- Kids going back to school [2:56]
- Big-city homeowners flock to small towns [4:11]
- 2020: Kelly’s best year in real estate [5:40]
- Kelly’s latest multifamily investment [7:44]
- Kelly and Aaron share their thoughts on section 8 tenants [8:14]
- New stimulus bill signed by President Trump [13:44]
- Experts estimate landlords owed $70 billion in back rent [22:46]
- Real estate market projections for 2021 [27:14]
- Kelly’s predictions for real estate in 2021 [32:34]
- Tips for buyers on building a strong offer [36:34]
- Plus so much more.
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- Episode 904 with Kelly Skeval
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Real Estate Rockstars, welcome back. This is Aaron Amuchastegui, and today we are doing state of the market. Let’s see number 64. I get to bring back one of my guests that was on show. She was Episode 904 Kelly Skeval from Ithaca, New York. Kelly, thanks for coming to talk to me today.
Kelly Skeval: Hey, Aaron, thanks for having me.
Aaron: Kelly and I, we check in a lot online, we get to follow each other, with what each other’s doing and getting to see different investments that she’s working on and different tips. I reached out to ask her she’d come on again and just talk news with me, and now we’re here, it’s end of 2020. Do you feel like 2020 was a fast year or a slow year?
Kelly: I feel like both, I feel like at times it was flying by and other times like the summer was the longest. I feel like both, I don’t know. How about you?
Aaron: I think it’s weird because at the beginning you think that it’s going by. I think it went by fast. Right now it feels like the year went by fast but when you’re doing the same thing every day, when we were on lockdown and there was no variation from day to day, the days felt like, “Oh my gosh, it’s just going by.” Then the memory links them all together into one day and it was like, “Oh, the first six weeks of lockdown went pretty first.”
Kelly: Somehow you can say that.
Aaron: Now we got to see what’s next. When you came on back in March and April, the world had just been shut down. You’re in upstate New York, you had talked a lot about how to run your business as a real estate agent, while you were had kids at home. Because you had done that before, you had experienced with that before. At the time, everybody was experiencing homeschool and being a parent and an at-home parent and a worker at the same time. You gave lots of fun tips about how to do that? What is the story with your kids in school now. Is it still like that? Or has it changed?
Kelly: We decided to send them back when school reopened in September. To send them back. You could do full virtual or full face-to-face five days a week. We chose the five days a week face-to-face. Since then, they’ve shut the school down twice for a couple of weeks and then reopened it again. We’re set to go back to face-to-face. Right now, they’re saying in January 11th they’ll go back face-to-face again. I think maybe that week before they’re going to be virtual for that first week. I can’t remember exactly. We’re doing going back and forth with both.
Aaron: I think it’s been really similar in Texas and Northern California and even where places are really strict or really not. I think a lot of places kids are back at school. They’re giving people the options though. The school system is just varied a little bit. There’s a lot of, that if they’re there, it’s masks and some separation and slightly different experiences. I think a lot of parents are giving kids a choice and saying, “Hey, do you want to hang out with your friends or not?” Most of them are choosing to go back and it’ll be good for things. What have you heard? We’ve had a lot of talks lately about the real estate market. We’ve talked a lot about New York City and San Francisco as those places where COVID has affected more dramatically than other. Up in Ithaca, do you guys hear much about the market in New York City?
Kelly: We don’t hear a lot about the actual market down there. We’ve had a lot of buyers throughout the year that have come up from Long Island, New York City, even as far away as Boston. Coming up here and buying, they really affected our little market quite a bit. That’s what we’ve experienced in terms of what we’re seeing from New York City.
Aaron: That’s a lot of what we talked about on the news, is people leaving the cities to kind of go to the suburbs, to go to the places with a little bit more space. Sacramento is a city in Northern California, that is really just booming right now because it’s so close to the Bay Area, and it’s so much less expensive than the Bay Area, San Francisco.
Places are leaving San Francisco, leaving the big city of San Francisco and just a couple of hours up the road is Sacramento. There’s these certain towns that are really booming while they’re benefiting more than others. I could see places being a couple of hour drive from New York City getting that bonus. I can see places that are a couple of hour drive from LA or from San Francisco or some of those the bigger cities where life has been changing to really start to boom. What’s your real estate career been like this year? How has 2020 treated you?
Kelly: It was a great year. It was my best year yet, I surpassed my goal that I set for the year. At one point, my team leader early on in COVID came to me and she was like, “Do you want to change your goal? Do you want to lower your number?” I was like, “No.” Then I beat it and I was like, “This is great.” It’s been good.
Aaron: How many deals was it? We talked goals when you were on in March, April. How many deals did you do this year?
Kelly: I ended up doing– Let’s see I had to write it down. I did 24 deals, it was just shy of $6 million in value, the goal was five.
Aaron: That’s so awesome, especially even just that mindset. When COVID first hit, I panicked, “I was selling assets.” I had a couple of extra houses, I’m like, “I need to sell these now before the market goes down. I got to make these changes.” I really felt like the sky was falling and there’s so many people that have thrived this year. I think that’s super cool that she said, “Hey, do you want to make your goal lower?” You’re like, “No, I’m not going to adjust my goal down, I’m just going to see and then it turned out that–” What would you attribute your biggest success in 2020 to be? Or if someone said, what’s the one thing that you think by doing it, it helped you this year?
Kelly: I think just adapting. So many businesses had to adapt. In the beginning, I was really impressed with restaurants that were adapting and just turning to curbside service or just how quickly a bunch of different businesses and investors were pivoting and adapting. I think just learning how to adapt with all of the regulations and the COVID rules and showings and virtual. All of that just helped keep my business going when buyers came to me and sellers.
Aaron: Adapting and being ready. You and your husband, you also are investors. I think when we talked last you had several houses that were rentals, I don’t remember your unit count. What was it back in March and April? And what is it now?
Kelly: When we talked last time, we had 10 units that we owned and we had an 8-unit under contract. Shortly after, I think we had our interview, we closed on that. That has been an awesome addition to our portfolio.
Aaron: So you have 18 units. We have a large portfolio and in general, we’re more occupied than we’ve ever been, we’re at a 99.9% occupancy rate. We have some people not paying because of eviction moratoriums and stuff. Our collection rates are higher than they’ve ever been. Even considering that we have some people in default because we’re fully occupied, we’re doing better. What’s it been like for you?
Kelly: I agree. We have been 100% occupied since last January which for quite a few years was not the case for us. Actually, all of our tenants are paying as well. We have a mix of students and young professionals. Then with these newly acquired eight units, we have a couple of Section 8 tenants mixed in there too. For now, everybody is paying. Actually, I take that back. There’s one tenant that we inherited, she’s not paying her portion, but a large amount of her rent is paid by a Rent Assistance Program.
Aaron: That’s one other thing, we do have a few Section 8 people, where Section 8 pays 90% of their rent, and the people have to pay 10% and they haven’t paid. We have several that haven’t paid their 10%. Section 8 evictions, they have their own eviction moratorium, if it’s a Section 8 property, there’s no evictions allowed right now. First there was an eviction moratorium for Section 8 and government-owned loans. Then that went away and then it was replaced with the CDC eviction. We’ll get into that one with the news. Maybe the Section 8 one is gone, maybe it’s just the CDC one now, but I’ll have to double-check that.
Kelly: I haven’t heard about that Section 8 one. I actually just recently called to get some more information on new sections, and I didn’t hear that Section 8 one, but that can totally still exists and I’m just not aware of it.
Aaron: I really love having Section 8 Rental Assistance Rentals. Even when it’s just the 90% of the partial coverage because once you get that resident in there for the most part, they love being in the program, the rent comes on time. They know if they mess it up, they lose that ticket. I’ve heard horror stories of people wrecking stuff, of Section 8 tenants being bad, but I haven’t had that experience at all. You said one Section 8 tenant?
Kelly: We have three that we inherited with that unit. Otherwise, we didn’t have any previously. Two of the three are great tenants, they pay their portion on time, they keep their places immaculate. They have lived at the property for quite a few years prior to us taking it over, and, as long as they want to continue stay, we’ll have them to stay. I’m a little more open to it now that I’ve experienced it especially in a pandemic like you said, where most of the rent is being paid by the government.
Aaron: I think that Section 8 programs are going to get bigger. Some of the news from a few weeks ago was one of Biden’s plans of affordable housing and really trying to push more affordable housing and putting more money into that, changing zoning laws and things like that. If I was going to have one prediction of 2021, it would be a lot more Section 8 funds available before the end of the year. A lot more Section 8 programs. If you are listening and you’re a landlord or you have customers that are landlords, I would start to learn a little bit about Section 8 and how it works.
Let’s jump into some news. Today is December 28th, that’s so weird to say. December 28th, year is almost over. December the 28th, 2020, I cannot wait for 2021. Although the first few months of 2021 might be similar to what we’ve experienced. I think everybody was hoping that by the time the ball dropped, it would be all right. We get to say, “We can put in the rear-view.” I don’t think we’re quite in the rear-view yet. The news of last night says, “Trump signs a stimulus and government spending bill into law now averting the shutdown.”
This was the an article from The Washington Post. It’s all over the news everywhere this morning. The stimulus had been getting talked about a lot over the past couple of weeks, and some different things that are in the new stimulus. A couple of highlights of that was, it’s a $600 payment to people, $300 of unemployment add-ons. I think that’s an extra $300 a week on unemployment. Do you remember what they did at the beginning of the pandemic?
Kelly: They were giving $500 for the add-on. It was either 500 or 600, right?
Aaron: Yes, I think you’re right. I think it was either 500 or 600 at the beginning, and then it went to nothing. There was a lot of talk that there was going to be a $2,000 payment to people in the stimulus. It was down to 600. Then Trump said he wasn’t going to sign unless they came back with the $2,000 per household. He ended up signing last night where it’s still as the 600. I’m trying to find the article summary that I just saw on it. They said now there’s going to be another one even tomorrow. That they’re going to vote on, that’s an additional 2,000.
It was still $600 payments to tax payers independence is what got approved. $300 dollar a week in enhanced unemployment benefits. A one-month extension to the CDC eviction moratorium. That’s what you and I were talking about before. The CDC eviction moratorium is a form that says, “If I get evicted, I will be homeless, or I have to move in with family and it will increase my chances of getting COVID.” They signed that and then it would just waive all evictions. All of our original evictions that we had posted got extended to January 3rd or January 4th. Now it says that’s getting extended to January 31st.
Now Congress is also scheduled to introduce legislation today to take the $600-payments to 2,000. The biggest thing they had in there is $25 billion in rental assistance. Over the past 10 years there’s been lots of different stimulus and those sorts of ideas. What do you think about rental assistance, rental stimulus? Have you looked into it much?
Kelly: No. In the beginning I looked into it a little bit, but I honestly haven’t been thinking of it a lot. I haven’t needed to because of my tenant paying rent. I don’t know exactly how I feel about it personally. Initially, I feel like it’s good, landlords lacked holding. Tenants aren’t paying, landlords have got to have to pay their mortgage. When it first happened I was calling the banks to find out what they were doing for landlords. They were basically saying, “You can defer your payment.”
I think our bank said for three months, this is initially. “You can defer your mortgage payment. Just the mortgage payment, not your taxes.” Our taxes up here are really high. You can defer just the mortgage payment for three months. Then at the end of that three months, that entire amount you deferred was due. Then you could apply for an eight or nine-month payment plan for those. When I saw that, I was like, “This doesn’t sound like it would be super helpful.” Nothing that I wanted to get into. I think if we can get rent assistance, that helps the landlords that are left with paying this mortgage.
Aaron: I think your experience with the 2 is like 30 million other landlords. There is the eviction moratorium is protecting people from not paying their rent. There are also foreclosure moratoriums. A lot of the discrepancy in that was that it had to be an FHA or Fannie Mae loan and it had to be an owner-occupied. If you’re an investor and you don’t pay your mortgage right now, that’s the exception that you could actually get foreclosed on. There are still some foreclosures happening. It’s one-fifth of the normal number right now, but that’s the exception. Private loans or ones that were investor loans.
Small landlords are the ones that I think have struggled the most with these eviction moratoriums. I understand why you do an eviction moratorium. You don’t want to have tens of millions of people getting evicted all at the same time especially at a time where financially they haven’t been able to replace income. Now with this new stimulus, hopefully the people on unemployment get that little bit of extra money. I don’t know how it’s going to be taxed. I think the extra $600 payment and the extra $2,000 payment is like a prepayment of a tax credit or something. It’s not free money, there are some caveats to it.
The National Rental Home Council is a group that I’m a part of and they said, it appropriates $25 billion for implementation, they read the new Act and sent us a summary. District Columbia will be eligible to receive funds directly from the secretary of the treasury. It says, “Local governments are eligible to receive funds directly from the secretary of state if their population exceeds 200,000. Initially, each state will be eligible for $200 million regardless of it’s size leaving $14.6 billion. $14.6 billion will be distributed to states in their proportion to their share of the US population.”
It’s kind of said of the $25 billion, $15 billion of it is just going to be spread out among the states based on population, and 10 billion is going to be specific to places with higher population. Then every state is going to have some of that. It says, “An eligible household includes a household that contains an individual that qualifies for unemployment benefit and experienced a reduction in household income. At risk of experiencing homelessness or housing instability or at or below 80% of the area median income.” I don’t know if people need to be both on unemployment.
It says, qualifies for unemployment benefits, I don’t know if that means they have to be unemployed or not. 80% of area median income, that says they will be able to use the assistance for rent, rental arrears, utility and home energy costs, and other housing expenses to Secretary of Treasury. They’re going to essentially give the money to local counties and local cities. They said some localities already in April and May came up with our own rental assistance programs, and then they spent the money really quickly. They said, those counties and cities that already have a program are going to get that money first.
People, if you’re out there listening, I would say, get ahead of it, because that is a really big fund that they’re trying to push into that. But if you do the quick math on how many tens of– If there’s 10 million people in default, and each of them gets behind 3000 in rent. I don’t know if I’m doing my math right, but very quickly, you’re going to start spending–
Kelly: It’s going to be used up.
Aaron: 30 billion is going to go pretty fast in that. That’s going to be really interesting. I’m glad you haven’t had to look at it yet, and we are going to start to look at it. Our advice to landlords out there is to be able to get ahead of it, try to figure out what programs are going to do it. Fill it out for your residents, go show up at their house and say, “Hey, we’ve got this ready for you. We just need you to sign so we can go get your rent paid for, and we can leave you alone.” I think most of the people that are in default are going to get assistance.
I guess the only thing that’s going to be tough is for the people that are making the median income or more, but I think their justification in that, is if people are making the median income, they should be able to pay their rent, so we’ll see. Then the CDC eviction moratorium, that’s the January 31st and it won’t be extended again by this administration, I have to imagine. Do you think they’ll keep extending that throughout next year?
Kelly: Actually, personally, I was surprised that it only was extended to the end of January, I thought for sure it was going to go into March.
Aaron: I think some States have taken it further already. I think California it’s end of February right now and some different places are doing it. It was kind of like punting it, it was just a quick little punt to say, “All right, now it’ll get through one administration and leave it up to the next administration to figure out what their rules will be.” I think this year there’s going to be something to slow the normal process of it, whether it’s a full moratorium and there are some exceptions of the moratorium that people are starting to see. We have one resident that we found out he actually owns a house too, but he’s on the CDC moratorium form. In that form, he has to sign something that says, “I don’t have any other properties to live in.”
Aaron: Yes, if it’s inaccurate, if they actually had two homes and he’s not paying rent on one, we’ll see. There isn’t really a specific way to go back to court and say, “Hey, he’s in violation of that.” Lots of stuff on rentals. The next article that I sent over to you, that we were looking at, it’s along the same line, I just want to touch on it really quick. It says, millions of renters are fighting to stay housed as the eviction near, and this was a Bloomberg article and it was an opinion article from Prashant Gopel and Patrick Clark that just says, “Hey, they’re going to give $25 billion for rent support, but it falls well short of what’s needed.”
It goes through kind of the story, are you going to risk potentially dying just to pay a bill? But if you don’t pay a bill, you’re going to be homeless, you have to literally decide what’s worse. That’s what people are facing out there. I was thinking this article had a little bit in there of, how quickly they thought that it’s the Democrats or Republicans months long stalemate to pass a $900 billion pandemic relief package. Even that which extends the federal eviction ban through January and earmarks 25 billion. It says, , oh, this is the number I want to see. “Tenants and landlords 70 billion in back rent right now.”
Kelly: Oh my gosh. Is that really what it is?
Aaron: 70 billion in back rent additional fees according to estimate by Mark Zandi. That’s exactly what we were just kind of almost predicting, right? That’ll go quick.
Kelly: Yes, it will go quick. Wow.
Aaron: That’s a lot of billion.
Aaron: The unfortunate part is most of those landlords aren’t people that have 300 houses or 200 or a 100, or even 18, most of those landlords have 1 house, 2 houses.
Kelly: Mom and pop little landlords.
Aaron: There’ll be some opportunity there, but it would be really tough to have one rental, so many people are just getting by themselves. They’ve got one rental, one mortgage on it, one tenant, and that tenant isn’t paying rent. If $70 billion is owed, it’s too bad that that– Especially the package itself was 900 billion, I guess I would have been happier if 70 billion of that was accumulated there, because the ultimate reset is what a lot of people have pushed that could help.
I think I agree with that opinion that, “Hey, it falls short.” It says landlords filled more than the 7,300 evictions in November, quadruple the number in July and property owners filed more than 2,600 cases last month in just Phoenix and Houston, where there are fewer safeguards postponing. Also, in New York City where a state law protects people facing COVID-19 hardships, landlords filed 7,300 evictions in November, quadruple what the number was from July. In July, there was 1600 evictions in New York city, in November 7,300 and then less we’re getting filed other places.
There is a rental crisis out there, the $600 payment and the $2,000 payment. Did you see any of those articles too? That when people were like, “Hey, there’s a $900 billion stimulus, but 50 million is going to this other country and 10 million is going to this other country.” There was so many of those in the–
Kelly: I wondering if you were going to bring that up.
Aaron: How crazy was some of that. So many people were like, “Why are you?” I wanted to write a post on it to share like that is an example of how socialism or big government is not going to save you in the future. People have to be responsible for their own, because everyone was excited, excited, excited. There’s going to be this big relief, and then they said, “Okay, everyone in the US is going to get $600, but we’re going to give $10 million to this country, or $20 million of this country, or this much to this other.” I went and researched and some of it was fake news, but a lot of it wasn’t. There were some examples where it said, “Hey this library was going to get the money anyway from something else. It wasn’t this, but a lot of the money going to other countries was real. That’s in the bill. How did that make you feel?
Kelly: I saw the headlines, I didn’t really do a lot of research into a it. But the headlines that I was reading where it was saying, “This is sneaky.” I was like, “Agreed.” This is super sneaky. It goes along with making, like you were saying, not trusting the government, knowing they’re not going to get it done for you. I think everybody has the right to be upset, especially when you’re getting a $600 check.
Aaron: Right. They get a $600 check, and then even the example that the 25 billion for rental housing is only a third of what’s actually needed. It’s just that example of going, out of $900 billion, there could be a lot of stuff that can get done and just like anything. You can’t sit back and wait, and count on a bailout or things like that to save you, you’ve got to take control.
The next few articles are contradictory. One is saying, “Hey, the market is going to be so awesome in 2021,” and two others are saying, “The market is cooling off.” I just got an email from the ListingSpark, which is a company out in Texas, they do flat rate listings. Their December real estate market update, it says, across major markets in Texas, our December real estate market update shows clear data that we were ending the year in one of the strongest sellers markets we’ve ever seen in modern history. The breakdown across Austin, San Antonio median sales price is up 19% in Austin, closed sales up 23%, average days on market is 33 days on market, and last year in December, it was 62 days on market.
Now, it’s 33 days on market, pending sales up 23, less than a month of inventory in the city of Austin, and the city of Dallas two months of inventory that it was 3.3 last year. San Antonio, I guess I don’t see how many months of inventory, but median sales price is up 13%. Median sales price went up 13% in San Antonio, up 12% in Houston, 12% in Dallas, but 19% in Austin. Austin on the news has shown a lot of people moving here from other cities, especially like Northern California, and places like that.
Kelly: I’ve heard that, I’ve been seeing that.
Aaron: Even in the neighborhood we bought, we bought the day that Texas got shut down. I was like, “What have I done? Why did I buy a new house?” Then later it was like, “Okay, the market is actually–,” but now, all the houses in this neighborhood are worth at least 20% more. Like the cheapest one in the market is 20% more than mine, and you go, “That’s crazy.” What’s it like up in Ithaca?
Kelly: I was just looking in New York state association of realtors website at their staff and pulled up our November stats, and it’s been great, everything increased, closed sales. Let me see here, I wrote it all down. Let’s see, in November here in Ithaca, closed sales was up 14%, in all of New York State was up 21%. The median sale price in New York State went up 21%, inventory the month supply, that’s lower, same with Ithaca and all of New York State. We have similar stats.
Aaron: You say one month supply up there too?
Kelly: Let me see here. I have the percentage, is down 26% for all of New York State, I don’t have the present one [crosstalk]
Aaron: As a state that’s crazy too, because that’s averaging in some of the markets they’re saying. They say only New York and San Francisco and a couple other cities actually have more houses on the market right now than they had a year ago. If you’re looking at it statewide and still getting that, that’s impressive. The three different articles an Inman article that came out the day before Christmas, says “A super hot market. Economists weighing on what to expect in 2021.” A handful of economists shared with Inman their forecast on home sales. It says the housing market will enter 2021 blazing hot with off the charts demand and extreme surge of homes in the sales.
“On home price and sales we’re going to see starting the year a super hot market.” That was the CEO of housing market analytics firm Altos Research. Inventory’s pointage is just under. He’s saying inventory is down and demand is still up. That was Altos’s data. He added, “It’s going to keep falling now through February as fresh new inventory comes on. We’ll probably have a resumption of more normal market second quarter of 2021.” Danielle Hale, chief economist at Realtor.com expects home sales to continue growing. Jumping 7% in ’21 and prices to continue rising to new highs, though maybe not, she says, at a slower pace than 2020. She’s saying the market is still going to go up. Daryl Fairweather, chief economist at Redfin also predicted a strong year for home sales, even stronger than 2020. She anticipates low double-digit home sales growth close to 10%.
A lot of people are saying that it’s going to be super strong. That’s what everybody said on that Inman article. I’ve got two articles on Realtor.com, and one came out in December 23rd, just a day before. It says, “New home sales fall as buyers begin to get cold feet in an expensive market.” That was December 23rd. A week prior, it said new home sales are booming. Specifically, new homes, newly built. Sales of newly built homes occurred at a seasonally adjusted rate of 841,000. 11% below the pace from October. Their headline was people are getting cold feet because now it’s getting expensive. I have seen that new home sales, every time they release a phase of 7 to 10 houses, they raise the prices. 7 to 10 houses and they raise the price.
Another Realtor.com article before that says existing home sales, these are resales, one person selling to another fall in November as buyers struggle to find properties to purchase. We’ve got one saying, “Super hot, super demand, ” and then we’ve got others saying, “We are seeing some slowdown in November and December from new home sales market. Buyers are getting discouraged because there isn’t enough property, because it’s tough to find the property they want.” When you think about both those side, I know we only have a couple more minutes, but what are your predictions with that?
Kelly: It’s interesting. I feel like the market here in our area is going to open up soon. It has slowed down a little bit but I feel like 2021 is going to be another strong market. I don’t disagree that buyers are getting discouraged. Right now, the buyers that I have, there’s really not a lot out there, there’s less that normal, this is a small market. There’s even less out there for them to choose from right now than usual. I agree that they’re getting frustrated but I think 2021 is going to be another great market. I think it’s going to be sellers market, but I think we’re going to continue to see this strong market.
Aaron: I think interest rates are going to stay low. They said six months ago that they were going to keep them locked in for the next three years and I don’t see that really changing any time soon. Until we see a bunch of economic jobs and big boom and comeback for that middle class sector, for the service industry, for some of the people in the finance industry. Some of those sectors have almost no unemployment right now. They’re booming and they’re getting all these low interest rates. The people at the more formal end lower income sector there hasn’t been a lot of job replacement in that. I think they’ll keep interest rates low because of that.
I think you’re right. I think supply will stay low because there’s nothing that’s all of sudden going to put a bunch of houses on the market. Nothing is going to change that. Home builders are building, that’s the only way supply is added, and they won’t be able to build at that pace that works, and not everybody wants to live in a new home community. As they add on specifics, most of the time new homes are built in the outskirts, in these spread out markets. There’s going to some places where there’s nothing that’s going to bring extra supply and I think they’re going to keep rates low where people can qualify.
I think you’re right, I think at least the first two months of the year, we’re going to continue to see a sellers market, we’re going to continue to see prices be tight. Although, I won’t be surprised if we start to see months of inventory go up just simply because it takes longer to find the right house. Every time we list a house on the market, we get multiple offers right away on it for the most part. As long as it’s an average house. Every time that happens, there’s 10 buys and there’s 9 people that are disappointed and 1 that gets the house.
Kelly: I know.
Aaron: I don’t even know if they’re excited. If you’re the highest bid out of 10 offers, are you like, “Yes. We did it.” Or are you like, “Man, I just paid too much for something.” How are your people feeling?
Kelly: If my people are the ones that lost out, I give them that talk. “Did they really win though?” If it’s my buyer that won, I’m like, “We won. We did it. You did a great job. You put together a great offer.” It just depends on which end of that my client landed on, but yes, it is crazy for those buyers like you said, 10 offers. I did notice though, as crazy as the market was with all of the multiple offers that were going on in our area. That if you put your house on too high, people were smart enough that they weren’t juts grabbing things that were wickedly overpriced. It had to come on in a good range and then multiple offers would drive the price up but if you came on to high, they weren’t going to jump on in just to buy a house. It was interesting.
Aaron: That’s a great point. The market has been hot but not if somebody said hey. Zillow used to have a Make Me Move, where it’d be like, “Your house is worth 200,” and they’re like, “But if you give me 300, I’ll move.” If people are doing that then they’re not seeing it. Last question with that. Because you’re both a listing agent and a buyers agent. What would be the one piece of advice you would give somebody to get their offer accepted? If the the people are like, “We love this home. We want this home. It’s not just price.” Any extra advice you would give them?
Kelly: You have to get creative, especially with the first-time home buyers. Really coaching them on how to get creative. We’ll remove contingencies that they’re comfortable removing. I really try to get as much information to really push the listing agent from on the buyer side to find out what they’re looking for. Because like you said, they’re not all looking for price. It could be that they just want to move fast, maybe they want a 30 day–. Here in New York it takes at least 60 days to close, but with an all-cash offer, you can usually push that up to 30. Do they want a fast-closing? Removing contingencies. Really just working with your agent to work hard instead of just writing an offer and throwing it in. Figuring out how you can put together a really strong offer aside from the price.
Aaron: Removing contingencies ahead of time or doing an inspection ahead of time and just saying, “We’re not going to–.” I think that goes a long way, because that is the one thing you don’t want. You don’t want to have 10 offers, accept 1, and then have that buyer cancel a week or two later, because then you’re like, “Man.” I’ve had that happen a few times in the last six months, being like I chose the wrong buyer. Even though it seemed like it was easy. Kelly, thanks for coming on. We’re out of time, but this has been a really fun state of the market. Any last thoughts you want to tell people as we’re finishing up 2020?
Kelly: I saw on meme that was going to 2021 with prepared but quiet mouths. I can’t remember. I’m totally messing it up, but I think it’s going to be interesting as we set high goals when going to 2021 like we did 2020 and hope for the best.
Aaron: I think everyone should go into 2021 setting really high goals. I’m going to COVID adjust them based on– My goals used to be, “We were going to go to three new countries in the year, and we were going to travel.” We’ve had to do certain things where we have to totally– We can think about the way the world is now and adjust those things a little bit. The funniest thing is the only goal I didn’t accomplish this year that was on my list. I had two travel goals, but one specifically that I really blew it was I didn’t read the number of books that I told myself to. I’m like, “What excuse did I have in 2020 to not read enough books?” I didn’t even have that high of a bar, it was like 10 and I usually do and I didn’t. Of all years to not hit my reading goal, I blew it 2020. Kelly, thanks for coming on. We’ll definitely have you on again to chat news with me.
Kelly: Thanks, Aaron.
Aaron: Real Estate Rockstars, thank you for listening.