Real Estate Shake-Up: New Buyer Broker Contract and MLS Rules Explained By Experts Fred Glick and René Pérez Jr. Of Arrivva

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

• Discover what the August 17th deadline means for new mandatory agreements and how these changes affect homebuyers and agents
• Get detailed insights about the new buyer broker contract as Fred and René dissect the new rules affecting the market
• Know why exclusive contracts in real estate are outdated and how is it affecting buyers
• Tips for customizing your agreements and navigating open houses effectively
• Analyze recent market shifts and the influence of price drops and interest rates
• Understand the implications of the new MLS rules on buyer-broker agreements 
• Insider advice on how to handle financial disclosures during transactions with top strategies for both buyers and agents to protect their interests under new laws

In this episode with Fred Glick and René Pérez Jr.

Fred Glick and René Pérez Jr. of Arrivva delve into the shifting landscape of buyer broker relationships following the recent NAR settlement. With the August 17th deadline approaching, they break down the new mandatory written agreements, uncover key details in the new buyer broker contracts and the updated MLS rules, and discuss the implications for buyers and agents alike. 

Tune in to get the crucial information you need to stay ahead in today’s evolving real estate market on We Fixed Real Estate.

Resources mentioned in this episode

• Fred Glick on LinkedIn
• René Pérez Jr. on LinkedIn
• Arrivva
• Claude.ai
• Google Meet
• Redfin
• Zillow

EPISODE TRANSCRIPT

[00:00:00] Drew Thomas Hendricks: Talking to Fred. Fred Glick and René Perez. Fred’s hawking his Once Upon a Coconut Water. We’re on We Fixed Real Estate and today we have a real special episode. We’re doing a deep dive in the buyer broker relationship, the fees in the August 17th deadline. Giving you all the data you need to know to be armed for success come the end of August.

[00:00:23] Fred Glick: The NAR settlement.

[00:00:25] Drew Thomas Hendricks: NAR, and not GNAR with G N A R.

[00:00:29] Fred Glick: Yes. Correct.

[00:00:30] Drew Thomas Hendricks: Not gnarly, this is NAR, National Association of Realtors.

[00:00:34] Fred Glick: Let’s just start with the superficial quick rundown of the history, and you can Google the crap out of this, but

[00:00:41] Drew Thomas Hendricks: You got notes of everything.

[00:00:43] Fred Glick: No, no, no, I have something special here.

[00:00:45] Drew Thomas Hendricks: Oh, okay.

[00:00:46] Fred Glick: Basically the realtors over the years had kind of this formula. And the formula was that a seller or seller broker, one way, shape, or form will pay a buyer broker to entice them to come and bring their clients to their house. Now this started, you know, before the internet, so you got a book once a week when you’re an agent and there’s no way to figure out what was for sale until the Sunday paper and they had Sunday open houses and that was it.

So information was kept very tight. So they could do whatever they wanted to do. So it just got along with the internet and, you know, they didn’t adapt and they kept telling people who were buyers, “Hey, the seller pays your fee. You don’t have to pay me anything. Don’t worry about it.” It is great while it lasted until this lawsuit that was class action got settled for. The judgment was 1. 8 billion for everybody. So blah, blah, blah. They all came with an agreement. And one of the things that they agreed on is that everybody in America, if you want to hire an agent, it’s gotta be in writing, just like the real estate contract, you want to buy a house, it’s gotta be in writing.

So in writing, you’re going to specify things. I hold in my hand, I print out very few things. I hate printed documents. But I printed this out. This is hot off the presses of the new buyer broker contract in California and it’s, I haven’t even had a chance to just super dive into it but it’s the fill in the blanks. And you know the representation period is 90 days, that’s the longest you can go. It can be exclusive or non-exclusive and remember that’s really big.

Exclusive means you’re married to that agent for that time period. You are married. There’s no way out. non-exclusive, which we are, means, hey, if we don’t get along, we don’t get along, you know, go out on our first date. We like it. We have a second date. It’s that simple to put it into just simplicity of what exclusive and not exclusive is. So that’s going to be part of this, so I haven’t had a chance to read through it as I said, but you should read through it, especially the fill in the blank stuff, but they start asking some really weird things. I did see.

And one of them was buyer financial information. I’ve never gotten into this before. So line 1, G1 on this is time to deliver buyer personal financial information. It says within 5 or X calendar days from the execution of this agreement. And there’s a car form. BFPI attached. I went looking for that form. I didn’t see it, but it’s probably buyer’s financial plan, something. I don’t know. They want to know about your finances. You know what? I don’t want to know about your finances. I’m going to ask you to sign to say that you are going to get approved by a mortgage company for a mortgage, because frankly, you know, for fully approved as best as you can, because quite frankly, we just don’t work with people who don’t do that.

[00:04:21] René Pérez Jr.: Let me give you a little more context there on the finances. Let’s say that you’re looking for an agent and you walk through an open house. A lot of people will, a lot of agents, they want to build rapport with you and ask, you know, what do you do for work and where you are and if you’re in the neighborhood, just try to maintain those questions as vague as possible.

I know that it’s hard because there’s agents that are smiley and they’re trying to be friends with you because that is a part of the game, right? People want to know exactly what you do and how can I have some leverage over you? Like, “Oh, does this person live in the same street? And they really want to live in that street. Okay. Well, since I know that, let me just make them overbid for a property.” Right?

So whenever you’re signing all this, remember that you might not end up working with that person long term, so you shouldn’t share everything. Just like Fred said, it’s more like dating, right? Like you wouldn’t tell a partner who you’ve been dating for a week, your entire life story or, you know, I won’t tell people how to live their life but you probably shouldn’t tell your entire life story the first week that you’re dating.

[00:05:30] Drew Thomas Hendricks: On the first date, no.

[00:05:32] Fred Glick: Pretty much kind of the same thing. And then there’s the second line, which I find interesting. Other financial conditions they called. The first thing they want you to check off or not check off,”Buyer does not have sufficient funds to pay broker.” Really? That’s not your problem.

[00:05:54] Drew Thomas Hendricks: Wait, so they’re going to check off buyer does not have sufficient funds?

[00:05:58] Fred Glick: Yeah. And the second one is buyer intends to purchase with the following loan product, which does not allow buyer to pay compensation to broker.

And guess what? That’s everybody. None of the lenders allow you to do that.

[00:06:16] René Pérez Jr.: Well, actually, I don’t know if that’s 100 percent accurate, because some lenders

[00:06:21] Fred Glick: No, no. All they do is verify that you have the funds. Period. That’s it.

[00:06:28] René Pérez Jr.: Yeah, but I’m talking about

[00:06:29] Fred Glick: It’s a closing cost.

[00:06:30] René Pérez Jr.: Yeah, yeah, but in terms of being able to use, I guess what I’m talking about is like the grants. Like if you get any.

[00:06:36] Fred Glick: Oh, okay, yeah, yeah.

[00:06:38] René Pérez Jr.: Things that they are allowing you to use it for buyer broker fees.

[00:06:43] Fred Glick: Yeah. But the point is that all lenders, you know, know what they’re doing with this. I mean, I prepared for that.

[00:06:51] Drew Thomas Hendricks: I don’t get the nuance there. Explain. So why would you check box? Why would you check that the buyer doesn’t have the funds to pay the buyer’s agent? Is that to show that the seller must do that?

[00:07:03] Fred Glick: That’s what they’re trying to provoke.

[00:07:05] Drew Thomas Hendricks: There’s no like options. It’s not like a multiple-choice checkbox.

[00:07:09] Fred Glick: No, you either check it or you don’t.

[00:07:12] Drew Thomas Hendricks: And if you check it, then why would the buyer agent even work with you? Maybe I’m not understanding it.

[00:07:18] Fred Glick: Because then what they do, they get back all this data.

If they’re smart, this is what they do. Because we’re not realtor, so we didn’t, we weren’t allowed to go to their seminar, even though we leased their documents. We weren’t allowed to go and get their expertise in this by attending seminars beforehand, but that’s okay. This is more fun. I can’t wait to put this thing in Claude.

[00:07:49] Drew Thomas Hendricks: Yeah, you really need to. Ai go with the old model and the new one.

[00:07:52] Fred Glick: Can’t wait and have it full consumer, but anyway, what were we talking about? We’re just going crazy with this thing. Yeah. You don’t have the funds. It’s the lenders are going to be fine with it, you know, because unless it’s part of a closing cost and which they’re going to have to disclose.

So, you know what, in order to get your approval, you have to have that amount. You know, or what they’re trying to do, that’s what I was going with, I’m sorry, is they’re going to try to show with data that look at all these people who couldn’t buy a house because you’re forcing them to pay their buyer broker.

If they’re smart, that’s what they would do. Just did prove their point.

[00:08:44] René Pérez Jr.: I think Fred’s being a little conspiracy theorist.

[00:08:46] Fred Glick: Oh, totally. If I was them, that’s what I would do, but they won’t. I’m sure there’s some ridiculous legal reason.

[00:08:55] René Pérez Jr.: And sometimes the simplest answer is a real answer. So I think it, it just boils down to this idea that if you write that down, then the seller is going to be nice and understand that, you know, that the buyers need the sellers to provide the buyer’s compensation. And that’s it.

I don’t think they’re smart enough to think that far ahead because yeah, I mean, absolutely makes sense. There’s a lot of people, and even in our buyers who actually like when the first settlement, lawsuit settlements were announced, but they said, “Oh, people who have the least money, they always get hurt the most.”

And it did. And for those buyers, it did not register that they’ve always been harmed. You know, it’s always been against the consumer. So it has not ever been a consumer-friendly market. So this doesn’t change any of them. It’s still not a market, the real estate industry is still not accessible to the lowest, financially equipped individuals, right?

There’s still this. That’s why there’s people can’t afford homes, right? That does not have to do with the settlement at all. That’s a separate. Story.

[00:10:08] Fred Glick: Yeah, it’s simple economics. You know, now it’s like, you’re going to have less order takers is really what it’s amounting to. That’s really it. But one thing I can tell you, and I’m telling this to René, first time he’s hearing it.

When we have our interviews with people on our Google Meets to begin our relationship, we talk about everything. And from now on, we’re going to talk about this document with them and fill it in with them so we can send out the docu stipend. Because it’s gotten that crazy, but it’s good. It’s good.

It’s, you know, basically, this is getting near where we are, but not fully there. But, you know, they have a place for a flat fee. They don’t have an hourly fee.

[00:10:55] Drew Thomas Hendricks: Now, is there a checkbox like exclusive, non-exclusive? How does an agent make it?

[00:11:01] Fred Glick: Yeah, this is non-exclusive contract, but you can check that it’s exclusive.

[00:11:08] Drew Thomas Hendricks: Okay. So write down like one hour instead of 90 days.

[00:11:13] Fred Glick: Exactly. They also talk about the types of properties, the location of properties. They wanted to get as close as counties and cities. It’s ridiculous. We do all over the state.

[00:11:23] Drew Thomas Hendricks: Oh, so you can be the exclusive buyer’s agent for San Marino, but if you’re in a house in San Francisco, then they’re okay.

[00:11:32] Fred Glick: Exactly. You can sign with different agents, in different parts of the state. If you wanted to get that specific or it shows.

[00:11:40] Drew Thomas Hendricks: Or you have a single family home agent and then you have a condo agent.

[00:11:45] Fred Glick: Or maybe you have something like a commercial broker, industrial broker, vacant land, you know, that kind of thing. Maybe you have it for that. Just some dude up in Mendocino finding you, you know, a farm.

[00:11:59] Drew Thomas Hendricks: Yeah, I get it.

[00:12:01] Fred Glick: There you go. Anyway, yeah, they allow you to put the type of properties. So if you’re buying a farm, you can click it off there. Location. We’ll have all this. We can put, can we put a PDF in the podcast?

[00:12:16] Drew Thomas Hendricks: We can put it in the show notes.

[00:12:18] Fred Glick: There you go. We’ll put this all in the show notes an example contract.

[00:12:23] René Pérez Jr.: I will say this about exclusivity and non-exclusive contracts. It’s mostly just a pure tactic, right? Because it’s not like, if you have an exclusive contract with someone that you can say, “Hey, look, I just don’t wanna work with you.”

What are they gonna do? Force you to work with them. Like, that’s just not real in the industry, right? Because agents, agents are all about, you know, building long-term relationships and not wanting to like have one bad review destroy you, right? So it’s just

[00:12:54] Drew Thomas Hendricks: Have the agent go after the next agent, like if they’ve got an exclusive one and try to get a referral fee or a kickback.

[00:13:01] Fred Glick: They would go after the buyer who signed the contract. That’s who they have a contract with. But I, you know, that’s, it’s like, you know, the law that just, the ruling that just passed from somewhere, or it was an agency, I forget who, but it basically said you can’t stop anybody from working in their industry, you know, and that was eliminated.

And you know what, exclusive real estate contracts should be eliminated. Same thing.

[00:13:34] René Pérez Jr.: So here’s the twist that I would like to see in these contracts. I think this all boils down to like the way that commission shouldn’t exists in the first place. Because the whole issue here is that you have agents that do work, and then don’t end up getting paid.

That’s just, I don’t know, like, even if it’s the shittiest agent in the entire universe, even if it’s, like, the worst employee, you still pay an employee even if they perform badly. You fire them, but you still get paid. Right? So, why in the real estate industry does it have to be this way? Doesn’t make sense to me.

So, it’s like, because that’s also where the consumer can start taking advantage of agents. And it’s not, it’s really not fair for an agent to have an exclusive contract because they’re working towards a goal of getting a home. And then all of a sudden it’s like, “Hey, actually I want to break the contract.

And “Oh, well, too bad. Oh, well, you don’t get paid for a lot of work that you’ve done.” Right? That is part of the broken industry.

[00:14:29] Drew Thomas Hendricks: What’s the solution to that? Cause even with the Arrivva’s flat fee model, you only get paid if the house goes.

[00:14:36] Fred Glick: Yeah. Well, here’s the thing. Most agents run around with people to the houses to be their friends and waste their time doing that.

Like our people go to open houses and if they see a house, we get someone else, we pay to open the door. So we’re, we have a lot more time because we work, we work smarter.

[00:14:54] René Pérez Jr.: But the point still exists, right? Because, I mean, you can’t say that it’s not true that a lot of, there’s a lot of the times where we book, we ourselves pay agents to go open houses, right?

And then these people might not buy anything or might go with someone else. There’s still an expense there, right?

[00:15:12] Fred Glick: Oh, there’s no doubt about it. I mean, that’s just our model. Well, no, yeah, but for most agents, well, you know, a lot of agents are going to end up signing up for these services. Like we just talked about where, you know, they show a house and get paid 50 bucks kind of thing.

They’re going to go work for property management companies and do that sort of thing. You know, there’s people that transition that way, stay in the industry, but there’s some are just going to leave. I mean, it’s just, You know, the system doesn’t work their way anymore because it’s all going to depend.

I mean, I’d love to start a scoreboard of some kind of like, what do you charge? What is, you know, this certain real estate office, some of them have minimum commissions, still have two and a half percent. I have talked to a couple of agents and brokerages where they’re just going to stick to it. You know, we’ll sign the contract, but you gotta get to and half percent.

So somebody buying a $2 million house needs to pay their buyer broker $50,000. Okay? It’s insane. They’re not gonna do it. People who are buying a $2 million house are smart enough to say, “You’re out of your mind.” So hopefully they find us, but don’t pay the two and a half percent. I don’t care how much they say they’re worth and their value and all that, because that’s all they’re doing.

They’re taking classes on showing your value. I get these emails all the time, all the time. All these just, yeah. Coaches, seminars…

[00:16:56] Drew Thomas Hendricks: You’ve got the new contract in your hands right now, and this is all coming down in the next 17 days.

[00:17:02] Fred Glick: Yeah. I mean, I’m going to start, I’m going to put it in clog.

We’re going to play with it. We’re going to clean it up. We’re going to put it to our, you know, I mean, we’re not stealing anything.

[00:17:13] Drew Thomas Hendricks: Like you don’t have, do you have to use that contract? You can have your own contract.

[00:17:17] Fred Glick: Oh, we can have our own. Yeah.

[00:17:18] Drew Thomas Hendricks: Okay.

[00:17:19] Fred Glick: And, you know, there, there’s things that should be highlighted, you know, but it’s, it’s all pretty normal stuff.

[00:17:27] René Pérez Jr.: I mean, I think that technically, like, we don’t need to use that at all. I mean, we’re not part of the settlement.

[00:17:32] Fred Glick: No, we could, we have one in Texas, we have one in Washington State, and they’re both pretty simple. And you know what, I may just take one of those and just change it for California, add some disclosures and say, here we go.

We have a simple. Simple process, simple agreement. So you do what you’re supposed to do, we’ll do what we’re supposed to do, and that’s it. And you’re supposed to do a closing. I’m sorry.

[00:17:59] Drew Thomas Hendricks: The aha thing that I just heard is that all these buyer broker contracts, it’s not one uniform contract. You go to five different agents.

If they’re not realtors, you might see five different contracts. So it does make sense to kind of, you know.

[00:18:13] Fred Glick: This is the one you will see the most, the California, the buyer representation and broker compensation agreement, non-exclusive, unless exclusive is checked in initial. So there it is.

[00:18:29] Drew Thomas Hendricks: Look at that.

[00:18:31] Fred Glick: Page one.

[00:18:33] Drew Thomas Hendricks: How many pages is it?

[00:18:35] Fred Glick: One. Oh, and in front of it is the disclosure regarding real estate agency relationship in such small ink, you can’t read it. The contract itself is 1, 2, 3, 4, 5, 5 pages. Then the buyer investigatory advisory, the broker compensation advisory, the possible representation of more than one buyer or seller disclosure and consent, the California Consumer Privacy Act advisory disclosure and notice, and then any overflow.

[00:19:18] Drew Thomas Hendricks: Wow. And that’s before you even start buying a house.

[00:19:23] Fred Glick: Yeah. Oh, and just again, you can go to an open house. You don’t need to have a buyer broker. Do not sign anything. You don’t have to sign anything. Anybody forces you to sign something, video, TikTok, report them.

[00:19:43] Drew Thomas Hendricks: Okay. I thought last weekend we were talking about the tour open houses, you now have to be in a contract and you were going to do like a little buyer broker license or a little.

[00:19:54] Fred Glick: Yeah. And then they straightened it all out. Okay. Everybody was saying, so yeah, you know, it’d be kind of fun to have one anyway. Just that the agent bothers you. Oh, you have to sign this. No, I have my open house card.

[00:20:11] René Pérez Jr.: Let the record show that I knew. And I said in the previous podcast that that was not going to happen.

[00:20:17] Drew Thomas Hendricks: Yeah. Okay. It’s been recorded. It’s now official. You were right.

[00:20:24] René Pérez Jr.: Nobody listens to me. What’s next on the, is that all Fred, on the contract?

[00:20:30] Fred Glick: I think it’s just, you know, sign when you’re comfortable with somebody, don’t sign if you’re not, and read it.

[00:20:38] René Pérez Jr.: And actually here’s something that I’ll mention. So different MLSs have different structures of how they’re going. When are they going to change their MLS rules and their platforms. We actually just received an email like 30 minutes ago for the Los Angeles MLS, where they said that they’re actually making the changes August 13th.

So, originally I was going to wait, we were going to wait to list a property August 17th, but it looks like we could, we can list it earlier. We’re going to list August.

[00:21:10] Fred Glick: Yeah, I think the car forms that I just got are from, they had it called, they called it the July update. So basically just start using the new stuff.

I think it’s what’s going to happen. But let me add one thing up in Washington State and the Northwest area multiple listing service, they’ve decided that they’re going to still allow for buyer broker compensation. So rebates galore down in the Bay and LA and San Diego and everywhere else we go in California.

We don’t know what’s going to happen to be honest. So it, you can’t put it on the MLS, but is there going to be some super secret network that they all play with or internally just giving it, who knows, but we’re going to ask on every deal and you should ask when you go to an open house. Is there any buyer broker compensation being offered?

Do you have the absolute right to ask that? Because it’s your money. Yeah. You get what I mean? Drew?

[00:22:15] Drew Thomas Hendricks: Mm-Hmm? Oh yeah.

[00:22:15] Fred Glick: Puzzled. Look.

[00:22:17] Drew Thomas Hendricks: I was just puzzled ’cause I was thinking about the last couple open houses I’ve been to and it was just some agent that had nothing to do with the house. They were just trying to

[00:22:24] Fred Glick: Oh, well that happens. They sit. Yeah. They, okay. Let’s talk real quickly about that. When you go to an open house, it’s almost rare that you’re gonna meet the listing agent ’cause they all have teams of thousands of agents who wanna work the opens because their goal, not to sell the house, it’s to find buyers. So they’re trained.

“Hi, how you doing? Thanks for coming by. Do you have an agent?” You’re going to hear that. And you know, say, you can lie. Yeah, just lie, “I have an agent.” Even if you don’t. Really, I’m telling you it is okay to lie to these people. Do not sign anything. There is absolutely no reason. So, you’re going to ask them questions about the house, and they’re going to either be honest to say, “Here’s the answer, I don’t know. Let me find out for you.” Also, you don’t have to give them your email address if you’re going to hire a buyer broker because the buyer broker will have the rapport with that listing agent or connect and get a rapport, which is what René does, and find out the information. Anyway, and this way, maybe we get it in writing.

But if you just give them your email address, they will just pound you to death. “Oh, do you have a buyer broker yet? Here we put everything in writing. Gee.” So more fun at open houses. We kind of redo what you have to do in an open house. Just get the information. But so yeah, these agents, most of the listing agency, they don’t do opens cause they got these kids working for them.

René and I different story. We love working in our opens. So this way we have the answers.

[00:24:20] René Pérez Jr.: The whole idea about open houses is, you know, if you have someone that you can really count on and they’ve been trained well, they should be able to host open houses.

[00:24:31] Fred Glick: Oh, totally.

[00:24:33] René Pérez Jr.: The problem is that you have a lot of listing agents who just get random messages from people you’ve never heard of who just saw that it’s a new listing and they’re maybe nearby and you see agents saying like, “Hey, can I host your open house?”

And they don’t care about the sellers. They don’t care about taking care of the house. They just care about being able to find leads. And I even, I have, I could pull up screenshots of agents just saying like, “Oh, no, sorry. I want to do the open houses because I want to get leads.”

Because sometimes when a new agents that I’ve never heard of, Fred just tells them like, go away. But I like to tell them, I can tell like, “Hey, well, look, I actually might need help in helping a buyer open up a property.” You know, and we pay them by, you know, by showing. Agents will rather not get paid at all just for the idea of finding a lead on an open house.

But anyway, the point of this is that it’s much better if the listing agent is actually at the open house because they should know more about the property. They should be able to talk, know better, to know how to discuss the house parameters with the buyers and not not talk too much, which is the overall goal of open houses.

[00:25:51] Fred Glick: And they kind of know where to lead people because they know the seller’s situation. They’re not going to tell you, “Oh, it’s a super distressed sale. And my clients will take anything and just write up anything. They don’t care.” They’re not going to tell you that. If they are, fire them. But they can kind of feel what you’re asking and, “Hey, might that take longer, can we do it shorter?” Or you know, sometimes, oh, and another thing buyers ask is what’s your seller want, what’s their expectations. Highest price, best terms. That’s all I say. You know, clean, fully underwritten pre approval, cash, you know, proof of funds, all the normal stuff, and bring us an offer we can live with.

What else am I supposed to say?

[00:26:47] Drew Thomas Hendricks: Yeah. Yeah. Let’s, you know, I want to talk about market conditions. Let’s talk about, get a like kind of finger on the pulse market conditions. I know in my neighborhood, my area, North San Diego, we’ve seen a lot of prices dropping lately.

[00:27:02] Fred Glick: Yeah. You were saying that last week or the week before?

[00:27:06] Drew Thomas Hendricks: Last three, four weeks. Now there’s been a rash of I think four, four houses on Zillow all in the neighborhood, all dropped 50, 60, 000.

[00:27:16] Fred Glick: Well, you know, too much competition. It’s probably it in just that micro area.

[00:27:25] Drew Thomas Hendricks: Is it the summer doldrums or just the summer? Like…

[00:27:31] Fred Glick: It’s sort of, you know, I think it’s, it’s quiet, but it isn’t.

I mean, we’re still busy. People are still looking, we still lost one yesterday. How many René?

[00:27:43] René Pérez Jr.: It was 18 offers. I mean, of course it always just depends on how the property was listed. This was the property that was listed under 2 million. But estimates and the comparables said that it was a 2.8 property.

So, of course, people that are looking in the 2 million dollar range, see the property that’s to their liking. It’s like, “Oh, I love it.” Well, the problem is that it was always going to be a property that was out of their, out of their budget. So it’s, I think it’s more of a balanced market. I think.

You’re not competing with 50 buyers. I think that’s just the realities of like, if it’s a super beautiful house and you really love it and it checks every single one of your checkboxes, it’s probably going to check all the other buyers boxes as well.

[00:28:39] Drew Thomas Hendricks: I think if I know about it more in my area or this North San Diego area, it’s an older area and they’ve all been, I could tell that cause there was state sales going on before. So it’s all empty houses with kids that are selling their parents home that probably just don’t have a vested interest really, other than get the inheritance.

[00:29:05] Fred Glick: And let me add this. Interest rates have dropped a lot. We could have locked someone today. It was like a 950 purchase, 650 mortgage, 30 day lock, 618 with a rebate of over $2,700. So basically we’re getting to, you know, almost 6% with, they had a little bit of cost, but we’re almost there. So that’s like a full one point now.

Now that’s going to bring more buyers. So, you know, the inventory stays the same, the prices go up. It’s very simple, but you know, in your area, maybe that got more buyers, maybe it’ll get a little more on somebody who’ll want to do it. Who knows?

[00:29:57] Drew Thomas Hendricks: Just definitely. It’s not, so it’s not California wide. It’s really, you’ve got to look at the different pockets and the different communities and each one’s really kind of, it has its own kind of

[00:30:06] Fred Glick: Sure. They each have their own story. You know.?

[00:30:10] Drew Thomas Hendricks: That goes into context. You got to understand the context of the neighborhood and the context of where the, what the pricing is.

[00:30:19] René Pérez Jr.: I know location, location, location, three most important things in real estate. People have been saying that for years and it’s still true. It’s simple, simple. Let’s see. So, René, what’s top of mind for you as we’re wrapping down this podcast? So you mentioned right now how in your neighborhood, there’s estate sales and that it’s kids who don’t really have like, they don’t really care much about the houses. They just want to get rid of them.

And people always wonder like, “Oh, well, why is my house not selling?” Well, the answer is, is your house ready to move in? Right? We’ve had a steady inventory of, of listings where there’s a lot of work to be done. And problem is that we have a lot of first time home buyers, first time buyers don’t know that it’s not that expensive to do X or to do Y.

They don’t know that termite actually isn’t that bad and that most of the time that the, the inspections might save 5, 000 dollars and the actual cost might only be a thousand, right? So if you want top dollar, what you have to do is have the, have the property be moving ready, do a lot of the heavy lifting ahead of time.

There’s programs and services that actually pay for all the, all the repairs into the remodel and you only pay the companies at closing once you sell your house. If you are looking to sell your house at the top dollar, you have to do the work. And I know that it’s hard because at the same time we have this idea and this knowledge that buyers want to make the house their own.

They want to do the kitchen finishes. But at the same time, like, buyers are also going to want that discount for the house not being ready. So it needs to be the middle ground of like, “Okay, I’m going to do, if it’s hardwood floors and it’s really, really, really scratched, we’re going to do the hardwood floors.”

Buyers are not, like, buyers are not going to ask for a super discount of 50k because the wood is a darker brown that they would really want in the beginning. If it was your liking, right? If they want to refinish it later, it doesn’t cost as much, but at least they get into the property and it’s a really nice looking hardwood floor. So…

[00:32:43] Drew Thomas Hendricks: That’s a good point. That’s a really good point. And especially in this neighborhood. I mean, when I moved in, it was a lot of flippers because the housing was that my neighborhood was geometrically lower than the rest of the surrounding neighborhoods. The people, it was great for flipping, but now the housing prices are on parody with Carlsbad and some of the coast.

So it’s not, there’s not so much skin in the game to be able to flip these houses with the max, but these houses are coming and having been lived in for 30, 40 years with minimal to no up updating and then getting on the market for top dollar.

[00:33:17] René Pérez Jr.: Yeah. And the thing is that people just see a sell price like, “Oh, that house sold for 2 million.”

And it’s like, okay, well, then how like,was it a fully remodeled or was it sold the same way that yours is being sold? And that’s also the difference.

[00:33:33] Fred Glick: And that’s why the AVMs that you see, the estimates of value on Redfin and Zillow and all that, they’re very, it’s a light version of value.

Because they don’t go in the house, they don’t know what you paid to have, for, I don’t know, upgrades, carpeting or fancy wallpaper or high end kitchen appliances, you know, they don’t know, they have no idea. So they’re just doing square footage ish to square footage ish in size and year built and blah, blah, blah.

So they’re very light. So use them, but don’t use it. It’s just, but don’t use them for anything real. Don’t set that as your sale price. Oh, a red pencil.

[00:34:20] Drew Thomas Hendricks: Wise advice.

[00:34:21] Fred Glick: Yes. Oh, one story. Bananas. Now, I do like bananas, people. I do like.

[00:34:33] Drew Thomas Hendricks: You got four. Right there. Ready to go.

[00:34:35] Fred Glick: Well, hang on. No, no, no, no, no. It gets worse. Actually I was on my phone ordering from one of these online services or bring you grocery and I ordered 18 bananas. I mean, I eat them. I like using for smoothies, et cetera, et cetera.

They brought me 18 pounds. I was like, “Whoa.” So I have a lot of bananas now.

[00:35:09] Drew Thomas Hendricks: Okay, that’s good.

[00:35:11] Fred Glick: Just eating banana everything. Anyway.

[00:35:15] Drew Thomas Hendricks: Yeah.

[00:35:15] René Pérez Jr.: You’re going to have to deal with them. They’re not

[00:35:20] Fred Glick: Put them in the fridge. You know what? I put them in the fridge, they’re fine.

[00:35:23] René Pérez Jr.: Oh, I guess you can put them in the freezer too.

[00:35:25] Fred Glick: In the freezer. No, you take them out of You got to squeeze them out.

[00:35:29] René Pérez Jr.: Yeah.

[00:35:29] Fred Glick: You can’t leave them with the

[00:35:31] René Pérez Jr.: The peel.

[00:35:32] Fred Glick: Peels, yeah.

[00:35:33] René Pérez Jr.: Well I will say though that orange peels are edible. I do remember my college days, whenever there was a hazing involved, I’ve heard stories of one of the things you have to do is eat the peel.

[00:35:47] Fred Glick: So it’s sour, you know, that’s all.

[00:35:55] Drew Thomas Hendricks: Cooking the zest of the orange. Were you great?

[00:35:57] Fred Glick: Oh, sure.

[00:35:58] René Pérez Jr.: Oh, yeah. That’s like a good Negroni.

[00:36:03] Drew Thomas Hendricks: Well, I got to go get it a Negroni. So we better end this episode.

[00:36:07] René Pérez Jr.: Yep.

[00:36:08] Fred Glick: The Arrivva cooking show.

[00:36:11] Drew Thomas Hendricks: Cooking and cocktail mixing. Yeah.

[00:36:14] René Pérez Jr.: Fred actually didn’t probably know what a Negroni is.

[00:36:17] Fred Glick: I know generically what it is. I couldn’t tell you what’s involved in making it.

[00:36:22] Drew Thomas Hendricks: René, what’s your perfect Negroni?

[00:36:25] René Pérez Jr.: So there’s actually a really good restaurant up here in San Francisco called Gary Danko.

[00:36:30] Drew Thomas Hendricks: Oh yeah.

[00:36:32] Fred Glick: Oh yeah.

[00:36:32] René Pérez Jr.: Instead of Campari, they actually use the way it’s, it was done in Italy. It’s Grand Classico. So it’s a different type of, a different type of mix. I think that’s the way to do it. I mean, so

[00:36:45] Drew Thomas Hendricks: Grand classical. So it’s like a -.

[00:36:48] René Pérez Jr.: Yeah.

[00:36:50] Drew Thomas Hendricks: Well, now I’m definitely thirsty. So this has been the latest episode of We Fixed Real Estate. I’m off to go grab a Negroni.

[00:36:57] René Pérez Jr.: Talk to you later.