Change the Conversation

Real Estate Marketing Dude

It's hard to deny we are seeing an economic recession. While that is a scary thought for those in the real estate industry, the truth is that there is a lot of opportunity for us.

Three Things You’ll Learn in This Episode

• How should we handle the recession?
• What can we still do when the market slows down?
• How to position yourself during a recession.

Resources

Real Estate Marketing Dude

The Listing Advocate (Earn more listings!)

REMD on YouTube

REMD on Instagram

Transcript:

So how do you attract new business? You constantly don't have to chase it. Hi, I'm Mike Cuevas a real estate marketing. This podcast is all about building a strong personal brand people have come to know, like trust, and most importantly, refer. But remember, it is not their job to remember what you do for a living. It's your job to remind them. Let's get started. What's that? Ladies and gentlemen, welcome another episode of the real estate marketing dude, podcast. Folks, what we're going to be chatting about today is the R word. The recession. It is here, folks. Interest rate just went up what 7.75 basis point as of this morning, the Dow was under 30,000. Interest rates as of yesterday, according to my mortgage broker friend were 7.125%. What are we going to do? There is we actually just did an event on this topic last night. So I think it's very relevant to share with you guys sort of what we uncovered there, because it's extremely relevant to what's going on in the market. And right now I understand you might be scared, I understand, you might be worried. But the reality of it is, is that these types of markets that we're about to experience and face are when the biggest opportunities actually occur. The greatest transfer of wealth you guys always occurs during a depression or a recession, not during the peak bullish market. So what you want to be focused on though, is where you're going to take your message. And while everybody else is out there, just doing a bunch of doom and gloom, what I wanted to share with you on is how to change this conversation. Because if you're watching the news, if you're watching the media, you're probably like, literally on the verge of having a heart attack, because literally everything they do is not only not true, but it never seems to be at least notice. But it's scary. It's scare tactics. And if you don't know how to change the conversation to your client tell your clients are going to remain scared. So what I'm going to chat about is how do we change the conversation. And it's a lot easier than you think. So what I want to do is start out with some of the objections that you guys are hearing on a daily basis. I'm gonna tell you the ones that we heard yesterday from agents, and I'm sure these are true in your market as well regardless of where you're at, in the United States. So number one, I'm going to hold off right now, and not buy a house because this market is going

to crash. I'm gonna hold out right now, and don't buy a house because the rates are too damn high. So if this is your first correction, first off welcome and during the ride, but the good deals are bought in the shitty times, I want you to think back about anyone who bought a house in 2007, or six, bought at a peak just like anyone who bought a house in 2022 or 2021. Okay, and the absolute best deals in the real estate market came in the 2008 910 and 11 years. Personally, I was buying condos in downtown Chicago on the 48th floor for $140,000 To give you an idea of what we experienced in the last crash. And a lot of you guys know me as a video guy. But before I was a video guy, I was one of the top short sale teams in the country closing 25 to 35 transactions a month. And I did that for three years in a row. And at that time, I see a lot of similarities with what's occurring today. Which is how I know this history repeats itself, folks. And when people are not buying, that's when you buy, okay, you want to change the conversation quit doing what everyone else is doing the most, the best thing to do when it comes in terms of real estate investing is do the opposite of what the current market trends are. So for example, in the last market that we just came out of where people were overpaying for properties left and right ever the old markets ever going to crash librium crush been saying since March, we're gonna go down 20% In at least San Diego County, and I am right on. Everyone thought I was crazy. I'm not doing this. It's like well, you know, you guys ever been here before, dude. So what do we know with history, folks, for those of you that haven't experienced a crash is that the best time to buy is when no one else is buying because that's when prices come down. And the reality of the situation is is that as we enter into this recession, there's going to be pain, okay? I don't know how bad it's gonna get. No, it's probably not going to be as bad as 2007 Eight, I'm pretty positive. It's not going to be because there are a lot of conditions then that were present that aren't present in this market. However, there are going to be people underwater, and the more cost that goes up The interest rates hike the inflation, gas, all of these other expenses just leads to one end result, less people can afford what the prices are, therefore prices start to drop. So what I'm telling buyers what I would tell buyers, if I'm not, if I'm selling you guys is like, what do you mean? Makana buy, this is the best time to buy, but we have to buy the right deal. We need to find the person that is going to let their house go. Because it's not about the interest rate. It's about the opportunity. Now, I want you guys to really take that into effect. And just because no one else is buying and people are not, that's when the prices are going to come down. And that's when you pounce, yes, you'll have to deal with an interest rate hike. Yes, you'll have to deal with some of these higher costs. However, this is where an agent who is absolutely creative can come on into the mix. So one of the things that you change the conversation with is you actually start saying, don't sell now buy now, because that is the entire purpose. Now what if someone right now can't buy because they're stuck with a higher interest rate, and they can no longer afford that house that they want? Well, it's very simple. You need to start getting with your lenders and figuring out how to do rate buyouts, right? If I'm a real estate agent, right now I am I'm not selling them telling you guys what to do. But I am 100% starting to structure my deals with a three to 6% seller concession on every single purchase offer, especially in this high interest rate market. The reason why I'm doing that is because I'm going to use that concession to buy down my interest rate, how much of a bite down can it go, whether it's three or 6%. I don't know guys, get with your local lender and come up with a rate Bytown program because this is a marketing opportunity. Now I'm going to start marketing my business, instead of saying interest rates are so high bah, bah, bah, bah, like everyone else, and all these doom and gloom users. Instead, I'm going to say we're getting properties, we're not only buying properties under market value, but we're doing it with a 5% interest rate. Here's how, folks, there's so much opportunity right now to stand out and do things different, because everybody else is going to do one or two things. One, they're gonna go hide or neath a couch, most of them are. But number two, they don't know what to do, because they've never been here before. Okay, the very first thing you want to do in this is changed the conversation, alright. And that's the truth, people are going to have lose their jobs, they're going to lose their incomes,

people are still going to get divorced, people are still going to have kids and move up, some people are going to have promotions. But with less buyers in the market, it's going to increase inventory levels. And with more inventory, that just means that there's going to be more deals because I'm not going to buy the house that my eyes fall in love with. I'm going to buy the house that my opportunity falls in love with because it's such a good fucking deal. Now, how do we switch this conversation for sellers? If that makes sense? And if you guys have comments on that, please feel free to write in. But how do we change the conversation for sellers? Well, it's quite the opposite. Because what we're seeing with sellers already is they're saying, hey, I want yesterday's sales price and then us are stuck in the middle of being like, well, how are you going to help them? Well, your house isn't worth that much, folks, you have to be honest with people. And you have to teach them the basic principles of supply and demand. As a matter of fact, in this type of market and appreciating market, you don't price it at market value, guys, you price 5% below it. We don't know what's going to happen. Interest rates just went up another point seven five that hopefully they're still not 7%. But that's a big deal. That's going to take a lot of people out of the market. Okay. And that's not doom and gloom. That's opportunity. Because you have to know how to position this back to sellers as well. sellers need to understand that there's less buyers out there. But if I'm going to go out and sell a house, well, here's how I'm doing it. One, let's see if your loan is assumable. So you could pass through the interest rate to Why don't you offer a rate by down program to start enticing different buyers to with the lower interest rate and have that built into your marketing plan. These are the types of things that are going to require everybody to be a little bit more consistent. So I want to walk you through a case study I did with this agent last night as we're sitting here talking, and I'll lay out the entire deal for you. And I'm going to show you how literally if she just takes my advice. She'll put it together and she's going to make $40,000 in another time. But before we talk she's like oh, this is a dead deal. It's a dead client. We have to bring value through the table by properly advising people and being creative in times like this. You often see people saying on social media oh the The Fly By Night agent is going to be out of business, they absolutely are. But this is why nine or 10% of the businesses, or 10%, the agents do 90% The business because the 10% that are doing the business are running a business, they're not another salesperson chasing a fucking check. So what do we do? On the seller side? Well, let's think about a couple of different creative solutions we could do. If you're gonna sell your house, offer a rate bite out and put that in your marketing, make your house more affordable, make your house more appealing, at the same time don't price at market value price below market value. Because in a depreciating market, people aren't buying what it's worth today, they're buying what it's going to be worth in three or four months from now, just like they are in an appreciating market, folks. Now, let's look through this case study. And then I'm gonna give you a bunch of other recommendations. But here is with an agent, she has a buyer that has a house to sell, but cannot sell the house but cannot buy the new house because of the house to sell. So in other words, they have to sell the bot. Their problem is right now is they can't sell their house in a timely manner. But they do have the house they want to buy. So they've located a $900,000 property that they want to purchase and move into as their primary residence. But they are stuck because they can't sell the $700,000 property. And where she's at right now is that well, the $700,000, or the 900,000, our house is about to get an offer. So they're about to lose their dream home. So I introduced to her yesterday, what I said would be why don't you do a bridge loan. Folks, if you've not been to owner advocate agent.com yet go to owner advocate agent.com. It's an entire training course we just rolled out it's a certification program, and we put you in touch with all of these different companies that you can finance deals just like this, what she's gonna end up doing is taking a bridge loan type option through one of the financiers we recommend, and the bridge loan is going to allow her seller to go buy their next $900,000 house, and they're gonna go ahead and buy it in cash. Now they're gonna lend the money for cash on the $900,000 loan, and the buyer is probably going to pay a few points, say it's two to 3% of the sales price, they're gonna charge them $27,000 To borrow that money. Okay, so if you're following this, follow the story here. Now,

in exchange, they don't have to sell their house for the ability to buy it, they're gonna buy the house close on the house and move into it, then they're gonna go back and list the other house back for sale, but not after they've done some improvements. See, what they're going to do is create what we call fixing list program. And because the sales price has dropped, and because it's not in tip top shape, what we need to do is put it into the top shape to get that extra price. So they're going to do small improvements utilizing another financier is going to help them renovate their house so that they could flip it or sell it for top dollar and make it the most appealing house on the market. Now once that house sells, what they're going to be doing is then refinancing their $900,000 house into a traditional 30 year mortgage or whatever they assume they're going to be doing. And if you followed history folks this small, or this interest rate hike we're seeing today, if history proves correct, we'll be short lived. And by the time that renovation is done. If my predictive analysis is correct, they're going to be refinancing not into a 7% rate, but probably more into the five because when you're in a recessionary market, and when the Fed raises interest rates, traditionally, traditionally, the mortgage interest rates go down, okay. And this is why you want to know all of these different types of things. This is why you need to know how to control the conversation in a market like this, folks, the best piece of advice that I would tell all of you is that if you don't start sharpening your tool belt, in terms of the knowledge you have up here in your head, and the solutions you provide as a real estate agent. In this type of market, you are going to be out of business. You have to look at figuring out a way to solve problems because that's what this market is, is the real estate agent who becomes the biggest problem solver will always be in demand. Because the traditional way of doing things that we've all been accustomed to doing for the last 13 years is changing and it's going to change. You're gonna see short sales, not quite the 2007 but they will be Hear, you need to know how to have that conversation with people who are underwater on their properties, when we were selling a lot of short sales, if I would have played my cards correctly, and I totally messed up on this, but again, this is what you learned from experience in history is that I would have built up and we did, but we didn't really do it. Well, I would have built up a mega buyer's list because we were doing so many short sale transactions, I had every investor in the city of Chicago showing up to my office, knocking on my door, taking me out to eat, because I controlled the freakin inventory at a certain aspect. And everybody came to us for short sales. All I did was learn how to do them and sharpen my skills. And before I knew it, I became the number one team because no one else is willing to learn. Folks, you're going to have to be willing to learn new things in your business to control and change the conversation. And it's going to be little things deals like this, that are going to allow you to do it. People make a lot of money in a recession in real estate and start controlling the conversation about how much opportunity is about to be in the market. Not all about the doom and gloom were to experience because these types of markets you guys are where brands get built. People remember and if you play your cards, right, it'll change the course and the outlook of your life. If you guys liked today's message, visit us at real estate marketing do.com I made a couple mentions here at the owner advocate.com or owner, advocate agent. If you're looking for creative solutions, to help yourself stand out, take the training, sign up for a course. And I believe you will be well served by it. But start thinking outside the box folks, it's time to do it. And people aren't going to remember what house you sold them. They're going to remember how you sold it to them. Appreciate you guys. See you guys next week. Thank you for watching another episode of the real estate marketing dude podcast. If you need help with video or finding out what your brand is, visit our website at WWW dot real estate marketing dude.com We make branding video content creation simple and do everything for you. So if you have any additional questions, visit the site, download the training and then scheduled time to speak with the dude and get you rolling in your local marketplace. Thanks for watching another episode of the podcast. We'll see you next time.

Transcribed by https://otter.ai