We are back after a brief hiatus. Starting today and going forward, every 2 weeks Bruce Norris, Craig Evans and Joey Romero will get together on the radio show and talk about the latest headlines in real estate. We will still have guest interviews on the other weeks. Hope you enjoy!
Episode:
Narrator This is The Norris Group’s real estate investor radio show the award-winning show dedicated to thought leaders shaping the real estate industry and local experts revealing their insider tips to succeed in an ever -changing real estate market hosted by author, investor, and hard money lender, Bruce Norris.
Joey Romero Hello, everybody, this is Joey Romero and this is The Norris group real estate radio show and podcast. And we’re going to, we’re back actually, after a small hiatus, we’re going to jump on this on a consistent basis. What we’re going to do is every couple of weeks, we’re going to just have Bruce and Craig Evans along for the ride and just talk about what’s going on in real estate. So, we’re going to call it What in the Real Estate?, it’s going to be the TNG real estate news forum, okay, so we’re going to have a little fun with this, this is we’re gonna try to run this a little bit how Aaron used to do the weekly roundup set everybody used to love on a weekly basis, we’re not gonna do a quiet on the weekly basis. But this, I thought this would be a fun way to reintroduce the radio show. And then on the other weekends, we’re gonna have, you know, the the hard hitting guests, you know, the heavy hitters in real estate. So alright, let’s get started. So the biggest story in the news right now is going to be mortgage rates. You know, when I first put the story together, it was at 7.31. And then today, the Mortgage News Daily has the current rate at 7.72. Yikes, and doesn’t look like it’s going to be coming down. And so what that means for monthly payments, for a million dollar homes, you’re looking at a monthly payment at about 6,800. And even on a more modest home of 500k, you’re looking at 3,400. So it’s creeping in, you know, the biggest, this is probably the highest, not that probably it is the highest it’s been since probably about December 2000, which it had the rates at about 7.42. And the other thing it’s doing is ARMsare taking up a little bit. They actually ARM alone is actually represented by a percent of all the loans now and it’s in its and it’s getting higher. So my question to the both of you is do you guys see this dropping anytime soon?
Bruce Norris Craig, you want to go?
Craig Evans I’ll let you jump in real quick, because you were with the stuff you were sending me the other day? It’s you’ve been playing with this for a few days, so,
Bruce Norris Yeah, well, Joey to have an interest rate reduction you need, you need a downturn in the economy. So as soon as you have a recession, and you know, all that sort of in play. So there’s a lot of things that cost more, the savings that we had was two and a half trillion dollars. Now it’s down to 500 billion, which is still a lot more than it used to be, let’s say before the pandemic hit. But as soon as you have a recession, then the Fed will start going in the other direction. And let’s say maybe that spring of next year, so you could have, you know, you could have a pretty big correction, depending on their concern about inflation coming back, right away. So you know, what’s interesting, and Craig could talk about this, because he’s, you know, he hires workers, there’s a lot of pressure on labor, you know, and there’s, like, big unions and stuff are getting to say, Okay, we’re going to, we want this much and, like UPS, so driving a UPS truck pays 150 grand a year, well, you know, that’s inflationary. So we’ll have to see how much that you know, trips into the numbers of inflation, but overall, the economy slowing, and you’ll have that be continual until you have a recession, and then the interest rates will get softer. But, you know, maybe the days of those 2% mortgages that we enjoyed, those are a thing of the past, at least for now.
Craig Evans Yeah, I agree, embrace it. I was talking with some friends this past weekend that are in the mortgage industry. And one of the lenders that I worked with, in several different instances, they they had a big, their national meeting and stuff up in Columbus, Ohio, or something where they admit and several people from their team, you know, we’re, putting out some data to them. Same thing, looking at some indicators that are going to start leading to some of the softening in the economy as a whole to start driving rates down. But it was interesting, I know you and I’ve talked several times about potential for, you know, lower rates coming in Q1 sometime next year. And I was interested to hear from the people’s take that the mortgage side of retail mortgages as all they touch every day, they’re still leaning to lower mortgage rates by the end of Q1, like you just said in sometime in the spring. So I find that encouraging, you know, we are just as you mentioned about labor and inflationary issues, you know, there are some inflationary things that we’re still seeing. But I will say this for the first time in probably, oh, two years, a little over two years. For the first time in the last three weeks, we’ve been hiring people at a lower rate than what we were hiring month over month.
Bruce Norris Okay.
Craig Evans So with the amount of people that were we hire on a monthly basis, that was encouraging to see that we’re getting some skilled workers and skilled labor, not just unskilled day laborer, but from unskilled workers coming in at a rate lower than what we got them 30 to 45 days ago. That’s an interesting thing to me, because that’s one of the I believe just in what you were talking about a few moments ago, when you’re talking about unions and things that are driving a lot of the inflationary process, that we’re starting to see a little bit of that turn coming when I’m when I’m seeing people saying, hey, I’ll work for this, they’re starting to show a little bit of some of the stuff happening there. That’s moving towards it now. You know, we’re, there’s still a lot of real estate going on. So it’s an interesting dichotomy that we’re seeing in that process as well.
Bruce Norris Well, you know, what’s really interesting is that, let’s say, I try to play this out in my mind and say, What side is going to be more excited to participate? So your, you know, seven and a half plus mortgage rate, right? Now, Let’s hypothetically say that, it’s now five and a half and 80% of the mortgages in place are below four. So what side becomes more motivated, is the buyer side has been on the sidelines saying, I’m not going to get a seven. But now that it’s five and a half I’ll participate? Is that going to be? Is that going to overwhelm the guy that’s got the 3% mortgage and say, I’ll list now, because at least I can get a five and a half? See, I, I think the pressure is going to be on the buying side, that they’re going to go okay, well, five and a half, I’ll get that.
Joey Romero Well, that was gonna be my next question was, if this goes to eight, eight and a half, and then by the, you know, whatever timeframe, they bring it back down to, let’s say, six, it’s gonna feel like a fire sale. Right?
Bruce Norris Yeah, I think, you know, John Burns does a lot of research, he came out with something, and I think I sent it to you, Craig, talking about the five and a half was like the, like, the mental number right now that clicks the switch to they’ll participate. And, you know, one of the things the builders probably have in place that a single individual owner doesn’t, is the ability to buy down a mortgage on a regular basis. And so, you know, even if the mortgage was, say, seven, you could pay points and so forth, and maybe buy that down to that magic number. So unfortunately, the higher normal rates get the more expense that costs and sometimes it’s not even available to the extent you might want it. So with with the rates this high, I mean, you basically think about the volume of sales for the regular real estate person, it’s at 50%. So that whole industry is 50% unemployed, if you look at the total income they’re making, and that’s lenders and agents. So I mean, they’ve got you know, that’s just like having a depression in their industry. So if if some reason that mortgage rate can get back into that, you know, under five or under 6% range, I think that would induce a lot of participation on the buy side. The inventory though, I’m still thinking okay, well, where’s that going to come from? If it’s not going to come from the guy that has the mortgage at three and a half or two and a half, then it’s going to come from new builds or there’s now a lot of pressure back on the the inventory that does go for sale, which is really kind of crazy, but you know, when we wrote the report with the title Uncharted Territory that was tongue in cheek, but it was being real, it’s going we’ve never seen the Senate charts.
Joey Romero Well, I think I think a sub A sub six number would absolutely get renters off the bench, but it’s not going to move people that are in place with the those three and a half in force.
Bruce Norris I think the people that had the the low mortgage is actually kind of made a permanent decision during that process because they didn’t get to refi, like in a three month period, they got to refi over an 18 month period. So they went from five to four and a half to four to three and a half. And at some point, they probably said, wow, what’s paying off our college loan, let’s add that office, we want it or the fourth bedroom, all that’s in place. And that’s like, we’re good. And I think that’s really the issue is that they’re pretty permanently going to stay there.
Craig Evans So Bruce, it’s been interesting, I talked with several high net worth friends down here. And a couple of them are actually making moves in their primary residence down here, or secondary residences down here. And it’s been interesting, because in that there actually are still some not almost a high volume of that. But there’s still people making moves in that because the people in that industry or in that section of the market, are looking at saying, I am getting a decent price on the sale. And again, these are extremely high net worth homes, you know, these aren’t average, you know, what, like, what the run of the market is buying and selling. That’s what they’re looking at, as I said, Listen, we can do a rate by down for right now, and keep our rate at a decent price. But we’re getting a better price than what we would have even gotten 90 days ago in that high net worth side of the home, you know, like I’m dealing with somebody that’s just buying one for about 7 million 180 days ago, that house was just shy of 10. Well, they’re buying it at seven, because now this person needs to get out. So that’s a significant, significant decrease, there’s that, hey, we know that the rates will go back down, and we’re gonna do a rate by down for right now. Sit in it, and it will refinance later. The interesting we want to talk about is what you and I talked about last week, on the home prices that we build for the, you know, what we call our workforce building that we do, right, the mainstream America that we built for and Douglas Brooke in that process. Yeah, and our biggest play is not you know, what so many people used to, will lower your price will, will give you some closing costs, that’s really not the biggest aspect of where people are getting, it’s like physically, because of an interest rate, they’re being priced out of the market, it’s not necessarily about the price of the home anymore. And so that’s what we’re seeing from to get our houses in a moving situation on a retail basis right now. That’s the big plane that we’re utilizing. And a lot of builders are just like you mentioned, is that we’re doing right by this, you know, because when I can go down and buy or write down a point and a half or buy it back down into the fives, it allows me to keep my comps, where it’s at and, and keep the market stable in that process, looking for a return in the next four months, five months, six months, that type of process that the market is in continuing to stabilize. And we’ve turned it around with the right guidance. That’s that is helping us move our sales at a dramatic pace.
Bruce Norris What does it cost to buy down interest rate? Say 1%? Say, on a 400 grand house? What would be the cost to get that to be from a seven to a six?
Joey Romero So half of California house?
Craig Evans So, we just didn’t want it 376. And I want to say our buy on that was just a little over eight grand if I remember right, at 200 bucks.
Bruce Norris How far is the lender willing to go on that? In other words, let’s say let’s say you had a buyer, but he said I have to have that five and a half. So you had to bring this thing down to five and a half. Is that even possible with the lender? It is? Okay.
Craig Evans It is. Yep. We had one a month ago that we needed to buy down two points on. Now what I did is I didn’t do a 30 year buy down on that I did a like I think a three to one on that if I remember correctly.
Bruce Norris Okay, so there’s some flexibility there. See, what’s interesting, because of the recent history of the low interest rates, which you said is significant. I think there’s optimism that we’ll return to those great rates at some point. That’s why that decision is being made. So it’ll be very interesting to see, you know.
Joey Romero Sounds like we need to interview Cary, Cary Pearce next week.
Bruce Norris Well, you know what I asked him so what are rates? I don’t know. Did I send that to you?
Joey Romero No.
Bruce Norris Craig?
Craig Evans You sent to me, yes.
Bruce Norris Yeah. So his rates will start with a seven. They started with an eight each. Yeah. So all three all of the three categories. That and he was basically saying okay, here’s the FICO score, a really strong FICO score. Are 600 a standard loan for Fannie Mae in California 20% down. And if you’re going to if you were paying some point, a some part of a point you got below eight and a quarter, but everything was over eight man.
Joey Romero Wow.
Bruce Norris Yeah, I didn’t I didn’t have time to talk to him about that. But that’s why I asked Greg what his rate was because I thought, well, here it is sale price 600 grand loan 480 FICO score 740 at 1.2 points, it’s eight and a quarter. If it’s less than a point, it’s eight and 8.37. And half a point was eight and a half 30 year fixed.
Joey Romero We’re gonna have to change our we’re gonna have to change our name to Harder Money Loaners.
Craig Evans Well, you know, Bruce, one of the interesting thing, one of the other things that that we’re kind of working through on some of this as well, is some of the adjustables that people are using, because not trying to buy more house, you know, ’04, or 5, 6 and 7, people were using ARMs, just trying to get more house and trying to get more houses and using a very unwanted strategy. And people were giving ARMsto anybody that can fog a mirror. It’s interesting, because of what you said a minute ago, because of the positivity of coming out of what people are seeing of what everybody is believing the market is going to do. Over the next six, eight months, from an interest perspective. People are coming into an ARM situation, we did an arm last week, it was a five one, I want to say we were low to mid sixes on a five one ARM. So again, with no rate by down using just a standard ARM on that, you know, again, that saving, you know, a point, point and a half point a quarter right out of that basis. You know, in their, with this one, they were locked at that five year spot. That’s not a bad gig when you’re looking at that. I think… …that’s good. I want to say they had maybe it was a two year prepayment penalty, but then the buyout of that was like half a point if they wanted to buy or maybe it was a point of a buyout early situation. So again, you know, if rates drop in the next eight months to a five in three quarters, something as you said, you know, I love your language, something that starts with a five, you know, if it goes to that it’s well worth it to pay, let’s call it even a point as a prepayment penalty to refinance that back down to full points and be locked into 30. That’s a great product.
Bruce Norris Yeah, well, that’s yeah, I’m going to need to have you share with me the lender’s contact information. Because that’s, I don’t think we have, if you will, you’ll do that free of charge, right. Craig?
Craig Evans Absolutely.
Joey Romero All right. So let’s, I knew this one was gonna take a little bit of time for us to to mull over. But Attom Data came out with a story today. In their report, they examined 575 US counties, and as far as what the median home price was, and they found that in 99% of those counties, it’s unaffordable for the median income, which is 71 to 14. So you know, if the target is 28% of your income goes to housing, before we get steamed on affordable, that’s where they got this data. So, is the American Dream slipping away?
Bruce Norris
What’s interesting about affordability? So you know, since we’re very familiar with those jobs, when it’s most affordable, so let’s go to 2009. In California was 58%, in the country, it was well over 70. And so everybody hurry to botlane, right? No, everybody was freaked out. And we had to bribe people with $8,000 to buy a house that was at 50 cents on the dollar. Go back to 2006. Go to 2021, the affordability number in California 17. You have any trouble selling anything? No. You had six to 10 bids in about a half hour for anything that was for sale. So it’s it’s always interesting, you know, when somebody points out the data, the affordability numbers, so let’s look at the history. What happens when affordability starts to come back. Every other chart does terribly because you’ve overdone it. You’ve reached a bottom of affordability where if you have an honest lending world, you don’t have a lot of people that can get a yes answer. So what’s unusual right now is we are just bouncing on that bottom number. So California is now at 16, 17 is usually, the bottom number unless you have a dishonest lending environment, so we’re we are literally maintaining median price on the strength of nothing is for sale that outnumbers the buyers capacity to buy what’s there. So, Attom Data, it’s interesting, because what do they do? They’d count foreclosures. So you know, they can they can come out and say, Wow, well, foreclosures have doubled this year. Okay, well, that means they went from two to four.
Joey Romero No, the story was, they take their tick back up to pre pandemic numbers.
Bruce Norris Yeah. Which is non existent. So see, that’s the thing about knowing the history. So I’ll just be quick with this. But the oddest thing, when you look at a history of last 50 years, you had 22 months of inventory for sale for houses, 1980, interest rates, 17, unemployment, 10%, condos were 30 months. And for the next two years, what was the price damage? Nothing, which was just mind blowing. You just go okay, well, how how could that possibly be? Then you go to 2008 and 9 , you have an interest rate way under 10. You have about 10 months of inventory? 10% unemployment, you have a 50% drop? Well, what’s the difference? The difference was in how many foreclosures were participating in the market in 2008. And nine, it was 70%. It dictated the value of every other property when that property sold for nothing. Well, in 2000, I’m sorry, in 1980, there was only one in four sales, it didn’t dictate anything. So that’s what’s interesting going forward is that you really have to ask that question, are we going to have a category of urgent sellers that have to sell no matter what that affects the value? I’d like to know how they’re going to show up.
Joey Romero Craig, on your end, you employ over 100 employees, you know, is that is the American dream still alive and well?
Craig Evans Well, in the lower side of, you know, in the workforce community, it is a harder process to buy now, not because necessarily of the price of the house, but because of the cost of the payment. You know, Bruce and I were talking the other week, on some of these houses that are out on the market, resale side of the mortgage is, there’s more value in the mortgage lenders, there isn’t a home itself. And so that’s where coming from a, let’s say, a new construction component. Because, you know, as we was Bruce has laid out many times when we talked about people that were refinancing in the twos and threes. That’s a money rate that, I don’t know that we ever seen that again, I mean, you know, no personal battle back and forth on a few levers that can be pulled. And that could happen, that could get us back there. There’s several those are some extreme cases of things happening. But, you know, if we get back into I think, what did you say a minute ago Bruce, five and a half, it’s kind of that rate that people have locked as, as what everybody feels is a healthy rate. You can enjoy as you said, you get back to that, all of a sudden, it’s going to be like a fire sale to people where they’re gonna feel like all of a sudden they can afford a home again, you know, when you’re in the eights. You know, I’ve got, I’ve got plumbers, I’ve got a link, concrete desk, things like that, that that will make, they work. Don’t get me wrong, they work but they don’t make six figures. They’re having a hard time getting into a house because they physically can’t afford the payment because their DTI isn’t funded.
Bruce Norris See what’s interesting about what our event is going to be able to share with the audience at I Survived is David Kittle the on the on the panel, David Kittle was like one of the top guys in the lending world. And the suggestion on that night will be find a way to let let these mortgages walk forward to the next buyer. Because that’ll fix your entire industry. As far as the realtors, they’ll have something to sell. If you don’t do that, that inventory is not showing up and it’s 85% of the volume normally. So, the volume is down by 50% in California from 500,000 to 250. And the builder portion of it is gone from 15 to 30. And that’s national. It doesn’t mean the builders are selling more homes. It means that people are trying to find something to buy and landing on the new home because it’s still there.
Craig Evans It’s always there. That’s right.
Joey Romero Yeah.
Craig Evans Well, Bruce, as I was telling you last week, we’re still for the last month and a half every week, week over week we’re still 20% in depth on incoming versus outgoing hounds on on an MLS perspective. So new homes coming on to the more market versus homes going off of the market via sold, were still sold and pendings. And they’re locked up, they’re done versus homes coming back onto them are coming on the market or coming back onto the market for a reason. When you take those two categories, we’re 20%, week over week continuingly in a deficit of what’s coming or what’s available to the market.
Bruce Norris That is a clarify, you’re not talking about your company, you’re talking about Cape Coral.
Craig Evans I’m talking about all of Southwest Florida from Northport, down to Naples, all of Southwest Florida in those markets, it is week over week, we continually see 19.5 to 20.2% deficit every single week of incoming versus outgoing. And the volume is, well, it’s not what it was six months ago, or eight months ago, the volume is so bad. Now, the last few months, August and September are historically slower months, because everybody’s you know, getting ready for school, they’ve just gone to school, they just bought all the stuff for their kids. It just is what it is. But even in the last seven, eight days, I mean, the buzz about what’s happening the real estate market down here. And I’ve got some friends in Georgia that I spoke with this morning, same thing, last six or seven days, all sudden people are saying, hey, phones are ringing like crazy, again, you know, I talked to our sales office about an hour ago, then a 14 calls today already wanting to see houses. So it’s interesting to see that dynamic of turning back on once you get to that kind of change in the market where that’s that. But when you’re saying, hey, in this marketplace as a whole, there’s a 20% deficit every single week of homes coming home versus going off that is starting to dwindle what’s out there?
Bruce Norris Yeah.
Joey Romero You know, one of the things that follows interest rates is the T-bill. And Bruce, I know you followed it for a long time. And and if we look at the T-bill from 2019. To to now, it’s a 500%. You know, but if you look at the chart, you know, from 1982, and you see that it’s you know, it was hovering at, you know, 15 and 12. What are your thoughts on on the T bill? And will this continue to rise with the with the interest rates?
Bruce Norris You know, what’s interesting, John Burns texted me something last night. And he was he was trying to say, you know, cuz I sent him that quote from Cary Pearce about the 8% interest rate. And he says OMG says, except for when I first bought a house, it was eight and a half. And so I responded and said, Well, how I got into business, I had to refi, a free and clear house at 17 and a half. So yeah, we’re all spoiled, that’s for sure. One of the things Joey right now is the spread between the 10 year T-bill. And the mortgage is way bigger than it normally is. So you can have this spread, usually at 2%. I think now we’re probably in excess of three plus. So the 10 years, I think I looked this morning was about 4.6 or 7?
Joey Romero 4.7616.
Bruce Norris Okay, yeah, so that’s really high. But that still should produce a mortgage, that’s around seven to six and a second three quarters, historically. And now if we’re at 8, it means the concern is I think that that’s going higher, for the time being, when that changes, and you have a recession, that spread will change too. So it’ll head the other direction, but the spread will change really quick. So you’ll probably go from the mortgage that’s starting to look at eight to something that looks under six, pretty fast if you have a recession where you go, Okay, now we’re headed in the wrong direction. Yeah.
Craig Evans That’s interesting, because that’s exactly what the friend of mine was talking about that the company he’s with. And I don’t want to talk about that, because that’s not you know, we’re not here to talk companies or things like that. But the data that they were talking about up in Columbus last week at their national event, that was the exact thing that said, Listen, what what we’re studying is the spread on the T-bill, because that spread is so much larger than what it historically is right now. And the same thing, you know, because I asked him, I said, Well, what are they saying that a recessionary movement would do to that spread? Is there every one of them completely agreed that it was you know, that that will start to diminish and spread pretty quickly, which I can say versus I mean, the team bill can be at a higher rate than effect spread starts to reduce, we can see, we could start to see six is pretty quickly.
Bruce Norris Yeah, you could, again, if you’re headed in the other direction, where the tenure is lowering, and as simultaneously that spread gets down, you know, to a normal range, you’ll have a very big difference very quickly.
Craig Evans I don’t know if you remember that’s, that’s one of things you and I talked about, probably four months ago, one of the triggers that that could get us back low is, you know, what happens from a recessionary perspective and what happens from an unemployment? You know, if the recessionary situation changes and the unemployment situation starts to tick up. So, because of certain triggers in the field, a lot of those spreads are going to start to change what we see coming out of the T-bill. And that spread on it, I believe.
Joey Romero All right, we’re gonna finish with a couple of little fun stories. So Florida became the second most valuable real estate market in the country. Care to guess what number one is?
Bruce Norris New York?
Joey Romero New York is number three 3.6 billion.
Bruce Norris Okay, the California?
Joey Romero California is still $10.1 billion in the valuation of it. And that’s because we have San Francisco, we have Orange County, we have San Diego, we have a wide a bigger range. And to round up the last, the last two spots in the top five, Texas at 3.3 billion. And New Jersey surprised me at 1.8 billion as the number five most valuable real estate market. And then the last one I want to kind of just touch…
Craig Evans You know what Joey. Joey, you know, it’s interesting that that’s one of the things we’re seeing a lot of people moving into Florida from New Jersey. And they love the fact again, they can take a house, that’s eight or $900,000 that they owe 30% on that they’ve owned for a while and then come down here. And now they’re thinking, Hey, we gotta have leverage again, and now they’re able to pay cash, for something down here. They’re loving that fine.
Bruce Norris Yeah, that’s a big advantage in Florida, because you have migration from New York, New Jersey, Illinois, Canada, all much more expensive markets. So you could go owing 30 to 50% on a property and buy a nicer house free and clear. So that’s pretty cool.
Joey Romero So the last thing I wanted to touch on before I kind of give you guys a couple of minutes for a couple of things. The states with the highest property taxes, the top most expensive were New Jersey, the median property taxes paid per year in New Jersey is 8797. And then you got Connecticut, New Hampshire, New York and Massachusetts, the least most expensive, least expensive, as far as probably Texas is the number one which is the least expensive is West Virginia, at a whopping 7560. That’s it. And then Arkansas, Louisiana, South Carolina and Mississippi. California came in good.
Bruce Norris By the way, that just means no one wants to be there. West Virginia literally loses loses population every year. And one of the problems is like you have only existing housing.
Joey Romero So California came in at 4,279. And Florida, the property taxes paid was 20 143. All right, so what I wanted to do here is give Craig, two to five minutes. We are a year removed from Hurricane Ian. So I wanted to give you a couple of minutes to talk about what the, what Florida looks like. I mean, from what I understand that like this is the first season you guys are officially back, right? In some capacity. So I’ve heard some of the projections say that’s going to be five years before the back to normal. But can you tell our audience you know, we’re, what Southwest Florida looks like a year from in.
Craig Evans Sure. I wish I had pictures because it’s very, very encouraging of where we’re at, you know, based on you know, when Bruce came down and visited us and, you know, I don’t live out on Fort Myers Beach out on the beach, but we do a lot of work out there with commercial things like that when other companies and you know, it was hard to fathom what it was going to look like even in a six month time period. Oh, boy, it’s great to see what a community can do when they pull together and become a community and start to do things and that’s, you know, there’s a lot of labor and skill that came in from other parts of the country as well as it always does out of, you know, after any emergency in any any instance like that. When you went to where there was literally no water and sewer even imaginable on an entire island with, I mean 1000s and 1000s of people and businesses, and no way to even get that up to having operational water and sewage in a matter of 37 days. It was a massive undertaking.
Joey Romero I mean, you couldn’t even drive there, right, the bridge got taken out?
Craig Evans And that was interesting. You couldn’t even get the population the average population still was not even allowed to go onto the island for about 72 days. But that’s a we already had operational water and sewage back on the island. Not for the entire island. But for 70, 75% of the island. We already had water and sewage back on there. So very encouraging to see how things are typing or taking shape. It was kind of fun, because, you know, we’re a year removed. People are getting put back together is there still harps everywhere on roofs because you can’t keep up Is there still three, four or five years worth of construction there? There is on some of the things, but it’s so interesting, because, you know, I saw something pass the day that they’re going to be starting in Cape Coral on the red light and the stop line replacement process that they’re expecting will take about the next eight months to a year. That’s supposed to start leaving December of this year. And it kind of hit me it’s like, you know, hey, everybody just jumps in and we’re right back to go into normal forgetting that. Oh, that. Yeah, that’s not why there’s been crooked now for the last 14 months. Yeah, okay. You get used to that you keep going. You help your neighbor, you do what you got to do in spite of the crooked stops. So things don’t stop. You know, there’s a lot of interesting stuff. You know, we were very, very, it was great this year to see some of the storms moving through, and not getting beat up until, you know, we were obviously a little concerned is what was going to happen with the storm earlier this year that came through and unfortunately, in up into the big bend of the state, and I know they took a beating. But we’re all southwest Florida even with that has fared very well. You know, we’re returning and getting back on a par a semblance of normalcy. You know, I know, Joe, you’ve seen what’s, you know Bruce, you’ve seen kind of what’s happening with our construction timeframes, things like that, we’re, we’re starting to get back to asemblance of normalcy of how things can function and, and hitting timeframes. And those things are very encouraging. So it’s been, it’s encouraging, I love where I live, I’m proud of being a Floridian. And I’m proud of our community to see what we’ve done and how, how people are helping each other. You know, it’s, you know, social media has been a great thing to watch you. First everybody can air their dirty laundry on social media, but at the same time you get to, you get to celebrate wins of the community, when you see that stuff, you know, I probably troll social media, maybe once every two or three weeks. That’s about it. But when I do I get to see friends that are all of a sudden they’re back in their houses, and just coming from a year ago, had nothing, you know, a friend of mine was out on the island and, and literally his entire house was completely underwater, didn’t come up with foundation. But at the same time, he five weeks ago, moved back into his house, you know, completely remodeled back into his house. So it’s been a hard year, but a good year. It’s a good place to be.
Joey Romero You know, Bruce, this was interviewing John Schaub, a couple years ago. And that statement said that, you know, the two things that we do in Florida, you know, we balance our budget, and we recover from disasters. And you, Bruce, so now give you a couple of minutes, you know, everybody’s always asking what’s Bruce up to so? So what’s Bruce, as far as you know, the real estate, what are you up to? And what do you see yourself doing in 2024?
Bruce Norris Well, I hope to support Craig’s desire to continue to teach people the real estate investment business, uh, we’ll you know, we’ll figure out dates and I’ll participate in those events. And I’ll be excited to do that. I get to speak next week in San Diego. We have I Survived event later in October, and with a great panel, and that’ll be a lot of fun, because some of those people in the panel are the decision makers for that, industry are certainly a big influence of them. So it’ll be it’d be really interesting to see their take on what they think is next. I still got 25 houses that are spect by another builder mission, one that I had come from California, we well, it’s really interesting, Craig, you’ll be encouraged about this. There was one that just closed last Friday. And we did have closing costs that we paid. But the highest that house had ever sold for in any supermarket was seven and a quarter. And it sold for 720. So yeah, yeah, so we took, five grand off and paid some closing costs. So that’s at the tail end of the really dead period for Florida. So all of a sudden now you’re going to have migration, and you don’t have inventory. So it’ll be interesting because we basically have two dozen houses that range from 1565 to 2170, that are brand new with all the stuff you’re supposed to have. So we all know like, okay, we’re trying to attract the, cash buyer, what do they want, they want a third car garage, they want to pull and they want to look at water outside their back, you know, window. And if you have all of that, then you have the product they want. So, you know, six months from now, I would be surprised if we owned anything for sale.
Joey Romero Wow.
Craig Evans Remember, you got 36 more with me? We’re doing two.
Bruce Norris That’s right. And that same reasoning, you know, well, we pick that same same product, different area, we’re just about to start those. And that’s exactly right. We’re thinking about, we need to land on the cash buyer square, not the financing square. Now, it could be the financing approved, and it will track both of them. But yeah, the cash buyer is probably selling something from a higher expensive area. So all of a sudden, yeah, the the price isn’t the deal, so.
Craig Evans So first, let me ask you, it’s interesting question. You said that you just closed on that last last week? When did that just out of curiosity? When did that one go under contract?
Bruce Norris Um, I don’t think it was very long. I think it was about a 40 day escrow or something like that.
Craig Evans So that’s what’s interesting. It goes into contract, because I had somebody talk to me about this a couple of weeks ago. Oh, well, it’s great. If you sold that 5 months ago, yours went under contract in the last 45 days, that was, so let’s say that would have been there in August, which is already the slow time of the year down here.
Bruce Norris Right.
Craig Evans At a point where everybody is crying, you know, the sky is falling, the sky is falling. And yet, you took a $5,000 haircut and a little bit of closing costs.
Bruce Norris Yeah. And that was a client that borrowed money to buy that house. So that was not a cash buyer. So that was even more interesting that that person showed up at that level.
Joey Romero So, I’m gonna I’m gonna close the show with our current events. Bruce talked about the Flip Hacking live. Just wanted to note that it is NOT a TNG Event. It’s a it’s gonna go on all weekend. But Bruce will be the keynote speaker at lunch only on October 12. So if you wanted to come here, Bruce talk about, you know, the economy and you know, go over chart. That’s the day that you’re going to want to be there. And then obviously, we have I Survived Real Estate. It’s October 27. That’s on a Friday. I like to call it real estate prom. It is $200 per seat and that 100% of that goes to the charities Make-A-Wish OC and the IE and St. Jude’s Children’s Research Hospital. And the last thing I want to mention is I want to thank our generous supporters, our Platinum sponsors this year in Alphabetical order, just so I don’t make anybody upset. The Inland Empire Real Estate Investment Club, MVT Productions, Realty411, The San Diego Creative Investors Association, so Dan Redig in SDCIA, Kaaren Hall and uDirect IRA Services, Buddy and Kimberly Rushing with White Feather Investments, and Tom Wilson, longtime supporter of ours with Wilson Investment Properties. I’d also like to thank our Gold sponsors. Brand new to us this year is a Fair Trade Real Estate, Mark Dalling, The Inland Valley Association Realtors, Keystone CPA Matt and Amanda, they’re always great. Leivas Wealth Management, NSDREI Derek Harms, David Granzella again for pretty much every year with NorCal REIA, Christina Suter with Pasadena FIBI, Sean O’Toole with PropertyRadar, The Outspoken Investor Tony Alvarez, White House White House catering and Brenton Lee over at Windermere Tower Properties. Thank you all for being generous supporters. It’s going to be a great night. We can’t wait to see you guys all there. So guys, I think this was a fun episode. I think I’m looking forward to doing this every couple of weeks. Thank you all.
Bruce Norris Thank you. Good God.
Joey Romero We’ll see you next week, guys for a couple of weeks.
Bruce Norris All right.
Narrator For more information on hard money, loans and upcoming events with The Norris Group, check out thenorrisgroup.com. For information on passive investing with trust deeds, visit tngtrustdeeds.com.
Aaron Norris The Norris Group originates and services loans in California and Florida under California DRE License 01219911, Florida Mortgage Lender License 1577, and NMLS License 1623669. For more information on hard money lending, go www.thenorrisgroup.com and click the Hard Money tab.