Latest / Real Investor Radio Podcast / Ep. 113 | The Market Is Frozen: How Real Estate Investors Adapt to a Softening Market
Transcript
- Jack BeVier (00:01) Hey everybody, this is Jack BeVier and David Moses with Real Investor Radio. excited to talk with David about what's going on in the market these days. always a pleasure. Sir, how's how's your week treating you? David Moses (00:14) so far so good. I was at the Rocket Classic yesterday, the Rocket Mortgage Classic, the golf tournament in Jack BeVier (00:21) Very nice. David Moses (00:22) Detroit. That was fun. I got to take a picture with the winner and got a signed hat for my son. He he couldn't go, but he but I I I brought it back for him. Yeah. Good Jack BeVier (00:34) That's awesome. That's really cool. David Moses (00:36) weekend. Jack BeVier (00:36) the multi determinant or David Moses (00:38) I only went for one day. I had our our company quarterly was Friday. I had tickets for Friday and for Sunday. but company quarterly was Friday so I missed out 'cause it sucked 'cause our whole EO chapter for Detroit was at was there on Friday and that would have been that would have been cool. but I you know, I got to see the I gotta see the the see the winner and you know, see the last last few holes. It was nice. Jack BeVier (01:02) Dude, that's lot of fun. That's a lot of fun. So well, so what's going on in your market? What we were chatting just before we started to press record here. what are you seeing in terms of just from the market, being a landlord, being a flipper, talking to your peers in your your part of the country in Michigan, what's the world looking? David Moses (01:21) Yeah, I y it looks frozen to me. I mean, it really does. It it looks to me like like sellers really they're not willing to take the haircut yet. they're kind of being patient, holding out for for for the numbers that they think that they should get. And buyers are you know, buyers are s are kinda on the sidelines too. I mean it looks to me like you know, the R for sale product is you we're we're we're not getting multiple offers. You know, w we'll usually get an offer at ask or very close to it, but only one. And then if that doesn't pan out, then, you know, we're dealing with you know, lowering prices and things like that. I mean it's it's it's been that way I think for several months i in most segments of our market. I would say probably the million plus, oddly enough, has been You know, that stuff has been pretty strong. I guess it's just you know, people have been pretty insulated. I mean, those don't go fast to begin with, but the but the market doesn't seem to be drastically affected up there. Jack BeVier (02:25) Mm-hmm. David Moses (02:27) but I but I'm surprised on the very on the very low end I'm seeing, you know, people offering ten thousand dollar reductions, twenty thousand dollar reductions on a hundred and fifty thousand dollar property. You know, they it's not to me that can't be even nominally meaningful to someone buying a hundred and fifty thousand dollar house, I think it's really more indicative of them, you know, sensing you know, sensing the stress and wanting to wanting a deal. Jack BeVier (02:56) Yeah. Yeah, I was gonna ask, do you think it's more like is it this more of a price point specific thing? Like are you seeing certain price points are weaker than others? You mentioned the low end. Is that also the case with the four hundred thousand dollar ish flip? David Moses (03:10) It se it seems like that stuff is is sitting. I mean that that w we're getting I would probably double the the the market times. and Jack BeVier (03:18) Mm. David Moses (03:18) we're we're usually dropping price a couple of times before we're getting before we're getting people jumping at it. we're on our offers we're ten to fifteen percent below where we would have offered. just being conservative and trying to be you know, just just trying to be careful. Jack BeVier (03:35) And are you so are you finding that when you say it double like day days on markets like doubling, what David Moses (03:40) Yeah. Jack BeVier (03:41) is is that from like is that from ten to twenty or is that from thirty to six? David Moses (03:45) No, it it's more like from between thirty to forty five to now sixty to ninety. I mean stuff's take stuff's taken a while to move. and I don't know. I mean I I I I sense that you know, it being kinda getting close to the midterm elections, still interest rates, you know, it well the five year was what, like mid threes in in February before the war broke out, before before the Iran thing and then it's it's like up not quite a full point, but it's up. Jack BeVier (04:16) My basic point. David Moses (04:18) So you know, I I does that mean if if all that if all that ends, if all that clears up, is that is that gonna so are the rates gonna come back down? Are they not gonna come back down? Jack BeVier (04:30) And would you say you've seen this like happen over the course is this like since spring? You know, like is this like a you know, since the spring selling season is over or was this already happening during the spring? David Moses (04:42) Yeah, I I I think the the winter had a normal down tick. Like the there's there's that rush in the fall in our market before it gets too cold for anyone to want to move. And then you know, we saw that, it just seemed normal, but then that spring bump was not what you know, it was not all that exciting. Like we like we got some inventory off of our books when when when it happened, but but it wasn't it wasn't the rush that it has been. for years. and it doesn't seem to be I mean there's still there's still no more product on the market than there was before. It doesn't seem like there's drastic mobility out of our market. There's not like people aren't just like exiting my market in droves. so I I don't know. I mean I I I would say that it's it seems to me that the optimist in me wants to say that that we're probably in a a period of pent up demand and just nobody's willing to that's not willing to to to you know, whatever relief valve, whatever's gonna cause that to to open back up, it just hasn't happened yet. Jack BeVier (05:48) So you and yeah, that y you take the optimist case is that that interest rates could unlock that demand and David Moses (05:53) And Jack BeVier (05:56) stuff would move again and prices would rebound or at least stabilize. David Moses (05:59) Yeah, I mean, like I wanna I mean, I wanna be cautious. I wanna be but I can't I I'm trying to figure out what's the what's the re like what's the reason if it's if it's a if it's really gonna be a permanent thing, if it's really going to be that w you know, we're gonna be stuck with this environment for an extended period of time, where's the why? Like, you know, are are there not households being created? Are there is there is there population decline? are is there is there an excess supply that's come on, you know, that that's come on the market. I don't see all of that. I mean, I don't, you know, a lot of that stuff you don't see until after the fact, but it just doesn't seem like you don't see any reports about an outsized number of you know, housing starts or permitting, you know, the the things that you would expect to see. you know, w where you have, okay, the this this is a bubble that's gonna burst. I I don't I don't see that. So it it just seems to me that it's people are just sitting on the sidelines and saying, if I can get a deal, great. And if I can't, you know, I'll I'll wait for interest rates to come down or I'll wait for more supply, you know, well you know, I'll I'll wait for a better house or a bigger house or whatever it is that they're you know that that in their particular situation is causing them to wait. And and and it could just be perception. It could just be the general feeling is that it's not a great time to buy a house and so people don't buy houses. And then when things you know, when the general perception changes, then everyone jumps into the market. So Jack BeVier (07:33) Yeah, I hear that. I do feel like it's like more of consumer psychology right now than anything else. Like the interest rates are where they were before. They're not helping, you know. You know, they're certainly not moving in the direction that's making it easier from an affordability perspective. And I but I also feel like the consumer feels weaker right now, right? Like student loan payments started to have to be made and credit card and auto defaults are up a bit. And the I think that the labor market is less tight. than it was previously. You know, I think that employees are feeling less confident that in their job security than they did a couple of years ago, which you know bolstered even the fact, you know, that it was a higher interest, it was also a high interest rate environment. But everyone was like, Yeah, but I definitely have a job and I've got options and like, you know, I they were confident in their source of income, you know, being a stable one. I think that confidence has lessened over the course of the past year or two. And so to me it's like I think it just may be that the macro backdrop is has has been not that great for a while, but the demand that was but but the yeah, that the that we're really just writing the more of like the consumer psychology wave right now. That that the the people don't feel great, don't feel confident. The Iran war was like a not a war that anybody thought no one predicted that war. No one was just like, you know, Trump didn't even run on he ran on against that, you know, idea. So like David Moses (08:56) Mm-hmm. Jack BeVier (08:57) the fact that we've found ourselves in a war is a bit un that that we now seem can't seem to ext extricate ourselves from seems to be I think is an unsettling you know an unsettling fact also. but I'll take the particularly I'll take the bear case on it rebounding though. Like I don't and I and I don't think that anything's gonna get better in the short term here. Like I think that I think that the consumer is gonna continue to feel uncertain for the next couple years because AI and I is gonna be more and more of a factor that like may start to cause some displacement. And I don't see why, you know, in a continued Trump presidency people are gonna think that everything's gonna be stable. The dude's just not he's he does not contribute to that, you know, everything's gonna be fine. Anything like every morning you're wondering what w you know, what new adventures we're gonna be going down today. so like I d I do think that the consumer is gonna feel unsettled for a while and given, you know, since we don't have a a a set of positive economic variables spurring household formation and demand, I could see everybody just kind of just sidelining themselves for a while. And and that this spring was like the last was the last was the end was kind of like the end of it, right? Like was was was the demand that t really did want to transact did this spring. And now it's just gonna be real quiet for a while. so I've kind of set ourselves up for that, which is probably the bear case. I probably I probably made our strategy the bear case as to what's gonna go on in the flipping market the next couple years. David Moses (10:40) And so what's that strategy? Is it is it just pricing a a a certain decline into it, pricing longer hold times into it, you know, into the investments you're making, holding things and not selling them for a while? What what like what what moves are you making? Jack BeVier (10:55) Yeah, getting out of projects that have that represent long periods of market risk. So very large rehabs and new construction I just wanna not take on because I'm concerned that nine months from now could be another ten or fifteen percent down. like that's that's conceivable. Not I don't think that that's like gonna happen, but I don't think it's inconceivable that that that this you know, that the that the winter market is just dead. Or that this, you know, that it's a boring or you know, down spring market next year. So I'm a I'm looking to avoid market risk. So I'm looking to avoid projects that are gonna take a long period of time. I'm pricing aggressively out of the gate. and I'm I was already price dropping aggressively, but I'm even now setting prices at the gate more aggressively than I was previously. And and then being pickier about on the rental projects that we're doing. recognizing that appraised values have come down and that the liquid and that liquidity events are are fewer and further between and that I can't afford from a cash flow perspective to keep sticking money into resize. So you know that's frankly by the way, the way we ran the business for the first fifteen years, right? The last five years are wo are the has been where like liquidity was you know, the easy part. And it was not the easy part for the first fifteen years. First so for us this feels like a back to basics. operationally, it's just like a back to basics. But I've also had to like look inside the shop and like, you know, make sure everything's tight and rattle some cages to be like to make sure that everyone's on point. Because frankly I think that everyone's just gotten a little sloppy and lazy over the course of the past five years. And so I'm having to Or I'm I don't know if I'm having to, but I am rattling some cages to try to like be like, No no no, like if we if we don't get really tight, like it'll be a problem. So like I've said I probably said this five times in the past two weeks. I'm like, it's my job to be really uptight now. So that three months from now, like we don't have to be really uptight because it's hard to make payroll. And you know, no one likes to hear that because I'm being a little bit hyperbolic and a little and it's and certainly inflammatory. But dude, run on ca cash running a cash flow b running a cash flow statement for a real estate business is freaking hard. Like insanely hard. And the past five years have been the anomaly. And I just think we're going back to what the business always was, which is like you just got you gotta move you gotta be lean and mean and and ru and run super and and operate super fast and and I don't know, cut off, you know, cut off your You know, your leg when it gets caught in a bear trap quickly and keep r and keep moving, you know. David Moses (13:43) Yeah. Yeah. I mean, that's definitely the bear case. I mean, w I'm not I'm not gonna you don't you don't sugarcoat many things. So I'm Jack BeVier (13:52) Yeah. David Moses (13:53) with you on that. I I I will say that we I anticipate from a rental perspective and a sales perspective that I I anticipate a flight to quality. So Jack BeVier (14:03) Mm-hmm. David Moses (14:04) we aren't we aren't I can tell you we are definitely not making any decisions to skimp on anything. I would rather be, you know, taking a discount on a product that is superior to everything else on the market, than than having to compete head to head, you know, against a you know well well, really against we're we're competing against homeowners, right? Who who probably haven't tapped all the equity out and if they gotta make a move they're gonna They're gonna they're gonna make a move. I gotta make a profit. So I want I want it to be a great a great product. From a rental standpoint as well. I think that you know, maybe we've tightened our standards a little bit on rental, you know, on on on tenant, on on who we'll accept because we don't want to be you know, this unfortunately politically we're just not in an environment where we can get people out when they stop paying. and and that's that's a that's a reality. but but that has that has come at a cost because we are there there are things that we'll sit or we have to take, you know, discounts on because because we have to we have to get it rented, but we won't rent to somebody, especially in certain certain sub markets within the Metro Detroit area where we know, you know, someone decides just to not just to stop paying, you know, they're they're there for six, eight months. Jack BeVier (15:35) Yeah. David Moses (15:36) And we're paying their water bill and we're paying their sometimes we're you know, in the debt of winter, we're paying their their gas and electric if they don't pay it, and we're trying like hell to get out of there. So Jack BeVier (15:46) Yeah, that's the thing with we haven't seen a consumer recession in a long time, right? Like COVID was like a wasn't really a consumer recession and we all got checks and so like no one ever really felt the pain there. particular and certainly and then paradoxically and it didn't transfer through the housing market at all, right? Like everyone paid their rent. Eve even if you were a even if you were a bartender and you got laid off, you s you didn't get evicted. You you still paid you got a way to stay in the house. David Moses (16:11) Somebody somebody paid your rent. Yeah. sure. Jack BeVier (16:15) No more through all the streets. So we haven't had a consumer recession in like a long time. And I would say I would argue that the vast majority of people who are operating in space environment never have. Like they've never seen changes in tenant behavior. and that's what happens in a consumer recession, right? Like the low end gets hurt first, the renters get hurt first. And I mean, given the nature of what this consumer recession may look like from a you know, if it's an AI. Placement driven one, which is what I think, then that segment of the market I think is the ones that are gonna get somewhat affected. and like you to your point, the folks, the landlords that didn't emphasize tenant screening and were instead focused on getting that body in the house because the lease was the last thing that their DSCR refi company needed. we could close and they could get liquidity, they just threw a body in there and then a consumer recession comes along and you know, and you're up creep. I do think that that is a significant risk factor for the over the for the next twelve months is the the the mistakes that have already been made, right? The least the the people are in the house. Frankly there ain't a whole lot you can do about it anymore. even if you know you made a mistake, right? Like if that's just a time bomb that you hope doesn't go off. So I think I think that's a source of risk. and we've been I we've been really also to your point, we've been really focused on leasing. Like just t literally taking acquisitions people off the street and leasing houses. Because I'm just like that is where the liquidity events are coming from. To your point, I don't want to s I don't want to skimp on tenant screening standards just to fill the houses. I'm gonna throw more horsepower at leasing. until we're leased up, you know, leased up tight. And and at least then I'll, you know, feel comfortable that I've done everything that I possibly can to unlock the liquidity that's within the portfolio right now. You know, like I got houses that haven't been refined yet because I'm still waiting on leases. I got a couple multi family projects that I have to be ninety percent occupancy for ninety days in order to do a agency refi on and we're leasing up, but I'm not ninety ninety and I'm not gonna be ninety for ninety for more than ninety days, you know, like I'm not even at ninety yet. And then I gotta wait three more months to get a refi and that's if the agency refi happens exactly that the moment that it the earliest moment it possibly could, none of that's realistic, right? Like that's just not how it's gonna go. Like and I'm feeling less and less slack in the system to to pay for that slack. You know, I'm gonna be there's there's nothing easy right now. So like where's that slack gonna get paid for? and I'm coming up with fewer and fewer answers. So tightening the belt. That's my that's that's my mood at the moment. David Moses (19:03) Yeah, yeah. I you know it what we you know, I went through I don't know if you were I don't know if you were in the business. You were were you in the business heading into the Great Recession? Jack BeVier (19:15) March two thousand seven. David Moses (19:17) Okay, so you like yeah. So so you basically Jack BeVier (19:22) I never knew what I missed the good times completely. I showed up just in time for it to start to coast. David Moses (19:27) So do you remember those days? Do you remember like like holy like you were at the top of the roller you didn't know you were at the top of the roller coaster, right? Your hands were Jack BeVier (19:36) Yeah. David Moses (19:37) up your hands were up cheering. You didn't realize what was about Jack BeVier (19:39) Yeah, the whole the whole pitch was that like, hey man, like Fred you know, I I it's summer of two thousand six I was interviewing a Fred my partner Fred Lewis now and and he was like, Hey, I just I bought this for twenty and I wholesaled it for thirty two and I bought this for sixty five and wholesaled it for eighty and we just flipped this house and made thirty grand and re fied and added these sixteen rentals and you know, they were all bobbin and weaving and money was flowing and deals were happening. And in March of two thousand seven I show up and it like, you know, yeah yeah, things are a little bit tighter, you know, there's some there's some concerns about the mortgages, you know. And then, you know, the thing just kept falling down. So I just saw guys fall for the first four years. David Moses (20:20) And and it doesn't seem like that's a realistic scenario. It seems like it's it's gonna be that first period of time where things just kinda started to weaken and you know, but there but there's no again, there's no supply, right? There's no there's no oversupply. So we're not in a situation where there's more places than there are people who need places. and it it does go back to that basic, you know, basic thing. But but when you're entering that kind of market, it's you know It is your friend and the bear, you know, and you do not have to outrun the bear. because what we what did we learn? Like if I had to do it all over again in the Great Recession, I you know I guess the the the crazy person in me would have probably picked more local banks and borrowed even more and then went to them and said, I'm I'm too big. You know, you you're just into it for too much with me. And and and you're not gonna take like you can take these things and you can trade to somebody with less experience or someone doesn't know what they're doing, or you know, I like the the the real, you know, ass in me. Obviously the smart play would have been just sit on the sidelines and wait. Right. But but there were deals there where, you know, I knew like we had just a few deals with small banks and the and the banks would basically say, Hey, we're going under. We're gonna get acquired by the FDIC. And then the FDIC came and they were like, We'll lop off eighty percent of your mortgage debt. and and that's just you know, there were so many things that I couldn't take advantage of because I didn't have a lot of that. Mo you know, most of it was you know, most of it was Fannie Freddie, those types of loans. D S C R didn't exist, so it was really just Fannie Freddie loans and and and then the non Qm stuff because I was past the ten limit that you had back then. I don't know if that is still a limit or Jack BeVier (22:17) Yeah it is. Yeah. Nine properties. Nine properties in your personal name, still the still the guideline. David Moses (22:21) Yeah, they still still don't have a reason to change that, I guess. Jack BeVier (22:24) Yeah. Okay, so let me ask you question. In given everything that we just said, how are you buying houses? Like what are the acquisition strategies? 'Cause we s 'cause we still have to operate. We all can't we can't just go stick our heads in the sand. Like we some some of them even if we made mistakes, they're made. Right? Like those beds are made and we just need to like pay the piper to like get through or not let enough time pass that rents can increase and solve our or get our principal down balances down, right? Like at the end of David Moses (22:55) That's right. Jack BeVier (22:56) the day we can just work our way through it. Or at least we'd like to, right? That's that's the goal. so like how are you thinking about acquisitions given that given given that kind of like all that backdrop that we just talked about? Like how are thinking, you know, where where are the deals gonna be bound with them? Where are they where are you finding them today? David Moses (23:14) MLS. We're we're not willing to market. We stopped. Completely stopped. No cold calls or texts or emails or we're we're basically, you know, let let the wholesalers do what they do. we stopped doing that completely. Jack BeVier (23:26) You stop doing that. Why'd you stop doing that? David Moses (23:31) the it it the market is not it I can't justify it. There's there's not the it the amount of effort and work and and you mouths you have to feed to keep that operation going didn't make sense. There's just not there's not enough deal flow. There's just not enough deal flow to to for for me to make make sense of that when we have, you know, there's deals on the MLS again. There's Jack BeVier (23:57) Mm-hmm. David Moses (23:57) deals and I'm I'm I'm not arguing that people who are doing this should stop. It's just, you know, that's not so I'm sure there are good deals to be had in in you know direct to seller marketing still like there were. but for us it's focus. we don't I don't need to have a hundred deals in a year. I've never had a hundred deals in a year. That's never been a a thing for me. So if I can get, you know it used to be three deals a month. Now it's like one to two deals a month, if I can get it on the MLS and and then I can decide what do I want to flip? What do I want to hold? I'm offering you know, it's usually things that are more physically distressed. I know you mentioned like long projects, you know, are things to kind of give you pause. I I agree with that. but what we're finding is kind of like the smaller houses where you can like you can renovate the whole thing and e even if you have to renovate the whole thing, even if you have to gut it, if it's a small house, it can be done fairly quickly. But those that's where kind of the deals seem to be because people willing to take a discount. Jack BeVier (25:04) Mm-hmm. David Moses (25:05) on the MLS, they really have to have something that's in rough shape. Jack BeVier (25:09) Mm-hmm. David Moses (25:10) or you just gotta catch them at that right moment where, you know, there's a lull, they're not getting offers, and they're just willing to take a huge haircut off their list price. you know, and and and that's, you know, that's kind of the kind of what we're seeing. And we're just sticking in very specific areas too. areas where we know they're Like if I look at the MLS and I do a comp at a property and I look at the ratio of comps that have, you know, sold versus comps that are for sale, right? Obviously during the Great Recession and coming out of it, it was, you know, seven houses for sale for every house that sold. Right. And then two years ago, it was, you know, you'd have twenty-five houses for, you know, that that is sold. And, you know, maybe you'd have one for sale. Probably it was pending. Right. And Now you're just looking at that ratio and saying, Okay, what's my competition? How much competition do I have? And if I've got a lot of it, if I've got houses sitting that are good rehabs, good flips that are just sitting, I just don't want to go up against them. So Jack BeVier (26:12) Yeah. I hear that. So I I t I I kinda I turned off the direct to mar direct to seller marketing also just just very recently. Same thing. And it kind of led me I was I was thinking about it. Like I was in late to that. Like we we were at the courthouse steps for a very long time and then when people were making direct people were making money in the run up or you know not in the run up, but like, you know, people were making the money in the wake of that doing direct seller marketing. I was really late to that. Like so we got bad at it. Or sorry, we got good at it on a three or four year lag series. It was like multiple years late. and then we had a couple good years of it. And then I would say for the past three years, I my cost of acquisition of a customer has been like between ten and fifteen thousand dollars. Like, which for me is unacceptably high. Like I just I've perceived that to just be like I'm just moving money around, but like I'm spending a lot. on cost of acquisition of a customer and it's been going on three years now and now I'm like a and I and I think it's because at least this is the story I'm telling myself that in I I think a direct I think direct mail marketing just is an up market. Is an up up market like up and to the right. If the market's going up, it's a great strategy for that, right? Because it's you're reaching out to somebody, they think their house is worth a number, you think it's worth you think it's you know it's worth a little bit more. And so you can give them what is to them an acceptable offer because you know that the market is up a bit since they had reference points. And so a deal and so deals get done at an acceptable cost of acquisition of a customer, right? An acceptable rate where you can spend three grand in mail and get a deal out of it. But in a down market, I know the market's softer and and we're going down The people I'm sending mail to have reference points from six months to a year ago. And so in the down market, the seller wants a s a certain number and my offer's lower and some people have to transact and eventually we get a deal done. But you know, after much ado and much follow up, but mostly I just spend a ton of money on mail to folks who just whether their expectations are realistic or unrealistic, doesn't matter. They don't want to sell for the number that that I'm they just think I'm wrong. Like they just think I'm trying to steal from and so David Moses (28:40) They do? Yeah. Jack BeVier (28:41) it's I'm like it's just a it's just not a down market it's not it's not a flat where down market strategy. It's you know, it's I'm sure it could be fine in a flat market, but like it's an up market strategy. and so I'm like, I just think I've been wasting money for the past couple of years with having too high of a cost of acquisition of a customer. and I probably should have pulled the ripcord three years ago. I mean I didn't know but so you know. time's always twenty twenty. But anyway, that's the percep that's the the conclusion I've come to right now is that like David Moses (29:08) Okay. Jack BeVier (29:08) I just I like you said, I'm letting letting the wholesalers grind it out and I'm happy to pay the fees and it's you know, if I pay a fifteen thousand dollar wholesale fee it's the David Moses (29:17) You're even Jack BeVier (29:17) variable cost without any of the overhead burden of or you know, David Moses (29:21) It's right. Jack BeVier (29:21) any of the the commitment to to to that to that strategy. So that was a hard thing for me to do, but Came to it about a month ago. David Moses (29:29) Yeah, I and I f for all for all the for all the similar reasons. I I'm looking at something that's kind of cool. the so various cities obviously they're you know they've late to the party, they realizing they need more housing, and a city near us has decided to pass a law that changed the minimum parcel size for a PUD from twenty-five acres to zero acres. Which Jack BeVier (29:59) Real. David Moses (30:01) is super interesting to me because that means I Jack BeVier (30:03) Explain what a P explain what a putt is to everybody. David Moses (30:05) Yeah, okay, so planned unit development, it basically just means I'm gonna take a property that doesn't meet the zoning requirements of of that particular parcel and I'm going to apply for a PUD. to allow me to do something that the zoning doesn't doesn't allow. and and it allows the city control over that without having to you know play the political games with you know various boards and and committees to approve variances and modifications you know in in zoning because there's just essentially a specific theme Yeah, it's just here it is. If it makes sense, we're gonna go ahead and approve it. And Jack BeVier (30:50) That's really interesting. Like you get 'cause when you're doing when there's like a zoning or you know, redoing the zoning, there's a it's a humongous negotiation, right? Because the zoning law transfer you know crosses the entire city, the entire county, and so you have to get all the different areas to agree to the least common denominator set of rules and there's all kinds of pork and horse trading that goes on. But if you can just go to a go go to one city council person and be like, Hey, I want to do a PUD in your backyard. Here's what I want to go do. It's still political 'cause you gotta go through that person, but at least you only have to go through the one. David Moses (31:26) That's right. And and all of them like housing. So it's not like I'm trying to put, you know, hey, I want an industrial building or I wanna grow cannabis or I wanna, you know, I I've got a a use case that they're very receptive to. and and and the sales job is easy because you go to them and you're basically just saying, Look, this is a you know, 10,000 square foot lot or whatever it is, and it's zoned for a single family residence. No one would ever build because the value wouldn't make sense for a single family. But if I can build that same square footage as a four family or a two family, you know, now this could make sense economically. Right. And I can buy the land for nothing because no one's willing to buy it because no one's, you know, because they can't can't do anything yet. Jack BeVier (32:12) Just the zero patients, yeah. David Moses (32:14) And and so now so it it becomes interesting. It's kind of goes back to my modular play that I did years ago because modular builders can build a a duplex, a triplex, a quadplex and would love to. and the prices there and the lead times there are starting to come down. And I think they will continue to come down as the market kind of stays frozen. And and hopefully there will be a moment where what it costs me to build it, you know, if I'm building brand new product, I don't mind building it at value. I don't I don't need to have a delta, a significant delta, because I've got a new product. There's a stabilized you know, i th there there's a there's an easy to stabilize, you know, component to it. They're very easy to rent. They don't cost much of anything to maintain. because they're brand new. You know? So we're Jack BeVier (33:03) I hear you. And you don't have the opportunity. You can't you can't go on the MLS and buy new construction built to rent. So like I hear David Moses (33:11) No. Yeah. Jack BeVier (33:11) you. Yeah. David Moses (33:12) So so the idea is that a and because it's only one city that's you know doing this, then there's probably other cities that would, you know, it might make sense to try to encourage them to do this in the future. But but for us this is just it it's easy. So we're playing with the numbers and trying to find out when's the right time to strike because we can get the lots for next to nothing. we can ask the city to help with a lot of different things, like hey. You know, we don't wanna pay permit fees, we don't wanna pay, you know, water tap. We don't wanna pay or we wanna do the water tap ourselves, you know, various different different things. and they get they get housing, you know, and they get housing and they get and they get tax base 'cause these are lots. So they're very receptive to that. Jack BeVier (33:53) So was this like was this PUD enabling legislation done at the state level, or did the city take it upon themselves to create this? David Moses (34:00) C the city the city did it. it I don't know if there was encouragement from the state to do it, but there is they call it missing middle money. that I I think is federal dollars that come to the state and then the state divies it up to counties. and so one of our you know, one of the kind of the things we're throwing around is possibly applying for some of this missing middle money. to kind of bridge the gap between, hey, we're gonna provide housing. They're not looking for people at seventy percent AMI. You know, they're looking for you building housing at a hundred to one hundred and twenty five percent AMI. Like they're looking for the you know, it's it's it's firemen and police officers and nurses. It's not, you know, people who are underemployed or unemployed or or who are, you know, for whatever reason just they make minimum wage and that's what they So this money can come in and maybe bridge the gap and say, Hey, I can build for this I can build product for this segment of the market, you know, but economically speaking, I'm X dollars underwater and I'm gonna apply to have the missing middle money come in and bridge that gap. And so we're looking at that too. Jack BeVier (35:11) That's really interesting. Do you think that and there's a lot of inventory in those locations to do that? Like in and is that where that came from too, the re their recognition that like, hey, nothing's gonna happen here unless we kinda spot, you know, s rezoned on a spot lot spot lot basis. David Moses (35:27) Yeah, and and there are well, there are there's some asymmetries of information there. There's a lot of people who own lots who don't know that this is a thing. but most people who own lots really aren't. They just own them. Like they you know, they're they bought them thinking, you know, one day they'll be worth something. Jack BeVier (35:43) property tax bill comes for one hundred and seventy three dollars, they shrug their shoulders and they write a check and they put it in the mail. David Moses (35:49) That's right. The really frustrating part for them is the is the grass cutting if they're not if they don't live next door, right? The person lives next door, they're not selling me their lot, but you know, for me to build a multifamily on it. But you know, but but they will there there are a lot of people who are just holding on to these lots who are happy to kind of get rid of them, and the city has some and the county has some. and so if they can just give us these lots, and you know, for five hundred bucks a piece, and if we can make the economics work, you know, like we don't need Jack BeVier (36:14) Yeah. David Moses (36:15) I don't need a huge delta. I just you know, because I like the product. And it's a multifamily product, right? It's not a it could be something I, you know, sell to somebody who's gonna live in one and rent out the other. You know, it could be could be something like that. I guess that's a an exit, but it's multifamily. So I I can sell it to somebody who's looking to own a duplex, triplex, quadplex, and the numbers, you know, the DSCRs tend to make sense. Those things tend to make you know, you got one root. You got four, you know, four ten. Jack BeVier (36:44) If you're into that if you're into that for what are you into that for? Three hundred grand? David Moses (36:49) I if I I'm I'm looking to try to be into it at a hundred K a unit for about a plus or minus eight hundred square foot product. you know, and and it's gonna be higher than that if it's a duplex. It's gonna hopefully be a little bit lower than that if it's a quadplex. you know, that's that's kind of where we're at. and we can finance them using regular DSCR loans once they're done and you know, and I have a bank Jack BeVier (37:11) Yeah, we think the rent's gonna be on that. David Moses (37:14) So that's the interesting part because there's not a whole lot of new buildings that rent. Ever it seems like everything that's new that is rented out is really it's built by some nonprofit and they're and they're really pigeonholed into a certain segment of the population to rent to. So you really don't have any real good comps. But high end renovations, you can kind of look there and you can say maybe thirty percent above what the market rent would normally be if that, you know, that bedroom bathroom count square footage, you know, type of product. you know, we're we're on the market, you know, an average unit of that mix, you know, of that of of of you know, that avatar. I'm I'm gonna take that add thirty percent. I think that's probably not too aggressive. that's been you know, it's been our RMO for a long time was you know, over renovate the rentals in areas that were s kind of surprising and you get a very small segment of the market willing to rent, willing or able to rent and pay that much, but that small segment has nothing. Like there's no no competition more. Jack BeVier (38:15) Well wait, so what do you think that what do you think that's gonna look what if it's you if you're in for a hundred grand a unit? David Moses (38:20) So I'm looking at I i that would wind up being somewhere in the twelve, thirteen hundred bucks, you know, as as a rental. Yeah, and and Jack BeVier (38:28) Yes, that's all. That's great. David Moses (38:31) and the taxes, you know, we'll get a year of zero ta you know, basically zero taxes. you know, so that you know, 'cause 'cause you get the care you get the lot cost, you know, and then hopefully we'll get some very advantageous assessments from the city. You know, so we're not getting absolutely murdered on taxes. So property taxes in Mich in Michigan are a an outsized expense relative to the rest of the country. We pay a lot with our property taxes. Jack BeVier (38:55) Hmm. What's your mill rate? David Moses (38:59) so the the the city this city is probably closer to eighty. Some somewhere in the eighty range on based on SEV, which is or based on taxable value, which is about half. Of the actual value. Jack BeVier (39:13) Okay, wait, so taxable value is half of the actual value. But then we're multiplying that by what? Eighty? Eighty you mean like point eight or what? David Moses (39:20) Eighty. Eighty. No, no, like eighty mils. So eight yeah, point so that's eight eighty mils, which is what is that, eighty dollars per thousand of value? Jack BeVier (39:30) Yeah, okay. I mean, so you but it but it's on half. David Moses (39:34) Yes, but it's on it's on half. So we're looking at I I would say that that it's like a unit that would rent out for twelve hundred dollars a month. that you know say that is a hundred grand, you know, of value, you know, you're looking at a four thousand dollar tax bill. That's Yeah, yeah, Jack BeVier (39:50) four thousand dollar taxable. So we're gonna David Moses (39:54) yeah. No, four thousand dollar tax Yeah. Jack BeVier (39:56) So four point so four percent. Like the David Moses (39:58) Yep. But Jack BeVier (39:59) the past year is effectively four percent a year. I got two point three eight and I and moan about my Baltimore city taxes at two point three eight percent. You got four. David Moses (40:10) Now now we've got we also have a capping. So basically, once you buy it, as long as you own it, the tax can't go up by more than CPI. It's it's like a CPI derivative, you know, that they, you know, by inflation essentially, but it's a it's a CPI derivative that they use that I can't I don't know the calculation or the which one it is. But yeah, so essentially you're you know, ten years after you buy it, you know, everybody who has bought since then is kind of subsidizing 'cause everything once you buy, once it transacts, then it gets uncapped. Right. And it goes to the you know, half the actual value. So those you know, those those are subsidies that that are there. So Jack BeVier (40:57) Interesting. Hey, when I switch curious and touch one more thing. trying for those listeners that aren't familiar, David and I also do a podcast called Fork.ai, which is focused on our company's small business AI journeys, trying to figure out how to make the most of this new technology and what the right way is for it to incorporate that into our businesses and you know cut costs. Grow revenue, manage risk, you know, really just like how to how to incorporate AI in our businesses and how and really kind of like we talked about our journeys as we're figuring that out. and then we both happen to have real estate businesses. So for real estate investors, we hope that that use case is you know kind of specifically highlighted and and particularly useful for those folks who are also looking for similar kinds of applications. But We talk a lot it's a ner it's a it's a technical it's a little bit more technical of a conversation. We are not afraid to get into the weeds. You know, on this podcast we're not afraid to get the the weeds to talk about real estate investing. On that podcast, we're not afraid to get into the weeds and talking about the technical aspects of like writing software and what AI tools are out there and how we're, you know, connecting systems together with AI tools. So, You know, it's it's for operators, you know, not for folks who are like trying to explore concepts. It's for people who are actually like waking up in the morning and want to like go do something with this tech. So at the risk of being a little bit of an overlap with that content, I've been Dave, I I've have I told you about this license rental licensing website that I put together. And it's kind of it's it David Moses (42:35) Yes. That's awesome. Jack BeVier (42:38) started with it started with I w wanted to figure out how many unlicensed rental properties were in Baltimore City. And then it's really grown and become the place where I'm just pulling all of public data sets and my I'm in Baltimore City specifically, so I'm where and Baltimore City actually has like pretty great access to open databases. So that's just become my particular use case. But it's really now turned into a project where I'm just every public database I can get my hands on that is keyed on real estate, keyed on residential real estate. I'm pulling all all that data together and and really just putting all the data sets in one place so that I can query that data or so that I can run searches and and answer questions about you know what's really going on in the residential real estate investing. Market. And it started as this, like, you know, me just having to bug up my ass about trying to figure out how many illegal rentals were there in Baltimore City. but now I've got water bills in there, permit data, homestead tax exemptions, every everything in the recorder's office, all the mortgages that are recorded, it shows all the transfers, and I've keyed all the all the players together. So, like if you're using three different LLCs. and you've got an office address and a work address and you use two post office boxes, I've actually got them all keyed together and I know that like John Smith is behind all that stuff. so it's been my little like nerdy labor of love like to try to like key all that stuff together. But now that I have, it's like really, really interesting data to analyze and like paint a picture as to what's going on. And I turned it on so last night. I turned it I turned I just said, Hey, I I've got Fable Five, which is the for for those who haven't played with AI yet, that's like the latest and greatest anthropic model. that was the one that was like, you know, they they were worried about it being able to like get through actually like have security breaches and like ha you know, hack their way through programming. So they had to they had to hold it back for a while so that people could patch their software before they release it out in the wild. Well it's now it's back publicly available and it's expensive as as models go, but it is very good. and so I just unleashed I just said, hey, like you have access to this project. Go look, go spend some time and look at all the data and tell me the interesting stuff that you see. And it's like good right? Like like the incongruencies know, people there's things that are like definitionally like you can see the city not enforcing its own laws, you can see the bad you can see bad behavior very quickly. It's phenomenally good at pattern recognition. And so when you give it large aggregated data sets, it gives you very interesting analysis. And so I was like, hey, what the top three, you know, things that are that are interesting? And I ha I happen to already know the top three things. But I did agree that those were the most interesting things that were that really popped out in this data set. and so now I've got a list of them and I'm just kind of going through and learning about what's really going on and how my market really behaves. And anyway, so that very long intro was to say that you should do that for Detroit. You should go, you should go create your own for Detroit, and every real estate investor, frankly, should do it for their own city. And I think you'll end up like, you know, really painting a very clear picture of like who the players are in your market, what they do, what's going on with them, you know, see who's borrowing from who, see who's not paying their water bills, see who's delinquent on their taxes, and all in real time is like, I don't know, fun. At least for me it's fun for me. David Moses (46:26) Mm-hmm. Jack BeVier (46:28) so anyway, I just wanted the I just wanted to slide that one in here on the on the Real Investor Roundtable podcast. talk about. I think that that's like a really interesting use case for people who are like struggling, I think, a bit. Real estate investors like, who gives a like about AI? Like I don't have enough I don't have enough operations in my office to like that it's worth it, right frankly, to like teach an an you know, a bunch of AIs how to help me with my business. And it's not gonna help me swing a hammer more effectively. And I like I generally think that there's to to a large extent like You know, for many, many, many operators that's true. but this is a use case that I think is interesting for everybody, is like better transparency of data and analysis of that data. I'm really seeing a use case for AI in that regard for real estate investors. David Moses (47:17) It's yes. I I would love to see like exactly the data sets that you're pulling from and you know, kind of what you're how you're using that. One thing that we you know, I wanna we we may have talked about this on Jack BeVier (47:28) That's good. David Moses (47:29) an episode of Fork Day, I don't remember, but but you know, Google has access to their street maps API that you can pull for I think it's still seven tenths of a of a penny. You can pull a street view, right? any specific, you know, any any coordinates essentially. And so what I thought would be an awesome an awesome activity or or or hobby for a market prob probably would be actually very economically useful would be to take those take those photos, take those street map photos. You know, you you can actually dip into the API for free to find out when the dates of the photos were. So you could actually constantly pull Google's API within their rate limits to just find out, you know, when a new picture comes up and you know, when when the little car went through that little neighborhood and took Jack BeVier (48:19) Mm. David Moses (48:20) photos, right? And then when you have those photos that are recent, going and obtaining the prior photos, right, for that, you know, for that same neighborhood. So you know you've got you're gonna download all the pictures in a certain neighborhood and then all the historical pictures in a certain neighborhood. And then using AI with those photos, for you could quickly analyze the photos and and figure out what's going on. Is there is this a gentrifying neighborhood? Is this a neighborhood that's, you know, improving over time? Is it dilapidating? Is it going in the other direction? And and I think you know, you probably want to start with photos that are relatively recent and then kind of work your way back and and kind of analyze you what you analyze it house by house. And you can determine, okay, this house is, you know, you know, nothing's really happened with this house. Like people aren't, you know, nothing's really going on here, right? But if you aggregate that thousands of houses in a particular, you know, census tract, you can actually start to see, you could probably build a heat map from that and decide, okay, these area these neighborhoods are dilapidating, these neighborhoods are gentrifying, you know, and look. Look at like where's the opportunity? Like probably not where it's gentrifying and definitely not where it's dilapidating, but adjacent to like you can actually start to see visually the path of progress and see where, Jack BeVier (49:47) Mm-hmm. Yeah. David Moses (49:49) you know, kind of where the opportunities might be in the future, you know, you know, as people get priced out of this neighborhood that's gentrified, where are they most likely to go? You know, and where are investors actually going now that they can't find deals in those areas anymore? Where are they going? Are they going north, south, east, you know. So I thought that would be really cool, you know, probably very time consuming project. But I think it would be incredibly worthwhile. probably breaks all kinds of Google terms of use to make that kind of thing public, but it would be super useful. You know. I I'm g I'm guess I'm guessing if you were using Google Street Map or Street Views to to determine which neighborhoods are going to they would they probably would care. Just publish that to the world. But it might Yeah, Jack BeVier (50:38) Yeah. No, I like that one. That's a good idea. I like that. David Moses (50:45) and if you if you can make it programmatic where where you know you could literally just you could pick any neighborhood anywhere, pretty much anywhere in the world. Right. And and you could do this. And so you know, I think I ran the cost it would like of doing the entire Metro Detroit market. It was something, you know, stupidly reasonable. Like it was like under twenty five grand to like build a heat map. Jack BeVier (51:07) Yeah. Yeah, that's the thing, and and like people don't you don't need to do the entire metro in order to like you know, like just you have a couple of areas that you're interested in. Like, you know, how many buy how many houses do we buy in a year? And only like and this is only about like the stuff where you're thinking about like rental properties, right? Like, you know, understanding the long term dynamic of a market is, you know, like much more interesting if you're gonna own there for the long term. So like, you know, where does rental economics work? Then, you know, all right, narrow down to that, then let's start analyzing. I guess I think it's great. David Moses (51:37) And if you if you overlay the rental data and you can Jack BeVier (51:41) Mm-hmm. David Moses (51:42) see how the number of rentals or the percentage of rentals changes over time, you know, that that could be that could be useful information in and of itself. It's obviously if you're gonna, you know, you wanna hold the rentals in the neighborhoods that are becoming, you know, less saturated with rentals, and you wanna probably divest of your rentals in neighborhoods that are where that percentage is meaningfully increasing. Not just from a competition standpoint, but just from you know overall value. The more rentals you have in a in a particular, you know, neighborhood, the the you know, the the less those values will will be over time. Jack BeVier (52:24) Man, you you mentioned earlier the the ratio of like the competitive set ratio, right? Like how many properties have sold for how many houses. If you look at a certain half mile radius or whatever, how many properties have sold in the last twelve months versus how many are active? And then you know, just give you a sense of like if and then if you do a time series of that, right, you can see like is inventory tightening or is it loosening, right? That becomes like I think a forward or you know, Canary in coal mine or you a forward indicator of days on market and then ultimately pricing, right? If you were gonna see nominal price drops, you would see elongation of days on market first. This ratio would be highly correlated with both of those things happening, right? So like even in the context of being a flipper, you could get a sense of like where inventory is hitting the market and what that's doing. 'Cause like for example, like I'll use a specific Baltimore use case. Like Highland Town is a market That's over in East Baltimore, it's like it it's it's edge-ish, but like you can there's still plenty of flips happening in in that market. But there's still a bunch of rentals there too. But you know, as the market was heating up, Highland Town got super hot. But the thing is, over the course of the past like 12 months and really specifically over the course of the past 90 days, Highland Town's really taken a beating from its days on market. And there's just a bunch of inventory there, nothing's quite moving, everyone's taking price drops. And anecdotally, you know, if your wife's a real estate agent and that's what we talk about at night, then I find out that that then a Thailand town's getting soft right now because, you know, she's my wife is literally selling houses in that location. But if you're just a real estate investor, it's kinda hard to like get all of that anecdotal evidence and compile it into an investment strategy. Like having a Having a a a higher resolutions analysis of what's going on even in the flipping markets, I think would be, I don't know, just a really a really useful productive tool. But I haven't, I don't know. I'm I'm curious if any of our readers have seen someone try to productize this idea. I mean, I know House Canary has like days on market on the zip code level, but even that zip code's just not not quite granular enough for what I'm talking about. know, like I wanna see it on the subdivision level or or even higher resolution than that. But I could see that being a useful tool for for a flipper who's saying like, hey, should I keep this thing as a rental or should I flip it? Like, you know, seeing that the competitive set is getting worse and getting more and more competitive would be you know, good information to have now rather than six months from now. David Moses (55:06) Yeah, I I totally agree. I think it does need to be granular. I think it needs to be, I think you need to be able to drill down to the house level because you're first of all, a flipper's gonna wanna know not just that days on market are increasing, because you can probably see just that fact from a larger data set. But why? Right? Like a a flipper wants to know not just, you know, They wanna know what's selling, right? They wanna know what what can Jack BeVier (55:37) Yeah, it's like are the flips not selling? Is the new construction not selling? Is it the grandma houses with new kitchens and baths? Is it the grandma houses? Like those are five different markets. But when the National Association of Realtors puts data out for a county or a zip code, even they just lump all that together. And I'm like, nah, man, we need to be like parsing this out. Like those things, those are different markets. The person who is Like no one is looked a homeowner, a prospective homeowner does not look at both a grandma house and a decked-out renovation. They don't. They never, even if those things houses were next to each other, they would not show both houses. So why am I averaging the sale prices of those two and looking at the average days on market of those two? Those are two completely different markets. David Moses (56:24) That's right. Yeah. And that and that's that's that's essentially why it needs to be so granular, because you need a why and and you need AI to analyze that, because you need you can't just have somebody looking at it and going, that's a grandma house, okay, and label it and then move on to the next house. That's not how it works. Like you need you need tons of photos being fed through AI, tons of descriptions being fed through AI. And when you can start to see, okay, now These types of houses are moving in this market, right? So a lot of flippers, you know, I I have made the mistakes. I'm I'm I'm the most guilty person I know of that has made the mistake of renovating a property unnecessarily, right? For flip. Right. Because how many times have I bought a house that was fine? The house was fine. It was perfectly habitable. And I Jack BeVier (57:15) Mm-hmm. David Moses (57:16) and the wind was in the buy, right? And then I spent a whole bunch of money and took a whole lot of time to make the same amount of money as I would have made just putting it on the market and taking my pack. Jack BeVier (57:28) Yeah. I'm also we're also very guilty of that. Now to t to to to maybe make you feel better, I will I do think that there is a rational argument that you have de-risked the exit by spending the money on the rehab. That you've opened up the market and so did you do a bunch of work and only make the same money make yes, but you knew you were gonna make that money with a much higher confidence. as a result of having done that extra work and not cut the corners. Because when you start cutting the corners, if the market softens, those are the properties that go stale first. And it doesn't cost the same money to come in at the end and redo those things. It costs more. So like you might have gotten out the same, but you did it sleeping better. And at least that's the story that I've told myself as I've David Moses (58:19) Yeah. Yes. I I I will say that that hindsight, five years, seven years, something like that, I agree with that one hundred percent. Going forward though, like in a softening market, you know, I w if affordability is a big part of it, and if people, you know, are willing to accept like if what's actually happening, this is what, you know, going back to tying it into why are things Why are days on market going up? Why are things not moving? Right. And if it's because people, the people who are willing to make a move or you know, are willing to accept a less renovated house instead of going to a more renovated or fully renovated home in a different area to get a cheaper price point, how many people in that particular area are saying, This is what I can afford here? I I can't get everything all redone. And depending on what's moving, Right. If that stuff, if grandma's house is moving just fine and the and the high end stuff is just not, if that's what's sticking, then and and I think that's not, you know, I don't think you can make that assessment market wide in any market at any time. I think I think it really is, I think it really does need to be more granular. You need to look at price point, you need to look at specific areas and neighborhoods. how transient a neighbor how transient an area is does tend to, you know, if it's a it's if it's a very if it's a very stable area where the population just doesn't turn over very very much, that, you know, grandma's house in in a in in a tight Jack BeVier (59:57) Yeah, moves. Yeah. David Moses (59:59) market moves just fine. and in a more transient market, you know, that's where you take advantage of the you know, the nicer places, you know, that that you take advantage of of You know, people coming in. you know, that's why gentrification works, is because people it's people who aren't from that area who are moving to that area. Right. And they don't they're they're will because it's such a cool house 'cause and they see stuff going on around it, you know, somebody in that neighborhood who all of a sudden can afford that house isn't buying that house anyway. Right? 'Cause they're getting out of their neighborhood. They want they want to go to whatever the older neighborhood was that was already, you know, a nice neighbor. That's that's where they're you know, that's where their mindset is. But but i I I just I I think having that data and knowing what's moving and why, is it's it's an awesome AI use case. And so I you know, we're we're we're already kind of trying to build that you know, from just a days on market standpoint. So we're trying to do that programmatically instead of, you know, me just pulling up the comps and saying, well, looks like there's more Like weight, maybe it's three to one, maybe it's four to one. Like I'm not actually doing the math. Jack BeVier (1:01:05) Yeah. So for anybody interested in investing in David and my next series A, David Moses (1:01:11) Yeah. Jack BeVier (1:01:11) where we solve this problem, just shoot us an email and we'll be happy to take your money. all right, and for those hey, for anyone who wants to nerd and check out that site that's that I built, since you're a real investor radio listener, y I'll tell you how to get access to it and nobody else does. 'Cause you're special. so it's you can just go to the URL B More license, the letter B more O R E license dot the Dominion Group dot com and don't tell anybody, but you can just sign up for free and you'll get email and password and you'll be able to log in and play around and do whatever you want. So you can see exactly what we built and I didn't do it was all just public data sets. So there's nothing proprietary in there. It's all just public data. I just organized it and but it's a much more useful tool than as the sum of its parts. So as an R I R listener you get access to that nerdy project that I'm obviously improving all or always improving. And if it breaks, it was priced accordingly. So let me know. But David Moses (1:02:16) Yeah. Jack BeVier (1:02:17) don't expect to go up the next David Moses (1:02:21) Yeah. Jack BeVier (1:02:22) all right guys. Hope everyone enjoyed that episode of Real Investor Radio. David, a pleasure as always, always enjoyed conversation, and we'll be recording more forked AI and RAR podcast episodes coming up. Hope everyone is having a a good end of the summer and your real estate businesses are are going well for you. Have a great one.