Beyond the Facade: Exposing Real Estate’s Hidden Practices With Fred Glick and René Pérez Jr. Of Arrivva

Here’s a glimpse of what you’ll learn: 

• Fred and René dive into the realm of transparency and consumer advocacy within the real estate industry
• Explore the strategies and debates surrounding hosting open houses in the real estate market
• Analyze the dynamic real estate market in Santa Clara County, influenced by factors such as school districts and the presence of tech giants
• Fred and René delve into the intricacies of making offers in highly competitive real estate scenarios
• See how California’s new loan assistance program works as it aims at supporting first-generation homebuyers
• In light of heavy rainfall in California and Washington, Fred and René stress the importance of checking for mold in homes

In this episode with Fred Glick and René Pérez Jr.

Join real estate experts Fred Glick and René Pérez Jr. as they delve into the intricacies of the real estate industry, offering valuable insights and discussions on transparency, market dynamics, negotiation strategies, and more. 

From navigating open house practices to dissecting competitive bidding scenarios, they provide expert analysis and actionable advice for both buyers and sellers. Stay informed and empowered with the latest in real estate trends and developments.

EPISODE TRANSCRIPT

[00:00:00] Drew Thomas Hendricks: Welcome to the latest episode of We Fixed Real Estate. Today, we have Fred Glick. How’s it going, Fred?

[00:00:06] Fred Glick: Groovy, dude.

[00:00:08] Drew Thomas Hendricks: And René Pérez, phoning it in from the road.

[00:00:10] René Pérez Jr.: Hey there. Welcome.

[00:00:13] Drew Thomas Hendricks: Welcome. So yeah, in the pre-show, we were all, we were chatting a little bit and Fred was called out went to give props and we talked a lot about transparency and consumer advocacy at on this show.

Fred, why don’t we, who was that person you were mentioning?

[00:00:29] Fred Glick: Okay. So, laterwendy, one word, L-A-T-E-R-W-E-N-D-Y on TikTok, but her website is sellinglater.com. She is an amazing resource for consumers. She’s so amazing that she’s calling out agents and getting cease and desist letters, so she knows she’s doing something right.

So listen to her, she can talk about the contracts that you sign and the antitrust lawsuits, open houses, and how they play games with it. And reloads, that’s going to be a big thing if you’re in a big corporation and you have a reload. These things that are referral fees between these referral agents and the agents, it’s all going to go away because the justice department is going to be after it.

And that’s going to be the next big lawsuit for, you know, suing everybody in class actions. I was talking today to someone from Dave Ramsey, Dave’s been around for years and promoting very reasonable and conservative ways,

[00:01:48] Drew Thomas Hendricks: Very conservative.

[00:01:50] Fred Glick: Very conservative, but A, he refuses to deal with fixed price brokers.

They told me they will not deal with us because I wanted to get on their spiel or whatever it is, but the reason is because it’s all in referral fee. And the first question the guy asked me, “Well, now that you’re a realtor…” and blah, blah, blah, I said, “I’m not a realtor.” And he’s went like, “Huh?” He didn’t know that a realtor is not a licensed real estate agent.

A realtor is a member of an affiliation affiliated group, and you just have to be licensed to do it. So it’s a trade organization, just like the N. A. R. I’m sorry. The N. R. A. N. A. R. N. R. A. kind of interchangeable. But anyway. Anyway, back to

[00:02:37] Drew Thomas Hendricks: Now, were you talking to Dave Ramsey himself or one of

[00:02:41] Fred Glick: No. One of his salespeople?

[00:02:43] Drew Thomas Hendricks: And was he thinking that fixed fees might be taking,

[00:02:46] Fred Glick: I don’t know. He’s just told they’re not allowed to contract with fixed-fee brokers.

[00:02:52] Drew Thomas Hendricks: It seems the opposite of his physical, fiscal conservativism.

[00:02:55] Fred Glick: Oh, I know he’s screwing the consumer by not letting us in because he’s probably not able to get a high enough referral fee.

So these referral fees are going to go away and he’s going to be out of business with this stuff if it transpires like that. So the Dave Ramsey, Mr. Conservative, I’ve got some issues with him and so should you. Don’t use his referral network because he doesn’t disclose to you probably that you don’t, that you’re paying a referral fee as part of the buyer broker commission.

So this is all going to change too. If we get to the thing with that the justice department wants where you negotiate the buyer broker fee at the time you submit a contract with the seller. That’s the way it’s going to work according to the justice department. I love that. It’s fine. It’s, you know, this is going to be all over the map and nobody’s going to know what to do. It’s going to be fabulous.

[00:03:49] René Pérez Jr.: I love it. A couple of things to mention is I literally mentioned this lawsuit maybe two months ago. Before it became, before it went all over TikTok, so.

[00:04:00] Fred Glick: Just to meet about the referral fees?

[00:04:02] René Pérez Jr.: Yes, of course. I mentioned.

[00:04:03] Fred Glick: Oh, it’s not a lawsuit yet.

[00:04:05] René Pérez Jr.: No, no, it’s not. No, no, it’s not. Yeah, it’s not. But I’ve been talking about this for months now, right? It is just goes to show that it takes a long time for things to actually happen. But I think, I mean, if you’re starting to hear about it now too, Fred, and I guess now you’re understanding it, then it means it’s getting a lot of traction in the general world.

But yeah, no, with Ramsey, like I know a lot of my friends like him. And the thing is when you watch his YouTube videos, they’re really convincing. I mean, it makes general sense. You don’t want to get in into high percentage debt. And especially if you’re a high earner, like when you start earning more and you spend more.

But then, I mean, this is actually something that I’m going to share with people because it’s kind of like, it’s, I don’t know,it’s a bit irresponsible for him to have these referral fees, right? I mean, it’s like, opposite of what you’re preaching.

[00:05:03] Fred Glick: Well, if he disclosed it, it would be fine, you know, but he doesn’t, but he doesn’t bother disclosing it.

[00:05:09] Drew Thomas Hendricks: Before we go on, I want to talk, I have one question about laterwendy, I watched the TikTok video that you sent and she was, talk to me about that open house. She mentioned that.

[00:05:19] Fred Glick: Oh, I don’t really know. The only thing I kind of know about it. Yeah. The realtor lists it on Wednesday and won’t allow anybody to see it at all, and then all of a sudden she has an open house. So what she wanted is she wanted to say, so we got 300 people at the open house. That’s because you didn’t show it to anybody else. And they priced it low. They played a whole game.

[00:05:42] René Pérez Jr.: What’s wrong with doing them? What’s wrong?

[00:05:45] Fred Glick: I forget, but there was something else about it. I mean, she was just like, we’re not going to show the house at all. And then all of a sudden the open house.

[00:05:53] Drew Thomas Hendricks: It sounded like she was like double dipping and chance to try to get the open house and have the buyer too.

[00:06:00] Fred Glick: That’s part. I’m sure there was motivation to make more money.

[00:06:04] René Pérez Jr.: I mean, maybe, but okay. From a negotiation standpoint, yes. I want to limit access in the beginning to create that better marketing feature for the open house.

[00:06:13] Fred Glick: But you know what, she’s got, you can go to her site. Again it’s laterwendy. Go listen because I didn’t listen to it. I don’t know.

[00:06:23] René Pérez Jr.: But I do want to talk about, you know, the way you market a property and you have open houses and you actually see the house before you make a bid. Right? A good real estate professional. We’ll make it easy for buyers to see your home, right? So at no point should there be a limit in home viewers for consumers who are trying to purchase.

Now, the end goal of the open house is to attract as many buyers as you can. Right? So,

[00:06:51] Fred Glick: Let me just let me say my way as many qualified buyers as you can.

[00:06:56] René Pérez Jr.: Sure. But you don’t know who’s qualified. We don’t know. Right. I mean, sure. So, there’s 2 things, right? Like, yeah, if you want a private appointment, you want to verify that someone is fully underwritten pre-approved and that they have the funds to close.

I mean, out of context, I mean, you see a lot of people who are not really shopping for a house, but then they realize that a house in their neighborhood is being sold just because they’re driving through the neighborhood. And guess what? They have enough family gift funds that even if they don’t have their pre-approval within 24, 48 hours, they can become qualified.

So even if you aren’t in the market, that doesn’t mean that they can’t be extremely qualified, right? So I kind of disagree with the idea that you want to let only people who are fully qualified from the beginning because that can change immediately. I mean, you can actually let someone in who’s fully under and pre-approved or a cash buyer and then the next day they, they lose their job, right?

But when they went to the house in the beginning, they were fully qualified. So, I mean, come on, I think anyone, everyone should be able to go to open houses. You don’t have to be fully qualified.

[00:08:02] Drew Thomas Hendricks: Yeah, otherwise I wouldn’t be able to see all my neighbors’ homes.

[00:08:04] Fred Glick: But here’s a little thing that we, that I do at least make them short, hour and a half.

I don’t make them 4 hours. The idea of 3, 4 hour open houses is not to make it easy for buyers to see the house. It’s because these agents want to find new buyers for themselves, new buyer clients. I’m interested in selling the house. I want only the people are going to come there. The ones that are really interested.

And if I have a short time period, I know a friend back in Philadelphia did half-hour open houses. It was great. I would do them, you know, but it’s just for traffic. Yeah. Because of traffic, you can’t in downtown Philadelphia, you can get away with it, so.

[00:08:39] René Pérez Jr.: I mean, I think it’s kind of, I disagree with that concept of super mega short open houses, just because people do have other things that they have to get done. I mean, at every single open house that I’ve hosted, that is a nice home, people always get to the house. I always have to stay later because people show up late. And sometimes I stay, even if I have it till three, I end up staying till four anyway, right? But now guess what?

People can’t, people don’t show up at 3:30 because I don’t have it marketed on Redfin or Zillow that I’m actually still there. So they can work both ways, you know, at the end of the day, yeah, you do want to limit it because you want the buyers to all go at the same time. And it does, I mean, at the end of the day, it does help, you know, show people that it’s a home that a lot of people like.

So I get that. I get that you’re not trying to get more buyers, but by limiting it, you are going to lose people. It’s just going to happen. Whether the people are serious, like, if it’s a serious, the open house

[00:09:41] Fred Glick: Maybe people contact me, “Hey, I’m going to be a half an hour late. Can you stay? Or I actually came back from a different open house.”

So, yeah, let’s put it this way. You and I will do what we need to do.

[00:09:53] René Pérez Jr.: Sure. Oh, yeah. No, for sure.

[00:09:55] Fred Glick: The bottom line.

[00:09:56] Drew Thomas Hendricks: Talking about what needs to be done. We talk a lot about the school districts affecting prices and how you have to really be prepared with your offer. Wall Street Journal just came out with an article I saw the other day talks about how hot the housing market is in Santa Clara, not so much because of the schools, but because of NVIDIA.

And if you’ve watched the stock price there, it’s probably the most valuable company in the world right now. And what happens when people are a part of the most valuable company in the world is they become very rich and suddenly the buying a house becomes inconsequential for how much they’re willing to pay for it. It’s just another, just another factor that’s driving this wild market up in the bear.

[00:10:37] Fred Glick: I wouldn’t say that they’ll just pay whatever, but they realize they’re going to be in a multiple-bid situation because as the article said, it’s cuckoo for cocoa puffs there. I mean, everybody’s trying to buy.

We had a client yesterday. There was a house in Santa Clara. That was, it was okay. It wasn’t in the greatest neighborhood. And what was it listed for René, like 1, 2 or something?

[00:11:01] René Pérez Jr.: It was 1. 3.

[00:11:03] Drew Thomas Hendricks: 1. 3. Is that the one we talked about last week?

[00:11:06] Fred Glick: No, that’s a different one. And this new buyer that we had, he said, and he was all cash.

He wanted to do like, you know, under a 1, 000, 000 and he told me, well, you know, there’s, they’re, they’re getting a divorce. I don’t know how I found that out of it. Right? And they need the money and there’s some foundation issues and what he didn’t realize is, and I said to him, like, think about all the other people looking to buy.

You know, it was a 5 school district. It wasn’t as great as the other school district, but I said to him, look, people are going to buy it now, knowing that more people like them are going to come in and make the schools better. And it’s going to be a 7 in 3 or 4 years. So, then he kind of got it and they didn’t day, but he was, I think he was going to be like, a million or something.

It’s like, no, dude, this is and now I can’t wait to send him this Wall Street Journal thing about Santa Clara County. So he gets it. So, yeah, it’s not a single-family house, great school district, show me the money, it’s all it is. We actually won one this week around there. Thanks. Yeah, they paid top dollar, waived everything, fast closing, you know, you just got to give the seller comfort.

That’s what it’s all about. Then we had another one. I think I can find my notes. So I saved this. This was a note from an agent about a property we put an offer in.

“Thanks for your efforts today. We ended up with 17 offers 9 were over 3 million. And the seller has accepted the highest and best offer.” Now that I think was listed at two, eight or two, seven, and we did two, nine, something, but nine of the offers are over 3 million out of 17. This is, this is a little light we’ve had them with 30 offers there. And now there’s, you know, there were 17 offers, but you had 16 losers.

You had eight people understand now that they gotta go the highest price, and now you got the rest of the people who bid low saying, “Uhoh, I gotta get out of the market, or I gotta start bidding higher.” So on the next one, that’s, you know, three blocks away that everybody knows about, there’s gonna be those people plus the new people.

So, it just keeps going.

[00:13:30] Drew Thomas Hendricks: They already end up lost,

[00:13:31] Fred Glick: Got a lot of losers. Nuts, but then in the Hollywood Hills, can’t sell anything, you know.

[00:13:38] Drew Thomas Hendricks: Some of those houses are like 88 million though.

[00:13:41] Fred Glick: Well, yeah, there’s the five, 6 million ones, four or five, six.

[00:13:46] Drew Thomas Hendricks: Interesting. Was it, is it just because of inventory?

[00:13:50] Fred Glick: No, it’s just no demand.

[00:13:54] Drew Thomas Hendricks: It’s the actor’s strike. They’re recovering.

[00:13:57] Fred Glick: Must be. So I got to contact all the winners of the Academy Awards last week if they want a new house.

So that’s an idea. We ought to contact all the agents and tell them about us. Anyway,

[00:14:12] Drew Thomas Hendricks: Talking about making offers. Like I noticed that this one, you just mentioned. 17 offers came in, nine of them were over and they just accepted one. What happens if it goes into like a second round? Like they’re like, okay, you guys are all competitive. Do you want to, do you want to adjust your offer?

[00:14:27] Fred Glick: Got it. Okay. So let me back up a little bit. I’ll talk about the generic stuff, but René is good with knowing all these little deets because he deals with all these more than I do. We go into an offer and we ask people, what do they want to put as a sale price and mortgage amount, number of days to close, waiving all these stuff, and blah, blah, blah.

But one thing we say to them is, “Hey, you got the buyer broker fee. What do you want to do with it?” So let’s say it’s a 2 million dollar offer, you’re paying 3%. That’s 60 grand. We take less than 10. So you’ve got about 50 grand to play with it. So what do you want to do? You can make your offer 1, 000, 950 and tell them to keep the 50 grand.

And therefore it’s cheaper for them for title insurance and transfer tax, and your real estate taxes could be lower, or you go in the 2 million and then you get round two. And maybe you do it in round two, where you just drop the 50 grand and say, “Hey, keep my bid, but you can keep 50 grand.”

Now your bid’s bigger than 50 grand or we go up in price or change the terms. But the bottom line is about 2nd rounds. This is the point I want to make and René will go into some details. We have no idea what’s going to happen because number 1, we don’t know the seller or the agent or what their strategy is. We don’t know what offers they’re going to receive.

There may be one, everybody’s a 2 million-ish, but somebody shows up at 2. 3 cash deal closing seven days. We don’t know. So you’re blown out. So it’s a big question whether you put your best foot forward right up front and say to yourself, “Look, I know it’s going to be a bidding war. If I get it, I’m going to pay more than I want to pay anyway. So should I just put up the money now, and if I win, I win. If I lose, I lose.”

Or the idea is “Hey, let me try this, and let’s see what happens.” Most of the time when people say, “Let me see. Let’s try this.” They lose. They lose even on the 2nd rounds because they don’t get that they got it. It’s usually the people who are kind of 1st putting bids in who don’t really see the pain yet.

So you just never know what’s going to happen in the 2nd round and you just got to feel it out to figure what to do in around 1. And this could be with 3 other people making offers, the other 2 might be crazy or it could be 75 offers and who knows. So you just don’t know.

[00:16:59] René Pérez Jr.: I’ve called this like the second silent round, right?

Where only the agents that have made aggressive bins are going to be contacted and be told like, “Hey, how’s your buyer looking at?” Now here’s a difficult part, right? Because that conversation can backfire. You know, if you’re an experienced agent, I mean, odds are they’re calling you and they’re interested in your offer.

So if you go and be happy and say, “Oh, well, I can go higher.” Well, guess what? Even if there’s no other offer, you’re probably going to be countered. So I know that I know some buyers who want updates and ask us, “Oh, can, can you ask, can you tell the agent that we’re really interested?” Well, sure I can do that, but then you’re going to end up probably overpaying because they know you’re extremely interested.

So I think that’s where Fred’s whole point of bidding your best and final comes from is from the idea that you don’t want to be pushed later on anyway to a higher price point or lose it because you didn’t try your hardest in the beginning. Now, obviously there’s different ways of bidding, you know, highest and best.

A house is going to be marketed quite aggressively low in most markets because they want a lot of eyeballs to see the house. So you can really discount them and really ignore the list price, but actually look at the comps, right? So you already know if you have a good offer if you’re looking at the comps as a baseline of a good offer.

And then from there, you’re going to then have to add the value of the emotional aspect of it. And that’s where neither me or Fred or any agent that says mega quote-unquote expert can tell you what it’s going to go for because we don’t know who the other buyers are on the other end of it.

So, it is kind of a, I mean, it’s really, it is an art of knowing, okay, where are the comps? Where did the other homes go for? How many offers did the house nearby have? And how much, how aggressive do you really want to be at the end of the at the end of the day, right? It’s really interesting to, to get the calls from agents.

And most of the time, there’s no reason for agents to lie. Honestly, I think agents know how difficult, and agents, I think for the most part, agents know that you as an agent that’s representing buyers, you don’t want to lose a deal for five or 10 K. So it’s an honest conversation of like, “Hey, you’re going to lose the house for 10 K. do you want to go higher or do you want us to just go with someone else?”

That’s how a lot of conversations go. And it also happens where I don’t have that call because we have no reason to have that call. And then we end up losing the house for 10, 15 K, right? So it’s that coin toss of, do we want to make the comment, have a conversation with the agent?

Do we just cross our fingers and hope that we have the most aggressive offer? Or do we believe and trust the agent that there’s other offers? Cause I mean, there’s a lot of types of agents, they could be bluffing and sometimes we don’t respond to the other agents and they say, “Oh, we have other offers that are higher and then we get under contract.”

So there isn’t really one best case or best negotiating skill on how to find out what it’s going to go for. But you can tell if a house is going to be aggressive, you know,by how full the open houses are, by the Redfin estimates that we talked about last week, by the fact that a nice house. Like if it checks out all your boxes, odds are that it’s going to check out the boxes of someone else too.

[00:20:30] Fred Glick: Yeah. So everybody likes a nice, clean, beautiful redone pretty house and, you know, the apple pie smelling and all that kind of good stuff. So it’s everything.

Wish we had the answer. There’s your problems.

[00:20:46] Drew Thomas Hendricks: You got a heck of a lot of answers.

[00:20:48] Fred Glick: Yeah.

[00:20:50] Drew Thomas Hendricks: So we’re heading into March madness.

[00:20:52] Fred Glick: March madness, that’s exactly what, we’re taking over for basketball, real estate buying of houses that are single families in great school districts is the new March Madness. In April it’ll be something else, but we’re going to call it March Madness. So sue me NCAA.

[00:21:15] Drew Thomas Hendricks: Sounds good. Any last departing thoughts as we’re wrapping up the latest episode of We Fixed Real Estate?

[00:21:20] René Pérez Jr.: Yeah, I actually have something today. So in a couple of weeks, just remember if you are a first-generation home buyer, know that the California Loan Program or Loan Assistance Program is coming to market.

You have all the month of April, April 3rd to April 29th to apply. And that’s a program that’s going to assist 1st generation homebuyers get up to 20 percent down in loan assistance up to 150k.

[00:21:49] Drew Thomas Hendricks: Wow.

[00:21:50] Fred Glick: Which they don’t have to pay back until they sell the property, but they give it back plus the profit they made for that percentage.

[00:21:57] René Pérez Jr.: Yeah.

[00:21:57] Fred Glick: It’s a web program.

[00:21:59] René Pérez Jr.: I’ll send you the website. But the website actually has, like, the entire details as how you repay back that loan and you’re able to refi once without having to pay back the 20 percent down.

[00:22:12] Drew Thomas Hendricks: And it’s first generation, not first-time homebuyer?

[00:22:15] René Pérez Jr.: So this actually is a phase two of the program. They had it sometime last year and the funds, you know, got right up in an hour within like the first two days they were gone. Right.

[00:22:26] Fred Glick: And it was the lottery this time, right?

[00:22:28] René Pérez Jr.: Yeah. So it was first come first serve and it was just first-time homebuyer. Well, this time they made it, they made more, they made changes, let it’s first time home buyer and first-generation home buyer.

And it’s going to be a lottery, not first come first serve.

[00:22:42] Fred Glick: Yeah. I think we, I think you got to get approved with a certain mortgage company. There’s a list of lenders on their webpage too. Yeah.

So we actually probably should do a podcast on that whole thing cause that’s going to be a big thing for next month.

And there’s different, different education things that you have to pass and all that. And so I think for next week’s podcast tune in to listen more about that.

[00:23:04] Drew Thomas Hendricks: René’s deep dive into the new first-generation home buying lottery.

[00:23:09] Fred Glick: Here, let me, here’s my parting gift today. There’s been a lot of rain, especially in California and Washington and people should check for mold.

Go get the little mold detectors, and the petri dishes, just in case. I mean, you might not even be able to smell it. So just check for mold because it gets into your body, kills you. So it’s not a good thing from what I hear.

[00:23:41] Drew Thomas Hendricks: Yep. Definitely check for mold, especially before you get the inspection.

[00:23:44] Fred Glick: Yes. So post drain, check for mold, check for mold.

[00:23:50] Drew Thomas Hendricks: With those words, everyone’s got their marching orders. We’re all checking for mold. Everyone have a great week and we will

[00:23:56] Fred Glick: Wait. Am I going to make this now? Mold madness.

[00:24:01] Drew Thomas Hendricks: Mold madness.

[00:24:02] Fred Glick: I had to, I’m sorry. I’m sorry.

[00:24:04] Drew Thomas Hendricks: I like it, Fred. Like it.

[00:24:07] Fred Glick: There you go. Have a good week, everybody. We’re getting out of here now. That’s enough. When the bad jokes hit, we’re out of here.