways: Jason's editorial 1:57 Forecast for the average 30-year fixed mortgage rate  > Housing affordability and Interest rates >  Massive distress < Big upward pressure on inflation Rick Sharga interview > Overall economy > Housing market- mortgage rates still near 20-year highs > January sales up from December, but down from 2023 > Inventory up 21% from last year   > New listings up 15% from historically weak 2023 numbers > The rate lock effect > Home prices are up YOY in every region of the country > https://www.baselane.com/jason > New home sales bounce back after declining late in 2023 > New home prices down 15% from peak  > Corelogic report: Investor share of home purchases continue to grow > Number of Flips down 30% from 2022 > Even though gross margins appear to be improving > Reason for pessimism? Apartments vs. single family property > Delinquencies, foreclosures, distressed borrowers, equity protection > CRE distress continue to build, commercial foreclosures > Observations   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

Jason discusses the surge in existing home sales by 9.5% in February, marking a two-year consecutive increase due to a slight rise in inventory. Fox Business highlights keeping mortgage rates under 7% for homebuyers. The show emphasizes the housing affordability crisis and potential impacts of the NAR lawsuit on realtor commissions, predicting market chaos. Despite media misreporting on commission changes, the segment stresses the need for real estate professionals in navigating complex transactions. It anticipates increased competition among brokers and agents, urging them to enhance service quality amid evolving market dynamics. Then Jason welcomes real estate analyst Rick Sharga. Rick discusses the housing market and economic trends. Despite concerns of a crash, he suggests a slow period with modest price increases rather than a downturn. He dismisses crash predictions, highlighting historical data showing home prices generally rise during recessions. Sharga addresses factors like consumer spending, job growth, inflation, and Fed policies influencing mortgage rates. He acknowledges the possibility of a mild recession due to Fed actions but emphasizes it may not significantly impact real estate if inventory remains low and distressed sellers are scarce. #cnbc #foxbusiness #neilCavuto #RickSharga #RealEstateTrends #HousingMarket #HomeSales #MortgageRates #NARLawsuit #AffordabilityCrisis #MarketAnalysis #FoxBusinessInsights Key Takeaways: Jason's editorial 1:40 WSJ article: 9.5% surge home sales in FEB 3:11 Fox Business- over and under 7% supply/demand dynamics Rick Sharga interview 14:49 Rick's macro view on the housing market 18:39 A different supply and demand dynamic   21:57 GDP remains strong, unemployment and other factors 24:55 https://RESimpli.com/Jason/ 26:37 Wage growth and consumer confidence & spending and the debt trap 31:49 Inflation and the FED 34:56 FED Funds rate, the Yield curve and avoiding a recession   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

The week began with an inflation report that was anything but pretty. The Consumer Price Index came in hotter than expected for January, upsetting Wall Street and frustrating people who want the Fed to cut rates in the coming months. The report triggered a sharp stock sell-off but stocks have bounced back since then as investors and traders wondered whether they overreacted.   The CPI for January came out on Monday, February 5th with a .3% increase for January. Economists had expected a .2% increase. The annual gain did come down from 3.4% to 3.1%, but economists expected it to dip below 3% to 2.9%, according to CNBC. The report doesn't show a significant increase in prices, but it does indicate that inflation continues to be sticky...   ...That's it for this episode. You'll find links to these stories if you'd like to more details on the CPI report. As for the housing market, you can get my forecast by watching 2024 Housing Markets Predictions webinar that I recorded with economist Rick Sharga. That's at newsforinvestors.com under the Learn tab. If you're not yet a RealWealth member, you can also sign up for free, while you are there. And please remember to subscribe to this podcast.   Thanks for listening! Kathy Fettke   Links:   1 - https://www.cnbc.com/2024/02/13/cpi-inflation-january-2024-consumer-prices-rose-0point3percent-in-january-more-than-expected-as-the-annual-rate-moved-to-3point1percent.html   2 - https://www.marketwatch.com/story/feds-goolsbee-says-some-high-monthly-inflation-readings-wont-knock-his-confidence-11486ac9?mod=economy-politics   3 - https://www.mortgagenewsdaily.com/markets/mortgage-rates-02132024 4 - https://www.marketwatch.com/story/inflation-data-jolted-stocks-and-bonds-this-will-decide-what-happens-next-63df42d1?mod=economy-politics

Real estate thought leader Rick Sharga is known for his astonishingly accurate market predictions (and for his sense of humor, too). In this episode (recorded live at Side x Side 2024, where Rick took the Main Stage), the marketer-turned-market-intelligence-expert talks about data access, the role of influencers and misinformation in the industry, and the trends in migration and housing prices. Rick also dispels fears of a housing market crash and advises agents to focus on finding need-to-sell clients and working with investors. Rick's Website cjpatrick.com

So what the heck is going on with the U.S. economy? We've been warned about a possible recession for two years now. But the economy is still going strong, and the housing market seems to defy gravity. The contradictions may have left you scratching your head, but the guest in this episode will help clear up any confusion. He'll also share his thoughts on what and where to invest. Our guest Rick Sharga has more than 20 years of experience in the real estate and mortgage industries. He's the founder and CEO of market intelligence and advisory firm CJ Patrick Company, and has previously served as EVP of Market Intelligence at ATTOM data, EVP for Carrington Mortgage Holdings, EVP of Marketing at RealtyTrac, and Chief Marketing Officer for Ten-X and Auction.com. Rick is one of the country's most frequently quoted experts on the U.S. economy, real estate, mortgages, and foreclosures. He's appeared on all the major news channels, and several times on this podcast. We just co-hosted a 2024 Housing Market Predictions webinar for the Real Wealth Show. You'll find that webinar at by clicking here. So, if you're wondering how to invest in real estate this year, you might get a few great ideas from Rick. You'll also find information about the North Dallas Rental Fund mentioned in the podcast at https://growdevelopments.com. And don't forget to join RealWealth to help expand your real estate knowledge and take advantage of up-to-date investing opportunities. It's free! And please be sure you subscribe to this podcast on your favorite platform, like & comment, we want to hear from you! Thanks for watching! Kathy Fettke LINKS: Watch this episode on YouTube: https://www.youtube.com/watch?v=4mf15R6wtj0 Listen & Subscribe to the Real Wealth Show on your favorite platform: https://link.chtbl.com/RWS Join RealWealth: http://tinyurl.com/joinrealwealth970 Rick Sharga's 2024 Housing Market Predictions Webinar: https://realwealth.com/learn/2024-housing-market-predictions/

The tide may have finally turned for real estate investing and the housing market. After carefully tracking sentiment among small investors, Rick Sharga's team at CJ Patrick Company has seen a BIG boost in optimism over the last quarter. It seems that betting on the housing market is back as improving investor sentiment and confidence pushes more and more people to go after rental property investing and house flipping. But which strategies will have the most explosive growth? We sat down to break the story with Rick on the newest Investor Sentiment Survey, what investors are feeling the most bullish about in the 2024 housing market, and the biggest concern investors have on their minds. And the data Rick shares isn't just shown in the survey—it's mirroring today's market conditions. In James' market alone, investor demand has quadrupled recently, showing a STRONG resurgence in a specific type of real estate investing.  We'll walk through the new investor sentiment numbers, why house flipping activity could explode over the next year, one big risk hurting rental property investors, and where investing activity is pooling across the nation. In This Episode We Cover: Latest investor sentiment numbers and the one strategy that is about to have a BIG comeback The HUGE opportunity for rental property investing that most investors will miss How James made MORE money doing HALF as many flips in 2023  Low mortgage rate predictions and why investors need to get in BEFORE rates drop One serious hurdle that's hurting rental property investors in 2024 And So Much More! Links from the Show Find an Agent Find a Lender BiggerPockets Forums BiggerPockets Agent BiggerPockets Bootcamps Join BiggerPockets for FREE On The Market Join the Future of Real Estate Investing with Fundrise Connect with Other Investors in the “On The Market” Forums Subscribe to The “On The Market” YouTube Channel Dave's BiggerPockets Profile Dave's Instagram James' BiggerPockets Profile James' Instagram Hear Our Last Interview with Rick on BiggerNews Home Prices May Have Bottomed Says New “Investor Sentiment Survey” w/Rick Sharga ATTOM's Home Flipping Report Book Mentioned in the Show Start with Strategy with Dave Meyer Connect with Rick: Rick's LinkedIn Rick's X/Twitter Rick's Website Click here to listen to the full episode: https://www.biggerpockets.com/blog/on-the-market-180 Interested in learning more about today's sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com. Learn more about your ad choices. Visit megaphone.fm/adchoices

Everyone keeps talking about an incoming surge of home foreclosures. Over the past few years, online crash predictors shouted from the rooftops about how another foreclosure crisis is always on the way, and we're only months from a full-on meltdown. How much of this is true, and how much of it is pure clickbait? We've got Rick Sharga, Founder and CEO of CJ Patrick Company, one of the world's leading housing market intelligence and advisory firms, on the show to tell us what the data points to. Ever since the pause on foreclosures during the pandemic, homeowners have been getting win after win. They were able to save up plenty of cash, their home values skyrocketed, and they could refinance at the lowest mortgage rates on record. Now, with high rates, still high home prices, and steady demand, homeowners have most of the power, EVEN if they're behind on payments. But, as the economy starts to soften, could the tapped-out consumer finally force some homeowners to default on their loans?  In this BiggerNews episode, Rick will give us all the details on today's current foreclosure landscape, walk us through the three levels of foreclosures, give his 2024 foreclosure prediction, and share the economic indicators to watch that could signal a coming foreclosure crisis.  In This Episode We Cover A 2024 update on foreclosure rates, defaults, and Rick's foreclosure forecast for next year The three levels of foreclosure and why most homes WON'T ever be defaulted on  Rising consumer debt and what happens as more Americans default on their credit card and auto loans Housing supply and whether or not a foreclosure crisis could finally give us some inventory  Economic indicators to watch that could signal a rise in foreclosures  How to use your home equity to invest in real estate (WITHOUT putting yourself at too much risk!)  And So Much More! Click here to listen to the full episode: https://www.biggerpockets.com/blog/real-estate-871 Interested in learning more about today's sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com. Learn more about your ad choices. Visit megaphone.fm/adchoices

Join us for an electrifying discussion on banking and commercial real estate as we illuminate the critical factors influencing the present terrain and predict challenges and opportunities that lie ahead in Q4 2023 and beyond. This is Part 2 of my most recent quarterly Win Win Webinar, and we leave no stone unturned.  My expert guests, Matthew Grossman, Founder and Principal at JMG Capital Properties; Matthew Mandel, MBA, CCIM, CEO, Investor, Fund Manager, and Consultant at ArchStone Advisors; and Rick Sharga, Founder & CEO of CJ Patrick Company, will blow your mind with their insights.   We're tackling the rising delinquencies, strategic defaults, and government interventions that are reshaping the financial landscape. But that's not all - we also reveal the untapped potential hidden within distressed assets. Whether you're a seasoned investor or just starting to dip your toes into the world of commercial real estate, this episode is a must-listen to glean firsthand understanding from industry trailblazers. We're not just discussing trends and hurdles; we're providing you with the knowledge and guidance needed to navigate this ever-evolving market and sharpen your investment strategy in the dynamic world of commercial real estate. If you missed it, Part 1 was released the prior episode. You can also watch the full live webinar on YoutTube at https://youtu.be/soViqOIO0xs. Register for upcoming episodes of our dynamic quarterly Win Win Webinar at https://us02web.zoom.us/webinar/register/WN_sfexwwQKSriZk18Gporouw#/registration If there's a specific topic you'd like me to cover in our REAL TidBits series or a guest you'd like to recommend for an interview, please share with us via email to kalyani@firstliencapital.com.    If you're interested in investing with First Lien Capital LP please connect with me at bill@firstliencapital.com or go to firstliencapital.com and press the INVEST button to be contacted by our team.    To learn more, visit:https://billbymel.com/Listen to more episodes on Mission Matters:https://missionmatters.com/author/bill-bymel/ 

Rick Sharga is the founder and CEO of CJ Patrick Company, a market intelligence firm providing industry insights, forecasts, and analysis to real estate companies. Rick has years of experience in the real estate and mortgage industries and he is with us on the show to talk about what we can expect from the market in the last few months of the year.   Listen now to learn more about what's really happening in today's market, what we should expect, and how we can plan for the next few months!   Key Talking Points of the Episode   00:00 Introduction 02:04 Who is Rick Sharga? 03:51 What should real estate investors focus on today? 08:50 Why should investors pay more attention to insurance? 11:45 How will the demand for housing be influenced by household formation? 13:33 What is the truth behind millennials and their home-buying preferences? 15:37 What is the problem with inventory today? 20:20 How much multifamily inventory can we expect to hit the markets in the coming months? 21:09 What should rental property investors keep in mind in today's market? 22:50 What opportunities can investors find in the AirBnB space? 26:23 Why do real estate investors need to be creative in finding inventory? 30:02 What do you need to know about properties in foreclosure today? 33:32 What opportunities can we expect in the commercial space in the next few months? 39:33 Where can you find distressed commercial properties? 40:40 Why is it highly likely for more banks to fail in the future? 43:27 What opportunities are there in self-storage for real estate investors today? 46:31 What is Rick's advice for real estate investors today? 47:38 How are migration rates affecting the real estate market? 50:05 What can you do to become successful in this economy? 53:02 How is inflation affecting the quality of life of people?   Quotables   “Look for people that need to sell their properties. There are sources where you can find all of that data and that's where you're gonna be able to find all the assets that you need to buy.” “The millennials wanted to own homes at the same rate that gen x did, the same rate as the boomers did – they just got started later.” “Don't jump at the first opportunity that you see because there will be other opportunities but make sure that whatever opportunities you do pursue is an opportunity that pencils out for you.”   Links   Social Media: Rick Sharga https://twitter.com/ricksharga https://www.linkedin.com/in/ricksharga/   Website: CJ Patrick Company https://cjpatrick.com/   Website: RCN Capital https://www.rcncapital.com/podcast    Website: REI INK https://rei-ink.com/ 

Join us for an electrifying discussion on banking and commercial real estate as we illuminate the critical factors influencing the present terrain and predict challenges and opportunities that lie ahead in Q4 2023 and beyond. This is Part 1 of my most recent quarterly Win Win Webinar, and we leave no stone unturned.   My expert guests, Matthew Grossman, Founder and Principal at JMG Capital Properties; Matthew Mandel, MBA, CCIM, CEO, Investor, Fund Manager, and Consultant at ArchStone Advisors; and Rick Sharga, Founder & CEO of CJ Patrick Company, will blow your mind with their insights.   We're tackling the rising delinquencies, strategic defaults, and government interventions that are reshaping the financial landscape. But that's not all - we also reveal the untapped potential hidden within distressed assets.  Whether you're a seasoned investor or just starting to dip your toes into the world of commercial real estate, this episode is a must-listen to glean firsthand understanding from industry trailblazers. We're not just discussing trends and hurdles; we're providing you with the knowledge and guidance needed to navigate this ever-evolving market and sharpen your investment strategy in the dynamic world of commercial real estate.  Part 2 will be released next week. If you're too eager to wait, you can watch the full live webinar on YoutTube at https://youtu.be/soViqOIO0xs.  Register for upcoming episodes of our dynamic quarterly Win Win Webinar at https://us02web.zoom.us/webinar/register/WN_sfexwwQKSriZk18Gporouw#/registration If there's a specific topic you'd like me to cover in our REAL TidBits series or a guest you'd like to recommend for an interview, please share with us via email tokalyani@firstliencapital.com.     If you're interested in investing with First Lien Capital LP please connect with me at bill@firstliencapital.com or go to firstliencapital.com and press the INVEST button to be contacted by our team.   To learn more, visit:https://billbymel.com/Listen to more episodes on Mission Matters:https://missionmatters.com/author/bill-bymel/ 

The Fed can raise interest rates, but they cannot create housing supply.  Housing intelligence analyst Rick Sharga joins us for the second week in a row. This housing market is awful for primary residence homebuyers. But at GRE Marketplace, you can still buy income properties with rates as low as 4.75%. Rick tells us that the most prosperous markets now favor the: Midwest and Southeast, single-family homes, rental property investors with buy-and-hold strategies. National home prices are appreciating modestly. Home sales volume is still down. Investors now account for more than one-quarter of property purchases. Mortgage delinquencies are near an all-time low. Rick and I discuss why this market is so bad for flippers.  High homeowner equity positions ($300K+) support this housing market.  Timestamps: The impact of rising mortgage rates [00:02:37] Discussion on how the Federal Reserve's raising of short-term rates has caused mortgage rates to go up, affecting the housing market. The affordability challenge [00:03:38] Exploration of the impact of higher mortgage rates on homebuyers, particularly first-time buyers, and the decrease in affordability. Low supply of homes [00:08:48] Analysis of the low inventory of homes for sale, with a decrease of 9% from the previous year and 47% from 2019, leading to a challenging market. The mortgage rate lock in effect [00:11:05] Discussion on how the mortgage rate lock in effect can crimp demand but cannot create supply. Hottest markets in the Midwest and Southeast [00:11:05] Analysis of the hottest real estate markets in the Midwest and Southeast regions of the United States. Positive turn in home price appreciation [00:13:06] Explanation of how home price appreciation went down but has recently turned positive again. Housing Permits, Starts, and Construction [00:21:24] Discussion on the trends and levels of housing permits, starts, and construction, and the need for builders to increase production. Investor Activity in the Residential Market [00:22:28] Exploration of the percentage of home purchases made by investors, with a focus on small and medium-sized investors and the misconception of institutional investors dominating the market. Delinquencies and Foreclosures [00:24:36] Analysis of mortgage delinquency rates, foreclosure activity, and homeowner equity, highlighting the low delinquency rates, the presence of equity in foreclosed homes, and the importance of early-stage foreclosure sales. The future direction of rents [00:32:00] Discussion on the potential upward pressure on rents due to low affordability and high homeownership rate. Inventory coming to the market [00:33:03] Exploration of the impact of expensive inventory coming to the market and its effect on rent prices. The overall economy and housing market [00:34:03] Consideration of the possibility of a recession, unemployment spike, and foreclosures affecting the housing market. The coach's role in finding real estate deals [00:43:06] Explanation of how an investment coach can help you find the best real estate deals in the marketplace. Advantages of buying properties from marketplace [00:44:20] Reasons why buying properties from marketplace can lead to good deals, including lower prices and absence of emotional seller involvement. Resources mentioned: Show Notes: www.GetRichEducation.com/467 Rick Sharga's website: CJPatrick.com Rick Sharga on X (Twitter): @RickSharga Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Invest with Freedom Family Investments. You get paid first: Text ‘FAMILY' to 66866 Will you please leave a review for the show? I'd be grateful. Search “how to leave an Apple Podcasts review”  Top Properties & Providers: GREmarketplace.com GRE Free Investment Coaching: GREmarketplace.com/Coach Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free— text ‘GRE' to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Keith's personal Instagram: @keithweinhold   (00:00:01) - Welcome to. I'm your host, Keith Weinhold. Hold a terrific discussion today on the direction of the housing market, including lessons that you can learn for all time plummeting home sales volume and direly low home inventory. Why home price appreciation is taking place now. Could the government soon penalize you for owning too many rental properties? What's the best place for a real estate investor to position themselves in this era? And more today on Get Rich Education.   (00:00:33) - You're listening to the show that has created more financial freedom than nearly any show in the world. This is Get rich education.   (00:00:56) - Walking from Horseheads, New York to Nags Head, North Carolina, and across 188 nations worldwide. I'm Keith Weinhold. And you're listening. To get rich education, you are going to get a fantastic market update today. And along the way, you'll also learn lessons if you're consuming this 5 or 10 years from now. Our expert guest was with us last week to discuss the economy. This week, it's episode two of two as we discuss the real estate market.   (00:01:25) - He has been the executive VP of markets at some of America's leading housing intelligence firms, and today he's the founder and CEO of Patrick Company, either a market intelligence firm for the real estate and mortgage markets. And he has 20 plus years of experience in those industries. It's the return of Rick Saga Part two of two. It's not imperative that you listen to last week's Part one of two that we can help you see the big picture. Enjoy this long, unbroken interview and then after the break, I'll come back to close it. Just you and I. We're talking with Rick Sagar, expert housing analyst, previously. We talked about the general condition of the economy. And now Rick and I are going to break down the housing market with what's happening there. There's so definitively connected. Keith One of the things to that the Federal Reserve has done by raising those short term rates is caused mortgage rates to go up, right? Mortgage rates tend to run loosely in line with the yields on the ten year US Treasury bonds that we talked about at the end of the first segment.   (00:02:37) - Those are now up around 4%. And typically a 30 year fixed rate mortgage will be between one and a half and two percentage points higher than that yield. So in a normal market, we'd be looking at a mortgage rate today of about five and a half to 6%. Instead because of the risk and the volatility that the market is pricing in because they're not sure what the Federal Reserve is going to do next. We're looking at mortgage rates for a 30 year fixed rate loan of over 7%. The most recent numbers from last week from Freddie Mac, we were at almost 7.2% on that average, 30 year fixed rate loan and 6.5% on a 15 year fixed rate loan. You and I were talking before the show and and you know, historically speaking, if we keep these things in context, we're still actually below the 25 year average, which was 8%. But we have a whole generation of homebuyers who've come of age during the period of the lowest mortgage rates in the history of the country. They got spoiled, they got spoiled.   (00:03:38) - And to be clear, it's one of the reasons that home prices rose as rapidly as they did and got as high as they are is because you could afford to make monthly payments with a two and a half, three, 3.5% mortgage. Now, you still have home prices about as high as they were then, and you have a mortgage rate that's doubled. And for most home buyers, particularly first time home buyers that make your monthly mortgage payment was going to go up by 45 to 60%. And most of us didn't get that 45 to 60% raise last year. It really had a huge impact on affordability. In fact, this is such an unusual occurrence that according to Freddie Mac, it's the only time in US history when mortgage rates doubled during a calendar year and they didn't just double in a calendar year. Keith They doubled in the space in a few months. It was that kind of systemic shock to the system that really hit the housing market as hard as it did. Right. And they've also nearly tripled in a pretty short period of time.   (00:04:35) - Yeah, they really have. And again, going back historically speaking and and get this from Gen Z folks and millennials, when I talk about, you know, the old days of mortgage and I do remember my first mortgage had two numbers to the left of the decimal point. I forget if it was 11 or 12%, but it was something like that. And they basically say, okay, Boomer, but that 11% mortgage was on your $70,000 house, Right. And not, you know, today's median priced home of $430,000 or whatever it is. So it's a fair point. Mortgage rates are not high, historically speaking, but that monthly cost, because of the combination of home prices and higher interest rates, is choking some people and making affordability a problem. And because of that, one of the forward looking metrics that I take a look at is the purchase loan mortgage application index from the Mortgage Bankers Association. So this is the number of people that are applying for loans with the purpose of buying a house.   (00:05:35) - They're off almost 30% on a year over year basis right now. You can see without straining your eyes at all the impact that these higher mortgage rates are having on the housing market. And we had almost record numbers of purchase loan applications from the time people who are allowed out of their house during the pandemic until these mortgage rates doubled from 2020 through the early part of 2022, mortgage rates were in the threes and fours and sometimes even in the twos. Yeah, everyone wants to talk about mortgage rates and it is an important discussion to have here at Marketplace with our investment coaches. Rick Some builders, as you know, they commonly offer rate buy down incentives to buyers of new homes. And what some of our providers are doing here, Rick, is we have one builder where if you use their preferred lender, they're buying down your income property's mortgage rate to 5.75%. And we have another builder where if you use their preferred lender, they're still buying down your mortgage rate to 4.75%. And of course, with Non-owner occupied property here, you know, previously you had talked about mortgage rates in excess of seven.   (00:06:47) - They might normally be about 8% for non owner occupied property, but you're able to buy them down to five and three quarters or even four and three quarters with one of our providers for new builds right now, that's a great deal and your listener should really be taking advantage of those opportunities. We'll get into new homes in a few minutes and what we're seeing builders do for consumers, But have to tell you, those numbers are better deals than consumers are getting right now. And you're being generous when you're talking about private lending rates right now. Most of the lenders I'm familiar with are nine, ten, 11%, depending on the nature of your investment. So your folks are getting a great deal with those rates. We talked about purchase loan applications. The other advanced predictor I look at is pending home sales. These are people that are entering into contracts. The deal hasn't been closed yet. Has it been recorded yet? This comes out from the National Association of Realtors. And those numbers are down on a year over year basis as well.   (00:07:42) - There's a lot of rate sensitivity in the market, though, Keith. And if you go back to March when rates went down just a fraction of a percent, we saw more purchase loan applications. We saw more pending home sales. But as rates have climbed back up over seven, we've seen both of these metrics go down. Yeah. So we're talking about pending home sales. We're talking about sales volume that's down in this discussion, not sales price. And anyone might be hard to say, but when you see sales volume that's down, including pending sales, how often is that due to worse affordability and how often is that due to low supply of homes? Why don't we jump right into that? Keith That's a great segue. And this is a very difficult time in the housing market because it has both of the factors that you just mentioned, two very difficult headwinds for the market to try and overcome. And and we'll get into details on both of those in just a minute. Because of that, existing home sales were down in July and they were down pretty significantly on a year over year basis, about 16%.   (00:08:48) - And that's the 23rd consecutive month where existing home sales were lower than they were the prior year. January was the lowest month of sales this month, and it broke a streak we started this year. I was forecasting that we'd see between 4.3 and 4.4 existing home sales. That's down from about 5.2 last year in about 6.1 million the year before. Right now, we're trending at a little over 4 million existing home sales for the year. So even my relatively low forecast for the year may have been overly optimistic. You mentioned inventory and inventory is a huge headwind for the market. Inventory of homes for sale today is down about 9% from where it was a year ago. It's down 47% from where we were in 2019, which was probably the last normal year we've had in the housing market. In a normal year, we would be looking at about a six month supply of homes available for sale. That's what economists or housing market analysts will look at as a balanced market balance between supply and demand. We're at about two and a half months supply right now nationally and in many states it's much lower than that.   (00:09:56) - So there's just not much out here. And the only reason the inventory number looks as good as it looks and it doesn't look very good is because it's taking a little longer to sell properties once they hit the market. If you were looking at new listing data, it's even worse. There's very little inventory coming to market in the way of new listings, and that's because of the rate increases we talked about a minute ago. 90% of borrowers with a mortgage have an interest rate on that mortgage of 6% or less. 70% have an interest rate of 4% or less. If you're sitting on a mortgage rate of 3.5% and you sell your house and buy a house at the same exact price with a 7% mortgage, you've just doubled your monthly mortgage payment. It's not that people psychologically don't want to trade a low rate for a high rate. There's a financial penalty for them doing so. And until we see mortgage rates come down a bit, probably into the fives, we're just not going to see a lot of inventory coming to market except for homeowners who need to sell or have so much equity and maybe you're going to downsize into a smaller property that they don't care about that kind of shift.   (00:11:05) - Yeah, that is the mortgage rate lock in effect. Perfectly explain. And the Fed with the raising rates, they can crimp demand. But one thing that the Fed cannot do is create supply. As much as you might like to see Jerome Powell in work boots with a nail gun, that just doesn't happen. There's an image for you, for your listeners. Yeah, and I'm not sure I'd want to. I'd want to live in that house. That's not Chairman Powell building, but inspection. Yeah. Good economist. Maybe not a carpenter. We were talking about this a little bit earlier, too. And if you're an investor, this is probably worth noting, whether you're a fix and flip investor or investor who's buying properties to rent out a lot of the interest. This is from the sharing some data from Realtor.com and they've taken a look at where people are searching for properties and where transactions are taking place and they're finding that Midwest Southeast are really the hottest markets, places that are a little off the beaten path, you know, places in New Hampshire and Connecticut and Maine and Ohio and Wisconsin.   (00:12:06) - But interestingly, some of the markets that had been suffering a little bit, they're starting to see a little more interest in whether it's California, but off the coast or markets in Colorado or Washington state. But clearly, a lot of the activity, a lot of the money is moving into the Midwest, in southeast. That's right. With the work from anywhere trend, you might see this small flattening and not as much of a disparity in home prices between markets. You're certainly still going to see that, but that can just help create a mild flattening when it doesn't matter where you live anymore and you can go ahead and purchase in lower cost markets. Yeah, and what I'm sharing now is national home prices, home price. And I'm glad you mentioned what you just did, Keith, because the fact of the matter is this has been a very localized correction. And if you're in San Francisco or San Jose, if you're in Seattle, if you're in Austin, if you're in Phoenix, you're in markets where prices are off 10% or more from peak.   (00:13:06) - If you're in Boise, Idaho, you're off more than 10% from peak of Boise had oil prices go up by 47% in a single year, a year or so ago. So he just overshot the mark. One of the reasons the national numbers don't show more volatility is because of what Keith just mentioned. It's because people are trading in where they are in a high price, high tax state moving into a lower price state and candidly outbidding local buyers and probably overpaying a little bit for those properties. So you're seeing home prices go up in some of those less expensive markets much more rapidly than they would under normal circumstances. And what we're talking about here is national home prices that are appreciating at a modest rate now. Yeah, and they are. So if you look at whether you're looking at the Case-Shiller index, it gets published monthly or the National Association of Realtors data. We saw home price appreciation start to go down last year. It was still positive but going down and that was true until pretty much the end of the first quarter this year when the data went negative for the first time in years.   (00:14:15) - So we were seeing on both a month over month and year over year basis home prices go down and that happened until June, June, things flatlined in July. Prices actually went up ah, year over year. So if you're looking at the median home price compared to the peak price a year ago, it's actually up about 1% from where we were last year, which is kind of amazing. The Case-Shiller index is a little bit of a lagging indicator and it rolls three months together, but it also started to turn the corner with its July report. So after almost a full year of price appreciation coming down and prices in decline, we've seen both of these indexes turn and are starting to go positive. It does show you that there continues to be demand for properties that are brought to market. And while home price appreciation certainly isn't soaring by any means, it's back in positive territory now. And that's something that a lot of people hadn't predicted this year. When the supply of homes is this low, it keeps generating a few bids for any available home.   (00:15:21) - Now, not as many bids as it did back in 2021. But besides generating bids, you have these huge population cohorts of millennials and Gen Zers that are growing, and they're in their prime homebuyer years moving through the system to go ahead and place those bids and keep just modest home price appreciation here lately. That's sort of how I see it. Rick If you want to add any color or thoughts to that, I think you're spot on. Keith It's the largest cohort of young adults between the ages of 25 and 34 in US history. That's prime age for forming a household. 33 to 34 is the average age of a first time buyer right now. And so these people would like to buy a house. And for people who are investing in single family rental properties in particular, at least short term, the affordability issue is something that definitely works in your favor. If somebody was looking to buy a house, they might prefer to rent a house rather than rent an apartment. I've read research that shows somewhere between 20 and 30% of people who had planned to buy have decided to rent for the next year or two while market conditions settle down or while they can put aside more money for a down payment.   (00:16:27) - These market conditions are playing in favor of people who have rental properties to offer. One other metric I'd like to share in terms of home prices, Keith is the FHFa puts out its own index. FHFa is the government entity that controls Fannie Mae and Freddie Mac. So these are your conventional bread and butter, vanilla kind of 30 year fixed rate loans. If you look at their portfolio, home prices are actually up 3.1% year over year. And every sector of the country is showing positive rice appreciation except for the Pacific states and the mountain states. And those are some of the markets we talked about earlier. And even those are very close to breaking even at this point. So HFA breaks it into about ten regions, nine of those ten currently appreciating year over year. Yep, something like that important for you to know again as an investor as to what's happening in your region. Again, whether you're you're planning to sell the property or rent it out. You talked about what builders are doing for your investor folks.   (00:17:28) - Yeah, we're seeing new home sales actually improving to consumers as well for a lot of the same reasons, incentives. So a lot of builders are coming to the closing table with cash. They're paying points on mortgages and getting those rates down where they're short term or long term. They're offering discounts, they're offering upgrades to properties. And so new home sales are still down, but just slightly on a year over year basis and have actually been beating last year's numbers for the last four months. My original estimate for new home sales this year was about 600,000. I think we're going to probably coming closer to 675,000 this year. And the only reason we won't sell more is because the builders aren't building that fast enough. But one of the reasons people are buying these new homes is because that's what's on the market today. People would have bought an existing home, can't find one. Here's the other factor. New home prices are down 16.4% from last year's peak. Now, this is informative. Think this would surprise a lot of people? Well, it surprises me.   (00:18:28) - It should surprise people because new home prices almost always go up, right? This does not mean builders are discounting homes 16.4%. What's happening is they are building less expensive homes, They're less expensive per square foot, and they're building smaller homes. And they're doing that in acknowledgement of the higher cost of financing. That also, by the way, is in sending people to look at these properties as either a starter home or a minor move up kind of property. But it is one of the reasons why new home sales are doing better than existing home sales right now on a percentage basis. That's an interesting number, Rick. A few weeks ago, I shared with our newsletter audience that builders are building homes smaller and closer together, which might be reflected in lower prices, but just didn't think it would be 16.4% lower from peak. Now, if you're doing year over year, it's probably not that big of a drop, but from the peak price we are off. And it is to your point, it's a pretty significant number.   (00:19:26) - It would be a problematic number if it was the existing home market, right, because then you'd be looking at the same property being worth 16% less. But a builder can kind of play with those numbers a little bit. Single family housing starts after falling for quite a while, are now back going back up only slightly from where they were a year ago, but they are moving in the right direction. Multifamily starts have actually tailed off a little bit after reaching record high numbers. There could be as many as a million apartment units coming to market this year. Yeah, which would be an all time record. So we've seen building on those multifamily units slow down a little bit. If you look at at new home starts for single family properties still below where they were a year ago. But again, for the first time in quite a few months, starting to trend up. A couple of things to share with your viewers here, Keith. In terms of construction, we're seeing construction continue to grow in the multifamily market because of all the starts we saw previously.   (00:20:23) - We are seeing single family construction slowed down, but that's because the builders are working their way through a glut of homes that was under construction. So we had a really weird happenstance about a year ago, a little over year, we had the highest number of homes under construction ever. And this data goes back to the early 1970s, and we had the lowest number of completed properties available for sale ever. And a lot of that was due to supply chain delays and to labor shortages. And over the last year to 15 months, the builders have gradually begun working through this glut of homes that were started but not finished. And we've seen the number of completed homes go up a little bit, almost back to normal levels, not quite there. One of the reasons they're not quite there is people are buying these homes before they're completed. They're working with the builder. Buying a home is it's almost ready to go, but still under construction. What's been encouraging, looking into the future is that permitting has increased a bit over the last two quarters.   (00:21:24) - We know builders are betting on the future. They're not necessarily breaking ground on all these properties they have permits for because they don't want to oversaturate either. And they're being very judicious with their building because they got caught with a ton of inventory during the Great Recession that they wound up selling at fire sale prices. But the trends are long term, looking like they're going in the right direction right now for new homes. So to help the viewer and listeners chronologically, we're talking about housing permits followed by housing starts. And then finally, housing construction. Right? Permits are up, starts are up recently, but down year over year. And the construction numbers are getting back close to normal levels. And we need the builders to build more because even before the rate lock effect took effect and existing home inventory got so scarce we didn't have enough housing in the works, we were depending on whose numbers you believe, somewhere between 2 and 6 million units short. We need the builders to come back to market. Note for your folks.   (00:22:28) - Keith Investors continue to account for a fairly significant amount of activity in the residential market. Over a quarter of home purchases 26% in June, which is the most recent data we have, were made by investors and believe this number actually under reports the number of investor purchases because it's from a company called CoreLogic, it's accurate data for what they count, but they only count investor purchases where the buying entity has an LLC and LP Corp kind of entity. And we know that a lot of buyers don't do that who are investors. So it probably understates it. But the fact of the matter is that historically speaking, 26% of residential purchases being done by investors is pretty high number. That's a pretty high number and as you alluded to, is probably actually higher than 26% of home purchases being made by investors. And so the headlines will breathlessly tell you that Main Street is being gobbled up by Wall Street. Oh, I know. And those institutional investors are evil people. They're buying everything that the truth is is completely the opposite.   (00:23:31) - If you look at investors who are buying properties, it's really the small investors who are buying about 46% of those investor purchases and medium sized investors about 35%. If you're looking at the biggest of the big investors, they're buying less than 10% of what's going out today. And they still own collectively about 3% of the single family rental stock. It's the mom and pop investor who continues to drive the market. Yeah, I'm glad you bring this up, Rick, because there seems to be this outsized perception that institutional money through someone like, say, in Invitation homes is just gobbling up all the good investor homes. And and they're really not. It's mom and pop investors that rule. In fact, there's some legislation pending in D.C. right now that's aimed to keep these institutional investors from doing what they're already not doing and have some tax penalties for anybody who owns. Here's the number that's important. More than 50 properties well, Invitation Homes owns significantly more than 50 properties. I know a lot of medium sized investors who own more than 50 properties.   (00:24:36) - Yeah, they're certainly not institutional investors. They certainly don't have a hedge fund behind them. Important again, for folks in this market to be in touch with their legislators and let them know what's really going on in the marketplace so we don't get this kind of bad legislation. It makes it tough for the average investor to really take full advantage of the opportunities that are out there. 100%. Mom and pop investors might need more than 50 units to obtain financial freedom. Yep. Just to wrap up, Keith, a couple of points on delinquencies and foreclosures. I know a lot of investors got into the business, you know, a decade or so ago and there was just a rash of foreclosure activity and you could buy a distressed property by just walking down the street and knocking on doors. It's a little different these days because of that strong economy we talked about earlier. In that low unemployment rate. Mortgage delinquencies are at an all time low. Mortgage Bankers Association reported that the midpoint of this year, at the end of the second quarter, the total delinquency rate was 3.37%.   (00:25:36) - To put that in context, historically the number is somewhere between 4 and 5%. So not only are we not seeing a lot of delinquencies, we're seeing less than we would see normally as seriously delinquent loans. The ones that are 90 days plus past due is as low as we've seen it in probably the last 6 or 7 years. That's really interesting. So not very many homeowners are in trouble with making their payments, which to some people might seem like a conflict with what we described back in the earlier part of the chat about low savings and higher credit card debt. So many of these homeowners are locked in to these really low payments where they got low mortgage interest rates. Plus inflation cannot touch those fixed rate payments. And that's an important point for those people that are in these homes. It would be more expensive for them to go rent right now, probably because they got such a good deal on the mortgage rate. There's usually a pretty strong correlation between unemployment rates and mortgage delinquency rates. So I mentioned that the most recent report had unemployment at 3.8%.   (00:26:37) - I think at the end of June it was a 3.5%. So we might see delinquency rates tick up a little bit. There was also some really bad social media memeing going on during the government's mortgage forbearance program. There was even an economist who predicted that almost everybody who got a forbearance was going to go into default and that would have been a catastrophe. If you look back a little over a year ago, actually more like two years ago when there was there were a lot of people in forbearance. You saw delinquency rates very high, but that was because people were allowed to miss payments. They were just being counted by the industry as delinquent. The fact is that less than a half of a percent, less than one half of 1% of the borrowers who were in forbearance and there were 8.5 million of them have defaulted on their loans. The overwhelming majority have done very, very well with that program. So it really didn't contribute to any kind of delinquency or default activity. So strong economy, extremely high, low quality because lenders really haven't been making many risky loans since the Great Recession.   (00:27:40) - The record amount of of homeowner equity that's out there. Yeah. Is keeping this market pretty solid to the point where foreclosure activity today is still running at a little bit less than 60% of pre-pandemic levels. So in a normal market, about 1 to 1.5% of loans are in some state of foreclosure. In today's market, it's about a half a percent. So we're just not seeing much go into foreclosure and the properties that go into foreclosure. The homeowners have a significant amount of equity. 92% of borrowers in foreclosure have equity in their homes, which is wildly different from where we were during the great financial crisis, when a third of all homeowners were underwater on their loans. At just about everybody in foreclosure was upside down. And people push back at me when I'm out talking at conferences about this. Keith Oh, yeah, they have equity, but they don't have enough equity to make a difference. Oh, yes, they do. 88% of the borrowers in foreclosure have more than 20% equity. That's typically the magic number that a realtor will tell you you need in order to sell your property and avoid any other kind of complications with one of these foreclosures, preventing any sort of fire sale and lowering of prices that makes all home prices go down in a neighborhood where not anywhere near that.   (00:28:57) - No, not at all. And in fact, some other data that I'll share with you and your listeners is that about 62% of the distressed property sales we see right now are properties in the early stage of foreclosure prior to the foreclosure auction, which means these distressed homeowners are protecting their equity by selling the property before it gets sold at a foreclosure sale. And so they're protecting the vast amount of this equity. But if you're an investor in today's market, there's some really important information in what I just gave you. You can't wait for the bank repossession. In this cycle, bank repossessions are running 70% below where they were prior to the pandemic, so there's fewer properties getting to auction because 67% of these distressed property sales are prior to the auction. Properties that get to auction are selling through at about 60% rate. So there's nothing going back to the lenders. So if you want to buy a property in some stage of foreclosure, your best bet in today's market is to get a list of people in the early stages of foreclosure and reach out directly to them.   (00:30:01) - Your second best bet is to get to that foreclosure auction. Be ready to move at the auction, and your worst bet is to wait for the lender to repossess the property. And in fact, I've seen anecdotal data that suggests that those properties are actually more expensive than the ones you could buy from the homeowner or at the auction because the lenders are fixing them up and selling them at full market price. Good guidance for those chasing distressed properties. So that's what's going on in the foreclosure market. I don't see foreclosure activity being back to normal levels until sometime next year. And I don't see activity bank repossessions being back to normal levels even next year. It's a very different marketplace. This is what I was just talking about. Keith If you were to break up what selling and what stage of the foreclosure process right now, about 64% of distressed sales are taking place prior to the foreclosure auction and less than 20%. Distressed sales today are those background properties. So it's a very different world than what a lot of investors grew up in.   (00:31:03) - Rick is about to share his summary with us, his closing thoughts. Before he does that, I've got two questions for you, Rick. I hear some people out there, it seems to be oftentimes the real estate agent type, maybe that's trying to be a big cheerleader for the market. And I hear a few of them say something like, hey, you know what? You better buy now, because when mortgage rates fall, home prices are really going to shoot through the roof. I don't really know that that necessarily happens because when mortgage rates fall, okay, that might increase demand of capable homebuyers, but it should also increase supply. Now, the mortgage rate lock in effect, goes away and more people will want to bring supply onto the market. And I also like to think about what happens when rates are falling. Typically, that means the economy needs help and unemployment might be a little higher. So my thoughts, Rick, are if mortgage rates do fall substantially, that might help home price appreciation a little bit, but I don't see it as any sure thing that that would make home prices go through the roof.   (00:32:00) - What are your thoughts? It's a great question. You make a very logical argument. A lot of it comes down to supply. And that's where I would hedge my bets. I don't think we see a ton of supply come back to market until rates are back in the low fives. So there's a point and a half of interest going from little over seven to maybe 5.5%, where we're probably going to see more buyers come to market than we're going to see inventory come to the market. My other thought we touched on it earlier is with rents. Talk to me about the future direction of rents. They were horribly hot a year or two ago, up 15% year over year. Rents have moderated substantially. But with this really lousy home affordability and a high homeownership rate, it seems like with this low affordability, we're set up for the homeownership rate to go lower in the proportion that rent go higher, which could put upward pressure on rents over time here. What are your thoughts with rents? Yeah, offsetting what you just said is a record number of apartment units coming to market this year.   (00:33:03) - There are likely to be some markets across the country that wind up oversupplied because of the amount of inventory coming to market. Now, don't get me wrong, the inventory coming to market is going to tend to be expensive inventory. And so that in and of itself could make rent prices come up a bit. I do believe in the short term I would tend to agree with you that the lack of housing stock available for people who would like to buy is going to play in the benefit of the folks who own properties to rent. And that will, I believe, be particularly true for people that own single family residential units that are like houses to rent. I guess we're going to split the difference on these two questions. I'm going to mostly agree with you on the second one. I do believe there's a chance prices will go up a little bit more than you think as mortgage rates come down until we get down to about 5.5%, mortgage rates are lower when we see more of that inventory coming to market. And what is the real wild card in all of this, of course, is what happens with the overall economy.   (00:34:03) - Do we enter a recession? Does unemployment spike? If that's the case, that should weaken, demand a bit and you could have a little bit of an uptick in foreclosures, which will weaken the market as well. So a lot of different components at play. And I think what people ask you questions like that, Keith, about, you know, mortgage rates come down, is this going to happen? They kind of oversimplify the equation quite a bit. There are a lot of other variables that go into it. 100%. Why don't you go ahead and share your closing thoughts with us? A lot of stuff we covered, so I won't dwell on too much of this very long. But from my perspective, a recession is still a real possibility. Probably not until next year if we have one. And if we do, it's likely to be pretty mild and fairly short and we shouldn't see a huge, huge spike in unemployment. I do believe that as the Fed decides it's done raising the Fed funds rate and announces that we'll see mortgage rates gradually decline back toward 6% by the end of this year.   (00:34:57) - And we'll be back in the fives next year. And by the way, historically, every time the Fed has stopped raising the Fed funds rate, we have seen mortgage rates come back down. Existing home sales right now are on pace for their lowest number since 2009. Likely, we're going to see somewhere in the neighborhood of 4.2 million existing home sales. But we're likely to see more new home sales than a lot of people had forecast beginning of this year, maybe 650, 675,000 of those sales in 2023. And we've seen prices decline in the new home market, but they might have bottomed out in the existing home market because of the supply and demand thing that Keith and I have kind of beaten to death during this podcast. Again, importantly for this audience, investors continue to account for a very large percentage of residential purchases and a lot of you seem to be shifting toward buy and hold strategies, which again makes ultimately good sense in a market like today's. And then that anticipated wave of foreclosures that all those folks on YouTube were trying to sell you courses to figure out how to maximize never materialized.   (00:35:57) - And at least during this cycle, not likely to any time soon. Probably won't. Yes, A lot of people a couple of years ago, especially on YouTube, were talking about a certain price collapse is coming and it never happened. And I never saw how it would have happened and I never made those sort of dire predictions. Well, Rick, this was a great chat about the overall economy, the housing market and what investors need with the housing market. I'm sure our audience learned an awful lot. It was a terrific update. If our audience wants to learn more about you and kind of wish this chat would just go on and they could learn more about you and engage with your resources. What's the best way for them to do that? Well, you can certainly follow me on social media. I refuse to say my Twitter handle is just Rick Saga. I'm on LinkedIn to hard to find there. You can also check out my website which is Patrick. Com. Enjoy doing these conversations with you Keith.   (00:36:51) - Think the first time we talked you reached out because I had come down like the wrath of God on somebody who was predicting a housing price crash because I didn't see one coming either and thought he was doing investors a disservice. So keep the faith and keep the good fight going. Keith And I'll be here whenever you want to talk. Jerry Listeners can't stop talking about their service from Ridge Lending Group and MLS 42056. They have provided our tribe with more loans than anyone there truly a top lender for beginners and veterans. It's where I go to get my own loans for single family rental property up to four Plex's. So start your pre-qualification and you can chat with President Charlie Ridge personally, though, even deliver your custom plan for growing your real estate portfolio. Start at Ridge Lending Group. Com. You know, I'll just tell you for the most passive part of my real estate investing personally, I put my own dollars with freedom family investments because their funds pay me a stream of regular cash flow in. Returns are better than a bank savings account up to 12%.   (00:38:00) - Their minimums are as low as 25. K. You don't even need to be accredited. For some of them, it's all backed by real estate and I kind of love how the tax benefit of doing this can offset capital gains in your W-2, jobs, income. And they've always given me exactly their stated return paid on time. So it's steady income, no surprises while I'm sleeping or just doing the things I love. For a little insider tip, I've invested in their power fund to get going on that text family to 668660. And this isn't a solicitation If you want to invest where I do, just go ahead and text family to six six, eight six, six. Hi, this is Russell Gray, co-host of the Real Estate Guy's radio show. And you're listening to Get Rich Education with Keith Reinhold. Don't Quit Your Day dream. Yeah, terrific insight from Rick, as usual. It's remarkable how much this interview is aligned with what we're doing here. As Rick discussed how, though, it's a tough environment for homebuyers, it's better for investors, especially for single family rentals and especially in the Midwest and South are core areas.   (00:39:23) - It's a better market for the buy and hold investor than it is for flippers. It's a tough chase for flippers. Sometimes you don't flip the house, the house flips you. There are still so few homeowners in delinquency and foreclosure. Rick believes that when lower mortgage rates come, home, prices could appreciate more than I tend to think. We'll see how that turns out. And, you know, historically here, as we talk about the direction of home prices and the direction of rent growth Now with respect to home prices, when I provided you with the home price appreciation forecast, I keep somewhat undershooting. The market appreciation tends to outperform what I think by just a bit. Back in 2018, 2019, home price appreciation rates, they were just kind of bumping along at 4 or 5%. Back then, interest rates were super low, housing supply was more balanced. And I said right here on this show then about five years ago, that I don't see what will make home price growth like really accelerate or shoot up from here.   (00:40:32) - Well, then we had the pandemic, something that no one saw coming when the pandemic fog cleared. You remember that all here on the show in late 2021, I forecast 9 to 10% home price appreciation for the coming year, which back then I was talking about 2022. And then that appreciation rate for 2022 came in at 10.2%. Although I was close, I shot just a touch low. Now at the end of 2022, well, about nine months ago, I predicted zero home price appreciation for this year. As we near the fourth quarter, it looks like we'll get low single digit appreciation, but that remains to be seen. However, I've long been undershooting the market just a bit, though. Close and mortgage rates. No, don't even ask me. I don't try I don't make mortgage forecast. That is too hard to do. Making a mortgage rate prediction is almost like a certain way to be wrong. Although Rick and I talked about how this is a good market for investors, to my point from last week, in some markets, cash flow has become an endangered species with some of these increasing expenses for investors.   (00:41:46) - And again, I have some really good news for you here. We have largely solved that problem here at Gray of higher mortgage rates, hurting your cash flow. And that's why investors like you are still snapping up rental properties from Marketplace right now because of the strength of our marketplace network and relationships. Here we have a new build provider offering a mortgage rate to investors of 5.75%. Yes, they will see that your rate is bought down to 5.75%. In today's environment, another new build investment property provider is offering a rate buy down to 4.75%. Yes, you heard THAtrillionIGHT? And we have another builder provider where our investment coaches have been sharing with you a 2.99% seller financing option. There is more to it than that. And these builders, though they are in business to move property. So take advantage of it where you can. And besides buying down your mortgage rate for you like that, some are even waiving their property management fee for you for the first year. In addition to buying down the rate. I don't know how long all that's going to last, so this can be a really good time for you to contact your in investment coach.   (00:43:06) - Your coach will help you shop the marketplace properties, tell you where the real deals are and tell you how to get those improbably low mortgage rates for income properties. Today, your coach guides you and makes it easy for you If you don't have an investment coach yet, just go to Marketplace. Com slash coach and they're there to help you out. And marketplace properties they are often less expensive than elsewhere in addition to the low rates from some of the providers. But now you might wonder why often are the prices not always, but often, why are they lower? Well, first of all, investor advantage markets just intrinsically have lower prices than the national median. And secondly, there is no real estate agent to compensate with the traditional 6% commission, you are buying more directly. Thirdly, these property providers, they are not. And pop flippers that provide investors like you and other people where they just flip like one home a year instead. These are builders and renovation and management companies in business to do this at scale so they get to buy their materials in bulk, keeping the price lower for you.   (00:44:20) - And another reason that you tend to find good deals at Marketplace is that you aren't buying properties from owner occupants where their emotions get involved and they get irrational over there on the seller side. So you can go ahead and get started with off market deals at GRI, marketplace.com. If you'd like the free coaching from our investment coaches, then contact your coach. And if you don't have one yet again you can do that straight at GRI marketplace.com/coach that's an action item for you this week that your future self should thank you for until next week. I'm your host Keith Winfield. Don't quit your day dream.   (00:45:04) - Nothing on this show should be considered specific, personal or professional advice. Please consult an appropriate tax, legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of Get Rich Education LLC exclusively.   (00:45:32) - The preceding program was brought to you by your home for wealth building get rich education.

In many world nations, if you're born poor, you stay poor. I discuss how in America, you can be upwardly mobile. Back in 2010, real estate prices had fallen, but rents had not. This created years of cash flow. Today, as prices have outpaced rents, cash flow keeps shrinking. Our Investment Coaches have access to income properties with 4.75% and 5.75% mortgage interest rates. It's a way to "bring back cash flow". Get started at GREmarketplace.com/Coach Terrific housing intelligence analyst Rick Sharga joins us for the first of two consecutive episodes. Rick & I discuss the condition of the American consumer, inflation and interest rates, concerns about a potential economic downturn, the housing market, the impact of consumer confidence on spending, and the actions taken by the Federal Reserve to control inflation.  There's flagging consumer confidence and a yield curve inversion. Are these finally harbingers of an economic recession? Rick's informal survey of economists find that there's a 50-50 chance of a recession this cycle. Earlier this year, 80% of economists felt that a recession was imminent. If there is a recession this cycle, Rick thinks there's a probability that it will be mild. Average hourly wages are $28-29 / hour. Wage growth is 4-5%. Wages are finally running higher than home price appreciation. Timestamps: The Future of Real Estate Investing [00:01:33] Discusses how owning real estate can help individuals move into a different wealth class and the benefits of owning rental properties. Changes in the Real Estate Market [00:04:06] Explains how the real estate market has changed over the years, with property prices catching up to rents and the decrease in cash flow opportunities. Taking Advantage of Low Mortgage Rates [00:07:53] Highlights the opportunity for investors to take advantage of low mortgage rates offered by builders and the benefits of using their preferred lenders. (Yes, even here in 2023. We have 4.75% and 5.75% rates that builders buy down.) The housing market correction [00:11:31] Discussion on the correction in the housing market and its localized impact on different regions. Economic landscape of the United States [00:16:09] Overview of the US economy, including GDP growth and the strength of consumer spending. Wage growth and home price appreciation [00:20:16] Comparison of wage growth outpacing home price growth, impacting housing market affordability. Consumer Confidence and Spending [00:21:24] The correlation between consumer confidence and spending during the pandemic, the impact of subsequent waves of COVID, and the role of pent-up consumer demand and government stimulus. Red Flags in Consumer Spending [00:22:25] The disconnect between consumer spending and low confidence scores, the record level of consumer credit card use, and the decrease in personal savings rates. Inflation and the Federal Reserve [00:25:44] The high inflation rate in 40 years, the actions taken by the Federal Reserve to control inflation, the impact on housing costs, and the potential for a recession. Yield Curve Inversion and Recession Predictions [00:31:07] Discussion on the yield curve inversion and its historical correlation with recessions. Impact of Recession on the Housing Market [00:32:04] Exploration of the potential impact of a recession on the housing market. Part Two: State of the Housing Market and Future of Investment Real Estate [00:33:03] Teaser for the next episode, which will analyze the state of the housing market and the future of investment real estate. Resources mentioned: Show Notes: www.GetRichEducation.com/466 Rick Sharga on X (Twitter): @RickSharga Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Invest with Freedom Family Investments. You get paid first: Text ‘FAMILY' to 66866 Will you please leave a review for the show? I'd be grateful. Search “how to leave an Apple Podcasts review”  Top Properties & Providers: GREmarketplace.com GRE Free Investment Coaching: GREmarketplace.com/Coach Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free— text ‘GRE' to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Keith's personal Instagram: @keithweinhold   Keith Weinhold (00:00:01) - Welcome to. I'm your host, Keith Weinhold. Today, it's part one of two of my exclusive interview with one of the nation's foremost housing intelligence analysts. How's the condition of today's American consumer? What's the future of inflation, the Fed interest rates? And should you really be concerned about a downturn today on get rich education?   Corey Coates (00:00:28) - You're listening to the show that has created more financial freedom than nearly any show in the world. This is Get rich education.   Keith Weinhold (00:00:51) - Welcome from Orange County, Florida, to Orange County, California, and across 188 nations worldwide. You're listening to one America's longest running and most listened to shows on real estate. With nearly nine years of weekly episodes. You're listening to Get Rich Education. I'm your host, Keith Wine expert, housing and mortgage analyst Rick Sugar is back and he is figuratively waiting in the wings. Here to give us an update on the economy shortly. In many nations of the world, if you are born poor, you stay poor. It's really hard to change wealth classes because you can't own anything in so many world places.   Keith Weinhold (00:01:33) - If you're born middle class, you also stay middle class. There's no way out of that. Owning real estate is the number one way to move yourself into a different wealth class. Owning your own business is another way, but with owning real estate, it's quite easy to follow a template and do what someone else has already done. Within a proven system. You don't have to have a new out-of-the-box business idea. For example, in the US, if you start collecting assets that pay you each month, you can quickly become upwardly mobile. In America, even if you were born into poverty and have a long line of impoverishment in your family, you can own your own home and that can help you go from poor to middle class. You can add rental properties and go from poor or middle class to wealthy because if you're in the US you are allowed to own things. Yeah, keep accumulating properties and keep getting rent money from tenants. In so many nations of the world. If you come from modest means, you just cannot get dozens of people or hundreds of people to pay you one third of their income every month.   Keith Weinhold (00:02:52) - But here you can get all these tenants to pay you one third of their salary in rent so you can close that class divide. It's up to you. That's what makes the US great. You can move into a different wealth class, the GSEs, the government sponsored enterprises. They will even give you backing on a bank loan so that you can do this. They're really encouraging this and enticing you to do this with as little as a 3% down payment on your primary residence or 20% down on rental properties. It's like they're almost forcing you to succeed. And there's even a 1% down program for primary residences now available in some places. So the bank gives you the loan, the tenant pays you the rent, and the government gives you the tax break. Like I say, that right there is using other people's money three ways at the same time, the bank, the tenant and the government, it all sort of falls in your lap if you want it to, but you do have to ask for it and you do have to do some arranging and you need to be diligent and attentive to.   Keith Weinhold (00:04:06) - But most Americans, they just aren't wise to this. Now, the real estate market, it has changed from a few years ago. It was spring of 2020 where we had that big inflection point, as you know, because I often discuss it. That was that supply crash. And since that time, home prices have run up faster than rents. But I'd like to give you some broader perspective here. There's something important with real estate investing that you may not have realized coming out of the global financial crisis 2008, 2009, 2010. At 2010, when we really started to lift up out of the rubble because by 2010, property prices were still down low. They were near the rock bottom. They're even lower than replacement costs in a lot of markets, which was artificially low. But see, rents didn't really fall much in the GFC. Rents stayed the same. So you know what happened in 2010 and all the years following it will cash flow began. And that's because all over America you then had these high rents and low purchase prices that had been beaten down by the GFC.   Keith Weinhold (00:05:18) - Cash flow like that wasn't really normal, but by now property prices have caught up to rents and even surpassed them. So besides investors being used to low mortgage rates, these ultra low rates, they also got used to this ultra high ratio of rent income to purchase price. That's just not there like it used to be. So today, in more places, you can't expect much of anything for cash flow now with a few years of. Income property ownership. Say if you bought something late this year, a few years later, now you shouldn't count on it. But rents, as we know, historically rise to then start providing you with cash flow to complement the other four ways that you're simultaneously paid. So my point is that today the deals aren't as good as they were ten years ago and five years ago, and that is all part of the provenance and perspective that I'm sharing with you from the real estate investing landscape starting from back around 15 years ago. But today I posit that it is still difficult to find a better place to invest a dollar than with a loan on carefully bought income property.   Keith Weinhold (00:06:31) - And I have some really good news for you here. All right. We know higher mortgage rates. They're not just a pain point for first time homebuyers and second time homebuyers for that matter, but they're a pain point for you, the investor. Well, if you didn't already know, we have largely sort of that problem here at Gray. And that is why investors like you are still snapping up rental properties fast. From Marketplace today, owner occupied mortgage rates are about 7% in income. Property rates are about 8%. But because of the strength of our marketplace networks and relationships here we have one new build provider offering a mortgage rate of 5.75%. Yes, they will see that your mortgage rate is bought down to 5.75% for your purchase. Yes, right here in today's environment, another new build investment property provider is offering a buy down to 4.75%. Yes, you heard that right. And we have another builder provider where our investment coaches have been sharing with you a 2.99% seller financing option. So is cash flow back? Yes, a lot of times it is.   Keith Weinhold (00:07:53) - The builders know that it's a pain point for buyers and our coaches and I hear a Gary know it too, So we have rubbed salve on the wound here, I suppose. 5.75% interest rates, 4.75 or even 2.99. At times you'll have to use the builders preferred lender to get those terms. Otherwise I like to use Ridge lending Group because they specialize in income property loans. There is even more to it. These builders are in business to move property, so take advantage of it. And besides buying down your mortgage rate for you like that, some are even waiving their property management fee for you for the first year, in addition to buying down the rate and don't know how long all this is going to last. So this could be a really good time for you to contact your investment coach. Your coach will help you shop the marketplace properties, tell you where the real deals are and tell you how to get those improbably low mortgage rates for income properties. Your coach guides you and makes it easy for you If you don't have an investment coach yet, just go to Marketplace slash coach and they're there to help you out.   Keith Weinhold (00:09:11) - Hey, it's really great to have the savvy and the experience of Rick Shaka back on the show today. His mind is always in the market. He's often doing these public speaking appearances informing audiences about it. He's been the executive vice president of markets at some of America's leading housing intelligence firms. We have so much to discuss that Today's episode is part one of two back to back episodes with Rick. This week, we'll discuss the direction of the economy. Next week, we'll go deep on the housing market. But even our discussion on the economy today is probably going to be viewed through the lens of having real estate investors in mind. So this intelligence is fresh and it is timely here in fall of 2023. But even if you're listening to this, a decade from now, in 2033, you are going to get lessons for all time. It's the economy this week and the real estate market next week. It could be a day or two until we have today's episode on Get Rich Education YouTube. But you can watch us there as well if you want the visuals and charts that complement our discussion.   Keith Weinhold (00:10:19) - Many of the sources that he cites today will be from Trading economics in the US Bureau of Economic Analysis. What's the present and future of the economy, especially as it pertains to real estate investor interest with Rick and I straight ahead. I'm Keith Reinhold in this is get rich education. Jerry listeners can't stop talking about their service from Ridge Lending Group and MLS 42056. They've provided our tribe with more lows than anyone. They're truly a top lender for beginners and veterans. It's where I go to get my own loans for single family rental property up to four Plex's So start your prequalification and you can chat with President Charlie Ridge personally, though, even deliver your custom plan for growing your real estate portfolio. Start at Ridge Lending Group. You know, I'll just tell you for the most passive part of my real estate investing personally, I put my own dollars with Freedom Family Investments because their funds pay me a stream of regular cash flow in. Returns are better than a bank savings account up to 12%. Their minimums are as low as 25.   Keith Weinhold (00:11:31) - K. You don't even need to be accredited. For some of them, it's all backed by real estate and I kind of love how the tax benefit of doing this can offset capital gains and your W-2 jobs income. And they've always given me exactly their stated return paid on time. So it's steady income, no surprises while I'm sleeping or just doing the things I love. For a little insider tip, I've invested in their power fund to get going on that text family to 668660, and this isn't a solicitation If you want to invest where I do, just go ahead and text family to 66866. This is real estate investment cogeneration. Listen to get Rich education with Keith Reinhold and don't quit your day dream. And you're going to get a fantastic market update today. And you're also going to learn lessons even if you're consuming this 5 or 10 years from now. Our expert guest was first with us here six months ago. He's been the executive VP of markets at some of America's leading housing intelligence firms. He was twice named to the Inman News Inman 100 most influential real estate leaders.   Keith Weinhold (00:12:54) - He is one of the country's most frequently quoted sources on real estate, mortgage and foreclosure markets. You've seen him seemingly everywhere CNBC, CBS News, NBC News, CNN, ABC News, Fox, Bloomberg in NPR got about just every letter of the alphabet in there on that one. Today, he's the founder and CEO of J. Patrick Company. They're a market intelligence firm for the real estate and mortgage markets. He has 20 plus years of experience in those industries. Hey, welcome back to Rick Saga. Thank you for having me, Keith. Happy to be here. It's an interesting time. Rick. I think some people are rather confused because you have such unusually low housing supply still. You have higher mortgage rates and we're careful not to call them high mortgage rates because we know historically they're pretty normal. And you have what I would characterize is a rather distinct regional variation in home price appreciation. So we're going to get some clarity today from that confusion. Now, if you're listening on audio only, Rick will describe the charts in a way that gives you a good experience.   Keith Weinhold (00:14:03) - If you're watching this on YouTube, go ahead and give us a like. So we really anticipate, Rick, your take on both the broader economy first and then the real estate market. That's exactly what we're going to go over today. And before we get started, I think you said something I'd like to emphasize a little bit. And this is something we talked about. I believe the last time we chatted is I've been saying all along that we were not going to see a housing market crash. We were going to see a correction of sorts and that the correction was going to be very, very localized. That the results you see in coastal California, in the Pacific Northwest, in markets that were overpriced, like Boise and Salt Lake City and Phoenix and Austin, we're going to be very different than what you saw on the East Coast, particularly the southeastern states, places like Tennessee and Florida and the Carolinas and virtually everywhere else in Texas other than Austin. So it's really worked out that way. There are some markets where we're seeing double digit price declines and other markets where prices continue to go up.   Keith Weinhold (00:15:05) - And we'll get into the national trends in a minute. But thought that was a really important point. Keith Yeah, Thank you for adding that, at least for a while there. Rick. It was one of the most unusual home price appreciation maps I have ever seen. There were some exceptions, but generally the nation east of the Mississippi River, you had rising home prices and recently west of the Mississippi River, you had falling home prices like a river divided it. It was really weird. To your point, it's normalized a little bit. I live in California. Speaking of weird and the pricing out here, the month over month prices and year over year prices went down for the first time in quite a while for about four consecutive months before normalizing in July. Now, even within California, you see different price trends depending on where you are in the state. But the point is really important for investors to remember that you almost threw the national numbers out, that they're important from a trend perspective, but you really need to become an expert in whatever market you happen to be investing in because the local conditions really determine how successful you're going to be.   Keith Weinhold (00:16:09) - Like the national outdoor temperature average is pretty useless, almost somewhat like the national home price average is. I guess the national home price average Still has some meaning to it though. Yeah, and you don't find quite as much variation in home price trends as you do in temperatures, but your points well taken. And again, it's important to be looking for economic trends. It's important to be looking for housing market trends and the markets that you're interested in investing in because that makes all the difference. So we're just going to talk about the general economic landscape of the United States, and then we're going to pivot into real estate and just what's going on with the housing market and getting the latest there. Yeah, why don't we jump right into it at this point, Keith, We're going to do a fall update on the housing market for this year. We're going to take a look at the economy. We'll take a look at what's going on in housing. I have a few slides to share on what's going on to delinquencies and defaults because I know a lot of investors are interested in foreclosure properties.   Keith Weinhold (00:17:11) - And then we'll have some closing thoughts and then you can chat a little bit more about some of the observations we're making in the market today. Let's start talking about that economy, including that part where some people anymore, year after year, they're always predicting this recession that never quite seems to happen. Well, we have predictions of a recession that are very much like predictions of a housing crash. And if you keep predicting that terrible thing long enough, someday you'll probably be right. It'll be right eventually. Just like a broken clock is right. Broken clock. It's right twice a day. So the GDP, the gross domestic product is the way that that most economists measure the strength of the economy. And the second quarter, this number was just adjusted downward a little bit, but we still had over 2% growth for the second quarter of 2023. That was a higher number than most economists had forecast. It was certainly a higher number than what the Federal Reserve was expecting. But it really shows you the strength of the US consumer.   Keith Weinhold (00:18:09) - A lot of people probably don't realize that almost two thirds of the GDP is comprised of consumer spending. There's other factors that go into it business spending, government spending, productivity, trade and the like. But two thirds of it is consumer spending. So when you see the GDP showing strong numbers, it typically means that the consumer is doing pretty well. And that's an important consideration as we move forward. Yeah, that's right. One of those reasons consumers are spending is because we're in this economy where pretty much if you want to have a job, then you've got a job. Yeah. The headlines read about tech companies doing layoffs and mortgage companies doing layoffs. Bottom line is the most recent unemployment numbers we saw were 3.8%. I think we're getting a little spoiled by some of these low unemployment rates because people forget historically, anytime you were under 5% unemployment, it was considered full employment. And the fact of the matter is there's still more jobs open than there are people looking for work. There's about 9.5 million open jobs in about 6 million people who are looking for work.   Keith Weinhold (00:19:11) - So employers have to compete with each other for those employees. And so these low unemployment levels are actually one of the things that's causing wages to go up, which continues to stoke inflation when there are more open jobs than there even are workers that makes employers want to entice employees with higher pay. Yeah, they need to do that to keep employees on the payrolls and they need to do that to hire new employees. So whether you look at hourly wages, which at the moment are up around 28, $29 an hour, or you're looking at annual wage growth, which is running around 4 to 5% a year. Wages are very strong right now. And this is the first time, Keith, in many years that I've been able to tell people that wage growth actually is running higher than home price appreciation for well over a decade. We saw home prices appreciate much more rapidly than we saw wages. And this is the first time in a while where that situation has been reversed. That's a really interesting takeaway, Rick.   Keith Weinhold (00:20:16) - Wage growth that's outstripping home price growth and that's going to be important going forward because one of the big headwinds that the housing market faces today is affordability. Despite what we just talked about, home prices nationally are running at all time high levels. We're going to talk about the cost of financing be much higher than it was just a year ago. And wage growth is the one positive in that category. As wages continue to grow and if home prices settled out a little bit, affordability ultimately will be a little bit better for potential homebuyers. Average wages at 28 to $29 an hour, Americans are basically making a dollar every two minutes now yet could be worse. And that varies, again, market to market, shock to job, but it shows you what's going on on average, partly because of this, consumer spending continues to be very strong. But one of the the real unusual situations we're looking at today is that there's usually a direct correlation between consumer confidence and consumer spending. And the more confident consumers feel about things, the more willing they are to spend money, particularly on big ticket items like cars and houses.   Keith Weinhold (00:21:24) - And that was all true. And the correlation held true until we hit the pandemic. And as we started to come out of the first wave of Covid, you saw consumer confidence start to go up, but then it came back down as we had subsequent waves of Covid. Then we had the war in Ukraine that we had high inflation and all sorts of other odds and ends. And consumer confidence has really never recovered back to pre-pandemic levels while consumer spending has continued to go up. And part of that is pent up consumer demand. We still hear people talking about supply chain delays, trying to order appliances and the like and having to wait for months. Part of it is all the stimulus money that the government poured into the economy during the pandemic and probably overstimulated the economy to a certain extent. One of my economist friends refers to what the government did in terms of stimulus, is trying to stuff $15 trillion into a $3 trillion hole. And the numbers may be a little lost. But think the visuals is image is kind of good.   Keith Weinhold (00:22:25) - But this disconnect we're seeing between. How much money consumers are spending and their relative low confidence scores is a red flag of sorts in a couple of ways. It's a red flag, among other ways, in that if consumer confidence doesn't recover, consumers ultimately could pull back on spending, and that really could ultimately lead us into a recession. Consumer spending outpacing consumer confidence. There are other two other red flags with this consumer spending, and we'll cover them pretty quickly. What is that? Consumer credit card use is at an all time high in the last quarter. For the first time ever, consumer credit card use topped $1 trillion. And the concern here is that consumers in a high cost of living environment may be tapping into credit cards to make ends meet. That's not a good scenario and ultimately is not a scenario that would end well. So part of what we're seeing kind of backstopping or enabling consumer spending is an increased amount of credit card use. The other red flag, Keith, is that consumer personal savings rates have gone down below historic averages.   Keith Weinhold (00:23:33) - So we hit an all time high in savings rates during the pandemic when the government sent out stimulus checks and unemployment benefits were enhanced. And candidly, there wasn't a lot consumers could buy. So they socked away a lot of this money post-pandemic. We saw savings rates drop down to almost historically low levels and they haven't come back much up from that. So the two red flags that we really are looking at right now, that could be indicators of trouble ahead for the economy are record level credit card use and lower than average savings rates. And again, both of those suggest that families who are sort of on the margins financially might be tapping into credit cards, might be tapping into their savings to make ends meet. In fact, I read some recent research that suggests that on average, most households have higher credit card debt than they have savings. It's not a great scenario, and this is consistent with many sources citing the fact that between 60 and 70% of Americans live paycheck to paycheck. Yeah, and it almost doesn't matter how high that paycheck is, which is a little bit counterintuitive.   Keith Weinhold (00:24:43) - I remember doing an interview on CNN years ago when Evander Holyfield mansion was being foreclosed on. It was a $30 million mansion outside of Georgia with two bowling alleys, swimming pool, indoor boxing rinks, basketball courts, the whole nine yards. I had to explain to the reporter that just because you're wealthy doesn't mean you're not living paycheck to paycheck. It's just sometimes there's more zeros to the left of the decimal point. Their cost of living tends to be much higher. So expenses are keeping up with income. All right, Expenses keep up with income. What's been going on in terms of consumer spending, in terms of wage growth, in terms of the GDP being strong has all contributed to inflation. And we had the highest inflation rate in 40 years. Not too long ago, we were up over 9% inflation year over year. And the Federal Reserve has taken very aggressive actions to try and get inflation under control. The primary tool they use is raising the Fed funds rate, which is basically what sets the rates on all short term interest.   Keith Weinhold (00:25:44) - And they've raised it more rapidly and higher than it pretty much any time in history. If you go back to the 80s, they actually raised the Fed funds rate higher because inflation was completely out of control then, but not as quickly as they did this time. So typically what you see is something more like what the Fed did say back in the 2015, 2016 period, where inflation ticked up a little bit. So they raise the Fed funds rate a little and they waited a while to see what kind of impact it would have. Then they raise it a little bit more and it's kind of a step by step process until they feel that inflation is peaked and they can then drop off the Fed funds rate. This time they raised it at higher increments they'd ever done before and much more rapidly. The good news is it does seem to be having its effect. The most recent inflation numbers are around 3% year over year, which is close to the Fed's target rate of 2% year over year. And a lot of the inflation rate that is reported on is housing costs.   Keith Weinhold (00:26:42) - And most of the housing costs are actually rental rates or what the Fed refers to is the rental equivalency. If you have a mortgage. And what we have seen is rental rates have gone back down from ridiculously high, asking prices. A year or so ago, it wasn't unusual to see an asking rent 15% higher than the prior rent rate. And that's in a market where the usual increase is 1 to 4%. So it was just completely off the charts. Those numbers have all come back to normal. And in some markets, we're actually seeing slight declines in year over year rental asking prices. The reason the Ric is bringing rents into the inflation discussion here is because rent and something called owners equivalent rent are a substantial contributor to the. They comprise more than a third of the CPI basket. Exactly right, Keith. And thank you for reminding me why I started this dissertation. The fact is that that decrease in rental costs has not hit the Fed's inflation numbers yet. There's about a full year lag in the housing numbers that the Fed uses in its CPI analysis and what's going on in the real market.   Keith Weinhold (00:27:52) - So if the Federal Reserve does nothing else, these housing costs get caught up. We will see inflation come down a little bit more. A lot of us are hoping that the Fed is done with its increases because of what's happened historically. Historically speaking, if you go all the way back to World War Two, the Federal Reserve not counting this cycle, has raised the Fed funds rate 11 times to get inflation under control. Eight of those times it's waited a little bit too long or it's waited for inflation until inflation got too high and it was a little bit too sticky and they had to overcorrect. And that ultimately steered us into a recession. There were three times once in the 60s, once in the 80s and once in the 90s where the Fed acted proactively to try and get inflation under control. And in those three cases, they were able to steer us into a soft landing and avoid a recession. In this case, they've already admitted they waited too long. They admitted that inflation got much higher than they expected.   Keith Weinhold (00:28:48) - It certainly wasn't as transitory as they'd hoped. So the likelihood is that they've already overcorrected and we will see something of a recession. They may get lucky this time. They may have actually walked the tightrope correctly. And assuming they don't continue with this aggressive course of action, they may have actually managed to work us into a soft landing this time. Yeah, and that is a terrific history lesson that you gave us, Rick. I often like to tell my audience about when you want to predict the future direction of something. I'd like to take history over hunches. It's easy to have a hunch that something's going to go a certain direction. But you look at history. You talked about basically how the Fed was late to identify inflation because they had called it transitory for a while, so they started hiking too late. Now, maybe they've overhyped or maybe they haven't. But if they have, maybe they will need to lower them too quickly. If they don't have that desired soft landing. The economists that follow right now are split about 5050 on whether we'll actually see a recession coming out of this cycle.   Keith Weinhold (00:29:51) - It was more like 8020, looking for a recession just a few months ago. Right. The economy is slowing a little bit. The last jobs report had about 187,000 jobs created, which was a good number, but it was lower than what we've seen in recent reports. So the economy slowing down, but not going to full stop or going into negative terms is an indication that maybe we do escape a recession. Good news, by the way, is even if we do have a recession, the rest of the economic measures that you look at are also strong, that it's very likely it would be a very short and very mild recession, and unemployment probably wouldn't get over about four and a half or 5%. So that's something to keep in mind as you go forward. You talked about history, Keith. I big on that too, history as a predictor of what might happen. Yeah. The other thing that points to a recession is something called a yield curve inversion. And without getting too inside baseball on people, people track the yield on a ten year US Treasury and they track the yield on a two year US Treasury and typically your yield on a short investment like a two year Treasury is lower than your yield on a ten year or longer investment because there's more risk involved in the longer time period and so forth and so on.   Keith Weinhold (00:31:07) - Every now and then, the bond market senses a disruption in the force. Darth Vader is looming over the market and you see these things switch places and suddenly the yield on a ten year US Treasury is lower than the yield on a two year US Treasury, and that's called a yield curve inversion. Now yield curve inversion doesn't cause a recession, but the last seven times we've had one, it's correctly predicted that a recession was coming and this current period we're in is one of the longer and deeper inversions that we've ever seen. So again, if you look at history as a predictor of the future, this yield curve inversion points toward us having a recession at some point before we get through the cycle. And I know yield curves can confuse a lot of people. If you're the listener or the viewer here, make a very long term loan to a friend, well, you'd want to get compensated with a higher interest rate for that higher risk amount than if you made a short term loan to a friend and he was paying you back.   Keith Weinhold (00:32:04) - Tomorrow, you might not charge him much of any interest at all because there's more certainty that you're going to get paid back. But that condition has been inverted, where when you make the long loan to the buddy, you're compensated with a lower interest rate yield. That is what is known as a yield curve inversion. Yeah. And I think yield curve throws people off. If you just think of it in terms of the yields, that probably makes it simpler. But again, if you're looking at recession predictors, these are the two. That I typically look at. And that's kind of important to know if you're going to be investing in the housing market because recessions can have an impact on the housing market. Rick thinks there's a likelihood that the Fed has already overcorrected with too many interest rate increases. If we do have a recession, Rick believes that it's most likely to be mild without many layoffs. Rick and I, we actually seem to agree on a lot of things. We see a lot of things the same way.   Keith Weinhold (00:33:03) - Maybe it would be more interesting for you if we disagreed a bit more to stay up on the latest moves in the real estate market. You can follow Rick Saga on X, formerly known as Twitter. His handle there is simply Rick Saga. Well, Rick made a Darth Vader reference there. And, you know, much like the original Star Wars movie had the sequel, which was called The Empire Strikes Back. You know, that was one sequel that some people liked more than the original. And that is atypical because usually people like the original more. But The Empire Strikes Back was a fantastic sequel, and I think that could happen here next week. Rick and I are back together for part two of two, the sequel. We are probably going to analyze and break down the state of the housing market and the future of investment real estate. And we should go on for twice as long on that as we did for today on the economy. So therefore, next week is kind of like the Empire Strikes Back, although I don't expect that next week Darth Vader is going to cut off Luke Skywalker's hand like what happened in the movie.   Keith Weinhold (00:34:10) - That just wouldn't be proper. And we're clearly not into improprieties around here.   Darth Vader (00:34:18) - You are unwise to lower your defenses.   Keith Weinhold (00:34:23) - Oh, Luke lost his hand this week. Not next week. Well, that's not even the scene where Luke loses his hand, But, hey, that totally worked. So. Getting back to real estate here, you need properties to be an investor. The builders know that higher mortgage rates are a pain point for buyers. Our coaches and I hear a know it too. So we have. Yes. Rubbed salve on the wound 5.75% interest rates, 4.75% or even 2.99%. And at times you're going to have to use the builder's preferred lender in order to get those terms. But really some remarkable Bibles that we've negotiated for you. So take advantage of it since I don't know how long that is going to be around. In fact, I'll even bring up those rate by down terms to Rick Saga next week and get his take to help you out on the cash flow side. We also have access to properties that would make good mid term corporate rentals in the southeastern US midterm rentals.   Keith Weinhold (00:35:27) - They often have higher cash flow than a traditional long term unfurnished rental. For any and all of that, contact your investment coach, you're probably working with one by now. They'll help you shop the marketplace properties, tell you where the real deals are and tell you how to get those improbably low mortgage rates for income properties. Your coach guides you and makes it easy for you If you don't have an investment coach yet, just go to Marketplace. Com slash coach and they're there to help you out until next week I'm your host Keith Winfield. Don't quit your Adrian.   Speaker 4 (00:36:08) - Nothing on this show should be considered specific, personal or professional advice. Please consult an appropriate tax, legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of Get Rich Education LLC exclusively.   Keith Weinhold (00:36:36) - The preceding program was brought to you by your home for wealth building. Get rich education.

Home prices were supposed to crash…right? Not quite. If you were hoping to snag a steal of a deal on your first home, we've got some bad news. But, if you're a homeowner or investor who was crossing their fingers that their equity would stay stable, things are looking good! As the housing market begins to “adjust” back to normal, investors are asking themselves, “What happens next?” We brought repeat guest and fan-favorite Rick Sharga, founder of CJ Patrick Company and former EVP of Market Intelligence at ATTOM, back on the show to share the findings of his most recent investor survey. Rick and his company have been tracking the sentiment of small retail investors—a dataset we rarely get to hear about—and he has some news to share. Investors are thinking about the housing market differently than most would assume. With high mortgage rates and financing fatigue, rental property investors and active house flippers have the same thought: things could get better soon. But what could change? Will inventory ever rebound? And what could cause another hot housing market? All that, and more, in this episode! In This Episode We Cover: The one investment strategy that has been dramatically declining (and why it may have a comeback) Home prices and whether or not we've bottomed out already What small retail investors think will happen next in the housing market The #1 challenge investors are facing today (and when this could improve) An “inflection point” for real estate and whether competition will heat back up Fixing the inventory problem and how long it will take to return to “normal” levels Declining and rising real estate markets that Americans are moving away from/to And So Much More! Links from the Show Find an Agent Find a Lender BiggerPockets Forums BiggerPockets Agent BiggerPockets Bootcamps Join BiggerPockets for FREE On The Market Join the Future of Real Estate Investing with Fundrise Connect with Other Investors in the “On The Market” Forums Subscribe to The “On The Market” YouTube Channel Dave's BiggerPockets Profile Dave's Instagram On The Market Podcast 17 On The Market Podcast 66 BiggerPockets Real Estate Podcast 604 Investor Sentiment Survey Connect with Rick: Rick's LinkedIn Rick's Twitter Rick's Website Click here to listen to the full episode: https://www.biggerpockets.com/blog/on-the-market-131 Interested in learning more about today's sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com. Learn more about your ad choices. Visit megaphone.fm/adchoices

Today, Jason is joined by Rick Sharga of ATTOM Data Solutions, licensor of the nation's most comprehensive foreclosure data and parent company to RealtyTrac (www.realtytrac.com), a foreclosure listings and search portal. Is there a looming housing crisis? Not according to the data! Listen in and get the facts minus the misinformation and hype from the YouTube click bait sensationalist ‘chicken littles'! Know the facts and data that will serve as an indicator of trends  in the single-family housing investment space across different markets. Note: This interview was done last December 2022. Rick is now with https://cjpatrick.com/   Quotables: “93% of the people in foreclosure have positive equity.” – Jason Hartman “Our data shows that about 6% of homeowners nationally are underwater on their loans. There's half a percent of homeowners who are in foreclosure.” Rick Sharga Mentioned: Altos Research Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

Will we see home prices go any lower? Will we see a rise in foreclosures? When will mortgage rates come back down to earth? Is it best to keep a bunch of cash on the sidelines so we can scoop up all the good deals when we are hit by recession? Where does it make sense to buy rental property in this economy? In this episode, you'll hear from someone who can answer those questions and more to help you as an investor make better decisions during these uncertain times. Rick Sharga has more than 20 years of experience in the real estate and mortgage industries and is the Founder & CEO of market intelligence and advisory firm CJ Patrick Company. He has also served as the Executive Vice President of Market Intelligence for ATTOM Data, Carrington Mortgage Holdings, and RealtyTrac's Marketing Department, as well as Chief Marketing Officer for Ten-X and Auction.com. Over his long and distinguished career, he's become one of the most frequently quoted experts on real estate, mortgage and foreclosure trends. If you want to expand your real estate investing horizon, and would like a referral to one of our proven property teams in places like Texas, Florida, and the Carolinas, please hit the “Join for Free” button. Once you are a member, you will have access to our investment counselors, and trusted real estate professionals that can help you reach your investment goals. To find out more about our North Dallas Rental Fund, mentioned during this interview, please go to growdevelopments.com.  And please don't forget to subscribe to this podcast!  Thanks for listening! Kathy Fettke  

Today, Jason is joined by Rick Sharga of ATTOM Data Solutions, licensor of the nation's most comprehensive foreclosure data and parent company to RealtyTrac (www.realtytrac.com), a foreclosure listings and search portal. Is there a looming housing crisis? Not according to the data! Listen in and get the facts minus the misinformation and hype from the YouTube click bait sensationalist ‘chicken littles'! Know the facts and data that will serve as an indicator of trends  in the single-family housing investment space across different markets. Note: This interview was done last December 2022. Rick is now with https://cjpatrick.com/   Quotables: “93% of the people in foreclosure have positive equity.” – Jason Hartman “Our data shows that about 6% of homeowners nationally are underwater on their loans. There's half a percent of homeowners who are in foreclosure.” Rick Sharga Mentioned: Altos Research Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

Today, Jason is joined by Rick Sharga of ATTOM Data Solutions, licensor of the nation's most comprehensive foreclosure data and parent company to RealtyTrac (www.realtytrac.com), a foreclosure listings and search portal. Is there a looming housing crisis? Not according to the data! Listen in and get the facts minus the misinformation and hype from the YouTube click bait sensationalist ‘chicken littles'! Know the facts and data that will serve as an indicator of trends  in the single-family housing investment space across different markets. Note: This interview was done last December 2022. Rick is now with https://cjpatrick.com/ Quotables: “93% of the people in foreclosure have positive equity.” – Jason Hartman “Our data shows that about 6% of homeowners nationally are underwater on their loans. There's half a percent of homeowners who are in foreclosure.” Rick Sharga Mentioned: Altos Research   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com  

In today's episode, Rick continues his series of charts that show where the current local housing markets are. See prices declining most rapidly in western states while Jason's linear markets like Alabama and parts of Florida continue to  increase. Migration patterns, job and population growth are factors in local markets are things investors need to understand if they are to succeed and make profits. You almost have to ignore these national headlines that do not inform you of these critical local market trends.  Discover how most states experienced price increases in March, with western states witnessing the most significant price declines. Learn about population migration patterns from high-cost and high-tax states, as well as the impact of remote work on the crash of office and commercial real estate in San Francisco. Explore the current talent diaspora and its implications for the market. Get insights on the year-over-year decline in single-family residences and the gradual rise of multifamily properties. Analyze Q1 rental rates, SFH data, and rent increases to identify signs of recovery. Understand how migration patterns from high-cost to lower-cost regions are driving prices. Explore the exit ratios of major coastal metros in the U.S. and the close correlation between job growth and population migration. Discover how demographics could provide a positive influence on the market. Gain insights into the significant presence of investors and cash buyers, who accounted for 45% of Q1 2023 sales. Evaluate the housing affordability index and its limitations. Lastly, dive into the outlook for 2023. Don't miss this comprehensive analysis of the real estate landscape! #marketinsights #RealEstate #HousingMarket #InvestmentTips Key Takeaways: Jason's editorial 1:22 The misinformation out there just continues to amaze me 2:28 Check out Jason's YouTube channel https://www.youtube.com/@JasonHartmanRealEstate to comment and see the graphs and charts Rick Sharga interview Part 2 2:54 Most states saw prices increase in March 5:42 Prices declining most rapidly in western states 6:57 Population migration patterns from high cost and high tax states 8:30 Working remotely and the crash of office and commercial real estate in San Francisco 10:29 "The World is Flat" - the current talent diaspora 12:11 SFR decline YOY, Multifamily Rises but slowly 13:06 Q1 rental rates show signs of recovery and SFH data and rent increases 20:05 Migration Patterns from high cost to lower cost regions drive prices 20:58 Major coastal metros have highest exit ratios in the U.S. 21:37 Job growth tracks closely to population migration patterns 24:18 Demographics should ultimately provide a tailwind for the market 25:35 Investors and cash buyers account for 45% of Q1 2023 sales 27:54 The housing affordability index and its shortcomings 3018 Outlook for 2023   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

Jason hosts Rick Sharga from C.J. Patrick Company who spoke about the current state of the economy and housing market. They discussed the cause of the resilience of the housing market despite 10 consecutive massive rate hikes. Rick stated that this is due to the large cohort of young adults currently coming of age and forming households, and the fact that people like having a roof over their head. They concluded that despite the rate hikes, the housing market is doing well. Rick discussed how demographics and the Fed funds rate increase have affected the housing market. He noted that in 2021, mortgage rates had doubled in a calendar year for the first time in history, leading to a higher cost of monthly payments for home buyers. He also mentioned how 70% of homeowners have mortgage rates of 4% or lower, which means they are not in a hurry to take on a higher rate. This is keeping inventory levels low, combined with growing demand, and causing prices to remain stable. He also noted how this is frustrating those who predicted a housing market crash. Rick Sharga and Jason Hartman discuss the current foreclosure rate, which is about half of the normal rate. They state that 93% of borrowers who are in foreclosure have positive equity. Of those 270,000 borrowers in foreclosure, 100,000 of them have 20-50% equity, 60,000 have more than 50% equity, and 20,000 have more than 75% equity. They also discuss the current state of the housing market. Mortgage rates have been increasing, but they seem to be stabilizing in a band between 6.25% and 6.75%. Existing home sales, inventory levels, new home sales, and rental pricing are all up from last year. Investor activity is also up. The Fed indicated at their last meeting that rates will remain stable until June. Key Takeaways: Jason's editorial 1:17 Crash bros are just wrong 2:57 In Nashville, inventory is super low; awesome financing offers  Rick Sharga interview Part 1 4:47 Welcome Rick Sharga, first time mortgage rates doubled in a calendar year 8:17 Foreclosure issues 11:39 Primary Mortgage Market Survey 17:40 Higher rates have crushed affordability 18:25 Purchase loan apps off 35% from prior year 20:36 Existing home sales down from February - and 22% below last year 23:07 Inventory increases in April, but new listings down significantly 23:41 New home sales improving as builders offer incentives 24:29 Inventory coming to market slowly, and selling quickly; disruptive technology & other issues 29:04 The current problems with multifamily housing 30:38 Price appreciation has declined rapidly 31:08 Most regions are still positive year over year 33:31 Most states saw prices increase in March   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

Housing intelligence analyst Rick Sharga joins us.  Learn about: plummeting home sales, delinquency and foreclosure rates, future home prices, interest rate direction, housing demographics, builder incentives to buyers, lender repossessions, and homeowner equity levels. I ask Rick: “Is a home price crash imminent?” 70% of mortgage borrowers have an interest rate of 4% or lower. They're rarely motivated sellers. America should have a housing shortage for at least 5 to 10 more years. FHA borrowers are exhibiting financial distress. Overall, delinquency and foreclosure rates are low. We discuss recession prospects, and what will happen when student loans must be repaid. Home prices are stable or should increase modestly in many areas of the Midwest and Southeast. Home price declines should continue in: many western US areas, high-end homes, and Zoomtowns. They could correct 10% in California. Today, you can get mortgage rates in the 5s on new-build income property.  How? With builder incentives for buyers, especially in Florida, at GREmarketplace.com. Want free coaching? GREmarketplace.com/Coach Resources mentioned: Show Notes: www.GetRichEducation.com/440 Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE  or e-mail: info@RidgeLendingGroup.com Memphis & Little Rock property that  cash flows from Day One: www.MidSouthHomeBuyers.com Find cash-flowing Jacksonville property at: www.JWBrealestate.com/GRE Will you please leave a review for the show? I'd be grateful. Search “how to leave an Apple Podcasts review”  Top Properties & Providers: GREmarketplace.com Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free—text ‘GRE' to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Keith's personal Instagram: @keithweinhold

Welcoming back Rick Sharga in this episode with our FIRST in-person podcast. Rick has been on the show before during our virtual sessions but is back now to discuss what is going on in the mortgage market today. Rick is the Executive Vice President of Market Intelligence at ATTOM, one of the country's leading providers of comprehensive real estate data for companies in the real estate, mortgage, insurance, finance, and government markets.  In this episode, Rick and I dive deep into conversations on mortgages and how the real estate market looks so different now than it has in previous years. What the future may hold and what data resources to pay attention to as you navigate this market in 2023. Thank you for listening and I hope you all enjoy this discussion.

In this Real Estate News Brief for the week ending January 28th, 2023... what's happening with inflation, a new surge in foreclosures, and the affordability of renting versus buying.   Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.   Economic News   We begin with economic news from this past week. The latest report on the cost of goods and services shows that inflation is cooling off. The PCE index is the Federal Reserve's preferred measure of inflation and it shows a tiny .1% increase for December. That reduces the annual rate from 5.5% to 5%. When you eliminate the cost of food and gas, the monthly increase was .3% with an annual rate that's down from 4.7% to 4.4%. PCE stands for Personal Consumption Expenditures. (1)   We also have a new report on the GDP. The government reports that the Gross Domestic Product grew at a solid 2.9% in the fourth quarter of last year. That's after a reading of 3.2% in the third quarter, and two negative quarters in the beginning of 2022. Economists generally believe that we'll see slower economic growth in 2023 due to the Fed's rate hikes. The rate hikes are meant to slow the economy and help bring inflation back down to the 2% level. (2)   The National Association of Home Builders reported on the housing share of the GDP which is lower than normal due to the constrained housing market conditions. The NAHB explains the two housing market components that contribute to the GDP as the residential fixed investment or RFI which includes home building and remodeling. The second component covers housing services like rent, utilities, and the cost that owners would have to pay to rent their own homes. For the fourth quarter the RFI was 4% of the economy while housing services accounted for 11.9%. That's a total of 15.9% of the GDP. Historically, the total is 17 or 18% of the GDP with an average of 5% for the RFI and 12 to 13% for housing services. (3)   Weekly jobless claims are down again, to their lowest level since April. Weekly initial claims dropped another 6,000 to a total of 186,000. Ongoing claims were up 20,000 to a total of 1.68 million. Several companies have announced layoffs but that hasn't had an obvious impact yet on jobless claims. (4)   New home sales were slightly higher in December. The Commerce Department says they were up 2.3% to a seasonally-adjusted annual rate of 616,000. Year-over-year, they are down 26.6%. That hit a peak of 1.04 million in August of 2020. (5)    Mortgage Rates   Mortgage rates were down a little more last week. Freddie Mac says the average 30-year fixed rate mortgage was down 2 basis points to 6.13%. 15 year loans were down 11 points to 5.17%. (6)   In other news making headlines...   Foreclosure Rate Doubles   Foreclosure rates are rising once again, but have not returned to pre-pandemic levels. ATTOM Data says they more than doubled in 2022 compared to 2021, with a 115% increase. In 2022, there were foreclosure filings on .23% of all housing units. In 2021, foreclosure filings accounted for just .11% Back in 2019, before the pandemic, they accounted for .36% of all properties. (7)   ATTOM's Rick Sharga says: “Government and mortgage industry efforts during the pandemic, coupled with a strong economy, have helped prevent millions of unnecessary foreclosures.”   States with the highest number of foreclosure starts last year include California, Texas, Florida, Illinois, and Ohio. Foreclosures hit a peak at the height of the housing crisis in 2009 and 2010. Back then, almost 2-and-a-quarter percent of all homes went into foreclosure.   Renting Now Cheaper than Owning in Most Areas   Research from ATTOM Data also shows that renting is now more affordable than owning in 95% of the places where most people live. That's a complete reversal from last year when it was more affordable to own your own home in 60% of the markets that were analyzed. (8)   Rick Sharga commented on the change in affordability saying “What a difference a year makes.” The study was based on the average three-bedroom rent compared to owning a similar sized home.   The only place where it was more affordable to buy than to rent was in Cook County near Chicago. Homeowners in that area typically pay 40% of their paycheck for housing while renters pay 38%.   If you'd like to learn more about investing in today's rental housing market, check out our virtual live event on February 11th. It's an all-day event featuring ten property teams in 11 markets and one commercial broker. You can find out more by joining RealWealth for free at newsforinvestors.com and registering for the event. If you miss it, we will have some of the sessions available on the RealWealth website for a replay. But if you want to see all of it, you'll need to attend.   That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!   Thanks for listening. I'm Kathy Fettke.   Links:   1 - https://www.marketwatch.com/story/u-s-inflation-rate-slows-again-to-15-month-low-pce-shows-11674826498?mod=economy-politics   2 - https://www.marketwatch.com/livecoverage/stock-market-today-nasdaq-set-to-lead-after-tesla-results-impress/card/u-s-gdp-grew-faster-than-expected-in-final-quarter-of-2023-but-don-t-expect-a-repeat-SXstKUC8fTFH4HHAkr3h   3 - https://eyeonhousing.org/2023/01/housing-share-of-gdp-lower-in-the-fourth-quarter-of-2022/   4 - https://www.marketwatch.com/story/u-s-weekly-jobless-claims-fall-to-lowest-level-since-april-11674740614?mod=economy-politics   5 - https://www.marketwatch.com/story/u-s-weekly-jobless-claims-fall-to-lowest-level-since-april-11674740614?mod=economy-politics   6 - https://www.freddiemac.com/pmms   7 - https://www.attomdata.com/news/market-trends/foreclosures/attom-year-end-2022-u-s-foreclosure-market-report/   8 - https://www.scotsmanguide.com/browse/content/where-most-people-live-renting-is-now-more-affordable-than-owning

It's 9 days till the life-changing Empowered Investor Live summit happening on January 27 to 29 at Scottsdale, Arizona! Empower your life by joining a community of investors and third party vendors together with Jason's own investment counselors who are passionate about your investing success! So start the year right! Go to EmpoweredInvestor.com/live and get your tickets TODAY! 18 to 29 year olds living with their parent/s! What does that mean? There is still demand for rental housing! But this demand will decline in about 20 years. That's a word of caution from Jason. But for now, you are going to make a fortune with your income properties! Here is part 2 of Jason's chat with Rick Sharga of ATTOM DATA. Know the facts and data that will serve as an indicator of trends  in the single-family housing investment space across different markets. Note: This interview was done last December 2022. Key Takeaways: Jason's editorial 1:59 Shadow inventory, shadow demand, 18 to 29 year olds living with their parent/s 5:37 What this means as investors 7:35 A word of caution: there will be a decline in housing demand- in about 20 years 9:40 Get your tickets to the EMPOWERED INVESTOR LIVE summit today!  10:28 Join Jason on a cruise on March 4 to 9! Mix a little business with pleasure! Go to EmpoweredInvestor.com/cruise now! Rick Sharga interview part 2 12:09 Chart: Mortgage rates still near 20 year high 12:52 Chart: October marks 13 consecutive months of lower existing home sales 13:30 Chart: New Home sales down 14% from 2022  14:36 Chart: Builder sentiment, housing starts declining rapidly 16:39 Chart: Very low new supply (Altos Research) 17:10 Chart: Inventory outlook for 2023 17:29 Chart: Price reductions have peaked (Altos Research) 19:57 Chart: Pendings dramatically lower 20:23 Chart: Purchase loan apps off 41% 24:19 Chart: Prices in western markets are declining 25:49 Chart: Further declines are expected in many - not all - markets (Zillow) 29:31 Chart: But homeowners still have record equity 30:16 Chart: Delinquencies below pre-pandemic levels 35:26 Chart: Foreclosures starts approaching pre-pandemic levels 37:44 Chart: But REO activity still well below normal   Quotables: "93% of the people in foreclosure have positive equity." - Jason Hartman "Our data shows that about 6% of homeowners nationally are underwater on their loans. There's half a percent of homeowners who are in foreclosure." Rick Sharga Mentioned: Altos Research   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

The EMPOWERED INVESTOR LIVE conference is almost upon us! Don't miss this life-changing opportunity to empower your journey to Financial Freedom! Acquire the life-changing information to let you begin walking down the road to your Financial Independence Day! Join us for a complete education, exclusive properties and more. Are you aware that income property is history's proven best investment? Jason and his team of experts will empower you to true financial freedom! Go to EmpoweredInvestor.com/LIVE to get your tickets today! Plus, you are also invited to go on vacation with me on the Empowered Investor PRO - Member retreat cruise. Go to EmpoweredInvestor.com/cruise for more details! Today, Jason is joined by Rick Sharga of ATTOM Data Solutions, licensor of the nation's most comprehensive foreclosure data and parent company to RealtyTrac (www.realtytrac.com), a foreclosure listings and search portal.  Is there a looming housing crisis? Not according to the data! Listen in and get the facts minus the misinformation and hype from the YouTube click bait sensationalist 'chicken littles'! Key Takeaways: Jason's editorial 1:22 Rick Sharga on the show today! 2:01 Negative 45% in office REITs; the declining need for office space 5:47 Outsourcing everything but not housing 9:49 Chart: Number of mortgages by interest rate 10:28 Chart: Household equity bubble 2.0 12:18 Join us at EMPOWERED INVESTOR LIVE 13:27 Go on vacation with me on the Empowered Investor PRO - Member retreat cruise. Get your tickets at EmpoweredInvestor.com/cruise Rick Sharga interview 15:30 Welcome back Rick 16:12 Is the sky falling? The numbers say NO 21:51 Chart: GDP Recovers After Two Consecutive Negative Quarters 23:25 Chart: Employment has fully recovered 25:29 Chart: Jobs, wages continue to grow 26:39 What gets your goat? 28:36 Chart: Consumer Spending soars, while confidence plummets 31:48 Consumer credit grows, while savings rate declines 36:21 Inflation still high, but may have peaked 37:14 The Federal Reserve has taken aggressive action 38:50 Yield curve inversion: is a recession inevitable 40:09 Will Federal Reserve cause a recession 43:07 Chart: Mortgage rates still near 20 year high   Quotables: "Wages for the first time in many years are growing faster than home prices." - Rick Sharga "The government took a 3 trillion dollar hole and stuffed 15 trillion dollars into it." - Friend of Rick's "When you have 50% more money floating around, you're going to have inflation!" Rick Sharga   Follow Jason on TWITTER, INSTAGRAM & LINKEDIN Twitter.com/JasonHartmanROI Instagram.com/jasonhartman1/ Linkedin.com/in/jasonhartmaninvestor/ Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: https://www.jasonhartman.com/ Free Class:  Easily get up to $250,000 in funding for real estate, business or anything else: http://JasonHartman.com/Fund CYA Protect Your Assets, Save Taxes & Estate Planning: http://JasonHartman.com/Protect Get wholesale real estate deals for investment or build a great business – Free Course: https://www.jasonhartman.com/deals Special Offer from Ron LeGrand: https://JasonHartman.com/Ron Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com

Rick Sharga, Executive Vice President of Market Intelligence at ATTOM is one of the country's most frequently-quoted sources on real estate, mortgage and foreclosure trends, and has appeared on CNBC, CBS News, NBC News, CNN, ABC News, FOX, Bloomberg and NPR. With more than 20 years experience in the real estate and mortgage industry, Rick has also been twice named to the Inman News Inman 100, an annual list of the most influential real estate leaders. As a highly respected voice of the industry, Rick shares his optimistic perspective of residential and commercial foreclosure activity, the impact various programs have on the industry, what we've learned from the last downturn and how mortgage servicers are much better prepared to navigate the current distress with more advantageous options for all parties involved.Connect further with Rick Sharga at https://www.attomdata.comFor information about the National Association of Default Professionals (NADP) Annual Summit, March 5-7, 2023, which Bill will be speaking on the investor panel at, go to https://www.reomac.org/event-5027524To learn more, visit:https://billbymel.com/Listen to more episodes on Mission Matters:https://missionmatters.com/author/bill-bymel/ 

Happy New Year and welcome to 2023! It's time to turn the page on 2022 and look for new real estate investing opportunities! And we have ATTOM's Rick Sharga to help us do that! He joins me in this interview to talk about his data-based opinions on what the real estate market might do this year. That includes specific markets that are more likely to outperform or underperform other markets, along with the strengths and weaknesses of different asset classes.   If you don't know Rick, you should. He has more than 20 years' of experience in the real estate and mortgage industries and is currently the Executive Vice President of Market Intelligence for real estate data firm, ATTOM Data. He is also one of the most frequently quoted experts on real estate, mortgage, and foreclosure trends by major media outlets.   Rick has also served as Executive Vice President at RealtyTrac, as an EVP for Carrington Mortgage Holdings and Chief Marketing Officer of the company's Vylla business unit, and as the Chief Marketing Officer of Ten-X and Auction.com. If you'd like to hear more about what happened in 2022, check out my 2022 year-end review with Rick Sharga.  We discuss the ups and downs of last year's market, and what we think is important for investors to know about 2023. Join RealWealth and enjoy all the benefits of membership at: https://tinyurl.com/joinrealwealth Subscribe to the Real Wealth Show podcast:  https://tinyurl.com/RWSsubscribe  Thanks for listening! Kathy Fettke

Foreclosures, mortgage rates, housing prices; if there's one person to ask about any of it, it's Rick Sharga, Executive Vice President at ATTOM, who handles housing market data and forecasting all day, every day. Rick is often seen as a housing fact crusader, taking down the clickbait hype that many mainstream articles love to post. While other media channels push fear, Rick focuses on facts, showing what's happening in the housing market, whether it's good or bad news.Rick knows much more about home foreclosure numbers than most, so we took time today to ask him exactly how rising interest rates, crushing unaffordability, and shrinking home prices affect today's homeowners. Could there be a foreclosure crisis on the horizon? Or, are homeowners in such a solid position that the chance of getting foreclosed on is slim to none? And if you're looking to make some money during this declining market, which strategy would work best as buyers and sellers get desperate?We also take a chance to get Rick's opinion on where interest and mortgage rates could be heading over the next year. Rick lays out the exact scenarios that could cause rates to plummet or rise multiple percentages and how homebuyers may go through a rate “reprogramming” to get hungry for houses once again. If you're holding, buying, selling, or renting in 2023, this is the data you need to know!In This Episode We CoverThe interest rate “reprogramming” and why rates don't need to hit rock bottom for a buying frenzy to start againMortgage rate predictions and what could happen that would cause rates to spike in 2023The latest foreclosure data and why homeowners being “underwater” isn't what you thinkThe best opportunity for real estate investors and the revival of wholesaling in 2023Bad news for house flippers and why profits are starting to drop for home renovationsThe “short-term pain, long-term gain” of real estate investing in 2023 (and beyond!)And So Much More!Links from the ShowFind an Investor-Friendly Real Estate AgentBiggerPockets ForumsBiggerPockets AgentBiggerPockets BootcampsJoin BiggerPockets for FREEOn The MarketJoin the Future of Real Estate Investing with FundriseConnect with Other Investors in the “On The Market” ForumsSubscribe to The “On The Market” YouTube ChannelDave's BiggerPockets ProfileDave's InstagramJamil's BiggerPockets ProfileJamil's InstagramHear Our Past Episode with RickATTOM's Home Flipping ReportConnect with Rick:Rick's LinkedInRick's TwitterCheck the full show notes here: https://www.biggerpockets.com/blog/on-the-market-66Interested in learning more about today's sponsors or becoming a BiggerPockets partner yourself? Check out our sponsor page!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

As the Fed continues to raise interest rates to slow down a booming economy and unacceptably high inflation, there are a several questions on the minds of every real estate investor, including: 1 - Are we going into a recession?2 - Will there be a housing crash? How far will home prices fall?3 - Will there be more evictions and rent reductions?4 - Will we see an uptick in foreclosure activity?5 - Which markets will be more resilient?In this episode, our real estate guest expert will share some ideas on what he thinks will happen, and what investors need to know to be prepared.Rick Sharga has more than 20 years' experience in the real estate and mortgage industries and is currently the Executive Vice President of Market Intelligence for ATTOM Data Solutions which is a market-leading provider of real estate and property data. Rick has also served as Executive Vice President at RealtyTrac, as an EVP for Carrington Mortgage Holdings and Chief Marketing Officer of the company's Vylla business unit, and as the Chief Marketing Officer of Ten-X and Auction.com, the leading online real estate marketplace. He is one of the most frequently quoted experts on real estate, mortgage, and foreclosure trends by major media outlets. Join RealWealth here: https://tinyurl.com/joinrealwealthSubscribe to the podcast here (or on your preferred podcast player): https://tinyurl.com/RWSsubscribeFor more information, and to listen to more episodes, go to: RealWealthShow.com

This is a crosspost episode from the Housing News Podcast, hosted by Clayton Collins. This week,  Clayton is coming to your feed live from the Blueprint proptech and real estate conference in sunny Las Vegas, Nevada. He had the opportunity to sit down in person and talk to Rick Sharga, the Executive Vice President at ATTOM, and Nate Smoyer, the Head of Marketing at Obie as well as the host of the Tech Nest Podcast.The three of them talk about what they learned and took away from the Blueprint conference, and how the market is impacting the decisions being made by prop-tech, mortgage tech, and real estate companies.The Housing News podcast explores the most important topics happening in mortgage, real estate, and fintech. Each week a new mortgage or real estate executive joins the show to add perspective to the top stories crossing HousingWire's news desk. Hosted by Clayton Collins and produced by the HW Media team.Check out the Housing News podcast at https://www.housingwire.com/podcastFollow and connect with this week's guests: Follow Housing Wire on Twitter Follow Housing Wire on LinkedIn Follow Clayton on Twitter Connect with Clayton on LinkedIn Follow ATTOM on Twitter Follow ATTOM on LinkedIn Follow Rick on Twitter Connect with Rick on LinkedIn

This week,  Clayton is coming to your feed live from the Blueprint proptech and real estate conference in sunny Las Vegas, Nevada. He had the opportunity to sit down in person and talk to Rick Sharga, the Executive Vice President at ATTOM, and Nate Smoyer, the Head of Marketing at Obie as well as the host of the Tech Nest Podcast. The three of them talk about what they learned and took away from the Blueprint conference, and how the market is impacting the decisions being made by prop-tech, mortgage tech, and real estate companies.Enjoy the episode!Join us for HousingWire Annual October 3rd - 5th, 2022 in beautiful Scottsdale, Arizona. Register here!The Housing News podcast explores the most important topics happening in mortgage, real estate, and fintech. Each week a new mortgage or real estate executive joins the show to add perspective to the top stories crossing HousingWire's news desk. Hosted by Clayton Collins and produced by the HW Media team.

Today I get to interview Rick Sharga, one of the nation's leading experts in real estate market intelligence. Rick is the Executive Vice President of Market Intelligence at ATTOM, one of the country's leading providers of comprehensive real estate data for companies in the real estate, mortgage, insurance, finance and government markets. We chat about what indicators we are looking at leading into this shifting real estate market. We talk about upcoming foreclosures and if it looks like the housing bubble is finally going to burst. We talk about the similarities and differences between the markets today and in 2007/2008. We chat about what you can do to prepare and get ahead in the upcoming markets and so much more. I hope you enjoy this episode as much as I did chatting with Rick.

Rick Is the EVP at ATTOM and has a great grasp on the market as he has been looking at Data for the past 20+ years in the industry of real estate. He is truly a data driven thought leader and helps people on a daily basis get to a conclusion in their market, and or the nations large market of real estate to make that educated decision for what they should do on their buying strategy or helping clients make the right decision for buying/selling. We discuss if there is a market drop coming and go over all these other factors of what the housing market looks like now and going forward! Check out: https://www.attomdata.com/

Jul 29 – After this week's market wrap-up with Ryan Puplava, Financial Sense Newshour speaks with Tom McClellan to get an update on his outlook for the stock market, the economy, and more. Next, Rick Sharga at ATTOM discusses the dramatic slowing...

ARE WE HEADED FOR ANOTHER MORTGAGE DEFAULT CRISIS?  For the most part consumer credit is healthy, but will a Recession hit the mortgage industry harder?Here from Rick Sharga, Executive Vice President Market Intelligence at ATTOM as he breaks down the latest in mortgage foreclosure trends.Follow us on social media!linkedin.com/company/vantagescoretwitter.com/vantagescorefb.com/vantagescoreinstagram.com/vantagescoreyoutube.com/vantagescore

Will housing prices drop in 2022? There may seem like an obvious answer to this question, “of course with interest rates rising housing prices will drop.” But, that's not exactly what the data shows, especially when you take into account that 2022 is not a normal housing market by any means. We had high demand, which is starting to cool, but housing prices are still far from affordable. And with so many homeowners enjoying huge equity boosts, is there even a possibility that foreclosures could fill the supply gap?Instead of postulating about what will or won't happen, we brought on an industry expert who can give a data-first decision on which way the housing market will move. Rick Sharga, EVP of Market Intelligence at ATTOM, knows the data. He spends the majority of his waking hours scanning through copious amounts of housing market information so he can give investors and real estate professionals a true, unbiased opinion on what will happen next.Rick goes deep into demand, what's causing it and whether or not it has been suppressed thanks to interest rate hikes. We also touch on the foreclosure “crisis” that never happened, how forbearance programs worked, and why we're starting to (finally) see an uptick of foreclosures, many of which could make great investment properties. Lastly, you'll hear why waiting out the housing market could be a move many investors shouldn't make.In This Episode We CoverWhy interest rate hikes are affecting the housing market faster than we thoughtThe possibility of a housing market crash and what it means for investorsForbearance and foreclosures explained and what makes this market different from 2008“Emotional equity” and how it could keep home prices high for years to comeBuying rental properties at auction and what to know before you make a bidWhy waiting for lower homes prices could cost you tens of thousands moreAnd So Much More!Links from the ShowBiggerPockets ForumsBiggerPockets AgentJoin BiggerPockets for FREEOn The MarketJoin the Future of Real Estate Investing with FundriseConnect with Other Investors in the “On The Market” ForumsSubscribe to The “On The Market” YouTube ChannelFind an Investor Friendly Agent in Your AreaDave's BiggerPockets ProfileHenry's BiggerPockets ProfileJames' BiggerPockets ProfileJamil's BiggerPockets ProfileKathy's BiggerPockets ProfileDave's InstagramHenry's InstagramJames' InstagramJamil's InstagramKathy's InstagramGrab Your Ticket to BPCon 2022BiggerPockets Podcast 604ATTOM Insights for Real Estate InvestorsConnect with RickRick's LinkedInRick's TwitterCheck the full show notes here: https://www.biggerpockets.com/blog/on-the-market-17Interested in learning more about today's sponsors or becoming a BiggerPockets partner yourself? Check out our sponsor page!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

There's a lot of uncertainty in the economy right now as inflation pushes higher. The housing market is contributing to inflation with higher home prices, and now we're seeing higher mortgage rates. As potential homebuyers get priced out of the market, real estate investors see the need for housing as a big opportunity for single-family rentals.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Institutional investors have been very busy this year expanding their portfolios of single-family rental homes. As reported by HousingWire, they've sponsored at least 10 SFR securitization deals worth almost $8 billion. (1) ATTOM Data Solutions' Rick Sharga says: The historically low inventory of homes to buy coupled with (rental) vacancy rates hovering around 2.5%, have positioned SFR owners for success in today's housing market.”Strength of the Single-Family Rental MarketThe institutional deals highlight the strength of the single-family rental market, but it's the “mom and pop” investors who are the biggest beneficiaries because the single-family rental market is dominated by small investors. According to rentalhomecouncil.org, 99% of single-family rentals are owned by smaller investors and 90 percent of them own fewer than ten units. (2)But the Wall Street landlords are showing a lot of interest, and their share is growing. This trend is gaining momentum as potential homebuyers lose the battle against inflation, and the Fed tightens the belt on the money supply.The Fed's recent decision to increase short-term lending rates by a whopping 75 basis points is the Fed's latest attempt to slow a hot economy. It's the biggest rate hike we've seen since 1994 and will raise borrowing costs for adjustable rate mortgages and other short-term loans.Rising Mortgage RatesIt's not directly tied to the popular fixed-rate mortgage, but will impact mortgages through a complex set of economic relationships. That includes nervousness among investors, bond yields and the 10-year Treasury. After more than a decade of low mortgage rates, the 30-year fixed-rate mortgage topped 6% last week. According to ATTOM, mortgage originations were down 18% from the Q4 of last year to Q1 of this year. Year-over-year, they were down 32%. The biggest reason for the mortgage downturn is a decrease in refinancing. ATTOM says just 1.45 million home loans were rolled into new mortgages during the first quarter. That's 22% lower than the end of last year and 46% lower than a year ago.According to Sharga: “The drop-ff in Q1 refinancing activity is no surprise with mortgage rates rising as rapidly as they have.”Renting Cheaper than BuyingHome prices are also keeping homebuyers at bay. According to John Burns Real Estate Consulting, it's now more costly to own a home than it is to rent one since the year 2000. The consulting group says it costs about $839 per month more to buy than to rent. (3)John Burns senior research manager, Danielle Nguyen, says: “With demand now shifting toward renting, home builders who were once reluctant to sell to rental home investors are now soliciting offers from investors.” She says: “Strong demand from investors will provide additional support to today's home prices.”SFR Opportunities for InvestorsAs dire as it may sound to hear about higher mortgage rates and expensive homes, demand for single-family rentals remains strong, and that's attracting more institutional investors. MetLife Investment Management told HousingWire that: “MIM believes that institutional SFR ownership is likely to grow significantly over the next decade.” It expects that share to grow from 2% where it is today to around 10% in the future. Much of that growth will come from the new build-to-rent trend that's taking shape.It isn't just the big landlords who are doing the build-to-rent thing. Although it's great that institutional investors might prefer to leave the existing home inventory to small investors and homebuyers, there are opportunities for small investors to own newly-built rentals. If you're a member of RealWealth, then you probably know that we work with with property teams who can provide that kind of rental unit to our members. If you'd like to know more about that, please go to newsforinvestors.com and sign up. It's free, and will give you access to our resources, including investment counselors and property teams. While you are there, you can also check for links on this topic in the show notes for this episode.Also, please remember to hit the subscribe button, and leave a review! Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.housingwire.com/articles/as-rates-skyrocket-wall-street-single-family-rental-investors-see-opportunity/?utm_campaign=Newsletter%20-%20HousingWire%20Daily&utm_medium=email&_hsmi=216674568&_hsenc=p2ANqtz-9kKz4UtawEjJ2FBXak6h5mP0nz8HU01QcfNmJN26CMLgu3kR8V-0LQbz_pxwqztwv6NKfgARrR6Fz2zghXhhq6CKy2Gg&utm_content=216674568&utm_source=hs_email2 -https://www.rentalhomecouncil.org/3 -https://www.marketwatch.com/story/its-now-more-expensive-to-own-a-home-than-to-rent-one-than-at-any-time-since-2000-heres-what-that-means-for-house-prices-11655213808

BRN AM  |  Home values in Opportunity Zones Keep Pace |   Rick Sharga, Attom   | www.broadcastretirementnetwork.com

In this episode of the Top of Mind podcast, Mike Simonsen sits down with Rick Sharga, EVP of Market Intelligence at ATTOM, for a deep dive into the state of the current housing market. Rick talks about areas of risk for housing in today's economy, shares some surprising insights into the foreclosure situation, discusses which policies might impact demand, and more. About Rick Sharga Rick Sharga is the Executive Vice President of Market Intelligence at ATTOM, one of the country's leading providers of real estate data for real estate, financial services, insurance companies, and government agencies. An accomplished executive with over 25 years of experience in consumer and B2B marketing, Rick has held numerous senior leadership positions in the real estate and mortgage industries and has also developed and executed sales and marketing programs for tech companies such as Fujitsu, JD Edwards, Toshiba, and Hitachi; start-ups like Tickets.com; and consumer brands including Pizza Hut, Acura and Cox Communications.  One of the country's most frequently-quoted sources on real estate, mortgage, and foreclosure trends, Rick has appeared regularly over the past 15 years on CNBC, the CBS Evening News, NBC Nightly News, CNN, ABC World News, FOX, Bloomberg, and NPR.  Rick has also been named twice to the Inman News Inman 100, an annual list of the most influential leaders in real estate. Here's a glimpse of what you'll learn:  Which segments of borrowers are most at risk in the current environment Surprising insights about the foreclosure situation Which regulatory changes might further dampen buyer demand this year Why new buyers are facing a “triple whammy” of challenges Rick Sharga's outlook for what's next in the industry Featuring Mike Simonsen, CEO of Altos Research A true data geek, Mike founded Altos Research in 2006 to bring data and insight on the U.S. housing market to those who need it most. The company now serves the largest Wall Street investment firms, banks, and tens of thousands of real estate professionals around the country. Mike's insights on the market have been featured in Forbes, New York Times, Bloomberg, Dallas Morning News, Seattle PI, and many other national media outlets. Resources mentioned in this episode: Rick Sharga on LinkedIn Rick Sharga on Twitter ATTOM RealtyTrac Mike Simonsen on LinkedIn Altos Research Follow us on Twitter for more data analysis and insights: https://twitter.com/altosresearch https://twitter.com/mikesimonsen See you next week!

It's a housing market crash! It's a housing market bubble! It's a relatively normal and stable housing market! Two of these statements might make you excited, anxious, or hopeful, while one simply makes you yawn. For years, we've heard numerous news outlets, forecasters, and housing authorities tell us that the next housing crash is right around the corner, only for home prices to skyrocket, interest rates to rise, and demand to stay red-hot.If you want to know if a housing market crash is coming, Rick Sharga, Executive Vice President at ATTOM, a leading provider of nationwide property data, is the person to talk to. His entire job is based on finding and figuring out the data behind housing market movements, which he then presents to field leaders who are trying to make better buying, selling, and lending decisions.Rick is an industry vet and was around during the mid-2000s housing market crash, the great recession, the foreclosure crisis, and everything that followed. Rick has seen the runup in housing prices over the past two years and has some interesting theories as to where we're headed next. Whether you think we're in for smooth sailing or on the cusp of another crash, Rick's predictions may surprise you. In This Episode We Cover:Why competition has recently fallen and whether or not this is permanent for the housing market The difference between 2022's housing market and the 2007/2008 housing marketWhether or not raising interest rates has affected hot housing marketsIf we're entering bubble territory and how to tell the real estate market is going southWhich real estate markets are primed for a correction in 2023 (and beyond)How to get ahead of the foreclosure auctions in a “high equity” housing market And So Much More!Links from the showATTOM Data SolutionsOn The Market PodcastRedfinZillowFannie Mae Wallstreet JournalWeatlh TrackFederal Housing Administration (FHA)BlackstoneRealtyTracYoutubeTiktok Dave Meyer's Instagram @thedatadeliBiggerPockets YoutubeDavid Greene's Instagram @davidgreene24David Greene Real Estate (Youtube)Rick's LinkedInRick's Twitter @rickshargaClick here to check the full show notes: https://www.biggerpockets.com/blog/real-estate-603See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

April 23-30 – Seg 2 – The Real Estate Bubble Myth – Debunked – Mortgage Interest Rates Rise – Will it Cool off the Market?719-301-3900  | Your Home Sold Guaranteed Realty ColoradoBarb, many people witnessed the mortgage meltdown of 2008-2011 and assume this current market is heading for another Real Estate Bubble.  What do you think the current market conditions will bring into the future and how will the rising interest rates affect this market?Mortgage Meltdown Facts: Buyers were getting loans they could NOT afforda. Going rate = 6.43%, Taking Teaser Rates of 1.0%b. Prices Rose Rapidly due to low payments andc. Buyers did NOT have to prove they qualified for the mortgage. Loans were sold as a stock/equity into retirement funds as a ‘good investment'e. Once rates are adjusted – people's house payments DOUBLED overnight.What is Different Now? – Buyers Must BY LAW Qualify for those loans!a. Current Interest Rates STILL Below Long-Term Averagesb. Affordability is Actually MORE affordable than the peak of the 2006 Housing Boom!#2: All 50 Major Markets Surveyed show the REAL House Price Index… Factors:Income – Median HouseholdInterest RatesHouse Price LevelsIncome:Median Household Income has increased 5.0% since Jan 2021 and 69.9% since January 2000!Interest Rates:While House Prices have IncreasedHouse-buying power has also increased Due to a long-run Decline in Mortgage Rates and The Slow, but Steady Growth of Household Income. * Interest Rates:* History:  30 Year Fixed Mortgage Rates * Average over past 5 decades:   8.21%* 1972 Average 30 Year: 7.25%* 1982 Average 30 Year 16.95%* 1992 Average 30 Year: 8.96%* 2002: Average 30 Year: 7.13%* 2012: Average 30 Year: 3.98%* 2022: Average 30 year: 5.00%Housing Supply CANNOT Keep UP with DemandExperts like Rick Sharga of Realty Trac:“The Supply and demand imbalance is the primary reason home prices have escalated so rapidly”“…After NOT building nearly enough in the last decade, homebuilders will take several years at least to add enough new supply to balance the market.”You are listening to the Real Estate Voice with Barb Schlinker of Your Home Sold Guaranteed Realty, if you are thinking of making a move Barb at 719 301 3900 or visit BarbHasTheBuyers.com When We come Back - We will be Discussing: Real Estate Agent's Tactics to Get You to Sign on the Dotted Line#coloradosprings #yourhomesoldguaranteedrealty #barbschlinker #realestatevoice

Real Estate News Brief - Week Ending April 16, 2022;Inflation Hits 40-Year-High, Double-Digit Rent Growth, Rising Cost for New HomesIn this Real Estate News Brief for the week ending April 16th, 2022... the latest surge in consumer prices, where rents are growing the fastest, and the high cost of building new homes.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week, and another alarming report on inflation. The consumer price index jumped 1.2% last month to a 40-year high of 8.5%. The increase was mostly driven by higher prices for gas, food, and housing. If you eliminate gas and food you get a core rate of 6.5%. Some economists believe that inflation will ease up soon, when the price of oil stabilizes and some of the supply chain issues clear up. But other economists worry that we might continue to see prices going higher. (1)Wholesale prices are also surging. The producer price index was up 1.4% in March to an annual rate of 11.2%. That's the highest it's been in almost 40 years and likely a sign of continued inflation. Economist Kurt Rankin of PNC Financial Services says: “Producer prices are an early warning sign of what households can expect in terms of consumer price inflation.” (2)There was a slight rise in new jobless claims, but that's off a 54-year low just last week. The Labor Department reported an 18,000 increase in applications, to a total of 185,000. Meanwhile, the number of continuing claims went down 48,000 to a total of 1.48 million. (3)Mortgage RatesMortgage rates hit the 5% mark for the first time in more than 10 years. Freddie Mac says the average 30-year fixed-rate mortgage was up 28 basis points to exactly 5%. The 15-year was up 26 points to 4.17%. High home prices combined with higher mortgage rates are making it a lot harder for many Americans to become homeowners. (4)In other news making headlines…Rents Hit Double-Digits in Many AreasRents are also moving higher in step with home prices. Many landlords are playing catch-up with rent levels after the pandemic. Realtor.com says that average rents are up almost 20% since 2020. The research covered March of 2020 to March of this year. (5)Among the areas with the fastest rent growth are Miami; Riverside County, California; and Tampa, Florida. Orlando and Jacksonville are also both in the top 10 for rent growth.Realtor.com economist Daniel Hale says that rents are creating affordability issues for some renters. She also says there are signs that rent growth is slowing down but it's hard to predict if the trend will continue. She says: “The jury is still out on whether rent growth will hit single digits by the end of 2022.”Property Taxes Heading HigherHome values appear to be rising much faster than property tax, which suggests that tax assessors have some catching up to do. ATTOM Data Solutions says the average property tax on single-family homes rose 1.8% nationwide last year. That's the slowest pace of tax growth in five years. (6)ATTOM's Rick Sharga says it's surprising that property taxes have gone up more because home values are up 16% for last year. That likely means that homeowners can expect to see higher tax bills as homes are reassessed.Some areas have already increased property taxes. In Nashville, Tennessee, they went up an average of 27% last year. Milwaukee homeowners are paying about 18% more on property taxes. Baltimore and Grand Rapids, Michigan, are third and fourth for the highest recent tax increases. Surprisingly, tax rates actually went down in some areas including Houston, Dallas, and Austin, Texas.Prices Keep Rising for Building MaterialsThe cost of building a new home keeps going up, although lumber prices just came down a little. The National Association of Home Builders says building material prices have gone up 20.4% year-over-year and 33% from the beginning of the pandemic. (7)Additional costs have added 31% to the cost of a new home. Realtor.com reports the average sales price of a new home was $511,000 in February. Insider attributes the drop in lumber prices to improvements in the supply chain and a softening of demand for lumber. It says lumber prices have fallen 39% from a March high and are now 52% lower than they were in May of last year. That's when they peaked at $1,733 per one thousand board feet.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more. Thanks for listening. I'm Kathy Fettke...Show Notes link: https://www.newsforinvestors.comJoin link: https://join.realwealth.com/?utm_content=Real%20Estate%20News%20Podcast&utm_campaign=Join%20for%20Free&utm_term=Description%20Text%20LinkSubscribe link: https://podcasts.apple.com/us/podcast/real-estate-news-real-estate-investing-podcast/id107995271 Links:1 - https://www.marketwatch.com/story/coming-up-consumer-price-index-for-march-11649764935?mod=economy-politics2 - https://www.marketwatch.com/story/wholesale-prices-surge-1-4-and-point-to-high-u-s-inflation-through-the-spring-11649853503?mod=economic-report3 - https://www.marketwatch.com/story/jobless-claims-bounce-higher-after-hitting-54-year-low-in-prior-week-11649940054?mod=mw_latestnews4 - https://www.freddiemac.com/pmms5 - https://magazine.realtor/daily-news/2022/04/14/rent-jumps-by-nearly-20-in-2-years6 - https://www.attomdata.com/news/market-trends/home-sales-prices/attom-2021-property-tax-analysis/7 - https://magazine.realtor/daily-news/2022/04/14/building-materials-rise-but-lumber-prices-ease

In this Real Estate News Brief for the week ending April 9th, 2022... the Fed's inflation fighting game plan, first quarter housing affordability, and the metros with more new listings.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week, and the Fed's plan to rapidly shrink its $9 trillion balance sheet to help control inflation. According to the minutes of its March meeting, which were released last week, the Fed plans to reduce its bond portfolio by about $95 billion per month. (1) Fed policymakers haven't made a final decision yet, but they say the reduction plan could begin next month.Federal Reserve Governor Lael Brainard said at a conference that she expects a series of rate hikes and a rapid winding down of the balance sheet to bring inflation to a “more neutral position.” That includes bigger-than-usual rate hikes. Kansas City Fed President Esther George said in a Bloomberg TV interview that “50 basis points is going to be an option that we'll have to consider, along with other things.” San Francisco Fed Bank President Mary Daly said during a meeting in Seattle that she doesn't expect the nation to fall into a recession. She said: “We could slow so it looks like we are teetering close to it, that's possible, but it will be a short-lived event I expect, and then we'll be back up.” (2)Jobless claims came in at 166,000 last week, which is the second lowest reading in U.S. history. The last time jobless claims were that low was back in 1968. The job market is strong, and that's one major buffer against the risk of recession. Wages are rising at a fast pace, although they are not keeping up with inflation. But jobs are plentiful, and workers are easily quitting one job for another. (3)Mortgage RatesMortgage rates are also rising quickly. Last Thursday, Freddie Mac said the average 30-year fixed-rate mortgage was 4.72%. The 15-year was 3.91%. It's gone even higher since then making it harder for many Americans to afford a mortgage. (4) In other news making headlines... Homes Affordability Drops in Many AreasRising mortgage rates combined with higher home prices are knocking a lot of people out of the home buying market. ATTOM Data Solutions' first quarter Home Affordability Report shows that home price growth in the first quarter was faster than it's been for at least 15 years. It shows that median-priced single-family homes in 79% of the counties analyzed were less affordable in the first quarter than in the historical past. The same report at the beginning of “last year” showed that 38% of the counties were less affordable. (5)ATTOM's Rick Sharga says: “It's certainly no surprise that affordability is more challenging today for prospective homebuyers.” He says: “As home prices continue to soar and interest rates approach five percent on a 30-year fixed rate loan, more consumers are going to struggle to find a property they can comfortably afford.” Inventory Increasing for Spring SeasonThere has been an increase in listings for the spring buying season, with more on the way. Realtor.com says that new listings were up 8% last week, and a new survey shows that 64% of the people in the survey plan to sell their homes in the coming months. (6)That's already starting to bring prices down. According to Redfin, 12% of the homes for sale had a price drop during the month of March, although Redfin's chief economist Daryl Fairweather says that “price drops are still rare” but they do show “there's a limit to a sellers' power.” He says: “Sellers can no longer overprice their homes and expect buyers to clamor at their door.” Redfin says the average home has been selling 2.1% above its asking price. (7) Cities with the Most New ListingsRealtor.com did some research as to which metros are seeing the most new listings. At the top of the list is Panama City, Florida. Daphne, Alabama is second on the list followed by Myrtle Beach, South Carolina; Jacksonville, North Carolina; Iowa City, Iowa, and Macon, Georgia. Rounding out the top ten are East Stroudsburg, Pennsylvania; Greeley, Colorado; Boise, Idaho, and Atlantic City, New Jersey. It sounds like there's a little something in there for everyone. That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review! You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/balance-sheet-to-shrink-by-95-billion-per-month-as-many-on-fed-see-50-basis-point-hikes-coming-minutes-show-2022-04-06?mod=mw_latestnews2 -https://www.reuters.com/business/feds-brainard-sees-methodical-rate-hikes-rapid-balance-sheet-shrinkage-2022-04-05/3 -https://www.marketwatch.com/story/u-s-jobless-claims-drop-to-54-year-low-of-166-000-11649335442?mod=u.s.-economic-calendar4 -https://www.freddiemac.com/pmms5 -https://www.attomdata.com/news/market-trends/home-sales-prices/attom-q1-2022-u-s-home-affordability-report/6 -https://magazine.realtor/daily-news/2022/04/07/housing-inventory-turnaround-possible7 -https://magazine.realtor/daily-news/2022/04/08/there-may-be-a-limit-to-sellers-power8 -https://www.realtor.com/news/trends/where-were-seeing-the-most-new-listings/

In this Real Estate News Brief for the week ending February 12th, 2022… the latest reading on inflation, home price growth, and foreclosures.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review. Economic NewsWe begin with economic news from this past week. The latest inflation report shows that consumer prices notched up another .6% in January. That brings the annual rate of inflation to 7.5%, which is the highest inflation we've seen in 40 years. Much of the increase is due to the high cost of food, energy and housing costs, which include rents. According to MarketWatch, Wall Street analysts only expected a .4% gain in January. (1)If you strip out food and energy for a core rate of inflation, it's at 6%. That's still twice the rate the Federal Reserve would like to see. Shawn Huss at Warsaw Federal calls inflation an “economic killer.” He wrote in an emailed newsletter: “It is a tax that does not get collected and if people believe prices will be higher in the future, inflation could become entrenched.” Huss also has some good news. He says that: “Inflation expectations for the future remain relatively low. The 10-Year Treasury breakeven rate, or what the bond market expects inflation to run on average over the next 10 years, is a relatively low 2.42%.”Jobless claims were down for a third week in a row. The Labor Department says there were 16,000 fewer initial state claims than the week before for a total of 223,000 applications. That's the lowest number we've seen since December. But the number of people already getting unemployment benefits stayed the same at about 1.62 million. Economists expect that fewer and fewer people will be collecting jobless benefits as the omicron wave diminishes. (2)Mortgage RatesMortgage rates are now at the highest level since the pandemic began. Freddie Mac says the average 30-year fixed-rate mortgage was 14 basis points higher last week, for a rate of 3.69%. The 15-year was up 16 points to an average of 2.93%. (3) Freddie expects the trend to continue because of the strong job market and the high rate of inflation, and says that that will probably take a bite out of homebuyer demand.In other news making headlines...Home Prices Higher in Q4Homebuyers are facing higher home prices as well, although home price growth is expected to slow down with higher mortgage rates. The National Association of Realtors says the median sales price of a home was 15% higher in the fourth quarter of last year, compared to the year before. That includes both new and existing homes. That figure is down slightly from a 15.9% year-over-year increase in Q3. (4)NAR tracked mortgage rates in 183 metros and says that two-thirds of them posted double-digit appreciation. That's making it tough on homebuyers. The report says that the typical monthly mortgage payment is about $1,240 which is about $200 higher than it was a year ago.NAR'S chief economist Lawrence Yun, says that many homebuyers are getting forced out of the market because of high home prices, but he also says that: “Home prices should begin to normalize later in 2022 as more homes come on the market.”More Foreclosure ActivityForeclosure activity is currently at its highest level since the start of the pandemic. ATTOM Data Solutions says it jumped 29% higher from December to January. That activity includes default notices, scheduled auctions, and bank repossessions. Year-over-year, they are up 139%. (5)RealtyTrac's Rick Sharga expects to see more increases throughout the year, but he also says: “It's likely that foreclosure activity will remain below historically normal levels until the end of 2022.” Back in 2019, foreclosure activity was about 60% higher.Sharga wasn't surprised by the January increase because foreclosures often slow down during the holidays and then surge a bit at the beginning of the year. He says: “This year, the increases were probably a little more dramatic than usual since foreclosure restrictions placed on mortgage services by the CFPB expired at the end of December.”Metros with the highest foreclosure activity include: Detroit; Atlantic City, New Jersey; Cleveland; Columbia, South Carolina; and Trenton, New Jersey.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!To learn more about real estate investing, become a RealWealth member for free at newsforinvestors.com. You will have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/coming-up-consumer-price-index-11644498273?mod=mw_latestnews2 -https://www.marketwatch.com/story/u-s-jobless-claims-fall-for-third-straight-week-11644500332?mod=economic-report3 -http://www.freddiemac.com/pmms/4 -https://magazine.realtor/daily-news/2022/02/10/home-price-surge-continued-in-fourth-quarter5 -https://magazine.realtor/daily-news/2022/02/10/foreclosure-activity-highest-since-pandemic-began

Investors were busy in the second quarter of this year. They increased their share of purchased residential properties. But even though they bought more than consumers, they spent less. So where are these great deals? The RealtyTrac report has a few answers.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.RealtyTrac published the results of its analysis with data from its parent company, ATTOM Data Solutions. (1) It found that investor purchases accounted for 15.4% of all U.S. residential purchases in the second quarter of this year. That's up 3.9% from Q2 of last year when investors accounted for 11.5% of all home purchases. (2)If you compare Q2 to Q1 of this year, investor purchases were about the same. Although the numbers show a year-over-year increase, RealtyTrac's executive vice president, Rick Sharga, doesn't believe they represent a significant change of course. But, he says they do disprove the idea that investors are gobbling up too much of the inventory. He says: “Historically investors have always accounted for somewhere between 10% and 15% of residential home purchases, and our data shows that this is still the case today, albeit at the high end of that range. But the data doesn't support the ‘Wall Street is buying up Main Street' theme that's been a popular theory for the past year or so.”States Attracting the Most Investors ActivitySo where are investors placing their bets? New Hampshire tops the list, with Delaware, Georgia, Arizona, and Mississippi rounding out the top five. In the second tier is Florida, North Carolina, Oklahoma, Arkansas, and Nevada. Investor share ranges from 23.2% of all purchases in New Hampshire to 18.7% of purchases in Nevada.As for the ten states with the lowest share of investor purchases - Vermont tops that list, followed by Alaska, New Mexico, Montana, and Idaho. The other five states include Oregon, West Virginia, Wyoming, Washington, and Iowa. Investor share of purchases in Vermont are less than 1%, while Alaska is 1.9%. The share increases to about 11% for Iowa.Biggest Investor DiscountsSo what's this about buying more and paying less? RealtyTrac says that in the second quarter, investors paid an average of 29.4% less than your typical consumer. That's on a national basis among 38 states with full reporting data. Investors got a better deal, on average, in 33 out of 38 of those states. For investors, the median price of a home was $205,000. For consumers, it was $290.230.As for the states with the biggest investor discounts, Arkansas was number one. It had the highest investor discount at 76.9%. Michigan was next with a 60% discount to investors. Louisiana and Nebraska were both about 55%. West Virginia and Oklahoma were around 50%.Sharga is quick to point out that investors are not getting special treatment. They are just better shoppers. And, he says: “Another misconception is that investors are overpaying for properties, making it difficult for consumers to compete and artificially driving up prices. But successful investors tend to look for below-market pricing in order to make a profit…” Plus, many buy in cash, which often comes with a discount.In Q2 of this year, 79% of investor purchases were in cash compared to 69% for Q2 of last year. While that figure varies from state-to-state, the report shows that the share was more than 50% in all states, except for Alaska. There's a link to the RealtyTrac report in the show notes at newsforinvestors.com.You can also find out more about real estate investing at our website by joining RealWealth for free. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources. That includes experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.And please remember to hit the subscribe button, and leave a review! Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.realtytrac.com/newsroom/wp-content/uploads/sites/14/2021/10/Oct-21-RealtyTrac-RE-Investor-Purchase-Activity-Press-Release.pdf2 -https://www.realtytrac.com/blog/realtytrac-investor-purchase-report-fall-2021/

In this Real Estate News Brief for the week ending October 23rd, 2021... the Fed's new rate hike schedule, a new wave of foreclosures, and a rent growth surprise for some single-family homes.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week with comments from Fed Chief Jerome Powell. It looks like the timeline for interest rate hikes has been pushed up again. Last month, there was more of a debate as to whether it would happen in 2022 or 2023. Powell indicated that conditions for a rate hike would probably be reached next year. That includes the Fed's goal of maximum employment. The inflation requirement has already been met. That's when inflation remains above 2% for a sustained period of time. Powell also said that now is the time to begin tapering the Fed's bond-buying strategy. Policymakers will discuss a tapering plan next month. Jobless claims fell to a fresh pandemic low last week. There were only 290,000 initial claims for state benefits. Continuing claims also fell. They were down 290,000 to 2.48 million. (2) Millions of jobs are going unfilled, however, which is making it difficult for businesses to meet the demand for goods and services. That's also creating supply chain issues that are driving up prices, and inflation.Home buyers are going full steam ahead to lock in deals before mortgage rates rise any higher. The National Association of Realtors say that existing home sales were up 7% from August to September. That's a seasonally-adjusted annual rate of 6.29 million homes. (3) Part of that increase is due to more inventory, but NAR Chief Economist Lawrence Yun says that inventory was quickly gobbled up. On the other side of the housing supply issue, residential construction was down due to those supply chain issues, and a labor shortage. The government says that September home starts were down 1.6% compared to August, and that permits were down 7.7%. Multi-family permits were down the most. They fell 21% while single-family permits were down just 1%. (4) Despite all the headwinds that builders face, the National Association of Home Builders monthly confidence index shows an increase of four points to a reading of 80. Anything over 50 is positive. Although builders have to keep raising prices, they are encouraged that demand and home sales “remain strong.” (5)Mortgage RatesMortgage rates rose slightly this last week. Freddie Mac says the 30-year fixed-rate mortgage was up four points, to 3.09%. The 15-year was up three points, to 2.33%. (6)In other news making headlines…Foreclosures on the RiseForeclosure filings jumped higher in September, after pandemic-related moratoriums were lifted. ATTOM Data Solutions released its Q3 foreclosure report which shows that foreclosure filings were up 24% compared to August, and 102% from a year ago. (7)Economists have been predicting a spike in foreclosures, but RealtyTrac's Rick Sharga says: “Despite the increased level of foreclosure activity in September, we're still far below historically normal numbers.” He says they are almost 70% lower than they were before the pandemic. And light years away from the number of foreclosures in mid-2009.Foreclosure filings were approaching 600,000 per quarter back then. Currently, there are 45,500 filings for the third quarter of this year.Single-Family Rent GrowthSingle-family rent growth quadrupled in August. CoreLogic says the year-over-year rate of growth was 9.3%, and represents the fastest annual rent growth in 16 years. (8)The single-family category includes both detached and attached units, such as duplexes, triplexes, quadplexes, townhomes, row homes, co-ops, and condos. Rent growth spiked the most for detached homes. Annualized rent growth for attached units was 6.4% while the rent for detached homes rose 11.7%.The city with the highest rent growth was Miami. Rents in Miami were up 21.5%. That pushed Phoenix into second place for the first time in almost three years. Rounding out the top five are Las Vegas, Austin, and Dallas. New Forecast for Top Markets in 2022New forecasts are coming out about next year's hot real estate markets. PwC just released its 2022 Emerging Trends in Real Estate report. The report includes a top-10 list of highly ranked real estate markets for 2022. Several of them are also on our list of recommendations for single-family rentals. Those markets include Tampa/St. Petersburg, Charlotte, Dallas/Fort Worth and Atlanta.PwC is also recommending those cities, and others, for the construction of new homes. If you have been following RealWealth, you know that we have expanded our focus on existing single-family rentals to also include the construction of new rental homes. Our recommended markets include Charlotte, North Carolina; Cincinnati and Dayton, Ohio; Dallas, Texas; Park City, Utah, and several Florida markets.You can find out more by joining RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/feds-powell-says-elevated-inflation-could-last-well-into-next-year-11634917919?mod=economy-politics2 -https://www.marketwatch.com/story/jobless-claims-fall-to-pandemic-low-of-290-000-as-businesses-try-to-avoid-layoffs-due-to-labor-shortage-11634819765?mod=u.s.-economic-calendar3 -https://www.marketwatch.com/story/existing-home-sales-rise-as-some-buyers-are-motived-by-fomo-11634826649?mod=economic-report4 -https://www.marketwatch.com/story/construction-on-new-homes-slows-as-supply-chain-woes-hit-the-housing-market-11634647997?mod=economic-report5 -https://www.marketwatch.com/story/home-builders-grow-more-confident-in-spite-of-continued-supply-chain-headaches-11634565934?mod=economic-report6 -http://www.freddiemac.com/pmms/7 -https://www.attomdata.com/news/market-trends/foreclosures/attom-september-and-q3-2021-u-s-foreclosure-market-report/8 -https://www.corelogic.com/intelligence/single-family-rent-growth-approaches-double-digits/9 -https://fortune.com/2021/10/18/hot-real-estate-markets-2022-outlook-real-estate-buying-a-house/

Real estate investors have experienced some big swings in the market over the past decade. We've gone from dirt cheap foreclosures after the housing meltdown, to more difficult investing opportunities today. According to a new survey, that's discouraging many small scale real estate investors, but difficult doesn't mean impossible. It means you need to be flexible, adaptable, and smart about your choices.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Real-estate data company RealtyTrac conducted an investor sentiment survey among 300 real estate investors from across the country. (1) It shows that 48% of them feel that the investing environment is worse or even “much” worse than it was just one year ago. And it wasn't that much better a year ago. The same survey shows that 45% felt that way in 2020 during the first year of the pandemic.RealtyTrac defines small scale mom-and-pop investors as those who buy one to 10 properties a year. That includes people who flip homes and those why buy and hold them as rentals. RealtyTrack says 90% of the 19 million single-family rental properties in the U.S. are owned by smaller investors. It also says there are thousands of people flipping homes at a rate of about one a month, although they are facing more competition from iBuyers like Opendoor, Offerpad, and Zillow. Investor Sentiment SurveyThis is the second year in a row for the RealtyTrac Investor Sentiment Survey. RealtyTrac says that last year's survey was evenly split between flippers and buy-and-hold investors. This year, there were more buy-and-hold rental property investors. Researchers say that could be the result of market conditions which are reducing home-flipping returns.Previous research by RealtyTrac's parent company ATTOM Data Solutions shows that the typical gross-flipping profit was $67,000 in the second quarter of this year. That's a 33.5% return on investment compared to a 40.6% ROI for Q2 in 2020. It's also the lowest ROI for flippers since 2011. (2)RealtyTrac's survey found that real estate investors are most concerned about high home prices. That concern replaced lack of inventory as the biggest worry in last year's survey. Lack of inventory is now second on the list of concerns. Investors are also worried about the cost of materials and labor along with competition from regular homebuyers.RealtyTrac's Rick Sharga says: “Investors are more optimistic about the future than they are about current market conditions. But they do worry about inflation -- about 81% of the investors surveyed were concerned about inflation causing material and labor costs to rise, making affordability an issue for prospective homebuyers and renters, and increasing the costs of financing.”The survey also asked investors about their foreclosure expectations once government protections expire. About 30% of them expect foreclosures to return to a historical level of about 1% while 33% expect them to increase, but remain below the levels we saw during the Great Recession. Real Estate Investors Need to Shift FocusThe survey title suggests that “Real Estate Investors Have Soured on the Current Market.” I think a better title might be: “Real Estate Investors Need to Shift their Focus.” At least that's what we are doing at RealWealth.The market is changing, again. It's something that the market will always do, so investors need to be flexible and adapt to new conditions. The last ten or so years have been easy for real estate investors. We had a housing crash and dirt cheap prices. But those prices have been rising for a decade. So what now?Yes, it's harder to get inventory. One of our property providers says that foreclosure auctions have completely stopped so she's trying to build new homes for buy-and-hold rental investors, although that has its own challenges.We are in a new market cycle, so investors need to be more creative. In California, new laws have neutralized the idea of single-family zoning. You can now subdivide a single-family property into a duplex, or even a four-plex if the lot is big enough. Investors could live in one, and rent the rest. Short-term rentals could also work, if local laws allow them.California also allows in-law units or ADUs on single-family properties which is another way for property owners to create rentals. Creative Investing for Today's MarketMore creative investors might want to look at ways to help aging baby boomers who need assisted living, or younger professional who need a place to decompress. One of my friends is now turning high-end homes into rehab centers for individuals who need a get-away place to recuperate. Empty hotels could provide an interesting opportunity for apartment conversions. What should you look for? As you know, homes are selling quickly, but that's not 100%. You can look for higher-priced homes that have been sitting on the market for too long and negotiate the price tag. At RealWealth, our teams are helping builders buy land for the development of single-family rentals. By contributing to these projects at the beginning, we are also able to help builders understand the difference between a rental home and a primary residence in terms of design and materials. You can also learn more about single-family rentals by joining RealWealth for free. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources. That includes experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.You'll also find links to information about RealtyTrac's survey in the show notes. And please remember to hit the subscribe button, and leave a review!Thanks for listening. I'm Kathy Fettke.Links:1 - https://www.businesswire.com/news/home/20210929005109/en/Real-Estate-Investors-Have-Soured-on-the-Current-Market-According-to-the-Fall-2021-RealtyTrac%C2%AE-Investor-Sentiment-Survey%E2%84%A22 - https://www.attomdata.com/news/market-trends/flipping/attom-q2-2021-u-s-home-flipping-report/

Homeowner equity is the highest it's ever been. So, how do investors play in this market where demand for housing exceeds supply? If you want access to a database that covers 90% of comprehensive foreclosure information, you'll want to listen to this show! For more from guest Rick Sharga, visit www.RealtyTrac.com

Homeowner equity is the highest it's ever been. So, how do investors play in this market where demand for housing exceeds supply? If you want access to a database that covers 90% of comprehensive foreclosure information, you'll want to listen to this show! For more from guest Rick Sharga, visit www.RealtyTrac.com

In this episode of Bankcast, we talk with Rick Sharga, executive vice president at RealtyTrac, about the current state of home sales, housing prices, low inventory, construction supply bottlenecks and where we go from here as the pandemic wanes. 

The Power Is Now Media is conducting a series of interviews about the importance of Homeownership and Financial Literacy, during the month of June. Today Eric Frazier speaks with Rick Sharga, Executive Vice President of RealtyTrac.Our goal is to inspire and educate everyone about the wealth-building impact that homeownership can have on your life. Especially for low to moderate-income families, minorities, and African Americans who have the lowest homeownership rate of all minorities.Rick is the Executive Vice President of RealtyTrac, a leading foreclosure search and discovery website used by real estate agents and investors.One of the country's most frequently-quoted sources on real estate, mortgage and foreclosure trends, Rick has appeared on CNBC, CBS News, NBC News, CNN, ABC News, FOX, Bloomberg and NPR. Rick is a founding member of the Five Star National Mortgage Servicing Association, on the Board of Directors of REOMAC, and was included in the Inman News Inman 100, an annual list of the most influential real estate leaders in both 2013 and 2014.

In conversation with Rick Sharga, Executive Vice President of RealtyTrac. Rick is the Executive Vice President of RealtyTrac, a leading foreclosure search and discovery website used by real estate agents and investors. One of the country's most frequently-quoted sources on real estate, mortgage, and foreclosure trends, Rick has appeared on CNBC, CBS News, NBC News, CNN, ABC News, FOX, Bloomberg, and NPR. Rick is a founding member of the Five Star National Mortgage Servicing Association, on the Board of Directors of REOMAC, and was included in the Inman News Inman 100, an annual list of the most influential real estate leaders in both 2013 and 2014. The roundtable panel is composed of VIP agents and brokers who are successful and have years of experience in the real estate industry. The goal of the Roundtable is to share market news, business and listings opportunities, mortgage and DPA programs, and marketing services that can help agents grow their business and better serve their clients. 

With the housing market more competitive than it's ever been, you need to be aware of what's really going on. This morning we're joined by Rick Sharga, Molly Dowdy and Jacob Gaffney to discuss what's really happening in our industry. Come SHRED with us!Rise&Shred: https://mailchi.mp/shredmedia/riseandshred

Are we really as bad as this video claims? Are we the true Villains of the next housing crisis? Join Jacob Gaffeny, Rick Sharga, and Josh Pitts as they dissect this YT video accusing "rich people and financial institutions" of dooming the housing market.Subscribe to Rise&Shred here: https://mailchi.mp/shredmedia/riseandshred

There’s a new plan brewing to help delinquent borrowers and prevent another wave of foreclosures. The Consumer Financial Protection Bureau wants to extend the foreclosure moratorium through the end of this year and is currently asking for comments on the plan. But does the CFPB have the authority to do this?According to the Mortgage Bankers Association, 2.7 million homeowners were in forbearance programs as of January 31st of this year. That’s down from a pandemic peak of some 6 million homeowners, but it’s a substantial number of homes at risk of foreclosure. Black Knight estimates the number of mortgages that are currently 90 or more days past due is about 2 million. And that’s about five times higher than before the pandemic began. The real estate data firm expects some improvement through the end of June, when the current foreclosure moratorium expires, but it expects that 1.8 million mortgages will still be seriously delinquent.The MBA says the delinquency rate for one-to-four-unit residential properties was 6.73% at the end of the fourth quarter. Black Knight says it fell below 6% in January, for the first time since the pandemic began. Although the foreclosure moratorium is currently set to expire in June, delinquent homeowners may have different dates for the expiration of their forbearance programs. Loans backed by Fannie and Freddie can have as much as one year of forbearance. Private lenders may have other options.Extending the foreclosure moratorium will give homeowners more time to work out a solution with their lenders. The CFPB is also proposing ways to streamline the process of getting homeowners out of forbearance and into other payment plans.The MBA’s CEO, Dave Stevens, feels the CFPB has gone beyond its authority in offering to extend the moratorium. Stevens told HousingWire: “My concern is that the bureau is overstepping its bounds and violating in essence agreements that have already been previously made.”He says that another halt on foreclosures could hurt the mortgage industry’s relationship with its investors, which servicers have worked hard to maintain. According to Black Knight, service providers have advanced investors $19 billion for delinquent mortgage payments during the last year. HousingWire also reports that lenders have already been doing a good job helping homeowners exit forbearance. It says that almost 86% of those who exited forbearance did so with a payment plan in place.Executive Vice President of RealtyTrac, Rick Sharga, says of the results: “I think the math speaks for itself how well the forbearance program has worked, and it’s one of the few times in my career that I have seen a government-initiated program adopted as well and executed as well by the industry as this one.”He doesn’t feel the same way about another foreclosure moratorium however. He says: “What they are doing is getting involved in a very complex process and it may be forcing servicers to violate covenants of the investor who bought the loan, and that’s the real challenge.”MBA President, Robert Broeksmit, is also citing some impressive numbers. He reportedly said in a recent article that mortgage servicers successfully helped 4.3 million Americans enter forbearance plans in less than 10 weeks. Broeksmit says: “The ability for the industry and mortgage servicers to overcome the obstacles created by COVID-19 will depend on our ability to work together.”The CFPB is proposing three actions to help borrowers impacted by the pandemic. The first is to grant borrowers more time, with a moratorium that runs through December 31st. The second is to give servicers a way to modify loans more quickly with less paperwork. And third, to improve communication with borrowers so they are aware of their options at the appropriate time. The public comment period runs through May 11th.You’ll find links to the CFPB’s proposal and other articles mentioned in this episode on the podcast player page at www.NewsForInvestors.comLinks:1 - https://www.housingwire.com/articles/does-cfpb-have-authority-to-postpone-foreclosures/2 - https://files.consumerfinance.gov/f/documents/cfpb_mortgage-servicing_nprm_2021-04.pdf3 - https://www.blackknightinc.com/black-knights-first-look-at-january-2021-mortgage-data/4 - https://www.mba.org/2021-press-releases/february/mortgage-delinquencies-decrease-in-the-fourth-quarter-of-20205 - https://dsnews.com/daily-dose/04-05-2021/cfpb-proposes-plan-to-avoid-foreclosure-surge

I'm joined by Rick Sharga of RealtyTrac, the countries leading expert on foreclosures, discussing what lies ahead as our government moratoria and forbearance programs expire. We are discussing topics from eviction moratorium, to foreclosures, to the crash in 08' and so much more!You do NOT want to miss this!Don't miss out on our daily news about the mortgage industry:https://mailchi.mp/shredmedia/riseandshred

On this episode of the podcast, Tim talks with his good friend Rick Sharga, Executive Vice President of RealtyTrac. They discuss the current market conditions that have resulted from the pandemic and the recession that followed, particularly how this recession is atypical and can’t necessarily be treated like previous ones. Rick talks about his outlook on the foreclosure environment and why data shows that there are not really as many people in serious delinquency as is being reported. They also talk about housing prices and walk through the presumptive President-Elect and Vice President-Elect’s proposed policies regarding the housing industry. This is a very informative session that you will want to be sure to tune in for! To view the slides from this presentation, please visit Tim's YouTube Channel or Facebook Page.· Foreclosureso Delinquency rates§ They are the highest they have been since 2009-2010§ However, all of the homeowners who are taking advantage of the governmental forbearance program are included in this number§ As soon as they set up a payment plan with their lender, they are removed from this list§ 70% of homeowners have more than 20% equity in their homes§ So they have a much higher likelihood of selling their homes than foreclosing§ This depends on demographics, demand, and interest rateso Sub-$250k homes are in higher demand now than ever beforeo There is a dichotomy in the workforce but both white-collar and blue-collar workers are looking to buy in this price rangeo The lower-middle class has essentially been neutralized in the homebuying process§ Entry and 2nd tier move-up properties are not availableo The housing industry crisis is really and affordability crisis· Biden Policieso $15,000 tax credit for first-time homebuyers§ A solution in search of a problem§ This will increase demand and drive home prices even higher§ More fees will be tacked on to Fannie Mae and Freddie Maco Homeowners Bill of Rights§ Modeled after California’s § Manifests as punitive§ Few people need this§ Missing a key component: protecting landlords· 85% of landlords own 2 units or fewer§ Doesn’t really affect hard money loans§ Could be helpful in low-income neighborhoods§ Key: in persistently underserved communities§ Provides loans to fix up the propertieso Public credit reporting agencyo Constructing affordable housing§ Will likely only help big developerso Industrial – finding holes in markets, cloud computingo Commercial – short-term pain for long-term progresso Hotels – currently at about 39% occupancy, will take a while to get them back on their feeto Retail – was already struggling, more bankruptcies, spaces could be repurposedo Office space – more people are working from home, but they also need more space per worker in-office· Predictions/Outlook for 2021o Depends on how soon we can get the virus under control and how the economy responds Connect with Rick:https://www.linkedin.com/in/rickshargahttps://twitter.com/rickshargaDecember 9th webinar: https://t.co/NXqDJ82Epf?amp=1

Rick Sharga, Executive Vice President of Marketing at RealtyTrac, talks with Jason Hartman about forbearances and foreclosures. Does one lead to the other, and how will this differ from the great recession? How has COVID-19 changed how millennials approach renting vs. buying?  Rick Sharga also distinguishes between foreclosures and opportunities. Rick also gives an excellent insight into every sector of what he thinks is to be expected in the commercial real estate market.  Key Takeaways: [1:00] Everyone is asking, "is Covid going to cause a housing crash?" [2:00] Covid has not slowed down the housing market even a little bit.  [3:45] The pandemic accelerated millennials' trend to stop as urban renters and move to a place of homeownership.  [10:30] The 2006 median price home was $650 more expensive than the median price home today, adjusted for interest rates and inflation.  [12:00] Rick distinguishes between foreclosures and opportunities. [18:00] Will 3 million in forbearance programs end up in foreclosures? [21:00] What happens when all of these loans come out of forbearance? [26:45] Discussing California's new law that the institutional buyer cannot buy foreclosures.  [28:45] We already see a higher number of commercial foreclosure properties popping up.  [30:00] Rick breaks down his expectations for each sector of the commercial real estate environment.  [33:30] One of the most significant shortages in housing is in the low price tiers. Here's why. Websites: RealtyTrac.com PandemicInvesting.com JasonHartman.com/Ask JasonHartman.com/Start JasonHartman.com/Recordings JasonHartman.com/Asset JasonHartman.com/Webinar JasonHartman.com JasonHartman.com/properties Jason Hartman Quick Start Jason Hartman PropertyCast (Libsyn) Jason Hartman PropertyCast (iTunes) 1-800-HARTMAN

Rick Sharga, Executive Vice President of Marketing at RealtyTrac, talks with Jason Hartman about forbearances and foreclosures. Does one lead to the other, and how will this differ from the great recession? How has COVID-19 changed how millennials approach renting vs. buying?  Rick Sharga also distinguishes between foreclosures and opportunities. Rick also gives an excellent insight into every sector of what he thinks is to be expected in the commercial real estate market.  Key Takeaways: [1:00] Everyone is asking, "is Covid going to cause a housing crash?" [2:00] Covid has not slowed down the housing market even a little bit.  [3:45] The pandemic accelerated millennials' trend to stop as urban renters and move to a place of homeownership.  [10:30] The 2006 median price home was $650 more expensive than the median price home today, adjusted for interest rates and inflation.  [12:00] Rick distinguishes between foreclosures and opportunities. [18:00] Will 3 million in forbearance programs end up in foreclosures? [21:00] What happens when all of these loans come out of forbearance? [26:45] Discussing California's new law that the institutional buyer cannot buy foreclosures.  [28:45] We already see a higher number of commercial foreclosure properties popping up.  [30:00] Rick breaks down his expectations for each sector of the commercial real estate environment.  [33:30] One of the most significant shortages in housing is in the low price tiers. Here's why. Websites: RealtyTrac.com JasonHartman.com/Ask JasonHartman.com/Start JasonHartman.com/Recordings JasonHartman.com/Asset JasonHartman.com/Webinar JasonHartman.com JasonHartman.com/properties Jason Hartman Quick Start Jason Hartman PropertyCast (Libsyn) Jason Hartman PropertyCast (iTunes) 1-800-HARTMAN

Rick Sharga, Executive Vice President of Marketing at RealtyTrac, talks with Jason Hartman about forbearances and foreclosures. Does one lead to the other, and how will this differ from the great recession? How has COVID-19 changed how millennials approach renting vs. buying?  Rick Sharga also distinguishes between foreclosures and opportunities. Rick also gives an excellent insight into every sector of what he thinks is to be expected in the commercial real estate market.  Key Takeaways: [1:00] Everyone is asking, "is Covid going to cause a housing crash?" [2:00] Covid has not slowed down the housing market even a little bit.  [3:45] The pandemic accelerated millennials' trend to stop as urban renters and move to a place of homeownership.  [10:30] The 2006 median price home was $650 more expensive than the median price home today, adjusted for interest rates and inflation.  [12:00] Rick distinguishes between foreclosures and opportunities. [18:00] Will 3 million in forbearance programs end up in foreclosures? [21:00] What happens when all of these loans come out of forbearance? [26:45] Discussing California's new law that the institutional buyer cannot buy foreclosures.  [28:45] We already see a higher number of commercial foreclosure properties popping up.  [30:00] Rick breaks down his expectations for each sector of the commercial real estate environment.  [33:30] One of the most significant shortages in housing is in the low price tiers. Here's why. Websites: RealtyTrac.com PandemicInvesting.com JasonHartman.com/Ask JasonHartman.com/Start JasonHartman.com/Recordings JasonHartman.com/Asset JasonHartman.com/Webinar JasonHartman.com JasonHartman.com/properties Jason Hartman Quick Start Jason Hartman PropertyCast (Libsyn) Jason Hartman PropertyCast (iTunes) 1-800-HARTMAN

In this episode, Millionacres Editor, Deidre Woollard sits down with Rick Sharga, Executive Vice President at RealtyTrac, to discuss the current foreclosure market and what he and his team see as risks for the coming year.

What percentage of your salary is going to taxes? Jason Hartman shares staggering stats on income tax across the US. And the migration out of high-priced, cyclical markets continues.  Rick Sharga returns to the show to distinguish between foreclosures and opportunities. Will the 3 million forbearance cases end up in foreclosure? Rick also gives an excellent insight into every sector of what he thinks is to be expected in the commercial real estate market.  Key Takeaways: [1:15] Would you like to work for the government for 228.5 days per year? [6:00] The mass migration continues.  [7:45] Check out this ad from a Baltimore politician.  [11:45] Speaking of migration, Uhaul prices' paint a clear picture of where people are going.  Rick Sharga [18:00] Rick distinguishes between foreclosures and opportunities. [24:00] Will 3 million in forbearance programs end up in foreclosures? [27:00] What happens when all of these loans come out of forbearance? [32:45] Discussing California's new law that the institutional buyer cannot buy foreclosures.  [34:45] We already see a higher number of commercial foreclosure properties popping up.  [36:00] Rick breaks down his expectations for each sector of the commercial real estate environment.  [39:30] One of the most significant shortages in housing is in the low price tiers. Here's why. Websites: RealtyTrac.com PandemicInvesting.com JasonHartman.com/Ask JasonHartman.com/Start JasonHartman.com/Recordings JasonHartman.com/Asset JasonHartman.com/Webinar JasonHartman.com JasonHartman.com/properties Jason Hartman Quick Start Jason Hartman PropertyCast (Libsyn) Jason Hartman PropertyCast (iTunes) 1-800-HARTMAN

FICO scores have hit a record high, but is a perfect FICO score the best situation? Jason Hartman discusses FICO scores along with vacancy rates. What looks the best may not be the best.  Rick Sharga, Executive Vice President of Marketing at RealtyTrac, talks with Jason Hartman about forbearances and foreclosures. Does one lead to the other, and how will this differ from the great recession? How has COVID-19 changed how millennials approach renting vs. buying?  Key Takeaways: [1:25] You are assisting with a fundamental economic concept called price discovery. [3:00] FICO scores hitting a record high? [5:00] Do you want a perfect credit score or an ideal vacancy rate? [12:30] Let's compare rent decreases of two-bedroom units.  [16:50] Number of homes on the market is down 39%. Rick Sharga [18:00] Everyone is asking, "is Covid going to cause a housing crash?" [19:00] Covid has not slowed down the housing market even a little bit.  [20:45] The pandemic accelerated millennials' trend to stop as urban renters and move to a place of homeownership.  [28:30] The 2006 median price home was $650 more expensive than the median price home today, adjusted for interest rates and inflation.  Websites: RealtyTrac.com PandemicInvesting.com JasonHartman.com/Ask JasonHartman.com/Start JasonHartman.com/Recordings JasonHartman.com/Asset JasonHartman.com/Webinar JasonHartman.com JasonHartman.com/properties Jason Hartman Quick Start Jason Hartman PropertyCast (Libsyn) Jason Hartman PropertyCast (iTunes) 1-800-HARTMAN

Rick is the Executive Vice President of Marketing at RealtyTrac, the country's leading provider of foreclosure information for investors, consumers, and real estate professionals.Talking point:State of the housing market and financial marketsWhere do you see interest rates going? They are at an all-time low. What's happening with the loans in forbearance What impact do you think COV19 in the Winter of 2020 and 2021 will have on the economy and real estate in general.What can we expect in 2021 with short-sales and foreclosures are there any reputable forecasts?What will be the impact on property values if foreclosures dominate the market?What should agents recommend when asked if buying or selling?How is technology changing the default servicing industryHow can agents prepare themselves for the future of real estate?

On May 20th, I put together a panel of experts for a three hour webinar. The focus of the webinar was to discuss the impacts of COVID-19 on residential real estate investors. The event was centered around a keynote address by Dr. Mark Dotzour. Dr. Mark G. Dotzour is a real estate economist who served for 18 years as Chief Economist of the Real Estate Center at Texas A&M University in College Station. He has given more than 1,600 presentations to more than 295,000 people and has written over 90 articles for magazines and journals. His research findings have appeared in the Wall Street Journal, USA Today, Money Magazine and Business Week.First 30 Minutes: Introduction of speakersOne hour: Keynote Presentation: “The Economic Outlook for the Residential Real Estate Market” Mark DotzourThirty Minutes: Q&A with Mark DotzourOne Hour: Structured Panel discussing the presentation with all of the speakers and Q&AOur Keynote Speaker:Dr. Mark G. Dotzour is a real estate economist who served for 18 years as Chief Economist of the Real Estate Center at Texas A&M University in College Station. He has given more than 1,600 presentations to more than 295,000 people and has written over 90 articles for magazines and journals. His research findings have appeared in the Wall Street Journal, USA Today, Money Magazine and Business Week.Our Panelists: Kathy Fettke received her BA in Broadcast Communications from San Francisco State University and worked in the newsrooms of CNN, FOX, CTV and ABC-7. She’s past-president of American Women in Radio & Television. Rick Sharga is an accomplished Marketing executive with over 30 years of experience in consumer and business-to-business practice. Kevin Ortner is the president and CEO of Minneapolis-based Renters Warehouse, the nation’s largest and fastest-growing residential property management company. Ken Channell has focused his career on organizational development and helping franchisees and their teams focus on using their strength to develop profitable businesses.Daren Blomquist is Vice President of Market Economics for Auction.com. Tim Herriage is your host for this exciting, informative, and results oriented presentation.

Housing expert Rick Sharga, CEO of CJ Patrick Co., talks with FHLB Dallas about home prices, home sales, remote work, first-time homebuyers, tightening mortgage credit and coronavirus.

How would you like a little good news on real estate today? Goodness knows we're inundated with plenty of bad news these days. And it's not surprising. We’re navigating through a very unusual situation right now. And the "unknown" is generating a lot of fear and creating a lot of questions about when we’ll bounce back economically, and how the COVID-19 bug will change the way we do business and lead our personal lives. As real estate investors, we must also be prepared for changes in the housing industry and the lives of our tenants. Will the economy recover quickly? Will the housing market hold up? Will the jobs come back? What will tenants want and need in a work-from-home world? What about single-family rentals, Airbnb, and housing for students and seniors?   There are a lot of moving parts, but our guest today joins me with years of experience in real estate and business strategy. Rick Sharga is the founder of consulting firm CJ Patrick. He’s also had high-profile positions at Auction.com, RealtyTrac, Ten-X, and Carrington Mortgage Holdings, and is frequently quoted by major media outlets. Today, he’ll share some valuable insights on how this pandemic will likely play out, and it’s not all bad news. Rick sees light at the end of the tunnel. Welcome, Rick. If you'd like to see which metros we think will recover the quickest, visit www.RealWealthShow.com.There you'll find detailed market data along with a list of rental property providers and property management companies highly rated by our members.

In today's Daily Download episode, HW+ Managing Editor Brena Nath discusses whether or not COVID-19 will derail the U.S. housing market.In an HW+ PULSE article, contributor Rick Sharga says:Like most of the news surrounding the COVID-19 global pandemic, reports about the U.S. housing market have been discouraging. Year-over-year listings of homes for sale have plummeted – in the worst-hit markets like New York City, listings are down 80% compared to April 2019. Home sales began to slow down dramatically in the last half of March, and are expected to drop even more drastically in April and May, which are usually two of the months with the highest volume of home sales. Pending home sales are off over 30%. And over 3 million homeowners have applied for mortgage payment forbearance, causing at least some concern about a large number of potential defaults at the end of the forbearance period. None of this should be surprising, under the circumstances. With almost every state in the country implementing some form of shelter-in-place order and shutting down most non-essential businesses, more than 25 million citizens filed for first-time unemployment benefits over the past four weeks. Given all of this, anything other than bad news in the housing market would be a huge surprise. The question isn't whether housing numbers will continue to suffer until the pandemic recedes and the economy has a chance to begin its recovery. It's what happens after that.Following the main story, HousingWire Digital Producer Alcynna Lloyd spotlights Michigan's resilient housing ecosystem, the Department of Housing and Urban Development's Office of the Inspector General's report that indicates some of the nation's largest mortgage servicers are providing borrowers with inadequate forbearance information, and Wells Fargo's announcement that they will no longer accept applications for new HELOCs.The Daily Download examines the most captivating articles reported from the HousingWire newsroom. Each afternoon, HousingWire provides its readers with a deeper look into the stories that are not only chronicling the biggest announcements within the housing finance industry but are also helping Move Markets Forward. Hosted by the HW team and produced by Alcynna Lloyd.HousingWire articles covered in this episode:[PULSE] Learning from past pandemics: Will COVID-19 derail the housing market?Under tight state restrictions, Michigan's housing market perseveresHUD watchdog: Some servicers are providing wrong information about forbearance

A recent report authored by Rick Sharga using data from First American DataTree examined how housing has fared and recovered from past pandemics, and finds signs for optimism in recovery. Sharga, the founder of consulting firm CJ Patrick Company, talked about the report, and how housing has performed better than the overall economy. The only exception […] The post Housing Data From Past Pandemics Offer Hope for Recovery appeared first on Mortgage Media.

On today’s episode of Business and BBQ, Tim talks to Rick Sharga, President and CEO of the CJ Patrick Consulting Company, about what he sees going on at the national level regarding the housing market. Rick brings his experience to the table to make predictions about the financial state of the country.Rick is generally hopeful for the future because the housing market is historically pretty good at bouncing back. Until bond-holders are more certain, mortgage interest rates are likely not going to continue to drop. He also believes that the treasury will not go into the negative, but that many banks are putting forth deferment programs to help alleviate pressure on loans. Rick speaks to the fact that when the capital market starts to seize up, it has a ripple effect on everything else.In addition, the two talk about the impact on markets across the globe. The takeaway is that whenever the lockdowns let up, the housing market tends to bounce back. There will be some displacement in retail space, Rick proposes, as a result of the move to digital and a loss of business for three months or so. Fundamentally, we will probably see some shifts in how business is conducted in the coming months. We will also probably see an uptick in manufacturing.Finally, Tim asks Rick about his opinion on the effects of the shutdowns on a variety of industries, from lodging and retail real estate, to healthcare and manufacturing. And as the economy restarts, small businesses are going to do extremely well, assuming they will be able to weather the downturn. A few things Rick points out at the end about the housing market:We should not freak out at the housing numbers when we come out of this.It will probably be June before we see the market rebound.There will probably be unusually high sales in September.Key quotes:“If you go back to every recession the market has had since WWII (except the Great Recession), the housing market is what brought the economy back.”“The yields on treasuries are at historic lows.”“There is some adjustment that happens when you start talking about negative interest rates.”“The buyer profile is going to be a little bit fuzzier than it was going into the pandemic.”“It’s much easier to work with a borrower before they’re in default than it is to try to fix things once they’re in default.”“People underestimate the disruption to lending that would happen if forbearance programs are engaged by borrowers large-scale.”“Candidly, if it seems like the government is making it up as they go, they are.”“The exception throws the whole system [of the loan servicers] out of whack.”“When you have that kind of short-term disruption, I think everybody hurts.”“AirBnB is very vulnerable right now.”“Some people are just hoarding cash right now.”“Schools are struggling mightily to convert to teaching online.”“We will have some fallout from this, but it’s going to be a while before we see foreclosures.”Contact and Partners:Tim Herriage can be found at www.timherriage.comRick Sharga on linkedin. Follow him on Twitter @ricksharga.Follow his company at www.cjpatrick.com

Rick Sharga, EVP for Auction.com and veteran 'weather man' for the real estate industry joins us today on FlipNerd.com to discuss the outlook for owning rental properties, market conditions and trends, and what to expect in the years ahead. Rick has his ear to the ground like few do...so don't miss this! Get your copy of our FREE "Profiting with Rental Properties" Guide!