Big Landlords Are Losing Everything Right Now

Mike, there's a lot of uncertainty right now, especially in the real estate market. A lot of people are freaking out. Friends of ours with gigantic portfolios of commercial properties, multif family are falling off the map. They're disappearing.

They're not even coming to events anymore. Um, they're not picking up the phone. They're terrified. They have personal guarantees and they bought so much real estate from 2021 to 2023.

They're frankly underwater. What are you seeing on the ground as well? Are you seeing what I'm seeing with these with these folks? Yeah.

I mean, one of the things that's I think so interesting is you're right, is like the biggest guys seem to be falling the hardest, you know, and I think a big part of that is there was always this narrative towards going bigger faster, right? And people trying to buy larger assets, more expensive assets. They were getting into commercial real estate instead of residential, which is a much safer place to start. And if you look over the past couple years, it was I guess say 5 6 years ago now.

It was easy to make money doing that, right? Because interest rates favored it. It was pretty hard to screw up honestly. But everyone hadn't gone through a real blip in the economy yet.

And right now, that's exactly what we're facing is changing interest rates, a lot of uncertainty. You know, you have an administration that's doing some wacky stuff that's very unpredictable. And as a result, all those people are, you know, they're eating like they're eating their their own words, right? And their own their own risk tolerance there is is definitely being challenged, right?

Whenever you take on so much leverage, there's more risk. And I think a lot of people didn't calculate in the risks that interest rates were going to rise when they were buying these properties. You know, when you have rates go up 4% within just a matter of years, it really blows up any of your deals, especially when you're buying at peak prices. So, let's jump in because there is a lot of distress in this market.

I want to talk about it from a viewpoint. I want you on this call because our people listening right now, they want to know what are they going to do with their real estate portfolios. If they're an agent, what do they do? If they're a wholesaler, what do they do?

And we're going to go over that today. We have tons of data to go over as things that you may have never heard before in perspectives that you're going to get tons of value out by watching this video. But here's one thing I want to jump in, Mike, real quickly. Have you heard of this, the FHA delinquencies starting to skyrocket?

And it's one of the most concerning things I think if you just look at the big picture is regardless of the stock market and the new tax benefits with with the new bill that came through and everything else, the fact that we have these major consumer delinquencies and like this massive consumer debt problem, that's very indicative of a bad economy, right? In a very poor situation for the average person. Because honestly, I don't really care if the stock market's doing good if the average person is u defaulting on their loans and can't afford to buy groceries, right? It doesn't matter what the stock market's doing if the general population is suffering, honestly, right?

They don't own stocks, so it doesn't matter. 60% of people right now are living paycheck to paycheck according to the stats. And the people who bought properties using FHA or VA, the reason I bring up FHA is because they only put 3.5% down and usually a more challenging borrower with not as high of a credit score. And you have to buy this mortgage insurance and you have to pay this premium to to be able to do the FHA.

But look at this. It's starting to move up very quickly. This comes from John Kaminsky. He's awesome, by the way.

If you should follow him for his Substack data, he's got incredible data. She just found out today he lives in Jacksonville as well. We're going to go grab lunch and and connect on this stuff, but I've been following him for some time. You should look him up on X, but you can see pretty quickly the FHA situation is getting pretty bad.

This is what is crazy, Mike. The FHA delinquencies on recent originations, right? So, this is from 2019 until basically today. The program called HAM, it's home affordability modification program, is expiring completely after September 2025.

So, you won't be able to do loan modifications on your FHA. It's just going to go straight into foreclosure. >> That's Yeah, that's going to be like such a major issue because what they've been doing is they've been delaying those payments so that you could kind of, you know, kick things down the lane a little bit. But now with this serious delinquency rate, 35.3%.

So, that's like a third of FHA buyers are going to lose their houses realistic at the end of this year. That 35.3% are the ones that did the modifications just for clar clarification. Okay, the actual delinquency serious delinquency rate was about 10% and it moved up to 15.3% and then the fed the the government actually stopped reporting the data in February. So John, I like his data because he's starting to grab from the actual sources and putting it together himself from various points to continue the the trend line.

They claim that's because Elon came in with Doge and that's why they stopped reporting. But of course, you know, reporting is not a very difficult task to do. >> Well, they start reporting when things get especially bad. You know, they they don't want to show you the real real bad news.

Any administration that comes in, they want to sound like they're doing great things all the time, you know. >> Well, is that why Trump is in, you know, uh, PY, right? PY, the grandson of PY Homes, the the founder of that company, you know, he's charge of the one of the housing administrations for FHFA. And he's like every single day saying Powell needs to cut rates.

We need to file PAL, right? They're making up an investigation against Pal at this point to try to put political pressure on him to get him out when I view him as like the only adult in the room and basically everybody else just wants to push him aside to cut rates 300 basis points. I mean, that would be 12 cuts in one Fed meeting, which we've never seen before, ever in the history of time. Like, why would the government do that?

Is it to bail this situation out? Like, why are they trying to push everything up so fast in such a short period of time? It's for votes, right? It's just one of the buzzwords that lingers around is interest rates, right?

And everyone seems to be tied to like lower interest rates equals good because everyone saw opportunity with that in 2021. But that's not the case if no one's buying the debt at the lower rates, right? Because Fanny Freddy has heavily reduced the amount of debt that they're buying in terms of mortgages, right? And nobody outside the United States wants to buy US debt.

That's why the bonds are in the toilet and the US dollar is what 10 and 10 10 and a half 11% down for the year compared to other currencies. So if if interest were down I don't even know what would happen because no one's going to want to fund the debt at that rate. I think the mortgage interest rates would probably stay the same but it would still be you know good for some attabo amongst Trump and his homies. But you know what whatever that's worth I don't know.

>> Yeah. And what's so interesting is you know we're independent thinkers here Mike. We don't play one side or the other. We just try to look at the data and see where things are going next and then bring it to you guys to get your perspectives and and go ahead and drop your perspectives.

What do you think as the audience, people watching this, what do you think would happen if rates actually did go drop 3%. Would housing skyrocket? Would it just become so unaffordable? Like, right, if 68% of people can already afford and living paycheck to paycheck, they're not able to buy, right?

Who are the buyers? Is it just going to be people buying two or three homes for themselves? Because the majority of Americans can barely afford their rent in the first place. >> Yeah.

I mean, it'll be private individuals that are chasing yield. You know, there's always been this concern around the United States were moving towards like a renter nation. And that's what'll happen is you'll have all these people that are coming in and buying properties without debt that are willing to accept a five, seven, maybe 10% yield on their money from the rent that they can collect. And that's what will happen at a very very large scale, especially when all these FHA people start defaulting and losing their homes and all those buyers can come in and buy these homes either at auction or directly from the sellers at 60 cents on the dollar.

>> So what you're saying is more speculators will come in and gobble up the distress and make money off of four people basically. >> Well, yeah, for sure. And and the the the speculator piece that the thing is is when you're buying things at a discount, it's no longer a speculation, right? Like if you look at places like Florida, one of the reasons that the entire economy there has kind of collapsed is because people were speculating on growth, not on existing information, you know, and and so like with my business, we buy a lot of houses at discounts.

We go direct to seller. That's how we work. But the thing with that is we are basing our purchase prices off of the value today, not what we hope the value to be a year from now or two years from now. And when people were going to Florida back when it was on Bigger Pockets and everyone was talking about the Southeast and the booming markets, right?

What I used to tell people is if you want to find out where to invest, go to wherever Bigger Pockets is talked about and cross those off your list cuz that's going to be a bubble in the next two years. >> 100%, dude. Because everyone listens to the same information. They all pursue the same thing and the next thing you know is everyone is like inflating the prices there, but the local economy cannot support it.

And that's exactly what happened in Florida is they were making these acquisitions off of values that are based off nothing. This is based off of touchyfey whatever. And that's not how you should make investment decisions. >> Well, I remember when Bigger Pockets was pushing all the Airbnbs and now everybody who bought Airbnbs is getting cr It's like everything that they tell you to do on that podcast, if you do it, you're totally screwed.

>> It just turns to turns to junk. And and the problem is is a lot of that stuff that they discuss there, it's based off of what is going to appeal to their key audience, which is >> newbie investors, >> newb newbie investors that haven't they have an unrealistic perception on what a return should look like, right? >> And that's why you keep seeing them, I would say almost say they're like the the doomsayers of the world, right? Because everything that they tend to push I would say is negative towards like the actual well-being of the country cuz for a long time you know it was mobile home parks and Brandon Turner is like everyone's going to be poor soon so I'm going to go and buy affordable housing in mobile home parks right and so he left and went his thing then it was Airbnbs and so you have all these people that are going into neighborhoods where people could buy homes for their family but they're instead being gobbled up by these Airbnb investors who think you know what this culde-sac needs three Airbnb and B properties.

That would be great. Lo and behold, that didn't work out, right? And then now they're doing like the co-living thing, right? Where they're saying, you know, we can't homes aren't affordable.

Rent isn't affordable for people. What if we took three families, we put them in the same five- bedroomedroom house and charged them a premium for that. That's a healthy thing to do. No, it doesn't make any sense, right?

But that's just like the direction that everything has been going has been towards a massive reduction in quality of life for the average person at the, you know, in terms of chasing yield. Like that's kind of the goal. It just that's never going to be a good long-term outcome for anybody. >> I can tell you're not passionate about this at all.

>> I'm definitely not. Well, the thing that gets me the most fired up, honestly, dude, is that like there's so many smart people that I know that I follow, they get sucked into this exactly the same way, >> right? Just because they get greedy and and a lot of it is because they're they're what I would call dumb money because they got lucky with the way the economy went in 21. That's where they made all their wealth.

They're not good entrepreneurs and so they need to be chasing whatever the current pitched get-richqu or high yield scheme is even though it's not sustainable long term and it doesn't make sense if you look at like a 10-year view of the country. >> And have you seen the account inverse Kramer? It's like so Inverse Kramer is like anything that Kramer pitches you do the opposite and his portfolio is up like 50% this year. In Kramer, >> right?

>> Kind of like Bigger Pockets. If Bigger Pockets has told you to do it, you're it's too late. >> It's way too late. >> It's way too late.

So, I mean, this is the problem with the people and I hope you guys are listening and watching that like you need to be careful. This is why you need to subscribe to podcast and to YouTube channels like this that tell you the truth of what's actually going on. I wish I had started this two years ago. We could have helped a bunch more people.

Um realize and and not make the same mistakes that we're seeing out there. And look, I've been saying sell your rental property since they started raising rates. I sold all of mine. I sold over 200 units since 20 since March 2022.

And I'm really glad that I did because those are, you know, some of them are down 40% from when I sold and things are getting worse every single month. All right, Mike. Question. I you don't I don't know if you know the answer to this, but what percentage of properties in some form of foreclosure were there at the peak of the 2008 financial crisis?

Say like eight or nine%. Like it's like lower than I would expect, but I know we're in a much worse position right now. It's lower than that. >> Lower.

>> Oh man, it's like six >> lower. >> Really? Four? >> Lower?

>> No way. It took 2.8% of properties to go into foreclosure to cause that crisis. So all you need is just a little tip of the iceberg, right? Because these were rated AAA and then they got downgraded.

Then banks had to dump all these MBS and the CLLO's and the CDS started popping off. So it and that's what I'm saying like you only need a little bit of distress for the whole system to fall apart when you have this type of speculative bubble. And so I think like when you keep it in perspective, what percentage of properties were important? 2.8% doesn't seem like a lot.

We're already at over 1%. >> Yeah. And then you're Yeah. And a lot of those too are the most vulnerable people, which would be the FHA borrowers who didn't have any money to begin with.

That's why they're FHA borrowers. >> And VA does the same thing. 0% down, 100% financing. And you know, the only good thing is they don't lose their jobs, which is great.

But you know, they they get underwater as well when they move and try to rent the house and rents go down. I mean, they're underwater on these properties and they just try to short sale them, fire sale them or just give them back to >> and and that's something a lot of people don't understand either is if you're new to real estate, it costs money to buy and sell real estate, right? Just the transaction piece alone. And so depending on where you're at, I'm I'm in Washington State and up here we have all the typical closing fees plus we have an excise tax which is about 2% of the sales price of the property.

So realistically, it takes you 9 to 10% of the sales price. Like that's just your fixed cost to sell the house. And so if your property hasn't appreciated 10% from when you bought it, you're underwater like right away just because that's what's going to cost you to sell it. And if you bought anything in the last couple of years, you're probably not up 10%.

In fact, you're probably down. And so there's really no way to get out from a mortgage unless you know like unscathed, especially if you don't have any equity because you had a low percent down payment loan. >> Yeah. So trai it's a great point.

Traditionally, we tell customers it takes seven years to break even on transaction costs alone just in the appreciation. Like, if you're not going to stay there seven years, you should probably rent. And right now, it's cheaper to rent to to buy. And we'll go over that chart.

So, it's kind of interesting that people are still buying. And people buy for non-economic reasons, of course, as well. They don't want to have to keep moving houses every single year as the landlord either, you know, or the landlord just sucks and they want to be able to have more control. But ultimately, like look at this chart.

There's now way more sellers than buyers. This chart I believe came out from Red Fin and the estimated number of US home buyers and sellers actively in the market and it's starting to skyrocket and there's a gap between you know look at the other time that that was in 2015 where there was a lot more sellers uh than buyers and then it caught up but right now I mean you can see from basically 2020 until 20 mid 2023 you know it started having this pivot and we expect this to continue I mean this can go on for you know 3 to 5 years where the sellers start to stack up and there's just not buyers and it's an affordability crisis. Yeah. And I think something too that's really important to understand with this is there's still people that can afford homes, right?

Like that's there's a decent amount of population, but the problem is is interest rates kind of stay how they are and the values of properties kind of stay at the same place because people aren't able to sell to not be underwater, right? Or not lose money or they're not going to give up their low interest rate. That buyer pool of people that can actually afford homes is going to continue to get smaller, right? And that's why you see the very very slow decline there from 2023 to 25 is that buying pool is the same group of people.

It's just they are slowly buying homes and there's less and less and less and less and less of them and eventually they're going to run out, right? And then that seller pool will just continue to climb kind of indefinitely. And that might be why they're begging for I mean literally begging on social media to lower rates and they're hoping that that will solve the problem. And again, no one actually thinks that's going to solve the underlying issues of the wealth, basically the wealth divide in this country.

Like you said, like there's only a limited number of buyers who want to buy unless it's people who are looking for yield and then we just have a spec that just fuels the speculative bubble again, which is which is crazy. So now what's happening, right, we have all these sellers coming on, we have a deceleration of housing. This is the K Schiller index year-over-year change. You can see that it's just decelerating the amount of price appreciation and and in our area we're negative.

So, uh, in Jacksonville, Florida. So, by the way, if you're in Florida, Georgia, or the south, like get in contact with me. I can get you in touch with one of the top agents that'll tell you how it is. A lot of agents do what we call buy the listing.

They tell the seller anything they want uh to be able to get the listing from them and then their house just sits for 6 to 12 months. We're seeing that right now every single day. I can get you in touch with somebody who will tell you the truth and actually help you out with your property. But this is how it looks like nationwide.

It's very different. Each state is so unique in term in each local area is so unique in terms of its population growth, where people are relocating, the jobs that are there. Jacksonville specifically, I think, is one of the worst cities in the country. Uh we're number two right behind Austin.

Price declines. Austin's down 21%. We're down about 10% from the peak. And we're it gets worse every single day.

And the only reason why inventory doesn't look worse is because there's so many expired and canceled listings every single month. It's like like 1,700 expired and canceled. If those were still on the market, because those are people who are motivated to sell, right? If you put your house on the market, you have to have people come into your house.

You have to schedule showings. You're willing to pay the commissions. You're willing to have the photographs done. All this type of stuff.

You're motivated. They're just coming off of the market. We expect a flood of inventory come on the second half of this year as people try to get back into it. But the problem is that we're seeing panic selling.

So there's one person in the neighborhood who panic sells and then everybody else has to reduce to that price because it won't comp out on the appraisals anymore. But this isn't happening everywhere. Mike, what are you seeing in your area? >> Yeah.

So like up here, I'm in the Pacific Northwest, completely polar opposite uh geographic area to you. And we're seeing some slowdown, but things are still moving relatively quickly. I mean, we we flipped a house over in Tacoma, just south of Seattle 2 months ago, and we had 30 walkthroughs in the first weekend, and we end up getting six offers, right? But the difference is is it's funny, completely counter to what Bigger Pocket said, right?

You got to run away from Washington because it's a blue state, you know, and people don't like blue states for landlord reasons and politics and whatever else, which has been the buzzer for the last last little while. Washington's a great state because we don't have state income tax, so we draw high income people. We also are very businessfriendly. And in general, we have a very high education and very high average income.

And so people here can still afford homes for the most part. And where people tend to get in trouble is if they're getting into like I would call like the mid-tier homes, right? Like the $500 to $800,000 range because that's a trickier price point for people to get approved for just with the debt to income requirement for Fanny Freddy loans. But if you get above that, you're dealing with rich people and they'll just figure it out.

And when you're below that, that's like the average affordability point for people at 7% rates. And those houses go quick, man. You know, as long as you have a good product and kind of counter to what you said before, if you can buy a house right now and you do want some stability over the next 10 years, I don't think it's a bad reason, a bad time to do so because you can get into a house, you can have some stability. You don't have to worry about 5 years from now when they're trying to put everyone into the same co-lending environments, right?

Uh not co-ending, the uh same co-living environments, right? And uh you can, you know, kind of weather the storm. If you can get in, you can probably get something at a decent discount if you're not afraid to make a low offer. >> Yeah.

Yeah. It's it's about the offer and the price on it. So, I'll tell you, Mike, here in Florida, it is different. So, there's a house on West Side I was just taking a look at and it's crazy, right?

It it sold for 325 just 2 years ago. Guess what it's selling for now? >> Probably 200 >> 250. >> 250.

>> So, it's, you know, and that's an affordable price point. Anything under 400,000 in Jacksonville is affordable. The affordable stuff is still dropping mostly because it's conditioned, but also because new construction built so much. You might, your area might not have the new construction, but what we're seeing is a spike in new construction sales in a massive drop off on existing inventory because the new construction folks are offering 4% interest rates and the buy downs and the existing inventory can't compete it with it.

And why would you buy, you know, a 1980s house that needs, you know, 40, 50 grand of a facelift when you could buy something brand new with warranties for the next 10 years? >> Yeah, cuz it has character, John. Don't you know, 1980s? It has the nice mid-century modern look of like a late '7s house.

People always say, I disagree with that so heavily. I'm in a brand new 2021 house right now, and I would never want to live in one of those old houses. >> Exactly. Me neither.

>> But there are certain area. I mean, it is pretty cool if you can like walk to your coffee shop and, you know, whatever in those older areas. So here's here's what we're seeing. We're seeing the housing markets with the biggest drop of investor purchases, right?

So Jacksonville had a massive amount of investment come through. I mean, American Homes for Rent was here, Progress Homes, Invitation Homes, First Key, all those players were buying up all the affordable single family properties and turning them into rentals. You know, basically from 2014 all the way up to 2022. And then they stopped right when the rates started going up.

They knew better. They were smart. I mean, the hedge funds know best. They know exactly what's coming.

Rates go up, asset prices come down. So, check this out. You know, Atlanta, Georgia down 65%, Jacksonville down 62%, Arizona. These are the areas that are getting hit the hardest, by the way.

The the ones that had the speculators and the massive new construction are the ones that have the most amount of drop um that we're seeing in terms of the number of transactions and and price. Does any of this surprise you? >> Not necessarily, because I mean, again, it's a lot of like kind of the the boom and bust markets that we've seen for a while. Yeah.

>> You know, and and some of the ones, a lot of this is based off of percentages, too, which is always like slightly misleading. >> Correct. Comparing to the peak, right? >> Yeah.

Yeah. For sure. So, like if you look at, for example, Portland down there at the bottom is showing a 47% decrease. But the numbers there compared to places like Atlanta are just significantly less at eight times more.

>> And and so when it says like investors, is this like how do they classify this? Is this LLC's that are buying just like institutional investors? Is because there could also be mom and pops that aren't even showing up in this either. >> Yeah, exactly.

So, this this source is Redfin. You know, I can drop in the comments in the notes of how they got this data together, but I do think it's really interesting and starts to share the narrative of what's going on. Now, look at this. This is where the areas had the most price increases, right?

So, the areas that, you know, benefited from the 2020 to 2021 craze are the ones that are getting hit the hardest right now. You can see >> Florida's up 68.7% on home price appreciation. That's insane. >> Yeah, dude.

It's nuts. And and it's kind of a self-fulfilling prophecy with that, too, because then of course, what do people come in and start doing as they start building all the new homes like you said, because that's obviously a demand for it. Prices are going crazy, but that just incre creates more supply and then once the demand drops, it's just an exponentially big collapse there. But yeah, like up here in in Washington, Idaho, I'm right on the border and some of the stuff, dude, in Idaho is insane.

Like like there was a house that we we bought it as like a cash offer for 250,000 and we were able to sell it for 400,000 after we did some work to it and made it look good, you know, and like did a decent amount of work. But that same house, like 2 years before we bought it, sold on market for 180, right? So, like our cash offer was like $70,000 more than it sold on market for just two years earlier. >> It was just a bubble.

Now, look at what happened to the price the cost of buying a house with a mortgage. >> Mhm. Yeah. See, this is one of the most insane things you look at is just like and this and this so this is just this is this include mortgage taxes and insurance.

>> Okay. So, it does include taxes and insurance because that's a whole other beast as well that's getting out of hand. >> It it's inclusive of mortgage tax insurance. It does include.

That's what I'm saying. Yeah. >> So, because because like the interest rates cause the principal interest to be high, but some places like the taxes are insane or like Florida the insurance like what like what is it? I guess up in Jacksonville, I don't know if you guys are affected by the hurricanes quite as much places like Tampa, but I imagine your insurance is insane.

>> In Florida, everybody get So, so insurance in Florida over the last 5 years is up 72%. >> That's crazy. So, like on a that $250,000 house you talked about, what would insurance be per year for that? It depends on how old it is to be honest with you.

The new construction stuff you can get for like under $100 a month. That's another benefit. But if it's like a 1980s house with an older roof or they do massive inspection, four-point inspections, they look at every single aspect of it. There's any sort of risk there, your premium's going to be crazy.

>> Yeah. >> So, you know, on my house it's like 3,200. On a on a regular house like 400,000 you're you're looking and if it's like you know whatever 1990s you're probably looking at 2500 >> a year pretty >> that's like double of what we would have here >> and your taxes are nuts because once the the prior seller this is what you know a lot of sellers get upset about is they get their tax bill the following year after they buy the house and the assessment is like triple because person had it who had it before had it for 10 years and it was capped because it was homesteaded and Now they get their new tax bill and they're just like their mortgage goes up 500 bucks a month and they're like what in the world? Like I can't afford this anymore and they're underwater.

>> Yeah. Well, see, and that's a real big reason I think there's so many FHA people as well that are defaulting cuz they didn't know. And I mean in my neighborhood up here, so they're all 2021 new builds on my street, but the street over the houses were built about 2 years earlier. And I remember when we got all of our tax estimates because my monthly payment increased $700 a month because it was originally based off of the land, right?

So, we kind of knew that was going to happen. That was fine. The people that were over there though on the next walk over, they didn't have that. And when we got those tax assessments, literally half the block went up for sale cuz I guarantee you there was people that were house poor that like had their budget and they're like, I can't afford an extra $700 to live in this house now, you know?

And so they cashed out and went somewhere else. And a lot of them I watch the sales they lost pretty bad on those houses like very significant 50 60 $70,000 losses. >> Timing is everything. And what's so funny is like Bigger Pockets was telling me to buy.

>> I know, right? Of course, dude. Yeah. Uh so this is just another from this from Red Fin.

It basically says the same like almost identical like when you when you have multiple sources you want to triangulate them and see, you know, are they accurate. I mean this is the housing payments. Like look at look at how it jumped from 2022 23 24 to 25. I mean, it's just gotten to an unsustainable point where the question is like, who is the buyer?

Like, we try to figure out who is the buyer for Florida right now, too, because migration to Florida is down 80% from the peak. And if we have like a negative birth rate, so people are dying, you know, faster than they're being born here. We have a we have a 25% of people are the boomer generation or older. So, like, who's going to replace these people?

And there's a silver tsunami as well. Like, all these older people are going to die. Who's going to be inheriting these houses and living in these houses. There's going to be a massive amount of inventory coming on in the next decade here in Florida and we're already overbuilt.

>> I know it's funny that silver tsunami I remember hearing that so much a number of years ago and I guess now like the tsunami it rises up real quick but it does come crashing down real quick too as people start to you know pass away and and exit the game. And so like that that again though that kind of goes off of making investments based off of speculation on things that you are expecting to happen and not off of current real world values and real world situations. And that's a really really dangerous game to play I think in any kind of investing, right? Is you need to look at the current opportunity that's there and not bank it off of any sort of like niche that's highly volatile like old people, right?

You know, cuz also too, what happens if they decide they don't like Florida anymore, >> you know, and they they decide to go somewhere else or the hurricane stuff is getting out of hand or a lot of people that are move to those places, they're very sensitive to politics and different things and they can like drive people away. That's why I've seen this mass exodus from California as people are sensitive to politics, you know, and so you need to always be making investments on the current values. And one of the most valuable things that I think you can keep in mind when it comes to real estate is it's one of the few assets that you can invest in that you make your money when you buy, right? Because if you have a house that's worth $400,000 today and you buy it for $300,000, you just made $100,000 on that equity the moment that you closed, right?

And you should always be looking to do that in some way. >> Yeah. You just have to be careful. And to be able to do that, again, you have to have a top agent.

And 80% of agents are total garbage and they suck at their job and they sell one to two houses a year. Get with me. No matter what market you're in, I can help identify. I've had 20 people reach out through this YouTube reach out to me.

Hey, I need agent in my market who actually knows what they're doing. I've helped every single one of them identify one of the top agents who actually knows the market. And then number two, we'll tell you the truth about what you should do. Should you wait till November to buy the new construction?

Should you buy right now? What what is the best optimal play for you and your family? And it can save you tens of thousands of dollars. Like you said, when if you can find somebody can negotiate and really understands new construction, especially in Jacksonville, you can chop $100,000 off the price and get a 3% rate.

That gives you the security where it does make sense to purchase a home because you now have that cushion and you know, your your cost basis is just so much lower. >> It reduces your risk. So this is everything is a function of payment. I like this chart because it just shows rates go down, prices go up.

So if rates go up, prices come down. >> Yeah. >> Situation. It's just like very clear that we're going to come have prices come down.

This is an indication of the UN University of Michigan. They come out with the current financial situation compared with 5 years ago. And you can see instantly, you know, we're at the US consumer is feeling it really bad. The wealthy, by the way, and I'm glad to be one of them.

We're killing it because we own assets. All of our stuff is continuing to go up and we're just getting richer and the people, you know, who are my friend, they're getting poorer because they go to the grocery store, everything's more expensive, right? The the tariff situation that's going through, you know, Goldman Sachs came out and said that 70% of the tariffs will flow through to the consumer and it'll actually just be basically a consumer tax that's paying for 70% of that tariff and 30% to the other parts of the supply chain. This is where, you know, this is why Powell was holding off on raising the rates because he he knew that these tariffs should flow through, you know, probably over the next quarter we'll see it, which is interesting.

So, we could start seeing a lot more inflation going into the end of the year and going into next year with these tariff impacts. But the consumer is feeling extremely crunched right now. >> Yeah. I mean, and I don't know about down there, but we see that on just like day-to-day expenses, you know, like our our weekly grocery bill for me and my wife, it used to be $150.

Now it's sometimes double that depending on what we buy, right? And it just the the little things here and there are adding up so so quickly. And again, this is such an important thing to to realize is the reality of this and not be looking at the stock market or different things in terms of like a healthy economy because what is happening is all these people that have owned assets that are selling it trying to figure out what to do with the money, they're going to the stock market cuz they don't know what else to do with it. And so that's just basically taking all the same money that already belongs to the wealthy people and just putting it into the, you know, Wall Street casino and it's just inflating it as tens of billions of dollars continue to shift over there.

You know, where it's not, it's like a small percentage of people that are actually making that change, not the nation as a whole. >> Yeah. There's a stat out there too, Mike, where people are like, well, 40% of homes are paid off, right? And that's why housing won't have a collapse.

Some crazy stat like that. And I'm like, those are those are owned by the rich people. That's not that's not owned by the 90% of Americans who have a mortgage and a monthly payment. So, you need to look at like how it's distributed and who actually owns them cash.

And, by the way, very wealthy people own all their assets cash. Why? Because it's good for asset protection. You can't go after their their home if if there's a creditor coming after you.

Um, so you know, there's lots of reasons why they do this, but it's not like the average mom and pop or just retail buyer who's who's buying cash generally, unless they're from like a high-cost area and they killed it and then they sold that and took all the equity out and are buying in a lowcost area because we did see that happen from New York and California, but now all their equity is tied up in their house. >> Exactly. Yeah. >> And it's evaporating and that's all of their net worth.

And by the way, we're going to see on back to the silver tsunami. The statistics show us >> 40 to 80% of boomers will be dead in the next decade. >> That's crazy. >> That's a crazy stat when you start looking at it long term.

So, let's look at the the builders. This is the home builder traffic. As you can see, 2025 is off to a very rough start, which is interesting because they're the ones that are offering all of the incentives. This is the total new homes for sale in the south.

Look at that. This is the south. This is the last market I'd want to be in right now, dude. Everyone that I know that's in the South is just suffering with their real estate.

>> Well, this is our friends, right? They bought in Texas, they bought in Florida, they bought in Georgia, and they bought large >> multif family. And those multif family are down 40%. They only got threeyear loans on these things.

>> And right, they were going to go in, they were going to do value ad, they were going to raise rents. And then boom, the asset fell and now they have to refinance. They have to cash in or give the property back to the bank. And they're they're terrified.

And that's, you know, another reason why the government wants to probably bail, you know, bail out investors basically, which kind of sucks. It's it's going to screw over the average consumer and bail out investors when they make these type of moves on interest rates. >> Yeah. And it's funny like all those people what they did is they looked at the same Bigger Pockets blog that was top 10 real estate markets of, you know, 2018 and that's where they went.

But yeah, and it's always a challenging thing, right? Because there's an argument on both sides where by bailing out the investors or the business owners or people with money technically that does have well that should have a downstream effect to more stability for other people for employees and different things. But the problem is we've been doing this for long enough to know that's not always how it works, right? And there's a whole bunch of people like with the bonus depreciation stuff they just got passed.

There's so many dudes I know that don't even have businesses that are freaking stoked. I'm like of course you are because you don't make any money. You don't know how to make money and you're going to argue with me about the trickle down effect when you when your trickle down is zero, right? Like it's going to be like to your kids, it pools at the top.

We already know that. >> Yeah. It it just makes the rich richer. >> Yeah.

>> Maybe it trickles down like 10%, but I mean obviously like the majority of it gets caught up. So here's a deeper chart. A lot of properties are under construction for new home inventory, right? You can see completed.

Look at the under construction and not started. I mean >> those numbers is not started. That basically means that they have like permitting in the lots and they just haven't started building the home. >> Yes.

>> Oh, wow. That's a ton. Yes. So, there's a ton of construction going on here.

And by the way, I don't know if like the immigration issue, getting rid of a lot of immigrants every single year will impact how that will impact housing. Yeah, a little bit. I mean, let's be honest, who's going to be building the houses? You know, like if we're looking at most the crews that we have around here, there's one of the most common things with the most efficient crews is they do have a pretty large immigrant population that are >> Same with the roofers.

We see the same thing with the roofers. Any of those construction jobs and so getting rid of those people, you know, it could open up some spots for affordable housing, but they're in our area. They all live in the same h there's like five or six people living in the same house living by the bedroom. So, we'll see.

We'll see how that impacts things. But basically, here's another one. The rule of 28% which is basically 28% of your gross income should be the maximum you pay for a house according to that ratio prices must decline 46% to close that affordability gap another way looking at it which is just insane they they've been flexing on this though too like with the mortgage approvals cuz I'm trying to think of where I saw this there was one that said that with FHA loans you can now get approved as long as your your debt to income is like 45% % 46%. It's unbelievably high.

>> They're increasing it the >> she is. Yep. >> To keep just like pumping more loans, right, and collecting more points and fees and everything else, but that's to the detriment because the amount of money there that's going into your housing, it leaves you so little room for error in every other part of your life. Well, also the people who are buying right now are generally poor people.

So, I'm just going to be honest with you, right? It's the end of the market cycle. We see people who have credit issues. We see people a lot more FHA, a lot less conventional or conventional 3% down.

FHA 3.5% down and it's harder to keep deals together because their financial situation. Well, they're buying at the peak and their financial situation is rough. What do you think's going to happen? Like they and then they're going to get, you know, obviously go through a foreclosure or short sale and then seven years from now it'll be the same thing, right?

That the process keeps repeating itself where the bottom buys at the wrong time and they just get stuck in this housing cycle where they're always buying at the peak and then getting hit. So, it it sucks and that's how we see it now. I mean, you can avoid this again, Mike, like you're saying, buy really well. Get the best agents.

Make sure you you prepare for this and you're prepared for something to go wrong. And this is what the market looks like without job loss, >> which is insane. So, look at this US housing market pending sales index just totally dropping off a cliff. It's really low in Jacksonville.

Jacksonville data just came out today. Uh pending home sales versus last year is down another 30% while closing sales are down. Home sales are super low also for existing homes which uh you know we're we're at a super low period. We're actually just as low on existing home sales than we were during the great financial crisis.

So people don't really understand like it's already worse than the great financial crisis. And we don't really most people don't really feel the pain. But in terms of number of sales, agents are feeling the pain, right? Because their commission dollars are going down on these existing sales if they don't work in new construction or have new construction around them.

I think a big part of not feeling the pain though is just the largest buying population or large population in general right now that's active in the economy as millennials and a lot of us we weren't really in positions to really know what was going on in um 2008 right we were either like very young adults or we were teenagers I mean I was still in high school I was graduating high school in 2009 and so it's one of those things you learn about in history right and you hear about all the effects of it but you don't understand the rate of time that it took to happen. You know, it's like learning about like a war like a World War II, you know, or the Vietnam War, right? And you hear about all these like critical moments that happened. What you don't know is in between all the parts that you learned about was like 12 months of stuff, you know, that occurred that the the details and like everyone was living their lives and doing things and making decisions while that conflict was going on.

It's like in 2008, there's people that were living lives and doing things in between all the ups and downs of the market. And in hindsight, it seems very very small, but like a very small period of time, but it was actually wasn't. >> Yeah, it's crazy. It's a good point.

So, we're seeing rental vacancies jumping higher than the pandemic high. This comes from US vac uh rental vacancy levels from Arbor. >> And a lot of this has to be tied to affordability as well because people are increasing rents, trying to keep up with taxes and everything else due to the new property values. And after a while, you do get capped on what you can re what someone can realistically pay for rent or what you can charge for a unit.

>> Yeah. So, they just find a lower quality house and move to a lower quality house. And so, we're seeing a lot of these luxury apartments they're building, they're like 50% vacant and they're still building in our area. It's it's like what are they think?

It's because once they break ground, they have to finish the project. So we had 78,000 multif family come on in the last 12 months here in Jacksonville and next year we have 111,000 coming on and we think that this multif family is going to drive rental rates for multif family and for single family properties down quite a bit. >> Yeah. So now with the bonus depreciation coming back, how many of these people do you think are just like moving forward with these purely just banking off of being able to take that bonus depreciation?

It's not a wise investment decision, but if you're stealing a bunch of investors money to go and do that, right? Like, I don't know. It's no skin off your back. We've already seen this a ton from a lot of the big gurus and stuff that were out there raising money that have been getting sent to jail or having these big class actions against them is they were raising money from limited partners, using all of their money to do the deals, and then basically taking all the benefits of the deal while the while the investor's money disappeared.

I I'm sure there's a lot more of those builds that are happening that are like that than we would expect. >> Yeah, I I hope not. But I mean, we've seen it enough in the networks that we're in where yes, they they can assign the tax depreciation benefits to themsel while using other people's money to buy the asset. And that's why if you are trying to buy a syndication, run.

Just buy an asset and control it yourself. 99% of the time they're they're taking fees that you know they're allowed to take, but you didn't read the operating agreement closely enough to realize all the things that they control. You have zero control over the your money once it once you send that wire. And so you need to be really careful.

Almost every syndication that I have seen even in 2021 from 2021 to today has gone underwater and they're doing capital calls and everything like that. But I haven't really seen one like maybe break even if they're lucky in a certain market, but most of them are underwater and headed to foreclosure. >> Yeah. And like big names too.

Like if you guys all of all you guys watching, think of the biggest real estate name that you can think of and I guarantee you that they are probably giving at least one property if not more back to the bank. >> Well, I'll tell you this. You hear Grant Cardone, he's begging on social media to reduce rates by 300 B. He's like, "Yeah, of course.

It's because he has all these apartments that are going underwater now." >> Yeah. Now they're on these adjustable loans that are now adjusting to 7 8% and he's losing everything and all of his investors money with those. >> That's why they're all begging for, you know, the government to reduce rates. So vacancies are up right on single family rental properties as well.

Inventory change. This is now worse than 2019. I was selling in 2019. I remember the end of 2019 was pretty bad.

We thought we were going to go into a recession and now the inventory is actually higher than what we had in that time period. So it just kind of puts it in perspective. Here's a map of Jacksonville, Mike, where it's just like you can barely see the word Jacksonville anymore. That's a picture says a thousand words.

And you know, there's a ton of FSBOs as well. And if if the expireds and and cancelled weren't here, I mean, it would be completely I mean, you wouldn't be able to see the word Jacksonville. It's crazy. But not every market's the same, right?

So, this is the month supply of inventory. Jacksonville, if you if you look at it from a big picture, Jacksonville is in a balanced market still. Now, obviously, it doesn't feel that way on the ground because people are slashing and it's and it's kind of rocket shipping, right? There's a pendulum that's swinging and it's speeding up really, really quickly.

But you can see that Jacksonville is starting to inventory starting to move up. Miami, right? So, Texas, Jacksonville, those type of areas. Meanwhile, there's other areas that have like very very little le levels of supply and that's likely because of the number of um new builds that they have in their area.

>> Yeah. Yeah. And so I just looked up Washington State and we're at 2.2 months which is still pretty Yeah. Still say still pretty strong in a lot of places, right?

And we we see that too. But like the crazy thing is during like 2021 on the runup, we were down to like 3 days >> of supply, right? Like there was nothing on the market. They were going so fast.

>> That's how you know it's a bubble. >> Oh yeah, for sure. And now where there was speculation, there's now pain. So here's the markets where there were a ton of concentration of institutional investors and those are the markets that are getting hit the hardest.

You can see here, you know, Charlotte, Houston, Atlanta, Phoenix, Dallas, Tampa, Jacksonville's in there as well in the middle of the pack. But >> how much were these kind of things inflated by like Open Door and some of these like I buyer companies that were just are now famous for making horrible decisions? Honestly, >> has to be a Yeah, I know. They're like 99% collapse.

Like these numbers have to be pretty heavily inflated by those because they these are the markets that they were targeting. Like I remember meeting people and they their whole strategy of flipping houses was they would buy a house essentially at retail and then sell it to Open Door for more than the house was worth. And they were like, "Okay, sure if that's what you want to do." And they did that for years, you know, and they bought millions of homes. I'm pretty sure they did.

And they char, you know, open door is interesting. They charge you like 11 to 15%. And sellers would do it because people wanted the convenience of just walking away from their home without any showing. So they paid an enormous amount of money.

Obviously that was a big mistake. I think people who use those companies, you know, and obviously there's a mistake. Look at Open Door. Like the business model doesn't even make sense even with charging that much money.

The real estate agent model is still the best model to sell if you get a good one, right? If you hire one of the bottom 80%, it's a horrible model. If you get one of the top 20%, they they pay for themselves at a minimum. At best, they're going to make you another 3, four, five, 6, 7% on your house if they know how to market it correctly and know how to negotiate correctly.

So, but these markets were the ones that, you know, had the most speculation are the ones that are falling the most now. Now, this is crazy. Check this out. Florida has more housing inventory than the entire Northeast.

>> That's nuts. So, like what's the population difference there between those two? So, how many people are in Florida? Like, >> this includes New York, too, right?

Includes New York. Oh jeez. >> Yeah, I think there's about um >> 24 million people 22 million people in Florida. >> Okay.

Yeah. Well, that's that's nuts. So, yeah, the total housing supply. Yeah.

Look at like the number of people across that. I'd be I'd be curious to see that in like another chart of like the ratios there. >> Active listings are just skyrocketing and prices are coming down. So, this actually came out where monthly housing payments are starting to fall.

It's part it's partly because the sellers are panic selling you know and rates have come down about 20 30 basis points. This report came out from Red Fin. So you know the the borrowers are now the buyers are starting to get a little bit of help. That's like the best thing about this whole situation.

Yes. So some sellers are losing their shirts but the buyers coming in they'll have an opportunity to get a little bit better. Now here's the crazy thing. People are getting married later.

Check this >> they don't you know you have to have dual incomes now to be able to purchase a house. I think it's like $120,000 you need to be able to purchase a house. Well, the median income in Jacksonville is 68,000. So, to buy a median house, you know, you need a dual income.

Yeah. And a lot of this comes down to the stability piece, too. And if we continue to march towards this like co-l livingiving and this kind of higher density forced living situation, this is only going to get worse, you know, because if you're stuck living in the same three-bedroom house as like two other couples, people aren't going to want to get married. They're going to want a lot more flexibility.

You know, this is going to have an even greater impact on having kids. >> You know, there's already the whole talk about how millennials aren't having kids and different things and that a lot of it's a stability problem, right? And people tend to forget about that. >> My friends tell me all the time, I'm 34 years old.

My friends tell me all the time, I don't have enough money to have a kid. >> I mean, it's valid comment, right? They're expensive. You're barely paying your own bills because everything's getting more expensive.

Like, what what are you supposed to do? Just like accept that you're going to have a worse quality of life? Well, you basically have to work for free to have a kid. So, basically, you're paying for them to go to daycare, >> right?

You're working to pay pay for them to go to daycare. Now, check this out. Median age of first-time home buyers is now 38. So, right, they're getting married later and now they're buying houses later.

So, they're starting to build wealth later because the majority of Americans do hold their wealth in their house through the principal payment. It's kind of like a, you know, a bank account that they pay off each, you know, get a little bit more in in their bank account every single month. But 38 years old, it's skyrocketing. It's just again people can't afford the payments and they're getting married later, they're having kids later, they're buying houses later.

And I think it's going to change a lot. Like a lot is going to look it's going to look like people are going to be 10 years older >> and everything. Like it's going to be normal to to have your first kid when you're like 40 now. >> Yeah, totally.

It'd be interesting to see this also as a function of who's actually buying it themselves versus who's getting like a co-signer from like their parents because I bet it would be if you took that into account, it would be even more alarming. Yeah, it's crazy. Now, how's the consumer doing? Here's the delinquencies.

This is pretty crazy. This comes from Bloomberg. Mortgage delinquencies are up. Heliloc delinquencies are up.

There's a lot of HELOCs. People use their equity and they tap it and they spend it. It's not talked about enough actually because the rates went up on the HELOCs. Are paying more on that monthly payment because the helocks are are variable rates.

So >> people people do wild stuff with that too. Like they're so irresponsible. Like my neighbor across the street, >> he pulled out a heliloc, bought a brand new boat, did all this sort of stuff. Then he got divorced and there goes all of his wealth instantly, right?

Cuz he has to basically sell the house to pay off everything like all the assets and stuff. >> Yeah. Yeah. Well, he sold the boat, right?

Had to pay off the heliloc they used to buy and all sort of stuff. And there was all the wealth in the house, you know, because they're being irresponsible with it. >> And divorce goes up in financial stress. So, I mean, we're probably see more of it.

Divorce is the number one wealth destroyer in the in the world. I think auto loans, delinquencies are up. The auto loan situation is crazy to me. Um, people are paying basically mortgage payments for their auto for their cars, depreciating asset, their credit cards.

I don't know how people are living off their credit cards right now. Student loan situation, the defaults that are going to go on come o up come October. There's a lot of things. You can't do loan modifications anymore.

They're going to start garnishing uh people's pay to pay their student loans and all this stuff. This is coming at the end of this year. So, I think the end of this year is going to be really, really painful. >> Yeah.

>> What's the number one thing stopping you from buying a house right now? Home prices are too high is the number one response. Mortgage rates are too high. Economic environment.

So, they just don't have the money to be able to do this. Spending is growing faster than income. Look at that change right there. So, we're seeing still people spend more than what they're making.

And then what do they do? They put it on their credit cards. >> Uh most gains, we talked about this at the beginning, are going to the wealthiest top 10%. Percentage of US households, equities, and mutual funds shared owned by the wealthiest 10% >> of the population.

So, it's the gains are going again to this top 10% and it's not going to the people who don't own assets, which is why I think the big beautiful bill is really bad for the average American. Like, really bad. So, yeah, like it's there's no question on that, right? Like I think the only people that I know that are really excited about it are the wealthy people that are really bad entrepreneurs and don't actually know how to make money, but they just like own assets, right?

Cuz they've been playing the game for long enough, a lot of older guys. And so, they need that bonus depreciation to be able to cover any tax bill that they do have, you know? But even then, like the funny thing is is I know a lot of them in 10 years are going to want social security and their benefits. Well, those are gone too.

So, I don't know what to tell you. >> Yeah. This don't get me started on crazy. So, on the politics side, you know, this the federal debt is skyrocketing.

This is like what the projection was before. Um this just goes, you know, it's it's it's going exponential at this point. This is why you see Elon come out and say, "Hey, we got to do something about this." But, you know, obviously the administration campaigned on reducing the deficit and they're doing the exact opposite right now with this bill. It's going to, you know, $5 trillion debt ceiling.

We're going to go fast. Probably $40 trillion just this year in the amount of money outstanding. And so, I there's no way we're not going to see inflation from this. This is what's causing >> the purchasing power of the dollar.

You referenced this at the beginning. Look at that. I mean, it's like the worst start of of the year. The purchasing power of the dollar is down 10% relative to other currencies you know just within this short period of time you know that the smart people who are doing the financials around the world they understand look the government's going to try to print their way out of this Ray Dallio has been saying it because it's the easy solution the politicians don't want to sit down and sharpen their pencils and figure this out why would you cut benefits for the constituents who voted you into power uh they need to keep that train going so nobody has the political will to actually fix this problem and you know pause a little bit of, you know, even even if you just rate, they didn't have to do the 2017 tax cut extension.

They could have just raised taxes on me 2.5% at the top rate of earning and I would have been totally fine with I'd rather see that that's better for America than continuing to have our, you know, kind of uh deficit spiral here and your borrowing costs will be higher. >> Well, well, that's that's the issue though, right? Is you said that's what's better for America. Most people don't care about that.

They want to know what's better for them, >> right? The people that are actually pulling the strings, that's all they care about, which is the most unsustainable model that can possibly exist. >> Yeah. And it's just how it is.

Like it's always been that way. It's >> And it's not even an American problem, right? You go everywhere in the world, it's like that, you know, and it's the one thing you can do is try to get to a position where you can be somewhat immune to that. And that's extremely hard to do.

There is luck involved. There's a lot of hustle involved. You know, there's a lot of unknowns that you have to kind of deal with. But like if you can get wealthy enough that you can just kind of like weather the storm, that's really the only option that you have over a long-term period of time to get by.

>> I agree. I think making your money as soon as humanly possible is going to be the most and getting it into AI stuff and stuff that's going to drive the future of innovation. I think that's going to be the biggest that's what I'm doing. I got all my money out of real estate.

You know, obviously I'm doing private lending now uh to real estate agents for fix and flips, but the majority of my money is now going into stocks because again, if there's an inflationary environment, equities are the best hedge against inflation. >> Absolutely. >> Student loan borrowers with payments due again, they're going to they're going to take the that type of money. So, Mike, like let's end this call, you know, this conversation with what what kind of mindset do we have to have to be successful long term?

You know, I'll I'll share with you my point of view and I'd love to get yours, but you know, I I think in decades, I don't think in years anymore. I'm thinking where is the market going to be? What's the next wave that I can ride to have success and go with it? I don't want to be swimming against the tide here.

So, I'm getting long-term focus on the next year and what where do I think the data is telling me to position my my assets, my business, where I spend my time working on over the next 10 years. And down markets are frankly where the foundation is set during the next upturn. So, there's going to be incredible buying opportunities out of this. At a certain point of time, sellers will capitulate.

There will be stress in the economy and you'll be able to pick up assets at fantastic prices. So you need to have that capital available. You need to have access to people who have that capital available so you can take down projects where the risk just the riskreward profile is phenomenal. And I always want to partner with people who are optimistic, right?

Have positivity, are the best at what they do. They're really detailed. They have a track record of success. I don't want to partner.

This is one thing with the Bigger Pockets thing. You know, you're you'd give your money to somebody who's never experienced a downturn before and they don't have the foresight to be able to say, "Well, I'm going to put a stress test in my model. What happens to this investment if rates go up 3%, 4%, 5%." They should have a business plan to have the worst case scenario happen. Well, I want to plan for those while also partnering with people who have the positivity on the other side of it, but they need to have a plan.

These people had no plan, no business plan whatsoever. And then grit is the key. Like I'm working harder now, Mike, than I've ever worked before. I love it and I love the people that I work with.

But if you don't have the grit to see it through, then yeah, maybe W2 and entrepreneurship isn't for you. But this is the time where you kind of show your true colors as a real estate investor and as a real estate agent and a wholesaler, things are harder. Are you going to be the type that bows out when things get tough? Are you going to be the one that powers through, gets the next side, is extremely skilled, and when the market's there, you can capitalize and take tons of market share?

>> Yeah, absolutely. Yeah. I think for me over the next 10 years the focus should be on what you can do to increase your own earning potential right and increase your vertical income like regardless what that is and that's not going to school and getting another degree to get like a different job that pays more a lot of it is you know learning basic entrepreneurship skills learning how to create value I'm a big fan of Alexi and a lot of the stuff that he does around you know like growing businesses and leading with like a value first model. And this isn't like going on social media and doing stuff either, but finding opportunities within your local economy about where you can make money at an asymmetrical rate because you bring people so much value that they want to give it to you, right?

And this can be in things like, you know, maybe you have like a moving company to go and help all these people that are losing their house that are going to need to find a new place to go, right? You know, whether it can be a construction company where you figure out how to partner with some of these banks are going to be taking all these houses back that are fixeruppers, right? You don't even have to be able to do the work. You just have to find people that can do the work for you and then you upsell the price that they're going to charge for it, right?

And that's really the only thing I think you can do over the next 10 years. That's a guarantee is once you learn how to make money, it is a skill that you can continue to use over and over and over again. It's the one thing that you can really do without any speculation. Outside of that, in terms of like actual investments, I think focusing on stuff that is heavily liquid, right?

Like like stocks, like crypto, things that if it does get a little bit weird or you do need to recover that capital, you can do it at a relatively quick pace. Relatively quick pace. Moving away from things like real estate, syndications, stuff where your money is going to be like locked in until a very long transaction time takes place, right? That will probably be your best bet to just weather the storm a little bit more so you're not stuck with something that becomes a falling knife.

>> Love it. Yeah. And the only thing I disagree with there is crypto. Definitely stay away from crypto >> for sure.

I know you got to throw that out there for people. I have like tiny tiny amount of Bitcoin. Equities are always gonna be a it's something that cash flow is not something where it's just the next person who will who's willing to pay the price and it's some sort of electronic speculative coin. But that's just my crypto bros.

Don't crucify me, okay? I'm I'm looking out for you guys. I think you guys will have a good run with this deficit spending that's going on here. Anyway, thank you all for watching.

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