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Category: Real Estate
Tags: FloridaHousingMarketRealEstateTrends
Entities: Boca RatonCape CoralFloridaNaplesPhil SimonettaPunta GordaStellar MLSZillow
00:00
Florida's experiencing a housing crash and home sellers can't give their houses away. Price cuts are happening.
Some cuts are even taking sellers back to 2019 prices uh when they originally bought the house and and it's crickets.
00:16
Home buyers seem to have put their foot down. They're they're just they're not pulling a trigger for whatever reason.
[laughter] For whatever reason. Well, today I have with me Florida real estate broker Phil Simonetta.
He's been a uh contributor to
00:31
our podcast and uh through the years and we appreciate his boots on the ground reporting. Phil, thanks so much for joining us again today.
Hey, always good to see you, buddy. So, is it as bad or worse than we're hearing in Headline News, the Florida
00:47
market? The headline news is about a month and a half behind the real numbers.
This show is brought to you by saxrey.education. Here you can find my Todd simple home buying course.
It's self-paced, packed with insider secrets, teaching home buyers how to save potentially tens of
01:03
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The headline news is about a month and a half behind the real numbers. It's actually a little bit worse um for what we're seeing.
I mean, our days on the
01:19
market are at record highs, our inventories are record highs, and our closed transactions are at record lows. The only thing that comes next is price drops.
Yeah. And you're seeing that, right?
Yeah. We're right now throughout the state.
I mean, there's, you know, there's different local markets, but
01:35
we're anywhere from 3% to 12% down year-over-year right now, depending on where you're at. Um, I mean, there are pockets, you know, Boca Raton, Delray Beach, they're holding values.
They're not coming down. Uh, Pontra Beach, you know, there there are markets that are
01:52
always going to hold up. Um, but in general you're down three to 12% depending on where you are.
And I I see another 10 15% drop in some of these places. Well, what you just said, Boca Raton especially, I mean, they're rich people buying there.
I mean, these are
02:07
millionaires. Yep.
Super rich. Um, but they're holding, you know, again, those kind of those kind of areas are always going to be in demand and there's going to be a limited amount of properties available.
So, it's like a, you know, it's like a like a little bubble that's always going to be because people want to be there
02:23
and they're willing to pay. Well, we'll cover some areas specifically um that are experiencing the the biggest drops and a lot of those are on the the golf side of things and uh so which is kind of surprising, but tell us what's going on with the home buyers.
Have they just checked out?
02:40
Yeah, well the buy the buyers right now I I wouldn't say they checked out. They're just being patient and are waiting.
you know, the buyers I'm working with have four right now we're working I'm working with um and right now they're super qualified, you know, ready to go. It's just that we're we're
02:56
going in, we're seeing properties, they've been on the market for a very long time. We're offering them, you know, where we feel the market's going to go.
And I try explaining to the agents, hey, this is why we're offering this. You know, here's where we are.
And and they're just being patient. They're not checking out.
They're just waiting
03:12
for the right deal. Um, but unless they're in a in a position where they need to do something, you know, I have a couple listings right now where, you know, they're they're they're estate situations or divorce situations where people need to sell.
You know, they're the ones that are really getting uh
03:29
anxiety and getting frustrated. Um, but other than that, you know, things are really frozen up.
Things are really locked up. There's not much happening.
you were telling me about and well before we go into that I want to talk about what you had just said and I think this is important and a lot of people
03:45
that are listening to my channel they're home buyers sitting on the sideline you may say they're not checked out I say they're checked out for now anyway because um they're realizing that home prices across the country are softening I mean it's a it's a fact it's not you
04:01
know this isn't something that I'm you know pulling out of my you know what but Um [clears throat] what a what buyers have to realize right now and what before they're even hiring an agent if they decide to do that at all and not represent themselves. But a
04:17
lot of times uh the conversations are very important. You said that you call the agents, you talk to them.
I mean that's a very smart strategy because they have to understand why the prices why the offers are coming in where they are. And a lot of these listing agents do understand that.
I mean, I'm sure
04:34
you're you're hearing that. Um, well, just say you tell us what are the agents telling you when you come in with a much lower price than what it's already dropped to in a lot of cases been sitting on the market for a year, 9
04:52
months. What What are these agents telling you?
They, you know, it it seems like they're afraid to present the offer. It seems like they don't like that they're they don't want to present the offer because I don't know if they maybe promised them a higher price or you know g listed at a higher price because that's what they
05:07
wanted to do and fed into it instead of telling them the reality. It seems like they don't want to present it.
I even offered them. I said, "Listen, with your approval, I we can do a three-way call.
Call them up, tell them we got an offer. I'll present the offer to them, tell them why." you know, I have no problem doing that, but a lot of these agents
05:22
don't want to do that, you know, and I I don't blame them, you know, and I even question sometimes even if they present the offer, you know, just because of the way they're, you know, talking to me and the way they're handling it, but what can we do? I mean, it's hard to I mean, the MLS allows us to, you know, present the offer if we we have a doubt.
But
05:39
it's, you know, it's frustrating. And I give you another example.
I have a showing. I have a gentleman wants to see a property.
The property has been on the market for 400 days. Two days now I'm trying to reach the agent.
I can't schedule it online. It's not set up through showing time.
The agent has not returned my call. Today I'm going to call the broker.
Two days I'm trying to
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show a property, $580,000 property. Um, it was started at 750 and it's been on the market literally 400 days with two different agents and uh my buyers interested in it making a serious offer.
Um, and I can't get a hold of anybody to go show it. It's insane.
Are any agents telling you that they
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refuse to present the offer? No, I I haven't gotten that because they know they have to.
I mean, they they're legally bound to present the offer. Doesn't matter if it's $10, they have to present it.
But, I mean, who knows? I mean, it's Florida.
It's the wild west, man. They could tell you one thing and
06:27
and never present. And I I think that's happening in some of them.
Are you finding where some of these agents are agreeing with you? No, they they're definitely agreeing with me.
And what I'm what I am in the conversations we're having, they're frustrated as well. It seems like, you
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know, they're they're trying to bring the prices down and do price adjustments with the clients. And it seems like the clients are butting heads with them.
And if you look at some of the numbers, dude, there there's over 2,000 cancellations in the last 7 days on on listings. Cancellations means that
06:59
they're they're releasing the the sellers, you know. Well, let's pull that up.
I know you sent me you sent me a chart. You sent me some listings that we're going to look at here and show people, but we'll start with this chart.
Tell us what's going on with this. Is this This is updated as of
07:15
when? This is updated as of last evening.
I I I put this together last evening um knowing we were going to be doing this this morning. Um and what this is is this is the last seven days in the Stellar MLS.
Stellar MLS is the largest area MLS in Florida. I'm in three
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different ones. We have Beaches MLS, which is like uh St.
Lucy County down to the Keys. uh Flex MLS, which is like Jacksonville over to the Gainesville and that whole area.
And then Stellar is the biggest area wise. So that'll go from Daytona Beach all the way over to Tampa
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down to Cape Coral and over to uh like just the top of St. Lucy County where where the other one lets off.
So it's kind of the whole center of the state. So when you look at these numbers, you're getting the massive area.
Now, the numbers, the percentage differences are the same in all the MLS's. Just the
08:03
amount of the numbers change because of the volume of land and and properties in the area. So, this one here shows you in the last 7 days there's been 10,343 new listings.
Okay? You see price decreases 14,242.
08:19
That means in the last 7 days, that's how many properties came down in price. You do see price increase there, which is a little misleading sometimes.
That there is like the builders when they put a coming soon or they have something and they finally hit the market and the price hits it, it's like an increase. So
08:34
that's a lot of it's new construction, too. If it's new construction, builders raise prices.
They're infamous for doing that. But as I was saying, like days on the market, inventories at all-time highs, and closings are at all-time lows, uh deals going through at all-time lows.
08:50
And now you also have deals falling apart at all-time highs. Look right there back on the market.
2734 deals fell apart in the last 7 days in this MLS. Well, if we look at that, those metrics that it's more than 25% of the new listings.
So, you have 10,343
09:07
new listings in 7 days. You have 2,734 back on the market.
That's about 25% ratio, more than that actually, of uh contracts that are closing compared to
09:22
houses coming on the market for sale. And it's even worse.
Look at the sold. Sold was 6,600 and back on the market was 27.
It's almost a third of sold contracts falling apart. Now, explain to us when the busy season is for Florida because a lot of the
09:38
country, it's the spring market for obvious reasons. People want to get moved over the summertime before their kids go back to school and before they take vacations and things like that.
What would you consider your overall your what is the peak market in Florida?
09:55
Yeah, it depends on where you are because like South Florida, peak market is the season. That's October to May.
You know, people are here in the winter time. They're coming down.
They're spending the winters here. They're buying October to May.
You know, when you get up to like central Florida, Orlando, CM, St. Cloud, where you have
10:10
families, it's more like the rest of the country, you know, where people are trying to get settled in before school starts. Jacksonville, you know, through this area up to St.
Augustine, St. St.
John's County is a very very big family oriented area. So it's not really the peak season.
Not in all of Florida. No.
10:26
And so but even in the family oriented I mean that would run true that spring is probably your busiest season. Is that right?
Yeah. Yeah.
That's what I mean. Yeah.
Yeah. So so we're not in peak market.
We're not hitting where the snowbirds maybe are buying in October. Um, and and we'll
10:44
get into the exodus and whether you're seeing, you know, new snowbirds coming to Florida with all the what's been going on with hurricanes and stuff like that. But pull that chart back up a second here.
Um, when we're looking at new listings at 10,000 hitting the market in what really is not the peak
11:00
season, does that alarm you? Is that a big number?
This is huge, Todd. It's It's been this way for the last seven to eight months.
every seven days. The average numbers, I'm talking two years ago, three years ago, you might see 1,500, 2,000 every
11:16
seven days. I mean, these numbers are astronomical, man.
I mean, it's it's insane. Why are people selling?
I think people are selling because they're either they're either getting out of Florida or they're trying to get their equity out of the properties. They're either second homes, investment
11:32
properties, or they're just downsizing. you know, these these people like the cost, you have the cost, the insurance has tripled on these homes.
The taxes are going up. Now they're talking about getting rid of the taxes.
We'll see what happens politically with that. Um people are are just fed up with the cost.
The
11:48
affordability is gone. You know, PE just to live and have an average, you know, home in Florida, you know, you're you need 125,000 a year, $160,000 a year with all the insurance, the taxes, the overhead, the the utilities are tripling.
You know, our utilities give
12:04
you crazy. I mean, 275 a month is normal utilities for electric.
Electric bill was 515 last month, and nothing's changed. I used less electric than the year before, and it's actually that much more.
People can't afford it. It's crazy.
Yeah. You you were telling me, so I want
12:19
to talk about um the um people selling because they want to get their equity. I spoke with a couple that just moved back to Maryland.
Uh they moved to Florida. They wanted to get out of the state of Maryland.
They moved to Florida and um
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they were uh they sold about a year ago and um this is in uh it's it's Ponta Gorta, one of the areas that's crashing the most right now. And you know, they said thank god they got out when they did.
But when you see that people are selling because they want to capture
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what equity they have, are they telling you that I mean are you getting the feel that it's because they know the market's declining fast and they're afraid they're going to they're going to lose their equity? They're that's exactly what it is.
They're going to they're
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afraid they're going to lose the equity and they're going to they're afraid they not going to be able to get out. They can't even rent the places because the rents are falling and it's not covering the the expenses.
You were telling me Speaking of go, I'm sorry. Speaking of Puna Gorda.
Yeah, speaking of Puna Gorda, I have a I have a property as a short sale there
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right now. Okay.
It's it's over in in Punta Gord there, right off Leo water and um the the value of it was $380,000. That's what the appraisals that's like what the values are.
I have it listed at $300,000 as a short sale right now. I haven't had a call in four weeks.
300,000 and the,
13:40
you know, the comps are showing 380. We started at 3.
We started at 350, dropped it to 325, now we're at 300. Nothing.
I had one call the whole time on the property. And this is a property on the market.
And this is a property that you told me that you're back basically to 2019 price
13:56
when they bought it. It's that's exactly where it is.
It's back to the 2019 price where they bought it. And it's a short sale because the people who owned it actually as the property increased they they took a mortgage out and they took equity out.
Now they're in over they're underwater because you know they owe $360,000 on a
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house that was worth 380 supposedly. We can't even get a call on a short sale at 300, you know.
So, it's it's it's just it's something that's like mind-blowing, you know, but it's it's that's where it's going. Prices are going back to 2017, 181, 19.
I really think so.
14:28
Explain to everybody what a short sale is. Okay.
A short sale is when you sell the property and the bank will accept less than the bank is owed just to get out of the property instead of having a foreclosure or instead of having any other issues. They figure it's just a
14:45
better deal to take less, write it off, and not have to go through that whole foreclosure expense and pro and and process. So, do you think this is going to be a thing?
I mean, you think short sales are going to come back? You think a lot of people are underwater?
Yeah, this is the second one I'm working on in the last month and a half. Um,
15:02
they're they're coming back. Um, the bank the banks don't want the properties.
The banks want the money. And if they can get out of it without taking the properties, cuz we all know when the bank takes the property, you know, there there's maintenance problems.
People aren't taking care of them while they're living in them. And the bank loses all that money plus the
15:18
court costs and all. It all gets tacked on, but they got to put all that out out up front.
And I think the short sales are going to are going to come back pretty hard. All right, Phil.
Let's um I I want to talk about the uh the withdrawals and
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the cancelled and uh what's going on with those. So why are people cancelling their contracts?
I mean what what we talked about here 2734 one and three back on the market compared to the sales as you said it's
15:49
about a third of the houses are coming back on the market not closing. Um, and then we have canceled as well.
Why are people cancelling their contracts? Okay, so let let me let me explain the difference between expired and
16:04
cancelled. So expired is when you have your 3 to six month contract for a listing and the date runs out and it expires, right?
So you have 4,161 of those in 7 days, right? Then cancelled is when a is when a buyer or when a seller decides that they're not happy or
16:21
they're not going to sell the property with the listing agent. And that is when the listing agent releases them from the contract.
See, when you list a property and you have a listing agreement, as you know, share for everybody else, they're bound to that brokerage for that term. But a cancel is when the brokerage
16:37
actually releases them and they no longer have that bound that they're not bound to them anymore. they can go to a different broker or a different agency and relist or do whatever they want to do.
So those cancellations of 2100 is those situations in the last 7 days. That's where people are probably unhappy
16:52
with the service or with the showings or with the marketing or whatever is happening with their listing and they're actually having the broker cancel it and release the liability and they can move on to relist and resell because a lot of those come back on the market. Um now if
17:07
you look at the withdraws that means they just withdrew it. they just withdrew it from the market and they left it with the brokerage in case they decide to resell it.
Right. Or they can be painting the house and putting it back on.
It's just withdrawn. Right.
Right. Um and then temporary off the market seems simil similar with that.
But when you're looking at 2134
17:25
cancelled, 1066 withdrawn, 2734 back on the market in this 7-day period, just for everybody, that's 48 58 I mean that's almost 6,000 properties. So, you sold 6636
17:40
and almost that total has either been uh the contract has either fallen through or it's withdrawn where the sellers for whatever reason are saying screw you maybe to their agent or saying better
17:57
days and cancelled almost one:1 ratio closed to Yeah. Look, but it's worse.
Look at the expired. There's 4,100.
And look at the temporary off the market. That's another seven.
So it's actually over 10,000.
18:13
Yeah. You're looking at the cancelled, withdrawn, temporary.
But look at the expireds and look at the So you're one to one for the new listings of what's what's going on and coming off. It's like one.
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And so your chances when you list your house, your chance [laughter] of actually getting it sold are less than I mean you have a one less than a one to one
19:34
ratio here. So for as many that are being sold more are falling through.
That's crazy. Absolut it's it's it's I've never seen it before in 20 years dude in of doing this.
So why are buyers backing out? Why are buyers backing out, Phil?
19:50
The buyers that I see are backing out. It's it's it's you know it's buyer's remorse.
First of all, they're seeing like they see the house, they're having the inspections now. The houses need some maintenance and things and they don't the sellers don't want to kick in the maintenance.
Uh they're investigating what the insurance cost is going to be because they're not doing that before they make the offers. And
20:06
then they're realizing what the taxes are. You know, their agents aren't really breaking down the taxes and the full cost to them until after they start, you know, they want the contract, right?
They get the contract and they figure it'll fall in place instead of I don't understand that mentality because why do all that work if it's not going to work out? You should do that all up
20:22
front. Is the lack of home sales starting to impact uh industry companies?
I mean we're talking about uh in home inspectors are depend I mean sales are dead. What are home inspectors, title companies, loan officers, real estate agents, what are
20:39
they doing? Are you seeing them fall out now?
Yeah, I I see a lot of it. A lot a lot of it.
And And I'll give you an example. I just spoke to an electrician that does a lot of work.
And I spoke to a plumber yesterday. I bought another uh bus.
We're actually building another pizza bus out um to put up up where
20:55
we're putting the bar in Pennsylvania. And um so what's happening is the plumber I talked to um this guy has his own company and he was telling me two of his friends actually shut their companies down and went went to work for bigger companies that have big contracts with the city and things like that.
and
21:11
the electrician, same thing. Smaller company, the guy's very well known, very popular.
There's a lot of new construction. And he's saying the same thing.
Um that that people are are are having hard times. Business has slowed down.
Even in new construction, the contracts with them have slowed down and
21:26
and they're worried about getting paid. Actually, he was telling me that there's been a couple builders that aren't paying.
They're doing the work and the builders aren't paying. and he's afraid the next thing's going to happen is these builders are either going to fold or file bankruptcy and they're going to be stuck.
So, I was actually having that
21:42
conversation yesterday with these these two people, which is, you know, that that's the first signs again of the downturn. Yep.
You know, going back to that, I mean, in the '08 crisis, um I mean, I remember even before that, I worked a lot of work for builders and they were
21:57
the riskiest clients to have. I mean, they screwed you the most back then.
Um Right. That's what you're telling me.
Yeah. Now, now I mean I can remember one n national builder was financially insolvent so they said and and offered me 10 cents on a dollar which they owed me a lot of money back in the day and my
22:14
attorney told me to take it because you may not get anything and they've restructured and I'm not going to say their name but they're still around today. They're a very big company.
Well, usually that's what they do. They usually go out and come back or either restructure.
That's what they do. Is there an end in sight?
I mean, you
22:30
said that you were expecting. So, depending on where you are in Florida and and I want to look at a a couple areas here, Phil, I want to look at this chart.
This is on Newsweek and uh recently too uh back in July, but I still think if anything, this data has
22:45
um become even more relevant. But if we look at uh this interactive map here and we look at the year-over-year uh price declines, the change Naples, you can see 19.2%.
23:01
Cape Coral 9.6%. Ponta Gorda, I mentioned them earlier, 14.5% down.
Uh North Point, Sarasota, Bradenton, 9.9% down. I mean, most of these are on the coast.
You can see the
23:17
villages here 11.3% year-over-year uh price declines. If if you're talking about another 10 or I mean are you thinking that there's another 10 or 15% to go?
So if a house is I do already priced down to 300,000 that they
23:34
could be looking at another 45,000 actually in the mid2s. I I I really do.
I'll tell you something. That's where the prices were in 171 18.
And these areas you're seeing that are coming down the most are the ones who went up the most during the pandemic. The ones that were falsely
23:51
inflated the most, like you know, just with the demand, you know, and and and and what was happening. Um that's what you're seeing here.
These are the areas that went up the most. At what point do the investors start diving back in?
you know, I saw um and I I don't know if it was uh I'm trying to
24:08
think of where uh recently one of the the counties um maybe you know about it just they're they're proposing to raise the occupancy allowance in a house to uh right now it's set for 10. I'm
24:23
specifically talking about like Airbnb hosts and stuff like that, which a lot of people have bought Florida houses for the purpose of short-term rental because it's a popular vacation destination. And u one of these municipalities and the
24:40
neighbors are all up in arms because they want to raise the occupancy uh limit. They want to eliminate a 12y old or younger from the occupancy limit.
So right now the occupancy set at 10 that
24:58
includes young kids. They're proposing removing that.
In other words, if there were 10 people and each of them brought uh you know or five of those people brought two or three kids. I mean you could literally have 25 people in a
25:13
house. At what point do you start seeing investors jumping back into the market or are have you already seen it?
No. The investors when the cash flow is there, they're going to come back, but it's not there.
I mean, you can't you look at these homes and the prices and
25:28
then you look at the costs and the expenses, taxes, insurance, maintenance, HOAs, they're losing money. You can't you can't rent them out.
Now, the commercial the multi-unit is different. you know, multi-unit properties, you know, 10 units and up, you know, there's still investors buying and building
25:45
there, but these the single family and the two, three, four unit properties, they it makes no sense. You're actually you're you're c it cost you every month to own it.
There's no there's no cash flow. Would you say the bulk of Flidians aside the retirees are people that work
26:03
for um some of the maybe the the lowest paying jobs? I mean hospitality unless you're a bartender in a very popular place or a waiter or waitress.
I mean maybe you're making a lot of cash but so long as people keep spending money. But
26:19
other people, I mean, you you say the rental business is big and the 10 unit plus, that's because a lot of these people can't afford to buy. Do you find that there are a lot of people living there that are below um median income for Florida that I mean, they're just
26:34
it's impossible for them. Yeah.
It goes to the affordability problem. And you're seeing people like that.
They're roommating. You have two, three people roommating, you know, they're getting a three-bedroom apartment or three-bedroom house and there's two, three people splitting bills, things like that.
co-workers. You have a lot of that that goes on in
26:50
Florida. Um, most of the people who live here are, I would say, older, retired.
Um, most of the people, you know, nobody, the average people are not buying. The only people buying are people in C or specific situations.
Like, I'm telling you, there's no married couples buying their first house right now. Nobody getting married or
27:06
expanding or having a kid, getting a bigger house. Everything's downsizing, divorce situations, estate situations where they're selling a property.
And then the buy side is is somebody same situation, you know, they have an inheritance they got and they're buying something or, you know, there's a there's a specific reason they're moving
27:24
here for work or or something's going on that the whole the whole picture is unbalanced. It's not a normal market.
I've never seen it like this ever in the years that I've been in business. You know, it's not a normal buyer.
It's always a special circumstance from from
27:40
the people that I'm dealing with. President Trump is talking about declaring a housing emergency.
Um, what are your thoughts on that? You I saw about that.
I I really haven't I haven't seen much about it. I don't know what the emergency what he's calling it for.
I can you give me a little
27:57
information on that? I don't I don't know.
Well, I mean, very little's been said, but he wants to come in and obviously he wants mortgage interest rates to be lower, and I think the pressure is there for that. Uh but he also wants to standardize regulations for new
28:13
construction. U maybe cut some red tape allowing people developers and contractors to build more [clears throat] affordable housing.
He's talking about perhaps cutting uh tariffs on certain building materials. This is coming through Scott Besson.
I have not
28:29
heard I've only seen articles. I have not heard uh the president talk about this directly other than the fact that he says that we need cheaper mortgage rates so people can buy again.
Do you think cheaper mortgage rates is the answer? Now, I I I don't think I don't
28:45
think just cheaper mortgage rates is the answer because average mortgage rates are what, five and a half to six five and a half to 7% is an average mortgage rate. And even if you get down to the five and a half at the prices we're at today, it's still not affordable with the answers, the HOAs, taxes, the insurance, the bottom line is the prices
29:01
have to come down. The prices have been falsely inflated due to the pandemic and the cheap mortgage rates of 2%.
That should have never happened. You know, we talked about this before.
You know, people can afford a payment a month and as long as that payment fits into the,
29:18
you know, the cost of the money. So, if they're buying a house, the mortgage, the taxes, the insurance, their monthly expenses, right?
As long as that payment covers that, it seems like the buyers didn't care what the cost was price. So, the price shot up when the rates were 2%.
Now, you can buy a $600,000 house at
29:35
2%. And have that payment work.
But now because the rates are five and a half, six, 7%. Now that house has to be worth 400 to make that payment work.
See what all these people miss is people can only afford so much a month. That's why so
29:50
many people in this country buy on payment, right? They go get a car, they just as long as they can afford the payment even though they're they're paying too much money for the car over the whole loan.
As long as they can afford that payment, that's what people look for until Right. Right.
or something. Yeah.
Right. Then they're stuck.
But the thing is
30:06
with with the housing, this is what happened during the pandemic because they could buy the $600,000 house at 2%. The first house sold, the second household, the comps went up.
Now all the houses are worth 600,000. They're not worth 600,000.
I just don't they're not I know what they cost to build. You
30:22
[snorts] know, the bottom line is now the demand is gone. The houses are still at 600,000 dropping to 550, 525 like what we're seeing.
But that mortgage rate is still too much. and those expenses, the taxes, the insurance, the the overhead, right?
HOAs is still way
30:38
high to that payment that the people can afford. Until that price comes down, it's not going to we're stuck, man.
Yeah. A lot of people, you have to you have to look at the numbers, right?
So, we're not really making a lot more money. They say that people are making more money and but they're they're not
30:55
not mo most people, I would say, are not. Um they're making more.
They're spending even more than they spent before. % the the debt's higher than it's been in a long time.
And the the the other thing is even if you look at let's say we got back to 4% rates, it still isn't 2.75 or
31:12
74%. Not only that, but since we had those type of mortgage rates below 4%, like you said, these other costs have also gone up significantly.
Property taxes nationwide have gone up on average
31:27
30%. you have um some states insurance costs, homeowners insurance have doubled since the sub4% mortgage rate.
So, we have to look at this thing from the perspective of doing the math, doing the
31:43
numbers. And you're right, in my opinion, I agree 100%.
The only thing that is going to get these buyers off the shelf is all of it combined. cheaper home prices, cheaper property taxes as a result of values declining, cheaper uh
31:59
homeowners insurance as a result of a replacement value being less because the home values are less and and on top of that, they would like the cheap mortgage rate as well. But I guess the question really comes down to, you know, what do
32:15
you tell a buyer right now? And and I know, you know, you just got your New Jersey license.
You and I were just talking and you said you're going to go sell houses in New Jersey because they're selling and you know, which is a big indication that you're not making money in Florida right now selling
32:31
houses. I think that everywhere is going to weaken and soften.
But with that same spirit in mind, what do you tell people in Florida that are on the sidelines waiting? Do you do are you telling them to continue to wait, continue to put low
32:46
ball offers in, continue to let the sellers feel this uh this pain of days on the market? This and and and eventually they'll come around or wake up as new comps are being set as to the real price now uh as these houses are
33:03
closing. What do what do you tell the buyers?
Yeah, the the buyers I tell them straight straight out and that's what I'm doing now with them. I'm I'm telling them, listen, if you like the house, here's where the market's going.
Here's where it's going to be. I think this is where you should put an offer.
And we're 50,000, 60,000, 70,000 under. And I say,
33:21
look, if we can't get it for this, wait, because give it another 3 to 6 months and you you'll get it. Just just keep waiting.
Unless you have to be here and you have to buy this house and you're staying there long term, I just tell them, hold off. you know, we got to get the right deal for them because it's not
33:37
worth the money that they're going to spend. Yeah.
Even if they are, even if they are going to stay there long term, I mean, I Right. You don't tell somebody not to buy.
I mean, if they have the money to do it and they need to do it, they want to do it, go buy the house. But in the at the end of the day, you know, even if they are, I mean, it no one likes to buy
33:55
something where they realize that, oh my gosh, I could have saved another $50,000 had I waited three more months. And on top of that, that's one of the reasons why I say Bitcoin, you know, will never be something that we use as a uh as
34:11
money because what happened is the fluctuation of that of that um of the value. I mean, you could buy a cheese steak today, cheese steak sub today and find out that tomorrow if you would have if if if you'd have waited tomorrow would have cost you two cents, but
34:28
instead today it cost you 20 bucks. I mean, it's the same thing.
Why Why do you want to go into the market when you know that it's falling and price declines are happening? At what point do you enter?
Let's take a look at a couple of these listings you sent me. Exactly.
34:45
This one is in CMI, Florida. 790K.
U you sent me these things. This is built in 2019.
Um it's been on the market for one day. I'm kind of wondering why why are we looking at this one?
Look at this. Look
35:00
at it. They dropped at $100,000 in one day.
In one day. So, what was the reason for that?
Sounds like a game to me. Sounds like Sounds like That's why I sent you this game.
That's why I sent you this. They had it listed at $8.90, put it on the market, and it was $100,000 drop the next day.
35:16
This is just something I'm I'm bringing up up to people's attention because this is happening. You know, if you go down, scroll down there, you'll see it.
It was I think a little bit lower. It shows you the history.
I thought this was very odd. Right down there.
Listed for sale. Right there.
Go up a little bit. Um, where is it?
There.
35:33
Listed for sale. Listing removed and then put back on.
That's 23 25 790. Where is it?
Here. Yeah, I don't I don't see it there.
There was It was on the market for one day and they took it off or it was on the market for a little while. They had it up for $8.90 and they
35:49
dropped it $100,000 like in like on one day and and it reprogrammed in here in Zillow. So, I sent this over to you to show you how weird this was.
Uh, so I'm just kind of curious while we're looking at this one, too. So, this one came on 879.
Go down to the
36:04
history of this one. I did.
It's It's nothing. I mean, it's We can't use Why is it not show right there?
Hold on. Saying that.
No, dude. This isn't Okay, so this this is weird because on the MLS when I was looking at these properties, it showed me the drops.
They're not showing on
36:19
Zillow. This was another one 70,000.
I think they dropped it. It's not showing.
Pull it up in your MLS and let's see if we can share the screen. Really?
Here it is. Right here.
Hold on. Yeah.
Yeah. No.
Here. 879.
Let me look at the history right here.
36:34
You want to share my screen quick? This is really weird cuz they're not showing this, dude.
And I'm going to show you right now where it shows it. It was 950.
This is weird. Zillow's not accurate.
Can you see? I'm on my screen.
I'm not on the So, what what you're showing us here, Phil, you see this here? Look.
827 new listing
36:51
950. What you're saying here is that Zillow is not showing this.
No, look. Look, it's showing 827 new listing and then look, price drop, same day.
Maybe because it's the same day it listed. Maybe there's some kind of quirk there that they can do this.
So, look here. 950 down to 879.
Same
37:07
day. See it?
Yeah. What about this?
Uh, let's go back to the first one. What about this 1580 Nassau point trail?
Which where is that? Is it in this MLS or Okay, that's that's in Stellar.
Yeah, that's it. Okay.
So, what is it? 1580.
37:23
Yep. NASA Nassau Point Trail.
Let's just see, man. Here we go.
Right here. Right.
So, 790. Yep.
Let's look at the history. Here you go.
Look. 8.90 down to 790.
Same day. No, day before.
September 2nd,
37:41
8.90. September 3rd, 790.
Okay. So, here we go, guys.
So, we have found something here that Phil was showing us. And uh you know, I was thinking that we were going to have to cut this stuff out, but [laughter] you know, um what what we got here is uh
37:56
inaccurate information. There's some kind of a crossover between what Zillow is showing.
Well, this is very interesting. What's your opinion on that one, Phil?
Yeah, there you go. So, look, this is the first one.
Listen, the So, we're not getting transparency is
38:12
what you're telling us. I don't think so.
Look at the first one I showed you where it showed no price drop, right? and you said that's weird.
So we looked here. It's showing 8.90 on the market and that's clearly the next day.
Yeah. L literally that's the first one
38:29
there. Not September second.
Clearly the next day. Let's do both of them quick so that people can see this.
So look, September 2nd, new listing 890,000. The next day they dropped it $100,000.
They're looking at it. They're looking at it.
Now go back to Zillow quick and show
38:44
where it shows no price drop. Here it is.
Isn't that the Nassau NASA point whatever, right? Yeah, this is Nassau point CMI.
So, let's pull that one back up on your side. And here's your price history.
Doesn't show anything from 92 when it hit the
39:00
market. Now, could it be that they did a delayed marketing for a day?
No, because Zillow would have banned it. Yep.
It would have been banned. It wouldn't be on Zillow, right?
And then let's look at the other one. What was the address for the other one again?
Let's compare that. The other one was Sugar Citrus.
We just covered that one. Let's look at Let's
39:16
look at this one. Let's look at this one.
Look at uh your 14317 Southwest. Now, is that which MLS?
Homestead, Florida. I don't.
Okay, that's going to be in That's going to be in Matrix. Let me switch my switch my MLS.
Hold on. I have to go into the
39:32
different MLS. It says Miami.
Yeah, that that one is Beach's MLS. The other two were in Stellar MLS.
So, that was Central Florida. I just have to log in real quick here, which I'm doing right now.
And uh some interesting stuff here. Well, this one shows that uh
39:48
on 93 of 2025, they dropped at 8.3% but in April of 25 they had dropped they took 11.8% haircut. So they're about 20% down based on what they originally wanted in the beginning of uh January of 25.
Of
40:06
course, they bought it 20 years ago for $107,000. So in 20 years they basically want 6x the price is 550 a recent cut of 50k.
Now tell me what your history says on this one.
40:22
Okay. Put my screen up there.
This this one's accurate. It's a different MLS.
This is a different MLS. It still looks the same because it's both matrix but maybe different rules.
Okay. Go ahead.
Right. Different rules.
So here you go. It was new on the market at 600,000 back
40:37
in May and it was on the market for 121 days and they just decreased it to 550 September 3rd and that was the only price cut since April. That's the only price was cut too.
Yep. Price cut.
40:52
Okay. So, wait, hold on.
Now, that was a different listing. It was a different agent.
See the number difference here? So, that was a different listing.
She'll be able to click on the history of that property and give the MLS. Right.
Oh, here it is. All the history is right here.
You can see it all on this screen. I can go back all the way.
Mortgage
41:08
history, everything. Okay.
But was it cut in April? Was that the only other price cut since January?
Well, here January 25, it was listed with a company at 680, dropped down to 600 in April 25th, and it expired. That
41:25
was an expired listing, right? And then they relisted it with a different It could have been the same.
Yeah. A couple weeks later they started at 600.
So they went from 680 to 600 expired. Started at 600 and now they just decreased to 550.
So these people it's really $130,000
41:41
drop. Okay, let's show my screen for a minute.
Let's give Phil a minute to get this one up. Um, check this one out.
This is 475 Briquel Avenue. Looks like a condo.
Apartment 3510 Miami. Uh, cut.
41:58
Give me Give it to me one more time. I couldn't I couldn't keep up with you.
You went too fast. Four.
What is it? 475 Briquel Avenue.
Yep. BL.
Yeah. Unit 3510.
And you guys can see my screen while Phil is Okay, here we go. I'm I'm on a screen.
It seems like it seems like beaches is
42:14
accurate. Stellar wasn't.
So, right. The question.
So, this one was a rental, too. Yeah, it shows here.
They had it rented now. Now, get this.
They were asking 50. They were asking 5,200.
42:32
Look, look, actually, no. Look, it started at 3,300, went up to 5200.
That's kind of weird. Um, you see that there?
Yeah. They bought it in 324 for 423,000, turned around and tried to rent it for
42:48
2500. That's kind of asinine.
Why would you Why would you payense 423,000? Doesn't cover the expenses.
What? It doesn't Yeah, it's ridiculous.
Like, hey, I you know, that's stupid. Maybe they thought, hey, I'll buy this in 24 home prices are skyrocketing and
43:05
they'll just continue. The only thing I could think is like even here, like look, they're asking 400,000, 500,000 for the house, but it rents for three and then they raise the rent to five to make it kind of coincide.
You see what I'm saying? I see that it was five.
I see rent. If we show my screen again.
43:21
Yeah, I don't see that. I see it.
They bought it for$423. They rented tried to rent it for 2500 and then as as for three months here, look for four months, April, May, June,
43:37
July, they said, "Well, nobody wants it at 2,800. Maybe we'll raise the rent to 3,300 because I'm bleeding." Right?
Then they said, "Well, nobody wanted it then." So, here in August, they dropped it back down to 2,800 and said, "Yeah, by now we're in September."
43:54
Now, do me a favor, Todd. Come back to They raised the price.
Hang on. They raised the price again 71425.
I guess they had it rented maybe. Um 3,300.
They dropped it to 3,000. They said, "F it.
We're gonna sell this thing for
44:11
$515,000, which is 21.7% higher than they bought the house in 204, right? But come back to my screen really quick.
I want to show you something. And now they're just they're just
44:28
dropping it. They're 3.3%.
Man, that's nothing. All right.
So So here we're back at my screen now. Now we're looking at this property, but look, there's numbers that aren't showing there.
Look right here. They actually raised the rent price to 5,200 in August.
August 15th.
44:43
But in all fairness, in all fairness, I don't know where it stands right now because I don't really mess with rental listings. Yeah.
I don't either. But but Zillow there for a while was charging like 10 bucks a week or something for Yeah.
They they went through a period of time
44:59
where they were charging you to put the rental listing up and uh a lot of agents said, "Screw that. I'm not going to I'm not going to do that." Let's check another one here.
Uh, let's look at this one that you sent me. U cut 50,000.
This
45:14
265 Northwest 135th Street also in Miami. Let me type that into There's got to be some worse scenarios than this than you sent 15 20%.
Yeah. Then I I went through these pretty quick just to pull these up.
Hold on. It
45:30
seems like beaches is more accurate than what Stellar was. Yeah.
See this one here started at 549. I got it up here now.
Um, let me see here. There we go.
Yeah. So, this one started at 549 in April.
They dropped it to 518 and now they dropped it to 459,
45:46
right? So, this is a $90,000 drop.
Yeah. Also was a rental it looks like back in 2024 for 3,000 bucks.
See, this this just investors are having their asses fed to them. This is what I'm telling you.
This this reinforces it. I'm showing you the investors are fleeing, dude.
inventory
46:03
because a real an investor that's paying let's see what they what did they pay for this thing. Let's look at that before I Okay, that's it looks like it looks like it closed at five 525 it closed it looks like in 24.
No pending 328 but I don't see it
46:19
closed. You got to go back further.
Yeah, I don't know. I don't even see maybe they just had it forever.
Yeah, I don't see it closed at all. just pending and it can look tax.
There you go. Look, look at 7122 closed sale.
Look at the tax record for this one. 265
46:37
Northwest 135th Street. This guy bought it.
Let me see if I can pull it up in IMAP real quick. Real estate investors that purchased a house, I don't care where it is in the country, for $450,000 is charging $3,000 in rent is losing their ass.
46:54
No, I'm I'm telling you, I'm I'm pulling it up in IMAP right here. This is the actual tax sheet.
So, we'll see dates. We'll see what he owes on it.
All that stuff. Well, I know there's a lot more um there there has to be more significant price drops that are in this Zillow.
47:09
No, there are. I mean, listen, I can if I have some time, I can sit down.
I can find you some huge ones. I mean, the bottom line is you tell us that we are seeing price reductions.
telling buyers that they are more price reductions to come at least another 10 or 15%.
47:25
Is what you feel and uh yeah so that you know that's important thing. Can you see my screen right now?
Like I don't know if you're seeing my screen. Okay.
So here's where this guy bought this. He bought this uh July 1922 for 335 for 335.
So he's not that smart. I still
47:41
wouldn't take that deal. That sucks.
I if I'm if as if as if as if as if as if as if as if as if as if as if a real estate investor there's 1% rule for any smart one out there unless you're so in other words if you're all in and that's including closing cost which isn't being disclosed here any kind of recordation fees any kind of repair cost I take all
47:58
of that I put it in one pot and say how much did this thing cost me to buy regardless of whether you have a mortgage or not if you're in 350 or 400,000 then the 1% rule you need either 3500 if you paid 350 4,000 minimum 1%
48:14
rule in order for it to make sense for investors because people don't realize you lose your butt on an investment on on in in landlording because people trash your place. You're going to have tenants that are going to need that you're going to have to go through eviction process.
You got to reent
48:31
ready. Yeah, you can find good tenants that stay there for 20 years, but it's rare.
It is a not a fun or good anymore good investment. um in my opinion to be a landlord.
Go ahead.
48:46
Yeah. Look, look at this too, Todd.
This is something weird here. Look how odd this is here.
Okay, so he bought this property July 1922. 222 335, right?
Yet, it doesn't show in Zillow that I could see, right? But he bought it for this.
49:03
But look at the mortgage 370. Yeah, that's his mortgage.
How do you get a mortgage 370 for something he bought 335? It appraised.
He probably did some kind of a renovation finagling. I don't know.
Renovation loan or something. Quick claim deed.
It was a foreclosure.
49:18
Yeah. Here you go.
I mean, somebody lost it and and and he's now trying to um you know, make hundreds of thousands of dollars here in a couple of years and he can't even rent the damn place. [laughter] So anyway, and the tax Yeah.
Yeah. Get out of here.
49:34
Okay. But yeah, dude.
So that so that's that, you know. I mean, look guys, the bottom line is, you know, um you can do your own research.
Uh pull up Zillow, look at these price reductions. I don't think that we showed you the best, most
49:50
accurate ones here that Phil sent, but um I think that you can agree that uh Florida is falling on its face. Yeah.
What blows me away is the inaccuracies. Like I just I mean that's crazy how you're not seeing what's really happening when you're looking
50:06
through Zillow and these other sites. I mean that should be pulling that information so people are seeing I mean dropping a price 100 grand in one day is kind of weird, you know.
Yeah, I I completely agree and I don't know why it's not showing up. I mean the bottom line is we know that buyers all across the country are pulling back and
50:22
it's because they can't afford it. I mean or maybe they can afford it but they don't feel the house is worth it.
I mean it's it's kind of like the stock market in a lot of ways. I mean you look at a stock and you say is it overvalued?
If I buy it now and it goes down tomorrow I lose money. And this is what
50:39
a lot of buyers have faced have been faced with over the last three years. They bought high at the highest level was 22 was the peak.
I don't care what you say. It is a fact that that the market peaked in 22.
Did some people
50:54
still elevate median prices or average prices? Yes, they did.
But that was because more rich people bought houses and they bought more expensive houses and and that altered that number. It's the fact we have seen the age of the
51:11
firsttime buyer go up higher than it's been ever. I think it's 39 years old.
59 years old was the the average buyer of real estate period. the number one uh cohort of home buyers in the last year
51:27
according to uh and I think it was 59 years old. I'm pretty sure I'm right on that, but you can check that too on realtor the um National Association of Realtors uh home buying demographics and all of these things add up to
51:44
an overvalued housing market. So, we'll see whether regardless of our president whether he is able to uh you know help with affordability somehow uh get us more affordable housing.
I don't think the
52:01
answer is just dropping the interest rate. But anyway, Phil Sim, thank you so much buddy.
And anybody wants to contact Phil, his information is in the show notes. Any parting parting words?
Yeah, just hey, it's it's it's bad for
52:16
sellers and it's [music] good for buyers, you know. It's really it flipped, you know, and and that's that's what we got going on.
Just stay patient and get a good deal. Hire the right person to work with you and make sure they have experience and make sure they know what they're doing.
52:31
Sounds good, buddy. [music] Well, we'll keep in touch.
Yeah. All right.
Good seeing you, man. I'll talk to you soon.
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53:04
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