What Buyers Get Wrong About Market Trends With Fred Glick and René Pérez Jr. Of Arrivva

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

• Discover the surprising consequences of a simple mortgage credit pull, and how to protect yourself. 
• Hear why national housing stats are useless when you’re house hunting
• Explore how San Francisco’s revival is changing property values and investment chances
• Understand California’s SB 326 and SB 721—and what they mean for condo and apartment buyers
• Learn how global economic forces quietly influence your mortgage rate
• The truth about escalation clauses—and why they might be hurting your offer

In this episode with Fred Glick and René Pérez Jr.

Think you know what’s happening in the housing market? Think again.

Fred Glick and René Pérez Jr. of Arrivva are here to bust the biggest myths buyers fall for—from believing every headline to misreading mortgage rate trends. If you’re making moves based on national stats or letting your agent talk you into an escalation clause, this episode could save you serious money.

Resources mentioned in this episode

• Fred Glick on LinkedIn
• René Pérez Jr. on LinkedIn
• Arrivva
• HowLoud
• Watch Duty App
• Escalation Clauses
• Yen Carry Trade

EPISODE TRANSCRIPT

[00:00:21] Fred Glick: So when you apply for a mortgage and they run your credit report, there’s a little known thing about what happens. The credit reporting companies actually sell the fact that you apply for a mortgage to other mortgage companies and they will start calling you and bothering you and trying to get you to go with them instead.

There’s now a lawsuit. There’s something to try to prevent that. There’s actually a website you can go to. But there is an investigation going on. There’s a law firm that’s now got a hold of it. I mean, this stuff has to stop. So be very careful and ask your loan officer, what’s the website I go to to make sure no one else contacts me now that I’ve applied for a mortgage?

That’s the thing you gotta do because they’ll be all over you like a cheap suit. It’s creepy. As I hear all of our information that Elon stole, he sent it to Palantir, so Palantir know, knows everything about everybody. Now it’s gonna make a national database and…

[00:01:36] Drew Thomas Hendricks: Oh yeah, I heard that.  Palantir is a creepy company, but yeah.

[00:01:44] Fred Glick: Yes they are.

[00:01:45] Drew Thomas Hendricks: And if you’re wondering where you are, you’re on, we fixed real estate talking about mortgages and Palantir. René Pérez is on the show.

[00:01:56] Fred Glick: All kinds of other stuff.

[00:01:57] René Pérez Jr.: I’m looking into where to invest in Palantir.

[00:02:02] Drew Thomas Hendricks: It was like $12 a chair of two years ago.

[00:02:05] René Pérez Jr.: I know. Yep. Yep.

Really sad.

[00:02:09] Fred Glick: Anyway, it’s part of the PayPal Mafia. So, EDAP Palantir and Elon are buddies, I’m sure still. So it all worked out and Trump doesn’t care. They didn’t know what’s going on, so.

[00:02:22] Drew Thomas Hendricks: Nope. So I’m gonna hit you with a question ’cause I found the article we were talking about, home sellers now outnumber buyers by the largest margin in 12 years, report finds.

[00:02:31] Fred Glick: Nationally. Nationally. I hate these headlines ’cause they don’t mean anything. If you’re buying a single family house for $4 million in Palo Alto, guess what? There’s 20 people looking at the same house. Okay. We just had one in San Francisco that blew our minds. It went like five, 600 grand above what we thought it would go for.

So, you know, yeah. If you’re in Florida trying to sell your 200,000 condo, forget it. Can’t get it insured. You got the balcony repairs.

[00:03:10] Drew Thomas Hendricks: That’s a really good public ins, public information statement that you said here. ‘Cause you know, it’s very sensational when you look at turn on CNN and it says the report found that nearly 500,000 more home sellers are in the market than buyers in April.

But that’s on a national level. So if you’re in a hot market like Silicon Valley or in a hot market like LA, it’s not as applicable to you. ‘Cause not…

[00:03:33] Fred Glick: Yeah. And what drives me crazy is you’re all over social media. These guys got 10,000, 20,000 followers. “Hi, this is Sam. And I want to tell you that in Orange County, prices are coming down.”

You know what? No, not everywhere. Real estate is local. So the guys who give you this broad information aren’t the guys to follow. Follow somebody and you know, Google, ChatGPT or however you find something, the exact area you’re looking at. Could be even the neighborhood. There’s areas of, let’s say Seattle, you can’t look at Seattle ’cause part of it’s slow and other parts are busy.

Is it a condo? How many bedrooms? You know, things like that. You have to micro search for your information. The macro things are great for generic content, and I’m sure it Googles well, but it’s really important that you get micro information. That’s bottom line. Like we have a buyer in know Olympia, Washington looking at properties, been on the market 200 days that come down about 300 grand, and he wants to come down another, say 150-ish.

And we’re gonna try to justify it. And you know, Olympia’s a good school district, it’s nice place to live. Crime stats are, you know, pretty normal. It’s not nothing unusual. So it’s like, okay, why? Why aren’t people buying their? That’s what we have to figure out to help him. You know, maybe it’s just houses overpriced like crazy and the seller’s out of their mind and the listing agent just keeps it busy.

So anyway, I could belabor this forever, but the bottom line is, you know, look for micro content. Don’t look at the broad outline. It’s just, ugh. You know, and the fact is where job’s gonna be.

 You know, where people want to live, you know, that’s all important. And where it’s going. Changing gears. Once you do wanna sign a contract, there’s three things that always are up in the air: washers, dryers, and refrigerators. So we had a buyer looking at a property and asked us, “Hey, can we still get a mortgage on the property if there’s no washer dryer or refrigerator?”

And, or I should say. The answer is you can absolutely get it. The mortgage companies, all they care about is a stove and a sink that are operating and maybe a little countertop. You know, so it’s a functional kitchen. So you can have grandma’s been there 400 years making her sauce, you know, on this one little old stove that works.

That’s fine. That’s all you need for a mortgage. So. You know, you take your clothes, go down by the, the river and get a rock and clean them and, you can get a cooler and put stuff in or never have anything that’s refrigerated I guess. I mean, a thing about, it used to be, it’s not as much anymore where people would take their washer dryer refrigerators with them to the new house.

If they had just bought it. Yeah, I understand. But it’s like most houses are going to keep it there nowadays, so we don’t see as much as we used to. But if you’re buying in France, turning tables a little here, you’re buying in France, people take their entire kitchens and people know they’re gonna have to bring their own kitchen, BYOK.

It’s completely different over there. But yeah, you get used to using something, but I don’t know that people are love with their fridge and washers and dryers. They’re getting so much better. Yeah. A little more expensive, but the electronics are making it easier. Making it, you know, just making it better.

[00:07:42] Drew Thomas Hendricks: Yeah. Maybe if you had a $30,000 Viking, you might have some sort of a, or a Gaggenau, a hundred thousand dollars Gaggenau.

[00:07:52] Fred Glick: Yeah. But if you’re, if you have that in your house, you can afford the new one. You’re probably upscaling and it’s probably an even better one. So. Yeah. But that’s the answer to that generic question of what can they do. You can get a mortgage.

[00:08:04] Drew Thomas Hendricks: I’d be surprised that mortgage is even – if you have a stove. Like in the, you are looking at a million dollar house, it’s gonna still be a $999,000 house if it doesn’t have a stove ’cause you can just put one in.

[00:08:18] Fred Glick: Yeah. There’s a lot of real estate, it is what it is. And that’s the rule and that’s fine. But there’s real estate agents who are trying to sell stuff. There’s one listing I looked at the other day, it’s been on the market. About four months it just came off and if you read the description, it’s like, “Oh, this is a great house,” and blah, blah, blah. I mean, it was just nauseating of how great the house was.

Then we read the agent to agent notes. Property is in bankruptcy. Agent is involved with the seller, you know, she’s got a piece of it. And it’s like, I could see from the pictures from four months ago there were holes in the wall. It’s just some mess and it’s up against the highway, so it’s noisy. We did a noise search on howloud.com.

Howloud.com, you know, it’s generic what they give you, but yeah, the algorithm knows it’s right up against the highway and there’s no giant partition. Yeah. The way people try to sell, what the agent didn’t realize, and I think I’ve said this before, especially if you’re an agent, you can’t list your own property because if you do and there’s a problem, your errors in admission insurance will not cover you.

Yeah. So list it with your broker in the office, but not yourself. But check with your E&O company. But anyway, you know, I think in the public description, it should say if the agent is, has a financial interest in the property.

[00:09:57] Drew Thomas Hendricks: You would think so. Yeah.

[00:09:59] Fred Glick: Yeah. They just have to disclose it.

You disclose it in the private notes. So if you’ve got fire, agents know what they’re doing, obviously they’re gonna let you know. And that’s going to, you know, maybe lower the price of the house for you because they’re involved and they can make lets, and, you know, all that kind of stuff, depending on the property.

But yeah, keep an eye on that stuff.

[00:10:27] Drew Thomas Hendricks: Yeah, that’s a good piece of advice. What’s the, so we were talking on the pre-show about San Francisco and how it’s a little bit of, a little bit of a renaissance coming on?

[00:10:42] Fred Glick: Oh man, this new mayor is, he’s all over the place. Gotta love him.

He’s, number one, trying to clean up all the homelessness and the fact that you’re people are literally scared to walk on certain streets. And 16th and Mission, there’s a  BART station, and for those of you not in San Francisco,  BART is the subway that basically goes two thirds of the way around the Bay Area from just below the airport into San Francisco, over towards Oakland up north and then down south. It goes this far now as Milpitas, but it’s supposed to go all the way to San Jose. So you can take Caltrain and  BART all the way around eventually. But there’s a station that’s underground at 16th and Mission, and when you come up from that area, it’s been like, it’s ugly, let’s put it that way.

And especially if you’re just visiting the city, you’re going be scared as hell, even downtown, just a place called the Tenderloin. And you can Google why it was called the Tenderloin. That’s something to do with police and steaks for real. But he is trying to clean that up.

And here’s my question. Do the homeless really care where they’re homeless? If they had a place out in wherever and they were told, “Hey, we’re gonna give you meals, we’re gonna house you,” and, “Hey everybody go here.” Is that the solution? I don’t know. I mean, there’s no answer to this, but it’s just like, there’s another problem with the Tenderloin.

It was actually zoned and they really need to change the zoning there. It was zoned basically that you can’t buy the building and rehab it or build a skyscraper and make it nice. You just can’t make it nice. ‘Cause the people who are there, they want to keep there and that’s, you know, it scares the hell outta people.

If you go outta your fancy hotel in downtown, you make the wrong turn on Market Street, go a couple blocks and you’re, it’s nothing you’re used to if you’re coming from out of town. It doesn’t have this. But there is a new Ikea and an Ikea, has a food court. That’s pretty cool. But kind of anywhere west of that, it gets interesting.

That way. But what he’s done, back to Daniel Lurie is, he’s created a more streamlined way to get permits. Because that’s been the problem. You wanna do anything in San Francisco, it’s three years. Just, you know, that’s why we get so many houses that don’t have permitted items.

Like a room edition or whatever. ‘Cause it’s like, I’d rather just get caught and pay the fine than wait and do it the right way. But if he gets this going in the right way, it’s really, really gonna help. And we, as I said earlier, we’ve seen prices going up, and they’re making a fantastic comeback. San Francisco.

What’s going, what still isn’t a hundred percent there, but if you want to kind of ride an upswing is the condos downtown. Which, you know, they’re, this $650,000 one bedrooms went down to the high fives. I see them now back at the 650 price. So they’re already on the way back.

[00:14:27] Drew Thomas Hendricks: Is that return to work, like having, people are being forced to return to work. So they’re gonna have to.

[00:14:32] Fred Glick: Well, between that and the AI companies setting up in San Francisco. You know, obviously there’s still people who commute. Let’s talk about one major issue in condominiums, ’cause we are dealing with this now.

SB 326. They can make t-shirts with that number on it. So this has to do with balconies and there’s actually two balcony laws, SB 326, which has to do with condominiums and homeowners associations. Even a pod where it’s townhouses next to each other, nothing on top of each other, if and multifamily and apartment buildings.

That’s SB 721. So SB 721 was pushed out. The deadline is now December 31st, 2026. The condominiums in HOA for SB 326, the deadline was December 31st, 2024. And condos, there’s a lot of ’em that just aren’t paying attention to this, taking their little old time. But they got to verify through a structural engineer or an architect that the balconies are all good.

They have to keep the inspection reports for 18 years. They gotta do it every nine years. They have to sample 95% of those units that are affected. So we have one condo association. Oh this is also for three or more units. Let me add that. So a two unit condo, not a problem. It’s also not a problem if the outside space is a roof.

So it’s not a balcony that’s protruding. Okay. So, that’s important. ‘Cause we have a condo now that we’re selling that we checked and we don’t have to do it. But you gotta get it done and you gotta get the work done. And here’s the topper kitties, Fannie Mae, the quasi-governmental organization that requires, you know, basically all the mortgages that you get that aren’t jumbo.

And the jumbo lenders, the Wells Fargos and the Bank of America, this world are jumping on the same thing. It’s under section A, excuse me, B4-2.1-03, Ineligible Properties. Go look it up, kids. And it’s basically saying that any unfunded repair costing more than $10,000 per unit that should be undertaken within the next 12 months is ineligible for financing.

So we’ve got, we have this town home that doesn’t have the balconies, but in the condominium there are, I believe, seven of them that do. And they basically have dragged their feet. And at this point in time, they have a contractor, but they don’t even have a exact start date to when it’s getting done.

And we’ve had Bank of America and now another one of our lenders, Sierra Pacific, who sell to Fanny Mae saying no, they will not approve it, even though the unit we’re trying to sell doesn’t have balconies.

[00:17:54] Drew Thomas Hendricks: Oh, wow.

[00:17:55] Fred Glick: So basically this unit is worthless right now, the list, because you can’t get a mortgage.

I’ve also contacted a non-Fannie Mae lender to see if they would entertain it, but you’re gonna pay, you know, one to two points higher in interest rate. And who’s gonna wanna do that? That lowers the value of the property. So, I think personally the property manager, property management company that runs this place is totally liable for this.

[00:18:25] Drew Thomas Hendricks: I would think so.

[00:18:27] Fred Glick: Yes. And you know, the, I don’t know what information they gave to the board of directors who are on the HOA board, but obviously we’re sorting, our owner is pushing and talking to people. I know René’s talked with another listing agent who’s talked to their seller to put pressure, but the work’s gotta get done.

They won’t approve it unless it’s done. And it’s Florida, you know, they have their own, balcony law. And I think that, I think, don’t quote me, I think that was extended the next year, but still that’s, it’s a big thing. It’s gonna come to a state near you.

[00:19:09] Drew Thomas Hendricks: Yeah. So there’s seven, how many units are in that building?

[00:19:15] Fred Glick: I don’t know. René, what do you think? Like 40, 50 units, something like that.

[00:19:20] Drew Thomas Hendricks: And seven of them have balconies? Now, would they use the reserves to pay for the repairs of these seven balconies, even though…

[00:19:28] Fred Glick: I’m not sure you know, what the financial situation is, but they know they gotta pay for ’em. They had to get the estimate first, and they kind of just got it from this agency or builder or somebody, contractor. So it’s just real important.

And you know, before, if you live in a condo in California, that’s three or more units, you gotta ask about SB 326. And if you have it listed currently, check on it because your unit’s worthless unless somebody pays cash, but they’re gonna want a discount and there’s not gonna be as many buyers. It’s real simple.

So we urge people in California in a condominium to please go through and do that.

[00:20:22] Drew Thomas Hendricks: That’s crazy. Right? Glad I don’t live…

[00:20:26] Fred Glick: Well, this all comes from shoddy work that was done and in Berkeley this happened and kids were killed and they had too many people on the balcony.

[00:20:36] Drew Thomas Hendricks: Oh, I remember. Yeah.

[00:20:38] Fred Glick: Remember that? That’s how this all started. Florida. Same kind of thing.

[00:20:41] Drew Thomas Hendricks: I think something just fell the other day. I saw something on the news that there was another balcony collapsed. Maybe it was in Europe though.

[00:20:48] Fred Glick: I don’t know. No, didn’t see it. But, you know. Hello. Apartment buildings.

Let’s just hit SB 721 if you live in an apartment, it’s three or more units. They have a sample size of 15%. They need to do it every six years and they need to keep the inspection reports for 12, which is easy. It’s all digital now. But they will allow an inspector type of structural, architectural engineer, general contractor, or a certified home inspector.

So it’s a lot easier to do that checking. But if you live in an apartment, hey, call the management company. Say, “When are you doing the SB 721 inspection?” I’m sure the person answering the phone has no idea what you’re talking about, but pressure them. ‘Cause you obviously, you don’t want to happen what happened in Berkeley.

[00:21:41] Drew Thomas Hendricks: No.

[00:21:42] Fred Glick: No. So. Anyway, that’s our happy news of the week. Unfortunately.

[00:21:50] Drew Thomas Hendricks: Let’s continue the happiness. Let’s talk about this yen carry trade deal.

[00:21:56] Fred Glick: Okay. So, as you may or may not know, mortgage rates are definitely higher than they should be. First of all, there’s a big question about what’s gonna happen with tariffs and all that, but the other thing is the Japanese economy is not doing too well.

And really they’re one of the biggest holders of US bonds, treasury bonds, mortgage backed securities, and there people are getting older and there’s not enough people who are younger. People just didn’t have kids there. And so the problem is they need to fund all these pensions and they gotta find the money somewhere. It’s easiest to sell our debt. And that’s gonna be a problem. But also, if you’re a complete nerd about this, there’s a really good TikTok, that came out.

We can put it in the show notes and the all in podcast that talks about what’s called the yen carry trade that’s fully explained it. We don’t need to go into super details here. I mean, Chamath Palihapitiya did a great job of explaining it in there. But yeah, that’s what’s gonna happen.

Fannie Mae comes out the other day and says interest rates next year are going to be in the low sixes. I don’t know where they’re kind of getting this theory of it. And I’m usually one to say that rates are going down, but you know, I still see rates going up. Until we have this question mark of what the hell’s going on with tariffs.

Tariffs cause inflation. Hello? It means prices go up. The reason the fed lowers interest rates, this is, you know, the primer of this is to, is to make an economy stronger. So they, they want you to have a lower borrowing rate. So you’ll go to the bank, borrow money to start a business.

As opposed to the high rates, then you don’t want to borrow.

[00:24:00] Drew Thomas Hendricks: Quantitative easily.

[00:24:01] Fred Glick: So. Exactly. And the higher rates low the economy down so that we can then eventually have it come back down. Because we, and the last thing is called stagflation. That’s the worst possible thing we can have. Prices go up and rates go up at the same time.

And anybody remembers the end of the Carter administration? That’s why Ronald Reagan got elected because of stagflation.

[00:24:30] Drew Thomas Hendricks: 23% interest rates.

[00:24:32] Fred Glick: Yeah. Yeah.

[00:24:32] Drew Thomas Hendricks: Mortgage rates.

[00:24:33] Fred Glick: I had a 12.5 percent adjustable rate mortgage. Yeah. And I’m just happy to get it.

[00:24:41] Drew Thomas Hendricks: Yeah. It’s not as simple as just ordering Jerome Powell to lower interest rates.

‘Cause there’s all these macroeconomic factors that are playing. I heard, I read something about, it was Mark Cuban. I was talking about why prices haven’t gone up yet was because everybody front run all their purchases in Q1, seeing what was gonna about to happen, and they’re still able to sell off their existing inventory.

But we’re going straight into a six month gap where the shipping containers weren’t here. Tariffs are…

[00:25:13] Fred Glick: And they still aren’t.

[00:25:15] Drew Thomas Hendricks: No.

[00:25:16] Fred Glick: There’s a website you can see where all the carriers are all over the world and they’re stuck in China. They’re not leaving. There’s, you know, the port down here in long beaches is gonna be really quiet really soon.

And that’s going to make shortages and shortages cause price increases. And now add that in California to the fact that people who are employed in the farms to harvest everything are scared to go there because they think ICE is gonna show up and deport them for no reason. So, I mean, it’s just.

If somebody looked at this at a macro level based on what is the plan, they would say you’re outta your minds. So what? Because it’s, and it’s simple. A three-year-old could figure this out and what’s gonna happen? Ah, don’t get me started on politics.

[00:26:11] Drew Thomas Hendricks: Yeah. So politics aside, what were we talking about? Oh yeah, it was the yen carry trade.

But I can also tell you about it. Well, this is politics. They’re really ramping, ICE is ramping things up in San Diego big time. There was riots here.

[00:26:27] Fred Glick: I saw that. Yeah.

[00:26:29] Drew Thomas Hendricks: One Porchetta, like an Italian restaurant. Of all the places to raid, why that? It seemed like there,

[00:26:36] Fred Glick: ‘Cause I guess there’s Mexican gangsters running out of the kitchen or something.

[00:26:43] Drew Thomas Hendricks: It’s a chain of like five of them here.

[00:26:46] Fred Glick: Who knows?

[00:26:46] René Pérez Jr.: Yeah. I had, you know, I had been calling just Fred to be exaggerating things, but now I’m even following his advice of carrying my identifications with me all the time. ‘Cause yeah, I mean, it’s inside a restaurant, right?

And it’s happened at like the Home Depot now too, right? Which is something I said would not happen, but here we are, right? So.

[00:27:11] Fred Glick: They go to schools. They’re going, yeah, I mean, it’s just. It’s like these guys getting off on this and they’re all wearing masks. They’ve all been deputized by somebody, you know, and what are they costing us and how much. Okay, here’s something somebody can do.

Figure out how much productivity has been lost in dollars compared to how much we’re paying these ICE guys to come and take these guys out of the country. It’s gotta be 50,000 to one.

[00:27:44] Drew Thomas Hendricks: And the unsettled uncertainty.

[00:27:47] Fred Glick: Exactly. And solve individual crimes and get the criminals, you put them in jail.

You don’t have to port them. You’re giving them no ability to have. In front of a.

By the way, don’t use us. You know, we’re okay with that. Go ahead. Go to someplace. Charge at two point half percent.

[00:28:14] Drew Thomas Hendricks: Yeah.

[00:28:15] Fred Glick: Yeah. Enjoy yourself. You don’t deserve to get our fixed price. That will get me trouble. Ooh.

[00:28:25] Drew Thomas Hendricks: Yeah. The whole unsettledness of the economy and the, just how people are just not, I don’t know.

Everybody’s on the sidelines, but on the other hand, there’s nothing like the security that a home can provide. So I would see some people might wanna just kind of hunker down into a home they own versus renting or kind of being in limbo. We fixed real estate.

[00:28:49] Fred Glick: Yeah. It’s a whole, whole different connotation of we fixed real estate.

But yeah, it’s like I don’t even wanna go anywhere outside of the country. I don’t wanna fly anywhere. ‘Cause who knows coming back, you know, I got, I’m a longhaired hippie and so they put me in an isolation room. I know somebody who is a US citizen, naturalized from South Africa. White person who got stopped and interrogated for an hour. You know, why? No reason they just like picking off whoever they feel like picking off. But anyway.

[00:29:29] Drew Thomas Hendricks: René, what’s the latest? You’ve been all, you’ve been quiet on this chat.

[00:29:35] René Pérez Jr.: Yeah, no, I mean, I’m just working through other things.

I guess I, you know, going back to Fred just saying like, we’re looking into like micro markets and things like that, I think there’s just a lot of uneducated agents in general, and that is why you still see over bidding, right? It’s always an agent who hasn’t, hasn’t done a lot of deals, who says, “Oh, well it’s a hard market, let’s just bid higher.”

I mean, we’re looking at a lot of deals where we would get a deal, almost a deal, under list. And you would so close to the finish line and then someone at the last minute comes in and submits above list. Right? That actually happened to a place to us yesterday. When we were gonna make an offer in a condo in San Francisco, right?

It’s been on the market 60 days and then all of a sudden an agent lies and says like, “Oh, it’s super active,” and it gets people excited. And people who didn’t know that the market is kind of soft. I mean, it’s not, obviously it’s not the Midwest, right?

[00:30:49] Fred Glick: But it’s actually a co-op, which is even softer.

[00:30:52] René Pérez Jr.: Yeah, exactly.

And then because they work with an agent that doesn’t have a lot of experience, they, you know, unfortunately overpay. Right. So that’s kind of the beauty of working with both Fred and I, is that we have done a lot of business, last year we did above $130 million in transactions. This year we’ve done at least five transactions every month. Right?

And that’s just the ones we’re closing, right? That’s not the ones that we actually write. And we look into and we look into underwriting and the mortgages and being the qualifications of buyers, being the activity. So, we’re in the market. We’re not just in San Francisco. We’re not just in Seattle. Right?

We’re all over California. Right? We’re all over Washington. And we can do business from a lot of, from a lot of states, just because it’s 2025, right? So we have the technology to look more deeper into the specific markets. So, that’s kind of my general commentary for the week.

[00:31:56] Fred Glick: With your comment, René, let me just add a little twist to it, that people think escalation clauses of the solution to these things. An escalation clause is a form that says, okay, we’re gonna bid, make up numbers a million dollars, and we’ll go up $5,000 over somebody else’s bid. Up to, and this is the key, up to 1,100,000, let’s say.

So the listing agent gets all the offers. They look at all the ones and see that you’re willing to pay 1,000,001. And they just figured in some way, shape, or form, they could kind of connive it to make you pay 1,100,000.

So, escalation clauses don’t really work. Go in with your number. If you’re close, there’s gonna be a second round. You want to go a little higher and get it. I mean, we just did that with the multiple counter offer. We came in 20 grand higher, we got it. You know, escalation clauses are just, that’s the way they work. So be aware of what happens.

[00:33:02] René Pérez Jr.: I have a pretty extensive article about escalation clauses, and they sound nice.

I mean, I think it stems from, again, amateur agents. I mean, as an agent, you want to be able to give your buyers and your clients options, right? So escalation clauses are a good, I mean, the sentiment is great. The sentiment is to give your buyers options to not have to overpay more. Right?

Problem is that there’s no policing in real estate, so there’s no way to verify that there’s other offers from the other side. So all we’re doing is just blindly telling the other side, this is exactly not my, my first offer is not my real number. I can go this high and I’m okay with it.

Right. So again, if we can attach that article into the podcast, I mean, it’s,

[00:33:55] Drew Thomas Hendricks: Yeah, I need to learn more about escalation clauses. I don’t think I’ve,

Yeah, I mean, a typical agent will, you know, a usually it’s a buyer who will say, “Oh, well let’s do an escalation clause.” And an agent who’s not informed about how that all works will say, “Oh, okay, great idea.” You know, and then fill in the form. So that’s the issue. There you go. Any last thoughts? First thoughts? Next thoughts?

[00:34:32] René Pérez Jr.: Happy start to the official start of the summer.

[00:34:40] Drew Thomas Hendricks: Yes. It’s June. We are recording this on June 2nd.

[00:34:43] Fred Glick: Yeah. And will we have June gloom in Los Angeles?

[00:34:47] Drew Thomas Hendricks: We have it here, we have it here in San Diego.

[00:34:50] Fred Glick: Yeah, we had May Gray, but now the hurricanes are starting.

The first one hit Phoenix with rain for like the first time in 300 years or something. So keep, keep the umbrellas handy kids.

[00:35:05] Drew Thomas Hendricks: Yeah, it’d be neat to have a nice rainy summer at night.

[00:35:12] Fred Glick: At night.

[00:35:12] Drew Thomas Hendricks: At night.

[00:35:13] Fred Glick: Yeah. Can we arrange it please? Just, yeah. Rain at night, help the plants, keep everything, the water supply up.

Stop the fires. So we even had fires the other day. I was, driving.

[00:35:26] Drew Thomas Hendricks: We had a big one east to me.

[00:35:29] Fred Glick: Really? I was driving on the I-10 going north. I was gonna head up to the 101 and it was backed up like crazy. So I said, “Okay, well I’ll go up the  I-10 and then go on the five instead.” So for you LA people, you know where I’m talking about.

But as I come up the 5, up the  I-10, it’s like it comes to a complete halt. So I find out, and I didn’t get it, an alert on my app. It’s a really good app, I forget the name of it, that alerts you to all the fires. There was a brush fire right around Dodger Stadium.

What’s it?

[00:36:13] Drew Thomas Hendricks: Watch Duty is the app.

[00:36:14] Fred Glick: Watch Duty. Yeah. Fabulous app worth paying for. Okay. Paid for that app. And we saw fire trucks closing off the  I-10 temporarily. I could see the firemen hosing down from up top above one of the tunnels. And then they closed off the entrance to the 5 from there for some reason, I guess because there were fires on the other side.

So I had to go all the way up to Avenue 26th I think it is, and then go and kind of wiggle in and come back and get on the 5. But it was like half an hour delay for, you know, I was too lazy to sit and go on the 101, which would’ve taken me 15 minutes. So, LA traffic, it’s crazy kids, but when you had a fire and they showed it from Dodger Stadium from the game, they could see it.

That was nuts, nuts, nuts, nuts. So we hope for rain. Let’s get some rain here. Yep. Moisten things up. Anyway, on that happy note.

[00:37:15] Drew Thomas Hendricks: On that happy note, this has been another episode of We Fixed Real Estate.