The Hidden Strategy Behind Low Pricing in Real Estate With Fred Glick and René Pérez Jr. Of Arrivva

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

• Delve into how some agents manipulate real estate prices with strategies like underpricing and outdated broker fees
• Understand the new commission landscape and how to craft competitive offers 
• Find out how small shifts in interest rates can impact the housing market and what it means for you as a buyer or seller
• Understand how the market anticipates interest rate changes 
• Learn how to find and secure rebates on new construction homes
• Find out when is the ideal time to list your home to avoid the holiday slowdown
• Listen as they address common concerns about how election seasons affect the housing market

In this episode with Fred Glick and René Pérez Jr.

In this intriguing episode, Fred Glick and René Pérez Jr. of Arrivva pull back the curtain on the sneaky tactics agents use to manipulate home prices. Discover how they are underpricing homes that start bidding wars and outdated broker fees could be costing you more than you think. 

Learn why the new commission structures mean buyers need to rethink their offers and how a slight dip in interest rates could shift the market dynamics. Plus, get exclusive tips on scoring rebates for new construction homes and navigating the evolving real estate landscape. Don’t miss this insider look at how to outsmart the market and save big on We Fixed Real Estate!

Resources mentioned in this episode

• Fred Glick on LinkedIn
• René Pérez Jr. on LinkedIn
• Arrivva
• Arrivva Live Mortgage Rates
• Toll Brothers
• Redfin
• Zillow
• Search the Largest Collection of New Homes 
• 334 Ogle St d, Costa Mesa, CA 92627, USA

EPISODE TRANSCRIPT

[00:00:00] Drew Thomas Hendricks: Welcome to We Fixed Real Estate. Fred, today we’re talking about low prices. What do you have to say?

[00:00:05] Fred Glick: Low prices.

[00:00:07] Drew Thomas Hendricks: Talk about what prices in real estate. What’s going on? 

[00:00:09] Fred Glick: So here’s what’s still happening and it’s getting worse. And it all rolls in with the change in the commissions. What agents are doing are pricing houses, and we’ve complained about this before, let’s say a house they put up for 899, 000 with the intention of it going for about 1. 3 million. So what they’re doing is they’re just wasting a lot of people’s time, making people upset, and it’s still happening. And they’re also playing this game because of the commission roll in. They’re kind of saying, “Hey, look, we’ll just keep getting this higher. And that’s why you pay us all this percentage. And we know how to do it.” And you throw in that buyer broker fee because they’re telling them the biggest lie in the world, which is no one will show your property unless you pay the buyer broker two and a half percent of the sale price. Okay.

I was just thinking, what year is this? And it’s 2024. So let me tell you to sellers. Please listen. Here’s what buyers actually do. They go and they look at the internet. 98 percent of deals are done on the internet. Okay? So yeah, you might lose a couple of people from this, but what they do is they look at things on the internet, they go to open houses by themselves, and then they hire agents.

The agents don’t tell them what homes to see. It’s a very, very small percentage of people that actually have that situation where they’re going to need guidance from an agent, but because of this new agreement, what they’re not supposed to do is they’re not supposed to steer just because the house is paying a buyer broker fee that you go to that person.

So if they’re following the law, it doesn’t matter. It can be zero. And you’re also, and this is the biggest thing, you’re already negotiating against yourself. You’re giving away two and a half percent of the sale price. And maybe someone came to you with an offer where you didn’t have to pay any, or you only had to pay 1%.

You don’t know. 2. 5 percent is not a set-in-stone number. We’re back to the Taft-Hartley Act violations because that’s price fixing. So, the other thing that I can tell agents is that you can keep trying this, but just to let you know, the Plaintiff’s attorneys and the United States Justice Department are keeping an incredibly tight eye on this, and they’re just going to mess it up.

And technically, by the way, this agreement has not been approved by the judge. Sometime in November, they’re actually going to the judge to get it rubbed, allegedly rubber-stamped, but it could change. It could really change. So sellers, please don’t listen to this. And you’ve heard the reasons why. I don’t know if René if you have anything to add about this.

[00:03:24] René Pérez Jr.: Here’s a bigger problem, right?

The bigger problem is that since agents are still trying to get away with giving two and a half percent concessions, the buyers go to the open houses, or they find out that there’s some form of concession. So there’s the expectation that there’s that concession still in place. So there’s a lack of, there’s a disconnect between the buyer’s understanding that at the end of the day, it’s about the net.

I don’t think, I don’t think buyers should, I think buyers should not want any buyer broker fees to be paid out of the seller’s pocket because it’s only increasing the sale price. So I think it’s a misguided idea of wanting the seller to pay for the buyer broker fee.

[00:04:15] Fred Glick: Yeah, let’s do the mathematics too. If you’re going to buy a $500, 000 house and you’re going to pay the agent $15, 000, what happens is now your sale price is higher by 15, 000.

So somebody is paying more title insurance, more transfer tax, your annual real estate taxes are going to go higher. Let’s say you’re borrowing 80 percent of the sale price. And now it’s 80 percent of 515 instead of 80 percent of 500. So you’re paying more interest over the life of the loan. So you’re financing really 80 percent of the buyer broker fee, which you never needed to do the way the system was before, but…

[00:05:00] Drew Thomas Hendricks: Refresh what the system was before for the people that aren’t pro real estate.

[00:05:05] Fred Glick: The realtor would basically tell you that you don’t have to pay me anything. The seller pays my commission, which they did. It was all part of the price. That’s what everybody did all the time.

So now it’s been bifurcated into, you know, you pay your guy, you just pay your guy. And you can’t offer any compensation to the buyer on the multiple listing service. So they’ve been doing it every other way that they can try.

[00:05:40] René Pérez Jr.: Following along with that, the other problem is that buyers wants to make offers in place still. And with doing that, they’re forgetting that they are making their offer weaker.

[00:06:02] Fred Glick: Yeah. Cause it’s all, you know, I’ve got to talk about, it’s all about the net. The calculation you must do now is, “Okay, the seller is going to get, here’s my bid of a million dollars.” And the seller is, you know, we want him to pay our $15, 000 of commission.

So he’s really getting three, I’m sorry, 985. So you got to think that’s the magic number and a listing agent’s got to do that calculation too. What are you going to walk away with before all your settlement costs? And so that’s the way you have to address your contracts. What’s the seller going to net?

So it’s a net deal, not just that, you know, number that you put on the front of the contract anymore. It’s simple traction.

[00:06:56] Drew Thomas Hendricks: It sounds simple.

[00:06:57] Fred Glick: Got to remember to do it.

[00:06:58] Drew Thomas Hendricks: I’m not quite understanding it. And I don’t know.

[00:07:01] Fred Glick: Okay. Here’s the way it is. So you say, “I want to make an offer of a million dollars on a property and I want the seller to pay $15, 000 to the buyer broker for me.”

So what the seller is doing is taking a million-dollar offer, but also now has to pay 15, 000. So the seller is walking away with 985, 000, not a million. So he’s going to compare it to somebody else’s offer. I’d say million dollars, you don’t pay my buyer broker. Well, that’s 15, 000 better for him. He takes that offer.

[00:07:40] Drew Thomas Hendricks: So, but where does the buyer come up with that 15, 000? Can they roll it into the mortgage?

[00:07:45] Fred Glick: No, no, no, no, no, no. The only, that’s why we’re asking the seller to pay it. It can be paid in cash. It can be paid as a credit towards your closing costs up to the limitations of what the lenders will allow. But this buyer broker fee is not allowed to be rolled into the mortgage.

It was never been able to be rolled in the mortgage.

[00:08:10] Drew Thomas Hendricks: So the seller gets the $1 million and then they give the buyer broker $15, 000.

[00:08:15] Fred Glick: Right. So it’s less money that they’re walking away with.

[00:08:20] Drew Thomas Hendricks: But if the buyer pays it, then the seller…

[00:08:23] Fred Glick: Yeah. Great. Doesn’t have to, it’s that simple. The buyer signs a contract with his broker, her broker, their broker, that says we’re going to pay you X amount of dollars or X percentage of the sale price as your commission. We as the buyer are going to pay it. Now there’s other ways of doing it. Asking the seller to do it, doing that seller credit, those kinds of things, adding it to your sale price though, that’s going to be the thing. And that’s what you have to remember.

[00:08:58] Drew Thomas Hendricks: Okay.

[00:09:00] Fred Glick: I love this statistic. Every time interest rates drop a half a percent, the number of people who are now qualified to get a loan and buy a house is 5 million more people. That’s pretty cool.

That’s the United States. I don’t know what the breakdown is, but obviously there’s still some places that don’t have enough housing, places that people are just avoiding, because of natural disasters, lack of insurance, climate has a lot to do with it. I mean, it’s just getting hotter. It’s just getting colder.

We had snow in the mountains here, in Sierras over the last weekend. Yeah. It’s just like we’ve become the Swiss Alps, I guess.

[00:09:52] Drew Thomas Hendricks: Yeah. Context. We’re recording this at the end of August 2024.

[00:09:57] Fred Glick: Yeah. Yeah. So anyway, we could pitch about that, but let’s get into rates. Here’s the thing about rates, they’re coming down, but I want you to understand this is very important.

The day the Fed drops, whatever they’re going to drop a quarter or a half, that doesn’t mean mortgage interest rates just drop right then and there. All the professionals who trade mortgage-backed securities already know what’s going to happen. They have already traded this. So every day mortgage rates change and sometimes two, three, four or five times a day because of what’s called a mortgage-backed security, which is like a bond, like a stock. It’s traded at different prices and there’s different options. There’s a whole bunch of things. It’s that kind of stuff. If you’re interested, you can Google it, but it’s not like the Fed has control of the mortgage rate.

It doesn’t work like that. It’s completely market-controlled. So once the Fed does it, nobody’s going to care. Rates aren’t going to move on that day. Let’s say put out a statement saying, “Hey, this is the last time we’re ever going to do it.” Or something crazy like that. But no, look at rates now. I mean, you can always for free just punt rates, no matter what state you’re in.

At arrivva.com/rates, we have an automated thing. What’s been happening is they’ve been slowly coming down. We had, I pressed something in the fives for an FHA and low sixes for conventional, so it’s really, you know, it depends on the loan to value credit scores and all that stuff. But it’s getting better.

I’ve heard from this person I follow on TikTok that she’s had so many phone calls from veterans trying to do the IRRRL, which is the, like, automatic basic rate reduction for veterans because they just do it with no cost. For VA loans, man, those things are in the fives. So, if you got anything, you know, 200, 000 and it’s over 6, do it. Get in line early.

So, it’s great. The refi will help stimulate, keep the economy kind of stimulated a little bit even though we’re going through a little, you know, thing. It’s not a crash, it’s not like 2008, got nothing to do with it. 2008, let me just put this on the record. My question, the biggest question I have, it’s still unanswered, is: How did Ben Bernanke and Alan Greenspan not figure out that option arms were toxic?

Did they not like have some curiosity and read the guidelines? And it just, every time I looked at those loans, it just said imminent collapse and it happened. Giving out 100 percent loan to value, 580 credit scores with no job verification. No, no, nothing verification. And hello, what do you think is going to happen?

Especially when you know, you’re ripping these people off with three and a quarter over coffee. I mean, it’s just, hello.

[00:13:20] René Pérez Jr.: A few of those would have been nice.

[00:13:25] Fred Glick: You know, they’re actually available. We have a lender that does them, but they’re very controlled at this point. So, yeah, the whole problem there is people’s payment went from a thousand a month to 2, 800.

Boom. Thank you very much. Cause of negative amortization getting to 115%. Anyway, we should just, just do the NegAm at the end.

[00:13:50] René Pérez Jr.: Yeah. I mean, we always talk about like the flaws of 2008 market and the crash and the crash and the crash. But there was also people who bought in 2006 with zero down, and now they’re selling their house that was half a million to almost 3 million. Right? So there’s also those success stories. That’s actually the

[00:14:12] Fred Glick: Totally, totally.

[00:14:15] René Pérez Jr.: Got coming up. You were telling me like, yeah, for me, 2006 was the best time of my life.

[00:14:23] Fred Glick: Awesome. Awesome. Time did well. Anyway, moving on.

If you want a rebate and guaranteed to get a rebate without any BS, start looking, and this is for consumers who want rebates because we give them. Go start looking at new construction, but don’t look at them right away because each new construction place has rules, and the usual rule is you have to show up with your agent the first time you go there.

So you can punch around on phone and internet, and especially if you call on the phones and sales offices, tell them you’re going to get a buyer broker, find out the details. And then find out the details, find the place you want, and then make an appointment with us. We’ll go over how the whole rebate works.

And we’ll help guide you through the new construction. We have a Toll Brothers today. Where is it at? San Ramon, René?

[00:15:23] René Pérez Jr.: In San Ramon.

[00:15:23] Drew Thomas Hendricks: Yeah. San Ramon, it’s a townhouse. Toll’s been around a long time. I mean, you know, everybody’s got their good and their bad, but basically they’re the Kings of the McMansion back East for years. So yeah, check your builders out, but they are offering rebates because they’re not part of the multiple listing service and they’re looking to draw people in and show me the money. So, but don’t, don’t tell this to any other agents. You say they’re not on the multiple listings, so you’re not going to be able to find them on Redfin. You’re not going to find them on Zillow. You basically

[00:15:58] Fred Glick: You may find them on Zillow. Zillow does do new construction listings. That’s a good point. Thanks for reminding me of that. I don’t know if Redfin does separately.

But pretty much, Zillow does, but also, there’s actually a website we can send you to. I don’t have the link handy. You sign up. Hang on, let me get this link.

There you go. All right, here you are. Okay. Yeah, we’ll put a link in the show notes. I’ll send it to you now, Drew. This is kind of a, for lack of a better word, an MLS for new construction only.

Okay, so it’s showingnew.com/Arrivva.com and go there. And the registration just comes to us. So, we’re not gonna bother you. So take a look, and you can put in all kinds of different filters for type, price, bedrooms, bathrooms, all that kind of good stuff. So there you go.

[00:17:11] Drew Thomas Hendricks: Good tip if you’re looking for new construction.

[00:17:15] Fred Glick: Yeah. Okay. What else do we want to talk about here?

[00:17:18] Drew Thomas Hendricks: I want to go back because I was,

[00:17:20] Fred Glick: Okay. You’re in charge.

[00:17:22] Drew Thomas Hendricks: I didn’t want to interrupt your brilliance, you talked about mortgage-backed securities, you talked about how, you know, they’re openly traded on the market. So, is this anticipated rate cut coming in September already priced in, or Fed rate cuts?

[00:17:38] Fred Glick: Yeah. It was priced in on the day that the rates really dropped. A couple of weeks, two, three weeks ago, I don’t remember.

[00:17:46] Drew Thomas Hendricks: It’s not that the Fed…

[00:17:47] Fred Glick: Do you remember, René?

[00:17:48] René Pérez Jr.: Yeah, well, here’s a common conception, right, for Drew. So, sometimes we get intro calls in which a client says, “Oh, I’m waiting for the Fed to drop rates because interest rates will go lower.”

I’d say that Fed rate cuts are like, are like earnings, right? For a public company, right? So before that particular date, interest rates are already going higher or lower based on expectations, right? So yeah, it’s not going to be where like, “Oh, they’re going to drop immediately.” You know, once it says like throughout the process of those dates, rates are already going lower or higher.

[00:18:32] Drew Thomas Hendricks: That really helps to paint it. Cause so the Fed rate cuts do affect interest rates, but they’re priced in or priced out like that. Therefore,

[00:18:41] Fred Glick: There can be a surprise one day, the market just decides to do something because of something happened, but it’s a major event.

[00:18:49] Drew Thomas Hendricks: Similar to a stock market where the, if people are projecting the Fed or it’s going to be raising interest rates, stocks are going to react on the future expectations.

[00:18:58] Fred Glick: Let me put it this way. In the world, if the shit hit the fan, war, whatever, the first thing that everybody moves their money to is United States Treasuries.

It’s the most secure thing in the world. The second is United States mortgage backed securities. So it’s the fan. It’s great for interest rates. 9 11. Good example.

[00:19:25] Drew Thomas Hendricks: What happened 9 11? In terms of, in terms of interest rates.

[00:19:32] Fred Glick: Very good. It dropped significantly because we thought it would be an economic collapse.

And it kind of stayed there and business kind of freaked out. Everybody freaked out. So,

[00:19:44] Drew Thomas Hendricks: Yeah. So it takes current market sentiment is really what drives the interest rates. And then it’s confirmed by actual…

[00:19:51] Fred Glick: Traders.

[00:19:52] Drew Thomas Hendricks: Yeah. Traders are pricing in a 0. 5 percent change in September. If PAL comes out and says, “Nope, we’re holding even,” chances are interest rates are going to rise.

[00:20:05] Fred Glick: Exactly. That’s not going to happen. I mean, it’s like the economic.

[00:20:08] Drew Thomas Hendricks: If it does, then that will directly affect it that day. Usually, if he says, you know, we’re in the shits, we’re dropping interest rates 2 percent today, that would affect it very quickly.

[00:20:20] Fred Glick: I think we’d get a little busier, but then again, there’s no supply. So that’s the problem. That’s the biggest problem. And the worst thing about interest rates dropping is you’re going to have more competition, but in areas where they can’t sell houses or it’s slow, it’s a beautiful thing. So it depends on the market. All real estate is local.

[00:20:45] Drew Thomas Hendricks: So we’re kind of anticipating interest rates declining over the next year. And I think most people are, I am. You were mentioning a few episodes back. There’s a loan or a mortgage that actually factors that in. It’s like a 2-1 buydown or maybe.

[00:21:00] Fred Glick: The 2-1 buydown. Well, 2-1 buydown stays the same. It’s just the rates change. That’s all. So if it used to be eight, we’d get six, seven, eight, and now the rate is five negative three, four, five.

[00:21:16] Drew Thomas Hendricks: Okay.

[00:21:16] Fred Glick: That’s all. That’s simple. The program stays the same. It’s just the rates change every day. Oh, so let me give you, let’s go back to the fifties. When you wanted to get a mortgage. And this is where all this thing about the Fed dropping the rate means something. What you would do is, you would go to your local bank.

And your local bank would have a CD offered. They’ll pay you 3 percent interest for the next five years. You figure, “Okay, I’ll put my money in there.” Then what they do is they turn around with that CD and lend it back, could literally lend it back to you at say 6 percent for a new mortgage.

So they made money and they did, you know, they didn’t have 30-year fixed loans. They had, you know, five-year things because they had a match with the CD, maybe a 10-year CD. So, you know, it’s kind of tough, but there was FHA, there was, there’s been VA. So most people are USDA. So most people kind of use those with low down payment. USDA is zero, three and a half for FHA, and zero for VA.

So that’s what people did. They did those loans or they went to the bank and did the bank and usually a shorter term it can get. Then all of a sudden, these mortgage-backed securities were invented as a security back in the 70s. Lewis Ranieri, I think was his name, who invented it, you know, so it was revolutionary. And to this day, it’s been fabulous.

I mean, they put a lot of restrictions at, with Dodd-Frank, which they should have. So now you actually have to qualify for a mortgage state. You’re gonna live there. So anyway, so that’s why people think, oh, you know, this day the rates dropped because that’s what happened at the bank.

And you’d see the rate just posted right up on the screen.

[00:23:21] Drew Thomas Hendricks: Ah, I see.

[00:23:23] Fred Glick: There was the rate.

[00:23:25] Drew Thomas Hendricks: So the advice that I’m taking from this is that, you know, rates may be going down, but the competition’s going to be going up for finding a house. So if you see the house that you’re looking for, you’re better off not waiting. You’re better off making an offer. You’re better off getting into a mortgage, figuring you can sit down the road.

[00:23:43] Fred Glick: Let’s just say, talk to your broker because it’s going to depend on the market. It might, you might be looking place where there’s 50 homes for sale and there’s 20 buyers, or you’re looking at Cupertino where there’s 150 buyers for one house. Right. Exactly. So

[00:24:02] Drew Thomas Hendricks: Really depends on the context of your situation.

[00:24:05] Fred Glick: Exactly.

[00:24:06] René Pérez Jr.: Yeah, so that’s why like the old saying of like, you know, don’t be sold on an agent telling you it’s the best time to buy. Realistically, you really want to just find a house that you like. You’re never going to have a perfect market for you. The only way to market is if you know someone that’s selling a house that is going to give it to you for cheaper than what the market rate is. That’s the only way. Realistically.

I do want to say this. The only way that the theory is flawed in that interest rates go lower, and prices go up is on the fact that there’s a lot of people who have not sold property because they understand that they’re not going to get the best price because interest rates are high.

So there could be, there could be an additional amount of volume of sellers who just decide to list a property when rates go lower. So people.

[00:25:00] Fred Glick: Yeah.

[00:25:01] René Pérez Jr.: I mean, we’ve had, I actually keep tabs on a lot of listing appointments where people, I tell them what the prices are going to be. And they don’t want that price.

They had expectations of much higher. And of course, throughout the consultation that I give them, I tell them, you know, recent sales of exactly what’s sold in the vicinity, maybe in that same block, and I try to keep it, you know, as recent as possible and they say, “Oh, well, okay, well, if that’s the case, because of interest rates in the market, I’m just not going to sell now and I’ll just sell later where interest rates are lower.”

And a lot of them, and I would think, you know what, they didn’t like what I said, and maybe some other agent told them they can get higher, but a lot of them are not in the market, right? And to some people I have spoken to, to some, I haven’t, but the reality is that there’s a lot of people who want to sell, and they’re just waiting for the right time. So…

[00:25:54] Drew Thomas Hendricks: I guess it depends on where they’re moving. Cause it seems illogical. If you’re waiting to sell your house for 1. 4 million and right now it’s 1. 2 and you want to get that extra 200, 000 and you’re moving down the street. Well, that house that you’re looking for, that was 1. 4 is now going to be 1. 6.

[00:26:11] René Pérez Jr.: Yeah.

[00:26:11] Drew Thomas Hendricks: Everything’s going to be going up. But I guess if you’re moving from San Francisco to South Dakota, potentially waiting, waiting a couple of months might be advantageous.

[00:26:22] René Pérez Jr.: Yeah, which is something that we see all the time, right? It just, I guess, boils down to where your family is, because people, you know, I mean, Fred says this all the time, but people like where they live, and people like where they live because everything seems natural to them, right?

It’s where they grew up. It’s where they understand the coffee shop. It’s where they don’t have to put a GPS and find a place, right? They feel comfortable. So most of the times where you see people moving out of state, it’s because, like, “Oh, my in-laws live over there,” or, “Oh, my parents are getting older, I’m going to move out there.”

The biggest issue with the California in general is that people move to other places for some time, and then they usually come back, right?

[00:27:01] Fred Glick: Yeah, and now let’s add on the fact that we have people that are required to return back to work three days a week. So, does that mean they’re going to move back here?

Does it mean it’s going to be a great thing for pedetairs?

[00:27:18] Drew Thomas Hendricks: We have a friend that’s moving back to Philadelphia. Somewhere near Pfizer’s making them be in person. And they moved out here thinking they’re

[00:27:29] Fred Glick: I’m licensed there. I can help them.

[00:27:32] Drew Thomas Hendricks: I think they have a house there, but they’re moving back.

[00:27:34] Fred Glick: Okay. Well, well, well, oh, they move Philadelphia.

[00:27:37] Drew Thomas Hendricks: That exact thing is they moved to San Diego thinking that’s where they were going to live.

[00:27:41] Fred Glick: Oh, this is interesting.

[00:27:42] Drew Thomas Hendricks: And now Pfizer’s like, nope, you got to be there three days a week. And they’re commuting right now, but it’s not going to last.

[00:27:51] Fred Glick: Wow. That’s very interesting. How many people moved to be California, Hawaii, Costa Rica, who knows what, having to now move back. I mean, a lot of people I heard going to quit, changing jobs. So that’s happening, but there’s a slowdown in hiring. So it’s not good timing because you’re coming up to a recession. Recessions mean excuse for corporations to lay people off, to save money, blah, blah, blah, back to hell from paradise.

[00:28:30] Drew Thomas Hendricks: Yeah, I’d say there’s a lot of people in Silicon Valley that might have moved to Boulder, or Colorado, live that kind of mountain lifestyle, even Tahoe, that now have to get back to Santa Clara.

[00:28:44] Fred Glick: Interesting. There’s a lot of answers, but there’s not a lot of property. That’s the problem. So they’re going to have to, so maybe this is a rebirth of condominiums.

You know that they start moving faster because, you know, maybe, hey, you share it with a couple of people, three of you buy three bedroom and you’re there at different part times. That’s an idea. Or, ah, okay. Here’s for the industrious real estate investor. Here’s an idea. There are places called crash pads that airline personnel have.

They own, cause I know I had a flight attendant and she bought three houses. This is like 15 years ago. And the idea is she would have bunk beds basically in every room. She’d have her own room and different people who let’s say live in Charlotte, but how to work a flight first thing in the morning out of Philadelphia would come in the day before and stay in the crash pad.

And they pay flat fee per month. They have their own food. You know, they all, they’re all in the same biz. This could really work for people, let’s say in tech, a tech crash pad. Buy it and, you know, people sign a lease, all three sign the lease, so it’s a long term lease, but, you know, you rotate time and maybe somebody will build an app, figure out how much time you use, it’s how much you pay for the next month or something like that. Be interesting. Anyway, that’s good use for a condominium.

[00:30:22] Drew Thomas Hendricks: Yeah, that’s a great, great business idea. If anyone’s listening.

[00:30:25] Fred Glick: There you go.

[00:30:27] Drew Thomas Hendricks: Be entrepreneurial. Let’s see, we’re heading into September. René, what do you think? We’ve already talked about rates. We’ve talked about housing. What’s your gut instinct on what’s going to happen over the next month?

[00:30:41] René Pérez Jr.: So, I mean, after Labor Day, right, there’s an influx of new inventory for people who want to put their property on the market before the holidays. You don’t want this in November and December for best price and best conditions. That’s just not realistic now. We have markets like the Bay Area who will still have volume of buyers in the hot markets.

San Diego, Los Angeles. There’s going to be pockets where it doesn’t matter if it’s Christmas. I foresee us writing offers Thanksgiving and Christmas this year again. You’ve done that the last three years. I don’t expect that to be any different. If you’re a buyer, I think that you should make offers on Thanksgiving and Christmas because you have to be less aggressive and people just want to move on.

But I think this is probably the week where you have to realize or you have to choose if you want to sell this year or wait until next year, until second week of January. Right? So it’s an important week for those that are prepping their houses, because it takes time, right? For a perfectly prepared listing, people always call us and ask, “How quickly can you put our house in the market?”

I can put your house in the market in one week. But that’s not me fully preparing to learn about your home, get all the disclosures and everything ready. It’s rushing things, right? You really need a month to really cover everything, the A through Z of giving you all the data, right? Of what the pendings are and of what’s selling and what’s not selling.

What repairs you should do, right? So you really, really need a month to get things prepared. So that’s why I say that this is probably the, the week for you to decide, because even if right now you call us today, we have until October, right? And put it through the month of October and you’re safe from, you know, if your house stays in the market 30 plus days, it’s still not in the holiday season. So…

[00:32:41] Drew Thomas Hendricks: No, that’s good advice. What about, are you getting any kind of, you know, conversations about people wanting to hold off because of the election or just wanting to see what happens. Nothing.

[00:32:52] René Pérez Jr.: We have gotten people who believe that election seasons affect, you know, the markets.

[00:32:59] Fred Glick: Oh yeah. They asked the question at least, but it didn’t stop them from buying.

[00:33:03] René Pérez Jr.: Yeah. So yeah. So to answer your question there, that is.

[00:33:07] Drew Thomas Hendricks: Someone that may have that unfounded concern. What do you tell them?

[00:33:12] René Pérez Jr.: Well, actually, there’s a big concern that’s right now in a lot of Twitter and a lot of, just threads anywhere in social media.

There’s this idea that California, for example, has passed a illegal immigrant 0 percent down.

[00:33:28] Drew Thomas Hendricks: I saw that.

[00:33:31] René Pérez Jr.: So, like, yes, the tagline looks scary and weird, right? That’s not saying that we’re providing illegal immigrants, 0 percent mortgage. We are allowing them to be part of a raffle that a lot of first time homebuyers are in. All these illegal immigrants also have to make the, have the same qualifications that any other buyer.

[00:33:53] Fred Glick: Exactly. So it’s green.

[00:33:56] René Pérez Jr.: Yeah. So, it’s not limiting any homebuyers from,

[00:34:03] Fred Glick: An illegal alien, was someone who was brought here on a boat 35 years ago, there’s 35-year-old illegal aliens who are working. Have social security numbers and all that. It’s not like it’s the guys are crossing over the border.

[00:34:18] René Pérez Jr.: Yeah, so I think what the tagline forgets is that this is not just giving a blanket. Illegal immigrants, everybody gets a house for zero percent down. There’s already a limited amount. There’s only like, I think it’s like three thousand quote unquote. It’s not, they’re not grants, but they’re, I forget the word.

It’s like a loan, these disbursements. So there’s only like 3000 of them. And from those 3000, it’s not going off for illegal immigrants, maybe 10, 20 illegal immigrants that qualify and we’ll be able to even be, you know, how the capacity.

[00:34:56] Fred Glick: And by the way, this is the thing I used to say for years, but they finally changed it only a few years ago: Did you know that anyone, anyone in the entire world, could have qualified for an FHA mortgage?

They did not care anything about your nationality for years. So, and that was done, you know, I mean, Nixon had a chance, Ford had a chance, Reagan had a chance. Bush’s had a chance and Trump had a chance to get rid of that. I’m sorry, I don’t think Trump did. Let me take that back. But a lot of administrations had a chance to get rid of it and they didn’t.

So, same people who voted for them are complaining about the illegal aliens and oh my God.

[00:35:42] Drew Thomas Hendricks: But now if you’re coming from France or Germany and you’re buying a house in the US you can’t get an FHA loan.

[00:35:48] Fred Glick: Correct.

[00:35:48] Drew Thomas Hendricks: Okay. When did that change?

[00:35:53] Fred Glick: I think it was, I think it was Dodd-Frank, during Dodd-Frank .

[00:35:56] Drew Thomas Hendricks: Okay.

[00:35:57] Fred Glick: Don’t quote me on that. We’re recording this, but I can’t remember when.

[00:36:03] Drew Thomas Hendricks: That’s interesting. So somebody coming from Germany or France or any, any country, Mexico.

[00:36:08] Fred Glick: Oh, you can buy it as an investor and we have, we have loans. You got to put like 35-40 percent down and you’re going to pay a higher interest rate.

It can be done non-qm, non-qualified mortgage also known as subprime. It will forever be subprime dressed as qualified, non-qualified mortgages.

[00:36:30] Drew Thomas Hendricks: If you’re listening to this in another country and you’re thinking about buying a house in the United States, talk to Fred and René. They can help you navigate the mortgage aspect.

[00:36:40] Fred Glick: And the real estate brokerage, don’t forget.

[00:36:42] Drew Thomas Hendricks: Oh yeah, and help you find a house.

[00:36:48] Fred Glick: Yeah, well.

[00:36:49] Drew Thomas Hendricks: Then you might actually have to take them on a tour because they’re probably not going to navigate the,

[00:36:54] Fred Glick: Why would you leave the South of France to come to, I don’t know, Burbank?

[00:37:01] Drew Thomas Hendricks: You might not come to Burbank, but you might go to Laguna Beach.

[00:37:04] Fred Glick: That’s true. We can do video tours.

Let’s see any last words. Well, not last words because I expect to talk to you guys again next week. But any final thoughts as we wrap up this episode? Be careful out there kids. Do not let any agent tell you you have to sign in for an open house. And if you do, sign Mickey Mouse.

Don’t give them your contact info. So you are allowed to go to an open house and then get a buyer broker. You know, they’re going to want you to sign a contract that says what you’re going to pay them. Read it. Two and a half percent is not normal or not what everybody charges. It’s not the same.

Real quick commercials for us. We have a beautiful near the beach listing in Costa Mesa. You can get this on Zillow and find it, on Ogle Street. Very cool. We’re having a listing coming out by the time this podcast comes out, it should be listed over in the East Bay, a monstrosity of a house.

So you got lots of need for space. This thing’s insane.

[00:38:26] René Pérez Jr.: Almost 5, 000 square feet. It’s a huge scene. And you can actually also build an extra ADU. It’s permitted, so…

[00:38:37] Fred Glick: Wow. Even better. This, this sounds like, you know, we could bring back the, oh God. What was his name from Silicon Valley?

What was the name of the guy who owned the house? I can’t think of it. Anyway.

[00:38:55] René Pérez Jr.: What was the guy that owned the house?

[00:38:58] Fred Glick: On Silicon Valley, on this TV show.

[00:39:01] Drew Thomas Hendricks: Oh, the TV show. Hooli?

[00:39:04] Fred Glick: No, well, Hooli was the Google-ish name, but no. The guy who owned the house, who allegedly died in Thailand or something.

[00:39:14] Drew Thomas Hendricks: Oh. Yeah.

[00:39:17] Fred Glick: Yeah. You know what I mean? Anyway, we need to bring those houses back. This would be perfect for it.

[00:39:23] Drew Thomas Hendricks: Yeah. And if you haven’t watched Silicon Valley, watch the show.

[00:39:29] Fred Glick: Yes. It’s really like…

[00:39:33] Drew Thomas Hendricks: The last episode of season one is just explains it all.

[00:39:41] Fred Glick: Yeah. Yeah. Okay.

[00:39:44] Drew Thomas Hendricks: Do you ever want to understand parallel processing? That’s your answer right there.

[00:39:47] Fred Glick: There you go. Ah, yeah, it’s fun in Silicon Valley. We do a lot of work from Silicon Valley and people we deal with, they’re great, but we know there’s characters out there. There’s no doubt about it.

[00:40:02] Drew Thomas Hendricks: Oh yeah.

[00:40:04] Fred Glick: Anyway, that’s enough talking.

[00:40:06] Drew Thomas Hendricks: That’s enough. On that note, we have fixed real estate for another episode.

[00:40:11] René Pérez Jr.: See you guys.

[00:40:13] Fred Glick: Cheers.