June 6, 2022

July 1, 2022

Las Vegas Market Roundtable with The Brendan King Group

Is the housing party over? Take a look as Brendan King discusses the Real Estate Market with his team and shares some valuable information. 

Is the housing party over? Take a look as Brendan King discusses the Real Estate Market with his team and shares some valuable information. 

Stream The BKG Podcast of the Las Vegas Market Roundtable with The Brendan King Group

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7-days at a glance, 14 days on market, 5.1 weeks supply, 825 new inventory, 3,525 active listings,  690 weekly sales, 679 under contract, $588,551 average weekly sales price, and the most expensive home sold this week was $17,500,000.

32 Economists

https://www.businessinsider.com/is-there-a-housing-bubble-market-crash-2022-5

New Home Supply

https://fred.stlouisfed.org/series/MSACSR

Indicators to follow for housing market

https://www.investopedia.com/articles/personal-finance/033015/top-us-housing-market-indicators.asp

Housing Market Crash Business Insider

https://www.businessinsider.com/housing-market-crash-bubble-price-declines-home-sales-drop-shepherdson-2022-5

S&P Case Schiller

S&P/Case-Shiller U.S. National Home Price Index (CSUSHPINSA) | FRED | St. Louis Fed

S&P/Case-Shiller U.S. National Home Price Index | ALFRED | St. Louis Fed

Unemployment Numbers

https://tradingeconomics.com/united-states/unemployment-rate-20-years-and-over-fed-data.html

Overvalued Areas

https://fortune.com/2022/05/31/is-housing-market-bubble-which-markets-overvalued-home-prices/

Home Seller Migration Hotspots

https://www.redfin.com/news/?p=74397

Places that are still relatively affordable

Home Migration

https://www.redfin.com/news/april-2022-housing-migration-trends/

Price below the comps

https://www.redfin.com/news/?p=74408

Why home loans today are not what they were

https://bit.ly/3aca6M2

History proves recession doesn’t mean housing crisis

https://bit.ly/38PmNMw

What Does the Rest of the Year Hold for the Housing Market?

https://bit.ly/3x4ICRE

Don’t let rising inflation delay your home purchase

https://bit.ly/39780gf

Jack Article

https://fortune.com/2022/05/27/housing-market-correction-peak-mark-zandi-moodys-home-prices-outlook/?utm_source=facebook.com&utm_ca

Denise Article

https://www.inman.com/2022/05/24/stop-googling-bubble-heres-why-the-news-may-be-more-positive-than-you-think/

Brendan King

S.0171492

Denise Tipton

S.0188027
Caroline Lauzon

S.0182209
Jack Palermo

S.0182508

The Brendan King Group

Office: 702-625-3457

Email: info@kingvegashomes.com

Website: https://www.kingvegashomes.com/

Real Broker, LLC

7997 W. Sahara Ave. 

Las Vegas, NV 89117

Youtube: https://www.youtube.com/c/Kingvegashomes

Instagram: @kingvegashomes

Facebook: https://www.facebook.com/kingvegashomes

LinkedIn: https://www.linkedin.com/in/kingvegashomes

Twitter: @kingvegashomes

Summerlin Home Search https://bit.ly/3dr5Ian

New Home Site: https://www.showingnew.com/kingvegashomes

This is transcribed (accuracy not guaranteed)

BrendanKing(00:00):Because they like to put greaton everything. It's always the great depression.

JackPalermo(00:04):The great stabilization.

BrendanKing(00:05):The great stabilization. What'sgoing on guys. Brendan King from the Brendan King Group at Real.

JackPalermo(00:20):Jack Palermo.

DeniseTipton(00:21):Denise Tipton.

CarolineLauzon(00:22):And Caroline Lauzon.

BrendanKing(00:23):And we're here for the marketround table. So there's definitely a lot going on, huh?

DeniseTipton(00:28):Yeah. Interesting.

BrendanKing(00:29):It's a different market.

DeniseTipton(00:30):Oh yeah. Absolutely.

JackPalermo(00:31):People always talk about thisbubble.

DeniseTipton(00:33):There's no bubble.

BrendanKing(00:33):But it's a different market.

JackPalermo(00:33):There's there's no bubble.

BrendanKing(00:35):In a matter of... So if you guyshave been watching and if you haven't been watching, you're pretty much in acave. The market has definitely changed. I think we've hit our peak. Does itmean it's a seller's market or a buyer's market? What do you guys think?

DeniseTipton(00:49):I don't think it's...

JackPalermo(00:49):Still a seller's right now.

CarolineLauzon(00:50):Yeah.

DeniseTipton(00:50):I don't think it's balanced yet.

CarolineLauzon(00:51):Yeah. Sure. Still a seller.

BrendanKing(00:51):So, definitely the biggestquestions we have right now are, are we in a bubble? Is the market going tocrash?

Group (01:00):No.

BrendanKing(01:00):Should I wait? Should I wait?

DeniseTipton(01:02):No.

BrendanKing(01:03):On the seller side we havepeople asking, "Should I wait?" On the buyer side we have peopleasking, "Should I wait?" And the answer for both of those is...

Group (01:11):No.

BrendanKing(01:12):Honestly. So, let's check outthe data, but for sure, absolutely, there's lots of reasons why both on the buyside and the sell side now, can definitely be a good time. Let's check out somedata. So, this is actually our most recent market update, which we got thismorning, literally. We contacted Theresa right here and said, "Can youplease send to us as early as possible today?" And we got it. So a coupleof the things we've noticed is this has pretty much been staying the same, 101%of list price has been received nearly every week for like months.

JackPalermo(01:46):Two years [inaudible 00:01:48].

DeniseTipton(01:48):Oh, yeah. Two years. Yep.

BrendanKing(01:49):Well, we were at 102, we're at100, but pretty much 101 for at least the past couple weeks, if not months.Average days on market, weeks of supply, all these things have been a big partof what the change is. So days on market pretty much the same, right?

Group (02:06):Yeah.

BrendanKing(02:07):What's one thing we'vedefinitely seen massive change?

CarolineLauzon(02:10):Weeks of supply.

JackPalermo(02:10):Weeks of supply.

DeniseTipton(02:10):Thank goodness.

BrendanKing(02:11):And I say massive in a case oflike...

JackPalermo(02:13):Well, it's been massive over thelast two years.

DeniseTipton(02:13):But it's doubled.

BrendanKing(02:14):Yeah. Massive in a couple weekchange.

DeniseTipton(02:18):Yeah.

JackPalermo(02:18):This is like a 50% change.

DeniseTipton(02:20):Yeah. It's doubled.

JackPalermo(02:20):Yeah.

BrendanKing(02:21):And that one number we need tofocus on big time is right here, active listing. So active listings one yearago were at 2,400. What's 50% at 2400?

CarolineLauzon(02:31):1200.

BrendanKing(02:34):1200. What are we at? 3525?

JackPalermo(02:37):Almost. Yeah.

BrendanKing(02:37):We're at 50% increase ininventory. Which is, I like what you said, it's great.

JackPalermo(02:42):It's great.

BrendanKing(02:43):So, definitely one of the thingsthat is very, very, very obvious about change, is active listings. And what'sthe one thing that we've had on the buyer side that's been a problem?

JackPalermo(02:56):Not enough listing.

DeniseTipton(02:57):Listing. Yeah.

CarolineLauzon(02:57):Yeah.

BrendanKing(02:58):So, already I know Caroline hadsomebody recently, right? That was having problems with getting offersaccepted.

CarolineLauzon(03:07):Yeah. It's been really difficultto get any offer accepted in the last year or two. And in the last coupleweeks, it's just, "Oh, there's only one or two offers".

DeniseTipton(03:17):Yeah.

BrendanKing(03:18):Yeah.

CarolineLauzon(03:18):This is great. Okay. We don'thave to offer a unicorn to get our offer accepted.

JackPalermo(03:20):Exactly.

BrendanKing(03:23):I had a client who had theirrent increased from $2,000 a month to $3,600 a month. And they quickly wentfrom a renter to a buyer because of the fact that they were going to pay $3,600a month. So all the savings that they were saving every single month were aboutto be given to somebody else.

DeniseTipton(03:42):Given up. Yeah.

BrendanKing(03:42):So we went to a new homebuilder, DR Horton Express.

CarolineLauzon(03:45):They're great, the Express.

BrendanKing(03:47):If you don't know about DRHorton Express.

CarolineLauzon(03:51):That's hard.

BrendanKing(03:51):Say that six times fast. Theyhave homes that they are constantly building, so you don't have to wait the 8,10, 12 months that most people have to wait.

CarolineLauzon(04:02):More like 14, 16. These days.

BrendanKing(04:02):14 months, 16 months whatever itis.

JackPalermo(04:04):Yeah.

DeniseTipton(04:04):Yeah.

BrendanKing(04:05):And so they went in, they put anoffer in on a Sunday and found out on Tuesday that they got it.

DeniseTipton(04:10):Oh, that's fantastic.

BrendanKing(04:11):My clients turned to me, they'relike, "This is easy".

JackPalermo(04:13):Yeah.

BrendanKing(04:13):And obviously that's not beenthe case for most buyers for a long time now. A long, long, long time. Butchange is definitely on the horizon.

CarolineLauzon(04:23):For sure.

BrendanKing(04:23):So besides just the most recentstats that we just showed you, here's a little spreadsheet that we've beentracking since before COVID right? Didn't we start this before COVID?

JackPalermo(04:32):Before COVID.

DeniseTipton(04:32):Yeah.

BrendanKing(04:33):So this is the interestingthing, and we'll be fast on this because no one wants to stare at data all day.Dat-er? Data?

Group (04:42):Data.

JackPalermo(04:42):Potato, potata.

BrendanKing(04:42):Potato, potata. Yeah. And Idon't know if I use data. But 3525. This is today.

CarolineLauzon(04:48):We've almost doubled in the lastthree months.

DeniseTipton(04:50):Yeah. Look at that.

BrendanKing(04:50):Let's scroll backwards. This isevery single week of active listings...

DeniseTipton(04:57):For 2022.

BrendanKing(04:57):For all year.

DeniseTipton(04:59):And then 2021.

BrendanKing(05:01):And then 2021. See, we got closeto 3,500 back in... halfway through 2021. Remember when we had that little pop?

Group (05:08):Yeah.

BrendanKing(05:09):And we were like, "Oh myGod, things are changing."

CarolineLauzon(05:11):And then the next week 1900.

JackPalermo(05:12):And then everybody bought them.

DeniseTipton(05:13):Yeah. Everybody bought them.

JackPalermo(05:14):And then everybody bought them.

BrendanKing(05:15):It was December? November,December of 2020, was the last time we've seen anything over 3,500.

Group (05:24):Yeah.

BrendanKing(05:25):So, the funny thing is way backthen supply was at 6.2, days on market was at 32. And remember what we weresaying, "This is a crazy seller's market!" So now everyone's like,"It's calming down. It's going away. Oh my God!" But what were wesaying back then when we were at 4,100?

JackPalermo(05:43):This is a crazy seller's market.

BrendanKing(05:43):This is a crazy seller's market.So, the thing is, yes, we're not in an insane sellers market, but we're in a...

Group (05:51):Still a sellers market. Yeah.

BrendanKing(05:52):Still a sellers market. Andthat's the big thing that we definitely want to just let people know that yes,things are changing, but on the buy side, you've got a chance right now. You'renot up against 18 offers. 19 offers.

JackPalermo(06:07):Better than going against one ortwo than 18, 19, 20. 27 offers.

DeniseTipton(06:11):Yeah.

CarolineLauzon(06:11):Absolutely.

BrendanKing(06:12):On the buy side, honestly, forus too, it's a little more enjoyable. We get to know our clients. You know howmany clients I've had the past year where I've had to like then go back andcommunicate with them, because I didn't even get to know them.

DeniseTipton(06:23):Right.

CarolineLauzon(06:23):Yeah, so quickly...

BrendanKing(06:23):I have one client who just movedin the other day, they never saw the house. They just moved in on Saturday.They'd never seen the home, I've never met them in person. They just moved inon Saturday after finishing up a job out of state and I've never met them. Theyjust did everything virtual, never saw the home. And I think that's going tochange a little bit.

JackPalermo(06:45):For sure.

BrendanKing(06:45):I think now we'll have a chanceto actually know who the buyer is.

CarolineLauzon(06:50):Yeah.

BrendanKing(06:50):Get to know the family and getto know the fact that they have options.

CarolineLauzon(06:56):Mm-hmm (affirmative).

DeniseTipton(06:57):Yeah.

BrendanKing(06:57):I think that'll help them reallylearn.

CarolineLauzon(06:58):And I feel like, yeah, forbuyers too, there will be more options in the offer process because therewasn't any... you had to really make your offer as clean as possible andoffer... I was joking about unicorns, but really you had to be so creative andoffer 60 day lease back for free and foot massages and anything to be creative.

JackPalermo(07:16):Waived appraisal.

CarolineLauzon(07:16):Waived appraisal.

BrendanKing(07:18):And just so guys know clean tous, the words clean, I don't mean to jump on you. Just so they know what cleanmeans, like to us a clean offer is like an offer where literally everything isjust...

CarolineLauzon(07:30):Waived.

BrendanKing(07:30):The bare minimum. Waivedcontingencies, waived appraisal.

CarolineLauzon(07:34):No home warranties.

BrendanKing(07:35):20,000 over appraise value.

JackPalermo(07:37):Right.

BrendanKing(07:37):Which to people in LA they'relike, "Yeah, we've been doing that for 15 years".

JackPalermo(07:41):Sure.

CarolineLauzon(07:41):Yeah.

BrendanKing(07:41):To us it was new and it nevereven got as bad as LA actually. But yeah, the giving...

CarolineLauzon(07:49):So now I feel like there's goingto be more options for buyers to be like, "Hey, I do want a home warranty.Hey. No, I'm not putting 20,000 above appraisal," and just a little bitmore...

DeniseTipton(07:58):Calm.

CarolineLauzon(07:58):Calm. Yeah.

BrendanKing(07:59):What do you think will be thefirst thing that comes back on a contract that we don't have right now?

JackPalermo(08:06):Ooh.

DeniseTipton(08:07):Oof.

JackPalermo(08:07):Home warranty.

CarolineLauzon(08:12):Yeah. Home warranty.

DeniseTipton(08:12):Home warranty. Yeah, because weused to ask the sellers to pay for the home warranty.

JackPalermo(08:12):[inaudible 00:08:12] whileeverybody else is waiving.

BrendanKing(08:12):What's one thing that has been awhile?

JackPalermo(08:14):Closing cost.

DeniseTipton(08:15):Closing cost.

BrendanKing(08:15):Closing cost. I thought about itthe other day, I was like, "Do I ask for closing cost right now?"

JackPalermo(08:20):I'm showing a property todaywhere it says agent to agent remarks, buyer or seller to offer closing costs.

DeniseTipton(08:27):Ooh.

CarolineLauzon(08:27):Wow. That is...

JackPalermo(08:29):It's just like [inaudible00:08:31].

CarolineLauzon(08:29):That is new.

JackPalermo(08:29):It's crazy.

BrendanKing(08:31):And these are good points.Sometimes the price doesn't always mean the end result. We were talking newhomes earlier and let me pull this one up, because this was one of Jack's statstoo. So this is something regarding new homes. So, don't worry about thetalking head here. So housing market just slid into a full blown correction.

JackPalermo(08:55):Correction.

BrendanKing(08:57):Jack was sliding me some statson this.

JackPalermo(08:59):Yes.

BrendanKing(08:59):So tell me a little bit aboutthe new homes.

JackPalermo(09:02):So new homes fell 19% to thelowest, since April 2020.

BrendanKing(09:08):Yeah. And that was somethingthat I think Redfin had mentioned. Right? So yeah. New home sales have fell19%. So what does that mean? If the sales have fallen 19%, what does that meanon the other end? What's going to be out there for people to actually purchaseis inventory.

JackPalermo(09:25):Inventory.

BrendanKing(09:26):What we've been hearing from alot of people is now, we may be in a little bit of a situation where new homebuilders... Remember this, when I bought my house, I got...

JackPalermo(09:36):Incentives.

Group (09:36):Incentives.

BrendanKing(09:37):3% for closing cost. I'm anagent so I got 3% commission, and I put 3,5% down.

JackPalermo(09:48):Wow.

BrendanKing(09:48):So I bought my house for like$800.

CarolineLauzon(09:51):Wow.

BrendanKing(09:51):Like literally $800. And it'stripled in price, but I think incentives...

JackPalermo(09:57):It's 2,400 now.

BrendanKing(09:57):Incentives will... Think aboutthis, and I think this is what this article states, which we don't have to goback to it. But, I think permits, once you get your permits to build a newhome, you don't stop building.

JackPalermo(10:10):Right.

BrendanKing(10:11):So if you have 3000 permitspulled and approved, now you have this supply of materials coming, you can'tstop building.

DeniseTipton(10:20):You have to keep building.

CarolineLauzon(10:20):Yeah.

JackPalermo(10:20):You keep building.

BrendanKing(10:21):You have to keep moving. So alot of these builders who are moving at the speed of light now will start tohave inventory, which means that there may be some opportunities coming up.

JackPalermo(10:30):Right.

BrendanKing(10:30):Again, none of this means acorrection, none of it means a bubble on that level, which I guess we shouldchat about. I don't think prices will come down, I think just the insanity willdrop off.

JackPalermo(10:41):Insanity will [inaudible00:10:42].

CarolineLauzon(10:42):Which is good.

DeniseTipton(10:43):Yeah. Because haven't we seen aslight reduction?

JackPalermo(10:46):19% of home listings cut theirprice in the last month.

DeniseTipton(10:50):Right. So we've seen it. Right. I'vepulled up listings where it's dropped 5,000, 10,000. Now, that's in the midlevel, that's four to six.

JackPalermo(10:58):Right.

DeniseTipton(10:59):Right? So we've seen it drop,because there's not 15 buyers, there's not 15 offers, there's two. There's notas much activity, which is good for buyers. It's not insane.

CarolineLauzon(11:10):Yeah.

BrendanKing(11:11):Yeah. No. And definitely this isthe Case-Shiller index, which shows the national home price index. This is homeprices. I was looking at this before. Look at this trough of up in the 90s tolike 2006. And then you have the crash quote, unquote, the great recessionwhere things dropped about 20%. Then you have this insanity of what we havenow.

DeniseTipton(11:35):Right. Look at the angle.

BrendanKing(11:35):But if you notice, if I were togo back, even before the 80s, you'll see this same wave of up and then down,and then up and then down. So let's say, God forbid, home prices here went down10%. And we went up what? 26% year over year right now from last year.

JackPalermo(11:59):Right.

DeniseTipton(11:59):Yep.

BrendanKing(12:00):I think 20 something percent theyear before.

DeniseTipton(12:01):The year before.

BrendanKing(12:02):So we're up 50% in two years.God forbid, let's say prices dropped 10%.

JackPalermo(12:08):We're still up 40%.

DeniseTipton(12:09):Yes, exactly.

BrendanKing(12:11):We're still up 20% a year. Thisis what people don't realize.

DeniseTipton(12:17):So it's not a bubble, and thebubble's not bursting.

CarolineLauzon(12:17):And in the long run, if youdon't look next year, next... like in the long run... real estate...

BrendanKing(12:21):Yeah. And in the long run, it'sstill crazy. It's still a crazy increase. And our biggest problem is this, isthe supply. So this is a monthly supply of new houses. Kind of going back towhat Jack was saying on new homes specifically. New houses sold, this is thesupply. And see how right here in 2020?

CarolineLauzon(12:47):Wow.

BrendanKing(12:47):Way down.

DeniseTipton(12:47):Lockdown.

BrendanKing(12:48):New homes.

DeniseTipton(12:49):Yep.

BrendanKing(12:49):And then you have up, and thenyou have a little dip right now as interest rates went up. But do you see thisblue line right here?

CarolineLauzon(13:00):Mm-hmm (affirmative). Go backup. Yeah.

BrendanKing(13:00):That is a massive jump. And thisis definitely what Jack was talking about. And if you don't know whatCase-Shiller is, Case-Shiller...

DeniseTipton(13:08):Case-Shiller price [inaudible00:13:10].

BrendanKing(13:09):If you look up Case-Shiller foranything real estate related, they have a monthly report always, on housingsupply, construction, all that.

BrendanKing(13:17):But look at this massive jump innew home inventory right here. Out of nowhere, similar to down in September of2020. But what happened was, when that happened, then they added supply, sothen the inventory went down. And then now, that's why they think there's goingto be an onslaught of inventory, because they tried to meet the demand of whenit was low right here, and then it went the other direction.

DeniseTipton(13:46):Right.

BrendanKing(13:46):So naturally we're going to haveto now get rid of this inventory. So hey, who knows?

JackPalermo(13:52):Who knows?

BrendanKing(13:52):None of us...

CarolineLauzon(13:53):Incentives.

BrendanKing(13:54):None of us have the crystalball. Nobody, and let's talk, when I mean nobody, we have 32 economists in theBusiness Insider website that all discuss what their thoughts were on whetheror not we'd have a housing bubble.

JackPalermo(14:11):Mm, let's see.

BrendanKing(14:11):32.

JackPalermo(14:12):Let's see what they say.

DeniseTipton(14:13):Yeah. Let's take a look.

BrendanKing(14:14):32. So let's check this out. So,on the Insider, are we in a housing bubble? 32 experts. And when we sayexperts, these are all the top in real estate, economics, real estate. Anythingnumbers related, these people would bore you at dinner, but would absolutelygive you the details that would tell you what's going on. So we go right hereto this part of the article where it states out of 32, 6 say that they thinkit's a bubble, 22 say no, and 44 say maybe.

JackPalermo(14:47):Four, just four.

BrendanKing(14:48):Sorry, four. Oh my God. 44 plus22 plus 6, is not 32.

JackPalermo(14:53):Yeah, it's more than 32.

BrendanKing(14:54):So six say yes, 22 say no, andfour say maybe. I'm not going to...

DeniseTipton(15:01):Suppose the difference on thatfour, you've got two to get.

BrendanKing(15:03):Yeah.

DeniseTipton(15:04):Yeah. Six, and then 24.

BrendanKing(15:06):Yeah. So the big thing is westill have to listen to those six, because there always is the oracle who in ayear or two says, "I'm brilliant."

DeniseTipton(15:15):"I predicted."

BrendanKing(15:17):"I predicted it".

DeniseTipton(15:17):And buy my book.

BrendanKing(15:18):But, the big thing in the end iswe don't know. But what we do need to do is listen to these experts and listento their information, because when all of it aligns and they all say yes, thenat least we know it ahead of time. But when I went through this article, what Inoticed is like Ivy Zelman who, in my opinion, is the smartest woman on theplanet when it comes to anything like this as far as real estate, especially. Iactually saw her speak in person, and she knows such specific data andinteresting stats that the whole room just went silent because she losteverybody.

BrendanKing(15:56):But she knows her stuff. In heropinion, she feels like, "No, we're not in a bubble, but yes, there'sgoing to be some corrections," like Boise, Idaho has gone up 70...

JackPalermo(16:08):73%.

CarolineLauzon(16:08):Oh my God.

BrendanKing(16:09):73% in Boise, Idaho. And Boise,Idaho is a beautiful place, it's beautiful. That's where San Francisco wentwhen COVID happened.

DeniseTipton(16:19):Right.

BrendanKing(16:19):Half of San Francisco, I had acouple clients here moved to Boise, believe it or not. And definitely, I thinkthere could be something on the horizon there. But then you have anothereconomist which states the complete opposite, David Rosenberg. Hello David.

JackPalermo(16:36):Hello David.

DeniseTipton(16:37):Hi David.

BrendanKing(16:37):There he is. David Rosenbergthinks the entire world is going to end. And this is the part of his quote thatI really enjoy is, "The leverage is less acute, but the price action isequally parabolic and out of sync with underlying fundamentals that typicallydrive real estate valuations".

BrendanKing(16:56):So in his opinion, he thinkswe'll have a bubble worse than the last one as far as home prices areconcerned. Which is really interesting, because I don't see anybody else sayingit to this extreme. And especially if we look at, keeping current matters, thisis one of our favorite go-tos for information.

DeniseTipton(17:21):Yeah.

BrendanKing(17:21):They've got a whole thing aboutthe recession that I definitely want to pull up here, that has a breakdown ofwhat the last six recessions actually had, as far as price increase ordecrease.

DeniseTipton(17:38):Yeah. Effect on the market.

BrendanKing(17:38):You saw this, right?

DeniseTipton(17:39):Yeah.

JackPalermo(17:39):I just posted it on my storytoday.

DeniseTipton(17:40):Yeah.

BrendanKing(17:42):What do they say about thehistory of a recession in a housing market?

JackPalermo(17:47):Oh, let me pull it up and showyou.

BrendanKing(17:49):So what they say out of the lastsix is... so out of the last 6, 1980, it went up 6.1%.

JackPalermo(17:58):6.1. Oh, there it is. Okay.

BrendanKing(17:59):1981, 3,5. It was weird that wehad two recessions back to back. 1991, negative 1.9%. This is housing prices.2001, it went up 6.6% because it was an internet bubble.

DeniseTipton(18:12):Right.

BrendanKing(18:12):Not related to housing.

CarolineLauzon(18:14):Yeah.

DeniseTipton(18:14):Yep.

BrendanKing(18:15):2008, housing related crisis,negative 19.7%. 2020?

JackPalermo(18:24):Up six.

BrendanKing(18:24):Up 6%. In this case, withinventory being as low as it is, what I found in that article with all theeconomists was that majority felt inventory is going to be the problem.

DeniseTipton(18:35):Yeah.

BrendanKing(18:36):Obviously, new houses coming onin a big, huge amount that could be help for the inventory. But, like we weretalking, what's wrong with the neutral market?

JackPalermo(18:46):Nothing.

DeniseTipton(18:46):Nothing.

BrendanKing(18:47):Like if we're at 9,000 homes,that's beautiful.

JackPalermo(18:51):Right.

BrendanKing(18:51):Sellers are happy, prices aregoing up, and buyers are happy because they have choices and they have time.

CarolineLauzon(18:58):Yeah.

DeniseTipton(18:58):Yeah.

BrendanKing(18:59):That's the big thing for me,sellers are like freaking out, "No, I'm not going to sell now," it'slike, "Well, when are you going to sell?"

JackPalermo(19:05):Right.

BrendanKing(19:06):Like, do you sell after it comesdown a little? Or do you sell later when it's more? The nice thing is, a sellermay actually have a house to buy now.

CarolineLauzon(19:15):Yeah. That's what I was going tosay is sellers have now options, because in the last year, a lot of people werelike, "I want to sell, but where am I going to go? What am I going tobuy?" And there was no option.

DeniseTipton(19:24):Right.

CarolineLauzon(19:25):Now actually sellers can selland find a house in a timely manner.

DeniseTipton(19:28):Maybe they can get and takeadvantage of those new home builders.

BrendanKing(19:32):Yeah.

DeniseTipton(19:33):Right? They time it.

BrendanKing(19:34):And I think what could happentoo, that's a good point, is I think now... that could be a little boost ininventory as well, is sellers who are sitting on the sideline because theycouldn't buy anything. They'll add too. So you'll have continued listings frompeople now that are going to actually buy something, because they can. We'llhave people who continue to move here. We were looking at some numbers beforethat were really, really interesting. Let me see if I can pull these up,regarding our state compared to other states.

DeniseTipton(20:06):Yeah. That's really interesting.

JackPalermo(20:06):Yeah.

BrendanKing(20:08):This was definitely interesting,because what it did mention is migration spots, and where people are coming andgoing. So one of these articles were the top eight migration spots in thecountry. 32% of home buyers are looking to relocate still. So look Q1 of 22,32.3%.

DeniseTipton(20:29):Right.

BrendanKing(20:29):Q4 of 21, 31%. We're actuallyhigher now than we were just a few quarters ago, where you feel like, "Oh,was this going to slow down with people moving?" I don't think so.

JackPalermo(20:42):I don't think so.

CarolineLauzon(20:44):Yeah.

BrendanKing(20:44):For Vegas?

DeniseTipton(20:45):No. Vegas has always been...

BrendanKing(20:46):What's the next cheapest spot inall of the West Coast besides Las Vegas?

DeniseTipton(20:50):My answer...

JackPalermo(20:50):Bakersfield, California.

DeniseTipton(20:51):Ah, you didn't let me answer.

BrendanKing(20:51):Bakersfield, California.Exactly.

CarolineLauzon(20:54):[inaudible 00:20:54]

BrendanKing(20:54):So look, popular migrationpoints, Virginia Beach. San Antonio. Houston, Texas. Jacksonville. Bakersfield,California. No offense Bakersfield, but I do think Vegas has a lot more tooffer.

CarolineLauzon(21:07):For sure.

BrendanKing(21:07):But...

JackPalermo(21:07):Apparently just put in a gasstation.

DeniseTipton(21:10):No, that's Searchlight.

BrendanKing(21:11):So here's the deal though, 365.You know what? They've got us beat on that. You know what? Vegas is definitelya haven for a lot of people in California. But there may be some parts of thecountry that 365 is an appealing price point with nice weather.

DeniseTipton(21:27):Yeah.

BrendanKing(21:27):Because it is California.

DeniseTipton(21:29):Yeah.

BrendanKing(21:29):But the other part of thisarticle I saw that was really interesting is, this is portion of searches fromusers outside of the metro for each area. Net inflow and net inflow for lastyear and this year. Las Vegas, we have slowed down a little bit for peoplecoming from out of state. However, 5,000 people is still a huge amount. And ifyou look, where are they coming from?

DeniseTipton(21:59):Cali.

BrendanKing(22:00):LA. So our average price pointis 445. Look at every other city on the West Coast. Sacramento, California,604. There look, I had to turn my sound off there, everybody. Sorry about that.Sacramento, California, 604. San Diego, California.

CarolineLauzon(22:19):Oh wow.

BrendanKing(22:19):865 average price point.

CarolineLauzon(22:22):Average?

BrendanKing(22:22):Another one we had on here,Spokane, Washington. All right. So, there's another option on the West Coast,you can go to Spokane, Washington.

JackPalermo(22:31):It's colder there though.

DeniseTipton(22:31):Yeah, but that's also the middleof Washington.

BrendanKing(22:33):Yeah, it is.

DeniseTipton(22:34):It's not the coast.

BrendanKing(22:34):It's not Seattle.

JackPalermo(22:35):Right.

BrendanKing(22:36):And then you have here 695 inBend, Oregon.

DeniseTipton(22:39):That's a beautiful place.

BrendanKing(22:40):And they're leaving places likeSan Francisco. 1.6 million average, 900,000 average in LA. Seattle, Washington,there it is, 850. Denver, Colorado, 615. Portland, Oregon, 556. Pick anothercity on the West Coast that's cheaper than us besides Bakersfield, California,with high population. I don't think you're going to find it.

CarolineLauzon(23:03):Yeah.

DeniseTipton(23:03):High population and great thingsto do.

BrendanKing(23:04):Yeah. Phoenix, also higher thanus.

JackPalermo(23:06):Phoenix, higher than us.

DeniseTipton(23:06):Yep.

BrendanKing(23:07):Boise, Idaho, way higher.

DeniseTipton(23:09):Higher than us.

BrendanKing(23:10):Salt Lake City higher.

DeniseTipton(23:11):Higher.

BrendanKing(23:12):So, where I think for Vegas thatpeople don't realize is, this is going to continue to be a case where peopleleave other areas, because we're just cheaper.

CarolineLauzon(23:21):Yeah.

BrendanKing(23:21):And we've got so much to offer.

CarolineLauzon(23:23):And that keeps our demand reallyhigh.

BrendanKing(23:26):Yeah.

CarolineLauzon(23:26):So speak back to the market,like offer, demand. We have so much demand, people think, "Oh, prices aregoing to go," but we have so much people moving here and there's just somuch demand.

BrendanKing(23:37):Yeah. Oh for sure. And that'sdefinitely something that I think we'll keep up. I definitely think the demandwill continue. And one of the things that I also noticed was... so this was oneabout a share of homes for sale with a price drop. So price drops haveincreased, but the big thing people don't realize is, in order for a market toneutralize, prices have to stop being listed 5, 10% above the last comp.

CarolineLauzon(24:07):Yeah.

JackPalermo(24:07):Exactly.

DeniseTipton(24:07):Yeah.

BrendanKing(24:08):I think comps now will start tobe equal to the last sale, not 5% above the last sale.

JackPalermo(24:15):Sure.

BrendanKing(24:15):Which means things are calmingdown for that reason. Because look here, you see Boise, Idaho share of homeswith a price drop in April of 2022.

CarolineLauzon(24:24):Wow.

BrendanKing(24:24):40.8%. Share of homes for salewith a price drop in 2021, 10%. Their change has been 61.6. So this issomething that definitely, I think we need to pay attention to.

BrendanKing(24:38):And if you come down to Vegas.Vegas is right here. We're only at 18.7%, compared to 11 though.

CarolineLauzon(24:46):Mm-hmm (affirmative).

BrendanKing(24:46):But that also is going to helpchill out the market a little bit.

DeniseTipton(24:49):Yeah.

CarolineLauzon(24:50):Yeah.

BrendanKing(24:50):So these aren't necessarily badthings. I think on a seller's side, if you're waiting for the top, I think thetop has come, and you may be on the downside.

DeniseTipton(24:59):But not too far down.

BrendanKing(25:00):But I think on the downside,meaning your top is gone. Like some people are still waiting. They're like,"I'm going to wait for the top," I think the top here.

DeniseTipton(25:10):Top's gone. Yeah.

CarolineLauzon(25:11):Yeah.

BrendanKing(25:11):I think the top is gone. Does itmean you're going to lose value? No. I think you could probably sell for thesame today in three months from now.

DeniseTipton(25:17):Yeah.

BrendanKing(25:17):But you're not going to geteight offers, push the price up $30,000. I've got one under contract right now,that if it fell out, I would probably have to go a little lower. Just becausewe pushed it like crazy. On a street that I won't name.

DeniseTipton(25:34):Don't name it, no.

BrendanKing(25:34):It's under contract, but if Ihad to go back on, that was a push price. That was a, "I'm going to getlots of offers," price, not a situation where we had to list at the lastcomp.

DeniseTipton(25:46):Right.

BrendanKing(25:46):So another one that I have tofind an article on was comparing us across the board to other overvaluedmarkets. So, I know we were chatting about this before. Jack and I wereespecially, because we brought this up. So this is an article that is inFortune Magazine, that actually is regarding overvalued housing markets. Soeveryone keeps saying overvalued, overvalued. So I saw this article, I gotnervous for a second. It mentioned...

DeniseTipton(26:20):You know what that's called?That's called a click bait headline.

BrendanKing(26:22):It's total click bait.

JackPalermo(26:23):Total click bait.

DeniseTipton(26:23):Click bait.

BrendanKing(26:24):So keep an eye on theseovervalued housing markets as the housing boom implodes. And then you come downhere. And nearly every metro is red. And what they're saying is, overvalued asfar as if things were to continue the way they are. So I continued reading andI got down to this next section.

JackPalermo(26:47):This one's a good one.

BrendanKing(26:48):This one's good. Very high, over70% chance of a price dip. All the way down to very low, which is zero to 20.So very low is this dark blue, very high is this red.

JackPalermo(26:59):Look at Las Vegas.

DeniseTipton(27:00):We're not red.

BrendanKing(27:00):Now look at this. This changesthe article a bit, because when you look at that first graph, you're like,"Oh my God, the whole world's going to implode." Then you look atthis, very low. What's this little sliver right here, Las Vegas, HendersonParadise. So, in Vegas we have a zero to 20 chance that we're overvalued. Ikind of agree with that.

JackPalermo(27:24):Yeah.

BrendanKing(27:24):And I think the thing supportingthat for us is that situation with us being surrounded by metros with way, way,way higher prices.

DeniseTipton(27:34):Yep.

BrendanKing(27:35):And what kind of constructionare we seeing here? Like uncommons...

JackPalermo(27:40):Amazing stuff.

DeniseTipton(27:40):Yeah.

BrendanKing(27:41):On the strip, there's some coolthings coming.

DeniseTipton(27:43):Yeah.

CarolineLauzon(27:43):Yeah.

DeniseTipton(27:44):Out in Henderson with the newcondos.

BrendanKing(27:47):Henderson. High end luxury.

DeniseTipton(27:48):High end, yeah.

BrendanKing(27:49):I think our time has arrived onthat market. And then just overall we have so much to offer. But I saw this andI was like, "Eh, okay."

JackPalermo(27:59):Makes a little bit of sense.

BrendanKing(28:00):Compared to Phoenix Mesa, you'vegot a whole red section here. Here's Boise over here. Boise, Idaho, highchance. Bend, Oregon, beautiful area, very high chance because of peoplepulling out of Seattle. And then Sacramento, you have a medium chance. Mostlybecause I think this is a mature city. Believe it or not, the only other redsare over here in like Bridgeport, Stanford, Norwalk. That's people leaving NewYork City.

DeniseTipton(28:29):Yeah.

BrendanKing(28:30):I think a lot of those people,if you work in New York that commute, if you're back in the office, I thinksuddenly you get on the train, do your hour and a half commute, believe me,I've done it.

JackPalermo(28:42):Done it. Yeah.

BrendanKing(28:43):I think a lot of these peoplemay turn around and be like, "I'm going back to the city". Who knows?I don't know, New York's pretty fun. I couldn't go back now, but I'd love to goback for five days and then get the heck out.

JackPalermo(28:54):Best place to visit. Nice placeto visit.

BrendanKing(28:56):But definitely as far as that'sconcerned, nice to see that economists agree that we're not overvalued. So Ithink in the end, what's your opinion, Jack? I'm going to give... we're eachgoing to do a prediction.

JackPalermo(29:12):Okay.

BrendanKing(29:13):Then we're going to go back tothis and we're going to see who was right or who cares actually in the end?

JackPalermo(29:19):My favorite word.

BrendanKing(29:20):Yeah.

JackPalermo(29:20):Stabilization.

BrendanKing(29:21):All right. All right.

JackPalermo(29:22):That is what is going to happen.

BrendanKing(29:23):So we'll call this... becausethey like to put great on everything. It's always the great depression, thegreat...

JackPalermo(29:29):The great stabilization.

BrendanKing(29:31):The great stabilization, as Jackhas coined.

CarolineLauzon(29:34):I like that.

JackPalermo(29:34):Yes.

BrendanKing(29:34):What do you think Denise?

DeniseTipton(29:35):I'm going to go along with thosesame lines, but I'm going to use food. It's not a cappuccino anymore, it's alatte. Still the same thing, less froth.

JackPalermo(29:44):Okay.

BrendanKing(29:44):All right. All right.

JackPalermo(29:46):Okay.

DeniseTipton(29:46):Still tasty.

BrendanKing(29:47):I like it.

CarolineLauzon(29:47):I like it.

BrendanKing(29:48):That's a good one too. Whatabout you?

CarolineLauzon(29:50):Same thing, along the same linesas you guys.

BrendanKing(29:53):Yeah.

CarolineLauzon(29:53):I think we're going to stabilizeand just be in a normal market. Happy market for everyone.

BrendanKing(29:59):Yeah. I agree. I think I'm goingto run with Jack's... we'll say, "Let's all cheers to a latte for thegreat stagflation."

JackPalermo(30:13):Stabilization.

BrendanKing(30:14):The stabilization. I mean,stagflation, I said stagflation.

JackPalermo(30:16):Stabilization.

DeniseTipton(30:17):Oh, no.

BrendanKing(30:17):That could happen too but...

JackPalermo(30:19):But it goes to show you that weall look at the data, we all look at the stats, and we all come to the sameconclusion.

CarolineLauzon(30:25):Yeah.

JackPalermo(30:25):Right?

BrendanKing(30:26):Yeah.

JackPalermo(30:26):So, I mean that's...

CarolineLauzon(30:27):I mean, for two years likewe're, "Oh, it's going to crash". And people two years ago were like,"I'm going to wait because it's going to crash. It's going to crash."But if you look at the data, it's not.

BrendanKing(30:37):Yeah.

DeniseTipton(30:37):You cannot compare it.

CarolineLauzon(30:37):And then they are like,"Oh, I should have bought two years ago." Yes, you should havelistened.

DeniseTipton(30:39):You should have when I told you.

BrendanKing(30:40):Well, that's the thing too.That's a good point. I know you mentioned something about inflation, and if youbuy and if you don't buy. But either way, if you're not in, it's still going tobe higher. I think is what it's going to be. Let's say we go back to normal,3%, then you're still negative 5%, but you're still better off than if youdidn't buy.

JackPalermo(30:59):Right.

DeniseTipton(30:59):If you don't buy, you have nocontrol.

BrendanKing(31:01):Yeah.

DeniseTipton(31:02):Right? So back to your renters,that became buyers. You have no control.

BrendanKing(31:05):Yeah. $3,600 a month.

DeniseTipton(31:07):No control.

BrendanKing(31:07):I think rent's going to continueto go up.

CarolineLauzon(31:09):Absolutely.

DeniseTipton(31:09):Because there's no inventory.

CarolineLauzon(31:12):Demand.

BrendanKing(31:12):Yeah. There's no inventory,demand is still there, Vegas is still cool, construction's still going.

DeniseTipton(31:16):Yeah.

JackPalermo(31:16):Awesome.

BrendanKing(31:16):And I think the biggest thing isprices are still... here's the thing none of us know, tomorrow they could go to10% with interest rates and make us all wrong. And that's the thing, we have tobe okay with that because that's just the way it works.

DeniseTipton(31:33):Yeah.

BrendanKing(31:33):The only way to know you're in arecession is to be in one. The only way to know market's going to crash is tosee it crash. So in the end, I think what happens will happen, but based ondata which we'll live with right now, I think we're in good shape.

JackPalermo(31:46):We're in good shape.

CarolineLauzon(31:47):And if you look at, back to mypoint earlier, the long run, historically, real estate, even if it did pullback a little bit, it does appreciate in the long run always.

BrendanKing(31:58):Yeah. But if it pulls back,that's good.

CarolineLauzon(32:01):Yeah. And I had a seller thatshe bought just at the top of the crash in 2006 or 7, and she held onto it, andfinally the market went back up.

DeniseTipton(32:10):There you go.

CarolineLauzon(32:11):If it crashes, it goes back up.It's like this is how the market works. So you have to look at the big picture.Unless you're a flipper, it doesn't matter, it's going to appreciate.

DeniseTipton(32:19):There you go. If you'reflipper...

CarolineLauzon(32:22):Stop being scared of the bubble.

BrendanKing(32:22):And that's the thing, if you'reflipper... if you're a flipper, there's still opportunity out there.

CarolineLauzon(32:24):Yeah.

DeniseTipton(32:25):Absolutely. Yeah.

BrendanKing(32:25):If you're an investor, I'm aboutto send a message to all my investors, because I think now we can negotiate abit more.

JackPalermo(32:30):Absolutely.

DeniseTipton(32:30):Yes.

CarolineLauzon(32:30):Well, now it's starting to makesense. The rent to mortgage value. I have a few investors that, because peoplewere putting 50 above appraised value, it didn't make sense, but now it does.

BrendanKing(32:39):Well, my guy was gettingfrustrated. Yeah, I would send him the numbers, id run it in our report.

CarolineLauzon(32:43):Yeah.

BrendanKing(32:44):And I'd run it in our report andI'd send it to him, he goes, "2% cash on cash return?"I'm like,"Yeah. It looks good, but it's not as good as it looks."

CarolineLauzon(32:52):Yeah.

BrendanKing(32:53):Now I think we'll have theopportunity to look at numbers and send our offers based on real numbers, notbased on hype.

CarolineLauzon(32:59):Absolutely.

JackPalermo(32:59):Right.

BrendanKing(33:00):And how long can we sustain 26%?Let's be honest.

CarolineLauzon(33:03):Yeah.

BrendanKing(33:03):You can't sustain 26%. So, anykind of adjustment is a warm welcome from us, because I think it onlyeventually will make things...

DeniseTipton(33:16):Stable.

BrendanKing(33:16):Even out and stable.

JackPalermo(33:17):Stable.

BrendanKing(33:18):And have our buyers be happy andour sellers be happy. So from the BKG, we welcome the great...

Group (33:26):Stabilization.

CarolineLauzon(33:26):I can't even say that word.

BrendanKing(33:28):But definitely, I think if youguys ever have any questions, feel free to reach out to any of us. We'll keeptalking data. We'll keep telling you the real deal of what's going on, becausethat's the only way you can make decisions is based on that. Not based on hypednews articles.

JackPalermo(33:44):Yes.

BrendanKing(33:44):Because the funny thing is,every single article we just pulled up, if you were to look at the headline...

JackPalermo(33:49):Click bait.

BrendanKing(33:49):You'd think the world wasending. Even though if you read the article, it says otherwise.

DeniseTipton(33:54):So read to the bottom.

BrendanKing(33:55):So read to the bottom. If youdon't want to read it, just call us or text us.

JackPalermo(33:59):We'll tell you what's up.

BrendanKing(34:00):And we'll tell you the realdeal. But either way, hey guys, this has been interesting.

JackPalermo(34:04):Been fun.

BrendanKing(34:04):I think it'll only get moreinteresting. No one's going to win this because we all said the same thing.

JackPalermo(34:09):I know.

BrendanKing(34:10):So when we go back...

JackPalermo(34:11):Copycats.

BrendanKing(34:12):When we go back, we can takeourselves to dinner.

JackPalermo(34:14):Yeah, exactly.

BrendanKing(34:16):Because either way, I thinkwe're going to see some good change for sure. So hey, the change is good.Change is good. And the market is going to be happy for both buyers and sellersand we're happy to see it. Any questions feel free to reach out, but we'll seeyou guys another time. Have a good one.

JackPalermo(34:34):See you.

BrendanKing(34:35):Bye.

 

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