Latest / Connor with Honor: AI, Real Estate and Real Life / Wednesday's Fed Meeting and Your Home Sale: Warsh, Bonds, and the Questions That Protect You

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Wednesday's Fed Meeting and Your Home Sale: Warsh, Bonds, and the Questions That Protect You · Connor with Honor: AI, Real Estate and Real Life

• 0:00
  SPEAKER_00: June sixteenth, and everybody's talking about the Fed meeting that's going to happen Wednesday, and people say, well, you know, it doesn't it doesn't have anything to do with interest rates.
• 0:08
  SPEAKER_00: In actuality, it it kind of does, depending on what the orders given will be.
• 0:14
  SPEAKER_00: And so that's where if you're a home buyer or home seller, kind of keeping up with this might be beneficial.
• 0:20
  SPEAKER_00: What's going to happen in the Fed meeting with Kevin Walsh, the new Fed chair?
• 0:25
  SPEAKER_00: He's set to speak the first time here on Wednesday, like speak to kind of officially, if you will.
• 0:32
  SPEAKER_00: What he's going to do is he might say things like, well, we're going to have to adjust or maybe modify some of those terms to give banks more ability to buy bonds.
• 0:42
  SPEAKER_00: If that's the case, if they're able to buy more tenure bonds as banks, because right now I guess they're limited.
• 0:47
  SPEAKER_00: There's only a certain amount of those they can own.
• 0:50
  SPEAKER_00: But if the regulation is lifted, they're able to buy more, then interest rates are probably going to come down in the housing, the housing interest rate.
• 0:57
  SPEAKER_00: Now, the Fed they deal with the Fed funds rate, which is the rate that banks borrow money back and forth.
• 1:04
  SPEAKER_00: So the lower that is, the more, I guess, more money banks can make.
• 1:08
  SPEAKER_00: And when they actually release regulation and the banks are now able to buy more 10-year bonds, or other entities buy these 10-year bonds, that helps the mortgage interest rate.
• 1:20
  SPEAKER_00: So maybe that's what we're going to see.
• 1:22
  SPEAKER_00: Or it could be the other way.
• 1:24
  SPEAKER_00: They could restrict it.
• 1:25
  SPEAKER_00: They might not change anything at the banking level, and they might push through and just let this economy continue because they're hoping that something might be changing in the Middle East where the straight of hormost gets opened up and there's some deal with this country and this and that.
• 1:41
  SPEAKER_00: We don't know.
• 1:42
  SPEAKER_00: But back to the buyer and seller end of it, if you're considering buying something, I know that people are often very fast to say, well, marry the house, not the interest rate.
• 1:53
  SPEAKER_00: And that's cool.
• 1:55
  SPEAKER_00: Can you still afford to buy what you wanted to with the current interest rate?
• 1:59
  SPEAKER_00: And if that says no, then maybe you should, I don't I don't know any other way to buy at that point.
• 2:04
  SPEAKER_00: There's a lot of creativity in the lending world.
• 2:07
  SPEAKER_00: There's different types of loans that they can package to maybe make your monthly payment a little bit less.
• 2:12
  SPEAKER_00: But as far as I understand, qualification is qualification across the board.
• 2:17
  SPEAKER_00: Qualify for this program, more than likely you might qualify for another program.
• 2:21
  SPEAKER_00: But some of them have different requirements.
• 2:24
  SPEAKER_00: Some of them have less PICO dependence.
• 2:26
  SPEAKER_00: Maybe your score doesn't have to be as high with one particular program.
• 2:30
  SPEAKER_00: Is there a cost to be able to use that loan program with a the less than maybe what might be considered normal FICO?
• 2:38
  SPEAKER_00: Probably.
• 2:38
  SPEAKER_00: That's where you need to know those costs.
• 2:41
  SPEAKER_00: What does it look like?
• 2:42
  SPEAKER_00: What does a normal person with good credit, with all these other things lined up good, what does their interest rate look like?
• 2:49
  SPEAKER_00: Versus your credit.
• 2:51
  SPEAKER_00: What does your interest rate look like?
• 2:52
  SPEAKER_00: And what does that look like over time?
• 2:54
  SPEAKER_00: Does it make financial sense for you to stop renting or living where you are and buy something?
• 3:00
  SPEAKER_00: These are all very personal questions.
• 3:02
  SPEAKER_00: People normally don't just buy residences based on interest rate either.
• 3:06
  SPEAKER_00: There's a lot of other aspects to life, other qualifications, other enhancements to life that go with owning real estate.
• 3:16
  SPEAKER_00: Well, a lot of times you don't now, well, now you don't have a landlord.
• 3:19
  SPEAKER_00: So if you want to change something, you can, depending on if there's an HOA in place.
• 3:23
  SPEAKER_00: If you want to add on, you can.
• 3:25
  SPEAKER_00: If you want to doll it up the way that you want to, you can, as long as there's no local restrictions prohibiting such moves.
• 3:33
  SPEAKER_00: In some areas, there might be an HOA.
• 3:35
  SPEAKER_00: Maybe you love rose bushes, but you move into an area that's controlled with some kind of a lake motif, like maybe Bridgeport.
• 3:43
  SPEAKER_00: And you want to put rose bushes out there, but you really can't.
• 3:45
  SPEAKER_00: You should know that going in.
• 3:47
  SPEAKER_00: And that's going to be covered in some documents called CCRs, covenants, conditions, and restrictions.
• 3:52
  SPEAKER_00: It's going to be a set of documents that's going to be obtained from the homeowners association.
• 3:58
  SPEAKER_00: The seller will pay for that.
• 4:00
  SPEAKER_00: That's normal.
• 4:01
  SPEAKER_00: That's a lot of money sometimes,$800 or$1,000 for an email document, which I still haven't got my mind wrapped around, but that's the cost.
• 4:09
  SPEAKER_00: But the seller will get that typically, and you'll have that in your hot little hand.
• 4:13
  SPEAKER_00: You won't have that though till you get into escrow and get past a certain point, maybe removing particular contingencies.
• 4:19
  SPEAKER_00: It depends.
• 4:20
  SPEAKER_00: But you'll get that in escrow.
• 4:21
  SPEAKER_00: Now, if you want that document early, because maybe you have five or six dogs or a dozen cats or you're an animal lover in that regard, or maybe just one dog, but one type, one breed.
• 4:33
  SPEAKER_00: It could be that some homeowners' associations say, well, you can't have that type of dog.
• 4:37
  SPEAKER_00: We don't allow pit bulls, for example.
• 4:40
  SPEAKER_00: Nothing against pit bulls, but sometimes I've seen that written that way.
• 4:43
  SPEAKER_00: Or you can't have more than three dogs, and they can't exceed 40 pounds any one of them.
• 4:47
  SPEAKER_00: Not altogether, but each dog can't be in a breed that's larger than 40 pounds.
• 4:52
  SPEAKER_00: Is it enforceable?
• 4:53
  SPEAKER_00: Yeah, yeah, it probably is.
• 4:55
  SPEAKER_00: How do they do it?
• 4:56
  SPEAKER_00: They probably put a lien on your property.
• 4:58
  SPEAKER_00: And maybe the lien is enforceable like faster than later.
• 5:02
  SPEAKER_00: I don't know.
• 5:03
  SPEAKER_00: These are all legal questions that come up.
• 5:05
  SPEAKER_00: But when you're going into it, maybe you should have your agent give you the phone number to the homeowners association.
• 5:12
  SPEAKER_00: And maybe, just maybe, you might be able to get somebody on the phone to answer your question.
• 5:16
  SPEAKER_00: They're not very nimble.
• 5:18
  SPEAKER_00: If it's handling, it's being handled.
• 5:20
  SPEAKER_00: A lot of the HOAs out here are being handled by management groups.
• 5:23
  SPEAKER_00: Some clever person said, hey, instead of letting you do it, we'll do it.
• 5:27
  SPEAKER_00: And when we do it, good luck them contacting anybody.
• 5:31
  SPEAKER_00: It's difficult.
• 5:33
  SPEAKER_00: But you call and you write down the name, the time you call, you just keep going with that, get emails, and you have to go back and forth a few times.
• 5:39
  SPEAKER_00: Sometimes they'll pick up the phone, they'll answer your questions right off the bat.
• 5:43
  SPEAKER_00: But the answers they give you, how do you verify that it's really true?
• 5:48
  SPEAKER_00: If you call in, you call in a homeowner's association management company, you say, I want to live in Bridgeport, for example, not trying to pick a Bridgeport, but I want to live in Bridgeport and I have, you know, three giraffes and I want to move them into the area.
• 6:03
  SPEAKER_00: It's not going to be a problem.
• 6:04
  SPEAKER_00: And then the person on the other end of the phone says, no problem.
• 6:08
  SPEAKER_00: You can have four or five giraffes.
• 6:10
  SPEAKER_00: You're good to go.
• 6:11
  SPEAKER_00: And then you hang up and you're happy.
• 6:13
  SPEAKER_00: You guys move in.
• 6:13
  SPEAKER_00: You got your giraffes there.
• 6:15
  SPEAKER_00: You know, they're all looking over the neighbors' fences.
• 6:17
  SPEAKER_00: And of course, well, either the guy that rides around on the bicycle with the camera gets you, or one of your neighbors has a problem with giraffes and say, Well, my God, I want a giraffe.
• 6:27
  SPEAKER_00: I can't even have a giraffe.
• 6:28
  SPEAKER_00: Why does he get to have?
• 6:29
  SPEAKER_00: So then the phone calls start, HOA sends you letters, and then problems arise because the person on the phone might have been on their last day, might not have cared, might not have really known, but you didn't ask that person to validate what they were telling you in a follow-up email.
• 6:46
  SPEAKER_00: So the person might be okay.
• 6:48
  SPEAKER_00: Or maybe the person didn't even know.
• 6:49
  SPEAKER_00: Maybe it wasn't an on-purpose thing, maybe it was a mistake thing.
• 6:53
  SPEAKER_00: But mistakes cost money.
• 6:56
  SPEAKER_00: That being the case, if you are dealing with a homeowner's association doing your research asking questions, you might want to make sure that you do a follow-up.
• 7:05
  SPEAKER_00: Same thing in any party in the real estate, agent, lender, anybody, anybody that has anything to do.
• 7:11
  SPEAKER_00: Home inspector, hey, hey, Todd, thank you so much for inspecting the house.
• 7:15
  SPEAKER_00: You had mentioned in your report, and as you did verbally, that there was this issue.
• 7:20
  SPEAKER_00: I would just like more clarification and then ask questions.
• 7:24
  SPEAKER_00: Over the phone is okay, but there's no, there's no enforce now your word against their word.
• 7:31
  SPEAKER_00: So follow it up in an email, everything written.
• 7:34
  SPEAKER_00: Text messages, yeah, I know, I know, that's the thing.
• 7:37
  SPEAKER_00: No, I I still think that email carries weight.
• 7:41
  SPEAKER_00: Text messages, yeah, but maybe there's maybe there could be some mistake or the brevity of a text message, maybe that leads some defense or prosecution or whatever it is, whatever side of this lawsuit you have to be on.
• 7:54
  SPEAKER_00: I think emails are the best.
• 7:56
  SPEAKER_00: So I would follow that up.
• 7:57
  SPEAKER_00: And that goes with anybody, your lender, your real estate lender, the person you're trusting to get you the loan on the house, if they're telling you something that that might sound very normal and possible over the phone, why not follow it up in an email?
• 8:09
  SPEAKER_00: Same thing with your agent.
• 8:10
  SPEAKER_00: If your agent tells you something that sounds acceptable, like it's normal, follow it up in an email.
• 8:16
  SPEAKER_00: If it doesn't, definitely follow up in an email.
• 8:19
  SPEAKER_00: But I would still follow up everything in an email.
• 8:21
  SPEAKER_00: Hey, Connor, you told me that that this, this, and this, and just wanted to make sure I understood you correctly.
• 8:26
  SPEAKER_00: And if Connor has no problem with that, if Connor isn't trying to sell you a line of bullshit and Connor is confident with his answer, and Connor knows when Connor puts this in writing, that's when Connor's going to be called out.
• 8:38
  SPEAKER_00: If Connor was trying to bullshit you into doing something that maybe you shouldn't be doing or should have more thought process into it, and you fire off the email, and now my answer is completely different than what I gave you verbally.
• 8:52
  SPEAKER_00: Well, Connor needs to be fired.
• 8:54
  SPEAKER_00: And I think that kind of runs the whole gamut of everybody involved in the process, the professional process of representing clients, whether it's it's legal, it's it's real estate, it's a car salesman, it's I don't care what it is.
• 9:08
  SPEAKER_00: That first time you're lied to, and that's the first time, that's when you start to formulate your exit strategy and you document it.
• 9:15
  SPEAKER_00: And you say, Well, you told me this.
• 9:16
  SPEAKER_00: You respond to the email.
• 9:18
  SPEAKER_00: Well, you you told me that this was pit bulls were allowed, and we were over there, because you know I have three pit bulls, you know, Larry, Moe, and Curly, and you said it wasn't gonna be a problem.
• 9:28
  SPEAKER_00: And then when I followed up in an email, you told me it's gonna be a problem.
• 9:30
  SPEAKER_00: And then when the agent says, Well, I don't remember that, I never said that.
• 9:35
  SPEAKER_00: Adios, adios, we're gonna have to seek seek your broker, we're gonna figure this out.
• 9:40
  SPEAKER_00: And if they are the broker, well, then you got another issue.
• 9:43
  SPEAKER_00: Then you're gonna have to level it up one more time and go to the board of realtors.
• 9:47
  SPEAKER_00: Seems to be easier to deal with just a regular agent, not a broker, because there's a better enforcement mechanism on that side.
• 9:54
  SPEAKER_00: A broker then has to, you have to go to that next level, which is the board of realtors, at least with an agent, a regular sales agent.
• 10:02
  SPEAKER_00: And there's a lot of agents that have a lot of time and grades selling and representing margin sellers that have fantastical records, really, really good experiences, client experience, that just didn't want to actually broker up because of the liability involved.
• 10:19
  SPEAKER_00: They would rather do what they do best, represent buyers and sellers, and then have the broker, the broker where they're a broker, where the who's their broker, will have them deal with it.
• 10:28
  SPEAKER_00: Now, once a broker, an agent becomes a broker, even if they're with another broker, well, the broker is now their equal, see.
• 10:35
  SPEAKER_00: Now, now, unless the agent's doing something wrong against the brokerage, the agent then deals with the issue themselves, who's a broker.
• 10:44
  SPEAKER_00: So, anyway, maybe, maybe food for thought.
• 10:47
  SPEAKER_00: But that's where we are with homeowners associations.
• 10:49
  SPEAKER_00: That's where we are currently in the real estate world.
• 10:52
  SPEAKER_00: Interest rates, Wednesday, we'll see what happens.
• 10:55
  SPEAKER_00: We'll see what additional allowances the banks might be given.
• 10:59
  SPEAKER_00: Word on the street is they might be given greater breadth to be able to go in and maybe purchase these 10-year bonds, and that might thereby lower interest rates.
• 11:10
  SPEAKER_00: I wouldn't see massive reductions in the interest rate world.
• 11:13
  SPEAKER_00: If it dropped a point, it would be a remarkable case and it would kick off the market, and we would see housing inventory go from 730 probably down to four or 300, because there are buyers waiting.
• 11:28
  SPEAKER_00: And it's not that they're waiting because they want a better interest rate, they're waiting because they need a better interest rate to be able to afford the residence they want to purchase because they were in the middle of purchasing when interest rates started to increase and thereby priced them out.
• 11:47
  SPEAKER_00: And the sellers haven't adjusted.
• 11:49
  SPEAKER_00: You still see a hundred price reductions a week, 80 price reductions.
• 11:53
  SPEAKER_00: These are these are little.
• 11:56
  SPEAKER_00: These are mostly sellers that priced above the market in the first place.
• 11:59
  SPEAKER_00: And now they're coming down to a more in line with the current values of real estate.
• 12:04
  SPEAKER_00: That's where they are.
• 12:05
  SPEAKER_00: And you know, sometimes agents go in and they say they kind of oversell the prospect, especially if they know that there's another competitive agent in the mix, they might say something.
• 12:14
  SPEAKER_00: That's why you got to just get in all the data points.
• 12:17
  SPEAKER_00: I wouldn't hire somebody because of what they say they're gonna sell your house for.
• 12:22
  SPEAKER_00: Just look at the data and make sure it lines up.
• 12:24
  SPEAKER_00: You want six months, it better 90 days of properties that are just like yours in close proximity that have closed escrow.
• 12:32
  SPEAKER_00: And then you can see that if they prepare the sheet right, it's very simple.
• 12:36
  SPEAKER_00: You'll be able to look at these properties, and then you can check their numbers with outside of that document resources.
• 12:44
  SPEAKER_00: There's a lot of systems out there that will carry the listings, and then you can also have them email those to you as well.
• 12:52
  SPEAKER_00: Not just numbers on the sheet, but the actual listings on these properties.
• 12:56
  SPEAKER_00: So there's some teeth there.
• 12:58
  SPEAKER_00: And if you here's another one.
• 13:00
  SPEAKER_00: So if you ask for those, you know, I thank you so much for sending this to me, Connor.
• 13:04
  SPEAKER_00: It's it's great, and I love the spreadsheet.
• 13:06
  SPEAKER_00: It makes a lot of sense.
• 13:07
  SPEAKER_00: Would you do me a favor?
• 13:08
  SPEAKER_00: Can you send me the actual entry sheets, the the customer report showing these listings, just so I can have them, just to make sure nothing was was accidentally left out.
• 13:19
  SPEAKER_00: And then if the agent doesn't, well, we have a problem, Houston, because they might have maybe unfortunately, in some circumstances, manipulated the data, and that's not good.
• 13:31
  SPEAKER_00: So just have that have that extra checks and balances.
• 13:34
  SPEAKER_00: Most agents aren't going to do it.
• 13:36
  SPEAKER_00: Most agents are gonna do the right thing, they're gonna tee it up correctly, they're gonna show you exactly the data because it's your house.
• 13:42
  SPEAKER_00: I don't want somebody being pissed off at me for the next 30 years because their mortgage payment sucks, because I gave them a value that might not have been real or whatever it may be.
• 13:51
  SPEAKER_00: That's that's that's bad karma.
• 13:53
  SPEAKER_00: I have plenty of bad karma, but it doesn't come in business.
• 13:56
  SPEAKER_00: So I would tell you to protect yourself in that regard.
• 13:59
  SPEAKER_00: All right, that's it.
• 14:00
  SPEAKER_00: That's your update.
• 14:00
  SPEAKER_00: We're at the 16th of June, I think I said 8 56 a.m.
• 14:04
  SPEAKER_00: Pacific Standard Time, Santa Clarita.
• 14:06
  SPEAKER_00: Oh, uh Sellersonlyagent.com.
• 14:08
  SPEAKER_00: Yeah, chew on that one.
• 14:10
  SPEAKER_00: Sellersonlyagent.com.
• 14:12
  SPEAKER_00: We'll see you tomorrow.
• 14:12
  SPEAKER_00: Thanks for watching.