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Jason: Good morning, Triad. Hope everybody is doing well. Hope everybody survived last night’s, well whatever it was that blew through here. It was wide open. So maybe you got your canoe out. Maybe you are floating in the front yard, but unfortunately, there is more to come. Hey, if we did not have the weather to talk about, some of us would not have anything to say. Right? It is too hot. It is too cold. It is too this. It is too whatever, but anyway, if you are out there, be safe. I think flash flood warnings are still out, so be cautious if you live anywhere near a little stream. Sometimes it becomes a very big one quickly. Use precaution and obviously do not let the kids out playing in the creek.
Last week, we got into a series on sales. We are going to continue that this week. We started talking a little bit about sweat equity last week, and now we are going to dive into the good old-fashioned sweat equity, hard work, making it happen, getting out there doing well, digging in and grinding out stuff.
Jason: It is a piece of business that is required for all business especially when you are getting them started. Somebody has got to push the boulder to get it going, to get the momentum.
Mikell: And I really appreciate this topic, Jason, because one thing you touched on last week is basically just having confidence in yourself, knowing that what you want to do matters. When you are talking about the part with the tractor, you probably thought that was a silly idea. Now, that is a million-dollar company.
Jason: That is right. Yeah, absolutely. People a lot of times they avoid problems. I want problems. Problems are what give us security in what we do.
Jason: The internet cannot fix problems.
Jason: I can. I can fix your problem. I can fix your problem house. You are not going to do that by clicking the mouse and going to whatever out there. You still have to have human capital and human people to do many, many, many of the tasks. I am not afraid of the robot generation although it will replace some jobs. Some of it is good because for safety reasons and those kinds of things we need robots doing certain things like it gets pretty dangerous out there in some of these careers and careers paths that people have. So technology is good, but it does not replace hustle.
Jason: It does not replace getting out there and making it happen. One of the things that you have really got to start doing is you have got to stop doing stupid, too. Warren Buffet has a great quote. He has got two rules in business. The first rule is never ever, ever lose money. The second rule see rule one. That is it. That is a great line –
Mikell: I like that.
Jason: -- from a guy that has a few Benjamins under his belt.
Mikell: Just a few.
Jason: Just a few. Just a few. You need to start looking at doing smart things with your money and time and making good moves in the right direction, right place. So today we are going to dig into that. The mindset. The mindset of champions. What do champions do in order to win? I will assure you they do not sit at home and watch TV and just entertain themselves. Right?
Jason: They have a plan. They have a purpose, and they are out there working it. So grab your pen and paper and let’s crush this Saturday morning and get things rocking and rolling. We can make excuses pretty much for anything that does not line up with our quick, easy plan and basically avoid this thing called sweat equity, avoid this thing called work. It is called work because it is no fun. Right? It would be awesome if you could, think about this. I am waking up today and I am going to go do fun at your job. Right? Typically, that is not the mentality that we have, but that is a mind shift, and when you can make fun at your job and what you do, my wife gets frustrated with me sometimes because she will call and she is like are you coming home. I am like yeah, sure, absolutely. What time is it? It is like 8:30. Oh, whoops. Just kind of blew right through that. Sometimes it is I just get caught up in what I am doing, and I get excited about it and time just blows through. Sometimes I am there late because well, it is busy. We have got a lot of stuff happening. And you cannot get it all in and done in a 40-hour week. I have folks that tell me I work 40 hours. I am like what do you do after Wednesday? They look at me like what?
Mikell: I like that.
Jason: I was like well, yeah, what do you do after Wednesday? If you are only working 40 hours you are not really getting, I do not know. Get a bigger stick. Get more leverage. Things to think about as we go through this, the mindset, the difference between having an idea and making it happen is really in the work, in the sweat equity. And so as an investor, one of the things I look for is the proof of concept before I invest, before I put my money into anything, I want to make sure has it been done before. And you should ask the same thing. Have you done it? What are the results and can it be scaled? That is what I am looking for. I get a lot of folks call me, and they have great ideas. They are like hey, would you partner with me on this? I am like sure, but I find out it is theory, and it is hard to invest in theory. There are companies that do that, but most investors do not invest in theory, and if they do, they are a very, very, very high-risk investment. Just to give you an idea. When you have an investor, when those three things line up, when you have the proof of concept, when you have done it, you have the results, and it can be scaled, the banks and investors will throw cash at you.
Jason: You will never have an issue with money ever when you have those things lined up. I got a friend who needed $20 million for a project. $20 million is not a little bit of money.
Mikell: Not at all.
Jason: That is a lot of zeroes. But because he had all three of these things lined up, he was able to raise that money in less than 90 days. Okay?
Jason: So that was from lots of different people, lots of different people that had faith in what he was doing, but he was also able to show them that he was able to do this, and he had done it in the past. He had done it on smaller scales. Typically, when it works on a small scale, it most of the time will work on a big scale. That is called working out your proof of concept. And so, those are the things that you have to do. He was able to show that I have done so and so with x amount of money and here are the results and here is where we will go and here is how it is going to grow. And the formula works for any widget on the planet. Anything. Any kind of widget out there it works as long as those three factors are deployed in every single transaction. So he got his $20 million because he had a proof of concept. He had a plan, and he was able to show and prove that it was not a theory of concept.
Mikell: It seems like he showed that previous sweat equity as well.
Mikell: That is what sold it.
Jason: There is no doubt about it. Yeah, because if you do not have the sweat equity behind it, what do you have?
Jason: Theory. You have got theory. You got an idea. Theory may be good for the science labs, but they are not great for business.
Mikell: No, not at all.
Jason: They are not great for business. If you prove it works small perfectly, first, keyword, first, then you will get the opportunity to show it big. But you have got to do it. So next question I get is where in the world and how do I start?
Jason: Really the key thing is you start with what is in front of you. You start with the prospect next door. Knock on a neighbor’s door. The business next door. The school, whomever you know that needs your product or service. It makes no difference. Action is the key to sales. You have to go do it. You have to go make it happen. A lot of people want to skip that step because that is the rejection step. Right? Think about, there are so many stories out there, but everybody from McDonald’s to KFC and all these different companies and they are billion-dollar corporations, most of them got told no hundreds and hundreds if not thousands of times because maybe they were talking to the wrong audience, or they were just working out the grind.
Mikell: My generation is afraid to fail. I admit that.
Jason: They are. They are hypersensitive to failure.
Mikell: I like that.
Jason: Hypersensitive. Most people want to skip that step and they want to go straight to advertising. Advertising does not create really much. What it does though it enhances what you are already doing. You start by beating the street. All right? You start by knocking on the door, knocking on the business. I have spent, fortunately, where I am at in my career in my life, I have been able to spend time with people of Shark Tank and the host of the show, and got to know some of them better than others, but I have been fortunate to get around people that are big thinkers. One of the interesting things is all of them started out kind of with this door-to-door, ground-roots, knocking on businesses or knocking on their neighbor’s door, it is how they started their careers. They did not start at this high level that we see. Dave Ramsey used to say on the radio all the time, he goes people think we are an overnight success. I have been doing this for 28 years, but I am an overnight success. Because they only see what they want to see or they only, now you are only visible to them at the level that you are at.
Mikell: That is true.
Jason: You did not see them going through the grind. And that is why they have books. You go back and read the books and you listen to the grind. Damon Johns has a got a great story, one of the guys on Shark Tank. This guy closed this company five different times and threw in the towel, and just something kept going out there and going out there. Now he is running an $8 billion company.
Mikell: That was actually really key what you just said, Jason. I do not know if you know it or not. But I would say my generation needs to read more books and stay off social media because social media shows where I am at now. They do not show the grind. They do not show the sweat equity. They do not show the pain.
Jason: That is right.
Mikell: The book would cover all of that.
Jason: Yes. Absolutely it does, yes. Yes, books are phenomenal. I find that most leaders and most people that succeed at a high level read many, many, many more books than they watch YouTube or the book of faces that are out there.
Jason: Most of those faces are fake faces. So think about where you are getting your information. Nobody gave these folks millions of dollars to get started. They started one sale a at a time. It is fun. If you watch Mark Cuban, he does not invest in much. He is probably the shark that invests the least, but he carries a lot of wisdom in what he says. If you watch him closely, especially his body language, you will notice when someone says that they door knock to sell their product, he lights up, man. That is when you get his attention.
Jason: You want to get Mark Cuban’s money, you tell him you knock on doors to sell your product, and you sell it at a high level, and you have some profitability in that, and I will tell you what. That guy, he gets excited. He lights up. He is behind that. Why? Because you cannot duplicate or replace that kind of hustle. A machine will not do that.
Jason: Right? And that is a drive and a will. At the end of the day, if you really think about it, he is not investing most of the time in the product. He is investing in that person that has the courage to get out there and present. The person that is willing to go knock on doors and present their product, that is what he is investing in. You look at some of the widgets that he does not, and they are successful. What is the story behind it? Is there hustle in there? Is there grassroots’ sales? And those are the things that he gets excited about. Not just him. There are other sharks that do that as well, but anyway. So this weekend, dig down, drum up the courage to get started, and that is all that it takes. Some of you guys are sitting on billion-dollar ideas, and unfortunately, they will go to the grave with you because you will never take the action to do it. People ask me. What does it take to make money? What does it take to be successful in business? Most people immediately go to money. It absolutely has nothing to do with money. It is 100% courage.
Jason: If you do not have the courage to get started, the money makes no difference. If I give you $100 million, and you do nothing with it, one, as an investor, I do not get a return, and two, you just have $100 million. Right?
Jason: And if it is not doing anything for you, you will eventually go through it. There is a masterful teacher that talks about this. He does not use money. He uses a thing called talents, and he gives you an example. It is a story of three different people with three different talents, and three different ways in which they used the talents. He gave one person ten talents and the other a couple, and one guy got one. And the guy that got one did not do anything with it. He had the talent to go out and make it happen, and he did not. And what did the teacher do? He took the talent away from him and gave it to the person that actually had the most, that was actually using the talent. Think about the stories that we hear and when you read books, you learn, and there are simple, teachable moments that are in that book. It just takes one little ah ha to really get you started.
Jason: Think about that. America is built on small business. Most people think it is built on corporate America. It is not. Corporate America does not drive America. Small business, people out here, the HVAC guy, the plumber, the electrician, the real estate agent, the insurance guy. These are the heartbeat and what drives America. The guy that fixes the truck. These are the guys that make it happen. We unfortunately put too much emphasis on corporate America. If you want to know the power, and some of you guys do, or the lack of power and the lack of hope and faith that you can have in corporate America, some of you have experienced this. You are working for a Fortune 100 company. Everything is awesome. You have got your pension. You have got all the PTO time you want. Four weeks of vacation. Everything is awesome, and you walk in one day, and they say we are closing the division, and 10,000 of you, 3,000 of you, 500 of you are going home. They did not ask about what was going on in your life. They did not ask about the struggles that are going on with your family. They simply said the bottom line says we cannot afford you any longer, therefore, you have to leave. That is not a place of control that you really want to be in especially when you are 57 years old and you get that message, and you are making $85,000 a year. Try going and replacing that at 57 years old. Very difficult. So small business. Those opportunities that you have, those ideas that you have, let’s go put them to work this weekend. Take action. Get the courage. Go out there and do it. Hey, guess what? You are going to mess up. The first 100 people may say no. But if the 101st guy says yes, it actually could change your entire, well, it could actually change you and every person behind you. Your entire legacy of what you want to do and leave on this earth could be changed just by one person saying yes. But you might have to hear 100 no’s first. All right. We are going to take a time out, go pay some bills, and we are going to come back and we are going to dig into the how a little bit more. So will be right back. You are listening to the Jason Bramblett Real Estate Show. We will see you here in just a minute.
And welcome back to the Jason Bramblett Real Estate Show. So we were digging into the why and the get started and what should I do, so now it is the how. I hear this quite often when I talk to, especially different real estate agents around the country. They are like well, Jason, that is easy for you. You are on the radio. You are on TV. You have got billboards everywhere.
Mikell: You have the number one real estate company in the Triad.
Jason: There you go. Even better.
Jason: All these things that I do, yes, but remember it goes back to marketing enhances. It does not actually get the stone rolling down the hill. I get a lot of folks. I am just working from my kitchen table. I am just working from my garage. I started on a cardboard box, which was my kitchen table because we did not have a kitchen table. We had a big cardboard moving box, probably a refrigerator or something. That is where I started. I did not start with billboards up and down the highway, and I did not start on the radio. I did not start with those things. So stop looking at where you are and look at where you are going. That is the key. You cannot look at where you are. And then you need to set targets. Targets are key. Targets show predictable numbers. When you do start, you need to know where you are going. You have got to put that number on paper. You have got to be able to create a formula or a recipe in order to get to the sale. So if you do not do that, then you have this unpredictability. Unpredictability is not something people invest in. They do not invest their money in a service that is unpredictable, and they do not invest their money in a product that is unpredictable. So you have to track everything. You have got to do it every day, and you have got to build a predictable system for your product, your service, or your widget. So we use a tool called a Daily Activity Report. This is how I learned. This is what I came up with, and this is what I teach our team members. It is just a simple sheet of paper that we created that tracks the dials, the contacts, the appointments, the tasks, and our priority touches. Every single day. It tracks the time that we are calling, and basically this is a blueprint to ensure that we are achieving the highest productivity in the shortest amount of time. Doesn’t that sound like a good plan? As opposed to just doing it all the time. Having basically building the perfect recipe to ensure that you succeed, and you do that by prioritizing and tracking that daily. Then what happens is you create the proof of concept. I have a plan here. I adjust my plan daily and I get it to where it starts to prove the concept that I have. And especially for prioritizing your time. I teach a principle called time blocking. It is simply just being focused intense on your task for a certain period of time because if you do not do that, this thing comes along called the whirlwind, and it will blow up your day if you are not prepared. You have got to make sure.
So the data, then that we do from our Daily Activity Sheet is actually loaded up into some cloud-based software that we have, and it creates a history. It creates a system in which I can see numbers over a long period of time. It takes that daily activity and it creates a nice, long tale in which I can see where a team member may start to kind of get off course. If they veer off course a little bit, I can see it happening, and I know the result of veering off course. This basically lets me see around corners. It lets me know when I have got a team member that is headed to the ditch, and they do not know it because their head is down and they are working hard, but they are not working in the right area or they are not doing the right things. So now I have data to be able to see that. I can see that deviation.
We will play with some numbers, and I know numbers are hard on the radio. But let’s just say you had 18 conversations in order to get to an appointment. You talk to 18 people and now you have got an appointment to get in front of them, and let’s say it is seven appointments to get to the sale. So you have got 18 people you speak with to get an appointment. Now you have seven appointments, and then you get a sale. If the team member is getting the appointments but they are not getting the sales, then there is an issue with their face-to-face contact. They are doing great on the phone, but they are blowing it up when they get in front of the people. Right?
Jason: So we are able to see that. So what is it? Is it their body language? Did they show up late? Are they off script? Are they not asking for the business? That is a simple one. Maybe they have face-to-face appointments nailed, but they are making 24 contacts to get an appointment instead of 18. And now we have a scripting issue. Maybe they are off-topic, they are off-script, or they are not using the scripts in which we laid out that we know are successful in getting people to meet with you. Maybe they are calling at the wrong time of the day. People are busy. If you interrupt them at the wrong time, they are not going to talk to you.
Jason: So you have to have a metric every day to be able to see this. You have to have a report. You have to have data, and the cool thing about this is you do it daily to prove your concept, and then our CRM system that we have and our cloud-based software allows us to take a look at a long period of time to say hey, maybe I got off track. Everybody has a bad day. Everybody should not have a bad week. Right? So maybe there is something happening. Maybe there is something going on in that team member’s life that they have not shared. Maybe their home life is a little tough. Maybe the spouse is nagging at them. I told you this would not work. I told you this was a waste of time. When are you going to make some money? Just go get a real job.
Mikell: Which happens.
Jason: Go out and get a real job and quit trying to sell that widget on the side of street or knocking on those doors. You know that is stupid and it is not going to work. Maybe that has just gotten into their head, and it has veered them off and it has got some doubt in there.
Mikell: You need a strong support system.
Jason: You need a strong support system, but you also need to be strong yourself.
Jason: If you do not have a strong support system, do you use that as an excuse. Read books, build up your self-confidence.
Jason: All right?
Mikell: I like that.
Jason: Do not dig into the YouTube haters and doubters and your Facebook friends that think you lost your mind and all these different things. You have got to push through that stuff. Life is not easy. It is just the way it is. I cannot fix that. I am not going to be able to fix that. This is not paradise, and so you have got to push through those obstacles. Next week, we are going to dig into more in our series on sales. You can go to Jason Bramblett dot com. If you want a copy of our Daily Activity Report, just shoot me an email. I will be happy to share it with you. No cost. My gift to you. Everybody have a safe weekend, and we will be back here next week on the Jason Bramblett Real Estate Show.
Jason: Good morning, Triad. I hope everybody is doing great out there, enjoying the sunshine and the beautiful North Carolina blue skies. It does not get any better than that.
Mikell: Not at all.
Jason: I tell folks everyday that if you are coming in from out of state and we got the Carolina blue skies going on, it is a disadvantage. It is hard to beat that for sure. Now, of course, in the next little bit, the humidity will show up.
Jason: Blue skies are nice, but when you are melting, it does not matter. Anyway, I hope everyone is going to have a good, wonderful, safe weekend out there. Remember slow down, take it easy. That plate of food is going to be there when you get there. I promise you. But you have to get there in order to enjoy Grandma’s food or wherever you are headed. So be careful out there.
Mikell: I would say leave early.
Jason: There you go.
Mikell: Because you may not get a plate.
Jason: Depending on what family you are going to. Right? That is right.
Mikell: That is true.
Jason: Yeah, it is possible. That is possible. But just be safe. There is lots of traffic out there this weekend as always. I have heard there is no sand left at the beach. It is completely covered with human bodies. Carolina Beach and all those out there are wide open this weekend. I think it is like state law. You have to go to the beach on Memorial Day weekend.
Mikell: Yeah, absolutely.
Jason: If you are there, be safe. If you are on a boat or on the lake, be safe out there. We are wrapping up today the series on getting your house ready to sell. So whether you are now, a year, three years down the road, whatever the case may be, stay tuned because we are going to walk you through each step as we go through it. And if you have questions, of course, you can give us a call at the office, 553-0796, or shoot us a message or email or, of course, Facebook, whichever one. We are pretty much everywhere. Instagram, whatever all these other things are. The tweeters and the twitters and LinkedIn. You name it, we are out there. What we find is interesting. We have got folks that are avid Facebook folks, but they do not do any of the other stuff. So we do it all so we can get in front of you. Get the information out to you. Get homes out to you. So if you are thinking about selling, you can reach out to us at any of those one social media platforms.
So last week we left off with the kitchen, so we are going to recap on that just a little bit. One key thing, this is a big mistake that some of you folks make. If you are going to buy appliances, make sure they all match. Okay? You do not want to end up with the white wall oven and the black dishwasher and the stainless-steel refrigerator and all those things. So get some continuity there, get something that matches, and just set a budget if you are replacing as you go. Or actually there are some great sales this weekend if you are in the market. There are actually some phenomenal sales at these big box places out there. And also make sure that the appliance package you choose matches the quality of the house that you are selling. So if you are selling a home north of $300,000, most people do not want dishwashers with turn dials on them. Right? It is kind of like a TV, well, you guys do not even know what that is. Now, once upon a time you actually had to get up, walk over to the TV and spin a knob to choose the channel. Right?
Jason: Channels did not get changed a lot back in those days because somebody had to get up off the couch. Right? Now you do not even have to have a remote.
Mikell: I actually remember those days.
Jason: Yeah. Now the TVs are so smart you just speak –
Jason: -- and it just does whatever it is you want it to do. Amazing. Granite as we get into the kitchen. Granite, it is simple. Unless your house is over $500,000, you really do not need to worry about these exotic different types of granite, these different levels. They have got level one to level 4, level 5 and all these different things. If you are over $500,000, okay, then that is fine. But in the 250-450 range, you really just keep it standard. Keep it simple. Granite is granite. It is a rock. It is kind of like diamonds. There are still places out there that talk about they are precious stones. They sell them at Walmart. Okay?
Mikell: They do.
Jason: They sell granite everywhere now, and that is why you have seen the prices come down. That is why we are selling $150,000 homes with granite countertops now. It has become affordable. It has become a product in which, once the big box stores start carrying it, you see the prices get pushed down, making it more affordable. But the number one investment in the kitchen for 22 years in real estate, this is the best two things you can do. Organize and clean. You cannot go wrong with those two things. So a well-organized pantry and an eau de bleach smell in the kitchen is a wonderful, wonderful thing. People never ever complain about those things. They actually, actually you will really draw attention to your kitchen. Think about grocery stores. You will probably go in one in the next week. Look at the amount of money they invest in make sure that all the labels are facing the aisle. Everything is easy to see. You notice they do not put the warning labels facing the outside of the aisle. Right? It is the representation of the food. It is the photo of the front of the can or the box or whatever it is. They do not turn the cereal box to the side where you can just see how horrible they are for you. Right?
Jason: They put the Tony the Tiger.
Mikell: And they put the cereals at the bottom shelf so they are eye level to the children.
Jason: Oh absolutely. Yeah, yeah, all the gross cereal is up high. All the granola whatever. All your sugar cereals are about 36 inches off the ground.
Mikell: Grape Nuts is definitely not going to be at the bottom.
Jason: That is right. You are not going to pay for premium placement there because no kid is walking around going I just feel like some barely today. No. They want those magic marshmallows and sugar –
Jason: -- in nine different colors and flavors. Right? It is the same thing with your house, and if you can duplicate that, take a look at that, observe what they are doing and do that with your pantry. Right? And make sure that it is orderly and neat and looks like or feels like that grocery store feel. It also makes everything feel a little bit bigger. Organization, continuity there actually really kind of duplicates or exponentially grows the space. It is amazing. If something is organized, if it is a 24-inch shelf, it is 24 inches, but yet, when we go in and organize the shelf, it makes it look bigger simply because you have that continuity there. Think about Dillard’s, Macy’s, whatever department store out there, whatever clothing store that you go to. Look at the money they invest in displays. Right? In making sure that the clothes are presented well. Obviously, they have got mannequins and all that stuff, but if you look at the shelves, if you look at how they display the clothing, duplicate that. You have got your closets. You have got your, not that people are going through your drawers in your house, but they are going to look in your walk-in closets. Make sure they are orderly. Right? There is a different price in retail shopping. If you go to some of these stores where things are just kind of thrown in bins, it is a lot different price than when you go to a name brand store, where they are really doing a top-level job of making sure everything is properly presented.
Jason: And the prices that they charge are substantially different.
Jason: And some of that appeals to folks, and that is fine. But remember this. People that go to those types of stores where you have to dig through stuff and it is like an Easter egg hunt. Right? You are in there digging around for the deals. They are there for a deal. The people that are going to the nicer stores, if you will, the stores that are have a representation of orderly, clean and all that, they are paying a different price. So when somebody comes to your house, do you want them thinking hey, I am looking for a deal or do you want them thinking like they are retail shopping? If you want to get top dollar, you do not want them on an Easter egg hunt in your house. Right?
Mikell: Not at all.
Jason: You want the house presentation to match the price point in which you are attempting to achieve for your price level. So it does not matter if it is a $100,000 house or $1 million house. I have been in some amazing homes that looked phenomenal on the outside. Landscape, yards, everything just perfect, and go inside, it looked like a bomb went off. Wow. So price range does not dictate behavior. Okay? Just because if it has got a big price does not mean it is a great presentation on the inside. I have been in some very nice, amazing homes. You walk in and you are just like wow. Unbelievable with the way in which, it is just the disorder, if you will, that is in the house. So think about that. It is a key thing. So as you observe these stores, steal ideas. Look and see how they have it at the grocery store, at some of these finer clothing stores that are out there or whatever your flavor of store is. But just recognize that people that are digging through bins are looking for deals. That is not what you want them to do at your house.
Mikell: Not at all.
Jason: You do not want to be showing your house as a deal. Remember you do not need any help to get the lowest price. You can just do that stupid all on your own. Right? That is what we are here for. We are here to get your more, but you have got to be willing to do some things. The most frustrating thing is to have somebody say yeah, we want top dollar. Then you go to their house and you are like no, you really do not. Nineteen different shades of blue is no. You are not looking for the best price. So we have got to coach you through where it is we need to get you as far as that presentation. It is huge.
So as people are moving, typically, they are looking for more space. You see a lot of folks that are upgrading right now, especially with rates being as cheap as they are. Most people do not move to the same. They either move up or down, but very few people make a lateral move. So you have got folks that are coming to your home that may be in an apartment. They are looking for more space. And so, you need to think about that. Make sure your closets are organized. They need to look clutter free. If they are cluttered and they open up the closet and they are like wow, there is no storage here. Well, there actually is. It is just you have got way too much stuff in there. It goes back to being organized, and neat and clean and organized closets help sell homes. Closets that are jammed up, I mean, some of you guys have got more bedsheets than the daggone Hyatt Hotel. You got three bedrooms and 90 sets of sheets. Pack some of them away. Use some minimum stuff. You have been hanging onto things for quite a while. Or get rid of them. Donate them. Sell them. Whatever you want to do. Chuck them in the trash. It does not matter to me. But just make sure you have a minimalist idea of what it is. Even folks that are downsizing, we see that they still are looking for storage. It is one of their biggest concerns. I am in a 5,000 square foot house. I am going to go down to 2000 or 2500 square feet, maybe a townhouse or something like that. And what they are looking for is something that they can take, memories, stuff that they do not want to get rid of yet, and they are still attempting, some of them are trying to put 5000 square feet of stuff in a 2500 square foot house and it does not work. But even if we have a downsizer that is considering your home, it is still important. They need to know or they need to have that visual that hey, I can take some of my lifestyle with me. I can take some of my lifestyle, will fit. Because they are making a huge change. Think about it. They have maybe been in their house for 20 years, and it is time or whatever. Empty nesters or they just do not need that big of a house anymore. But they still want to make sure that what they are buying is going to fit the essentials. Now the essentials to them may still probably be too much stuff, but we have got to be able to make the presentation. We have got to be able to show off the space. Right?
Jason: Kids’ rooms. Kids’ rooms are their own little unique animal. I really do not care that much about kids’ rooms and the reason why is this. I would say kids’ rooms are probably the least important room in actually the selling process. Every parent that I have worked with in the past 22 years bribe their kids with something that they are going to be able to do in their new room. Every single one of them. So whatever is there is going to change 99% of the time. Very few exceptions to people who move into a home and not change anything about the kids’ rooms, especially teenagers because teenagers hate you. Right? When you are upsetting their apple cart, you are ruining their life because we are moving to a new city, to a new area, to a new state.
Mikell: New school.
Jason: New school. New everything. And you are absolutely destroying everything that they know that is good in their life. You are messing it up. And so what we do is we tell them hey, you can do whatever you want in your new room, and it will be all yours. And so, that is okay. That is why sometimes we go into some of these kids’ rooms and they are creative. I will give you that. But I do not worry about it so much. If it is screaming craziness, then yeah, we may need to tone it down a little bit. Maybe neutralize it, but the biggest key with the room is it just needs to be clean, and here is the kicker, smell free.
Mikell: I was going to say smell nice.
Jason: Yeah, I know teenagers in and of themselves come with this odor. Eau de teenager, which is typically pizza from three weeks ago that is jammed under the bed, empty drinks, all kids of stuff and things that just never seem to migrate back to where they are supposed to be.
Mikell: Workout clothes –
Mikell: -- that never made it to the wash.
Jason: Never did. Shoes that have not seen a washer in a long time. Yeah, so it needs to at least smell presentable.
Jason: That is a key thing there. Get it at least somewhat organized, but clean and the proper smell is a good thing in the kids’ room. But do not go crazy with spending a lot of time there because we have seen time and time again that is what parents do. Parents will do everything they can do to ease that transition by selling the kids on hey, we will let you paint your room purple. We will let you put whatever. We are going to get you a new bedroom suite of some kind. Beds, bunkbeds, whatever it is. It is something we do as parents to attempt to make that transition as easy as possible. It is an attempt. That is all that it is. It does not mean it is still going to work. Hopefully, it will.
Jason: So let’s do this. We are going to take a quick timeout. Go pay some bills. We will be back. You can get us at Jason Bramblett dot com or at the office, 553-0796. You are listening to the Jason Bramblett Real Estate Show.
And we are back. You are listening to the Jason Bramblett Real Estate show. I hope everybody is having a great, great weekend. Remember be safe out there as you are traveling around to wherever it is you are headed to. Use time on your side. Right?
Jason: Drive a little slower, leave a little earlier and relax, and when that person cuts you off, it will be okay.
Mikell: It will. Actually, there are a lot of red and blue lights out there on the highway.
Jason: Yeah, I am sure. I am sure. America is the only country that I have driven in that we actually have people that get mad when you get like, somebody cuts in front of you. What is funny about America is you can have somebody pull out in front of you like three football fields away, and you guys still go crazy and honk the horn. In all the other countries I have driven in somebody can pull out in front of you three millimeters, like there is just enough room for air and that is it, and nobody honks a horn.
Jason: Just relax.
Mikell: That is their reality.
Jason: Just flows. It is no big deal. I have been in countries, where there is one stoplight, and actually the stoplight causes more problems than anything else. So just relax. It is going to be okay. So before the break there we were talking about well, teenagers and those smelly little things that they are. But there are other things that smell in a house, and since we are talking about odors, I thought I might as well go ahead and make everybody mad and talk about your puppies and your kitties and those things and your pets. We love them. I live on a farm. We have got lots of them. They all have odors, good and bad. Right? And so when you are selling your home, you might want to have a friend that is honest with you. An honest friend. Not a friend that tells you hey, that dress looks good on you. Or no, you do not look like a goofball with that shirt on. Right? You need somebody that is going to be honest and not just tell you what you want to hear when it comes to the odor in your house and your pets. You have become what we call nose blind. You do not know that it smells as bad as it does at your house, and a good, honest friend is worth their friendship when you are going to sell your home. Just to be clear with you and say yes, the cats are really a problem. Now, I would say if you have got 32 of them, you do not even need to call anybody. Right? Just know that that is going to be an issue. Right? Sure.
Jason: But it is something that we deal with and it is something that is where you need some help sometimes because we do get used to the odors in our home and we do not recognize or know that they are just a little bit, we say funky, if you will. The other thing is if you are a smoker, and I know this is a tough one for some folks, but we find smoking in a home is typically going to reduce the value of that property between $10-20,000.
Jason: Especially if you are in the 2000-3000 square foot range, simply because if they are non-smokers, if we can even get them to consider your home, you are looking at a 100% complete paint of every single thing in the property. Ceilings, baseboards, walls, everything. New carpet all that, and then hours and hours of cleaning all the other areas. So there is a price that you will pay for smoking in your house. Now, I know some of you will say I do not smoke in the house. I smoke on the deck or I smoke in the garage, and I just only smoke one a day. Whatever it is, it still follows you home unfortunately. It is one of those things that if it is a non-smoker that comes into your home, even if you do it very, very rarely, and sometimes if you do not even do it near the house, you just do it in the car, it still lingers in the property, and people will discount the price in which they are considering to pay for your home to deal with the cleanup of that. So it is something to think about. All the more reason to maybe to decide not smoke anymore if you choose.
All right. Master bedroom. This is, and the bath. This is typically the second place most people spend a majority of their time in looking at the properties. Number one is definitely the kitchen. No question. Most people go straight yo the kitchen when they look at a home. The second place though is normally the master bedroom suite or just master bedroom master bath. If it is not a suite, do not worry about it. It is still where they are going to go look. We see that carpet is becoming less and less desirable. Hardwoods are definitely the most preferred thing right now, and that could be a fad and it could go away. The good thing about hardwood floors is they will last 100 years. It is one of those things. You can put it down if you put down good quality hardwood floors they will last forever. They will last longer than probably you want to be in the house, and or they will actually last longer than you. I have sold many, many, many 1910, 20, and 30-year-old homes that have outlived their owners and they still have hardwood floors and they are still there.
Jason: And many, many generations of people have passed through, and yet the hardwood still remains. So exercise equipment, this is one of the biggies in the master bedroom. If you have exercise equipment, I would suggest during the sell you get rid of it. I find most people dispose of exercise equipment in the master bedroom to get it out of the way, and it ends up being a really fancy place to hang your clothes. Like on that treadmill that you bought that you were going to lose weight with, and yet it is doing a great job of holding up your shirts and pants and whatever else you have –
Jason: -- hidden it with. We say we try to hide it. I think that is it. I think if I put enough clothes over it, I will not remember it is a treadmill. Right?
Mikell: There you go.
Jason: I will not remember that I need to get on that thing and maybe do some miles. But as you move into the bathroom, brass right now again, you guys know that I am an anti-brass guy.
Jason: But especially in the master. This is where you are going to see some real hesitation and some kickback from buyers. Nothing screams 1990 like brass. It is just fake gold. Right?
Jason: And realistically that is all that it is. So investing money in the master suite, in the master bath to get rid of that is money well spent especially if you are in a neighborhood that is really kind of plagued with it and you are the standout. The houses that we see in those types of neighborhoods that move the quickest are homes that have transitioned to the satin nickel and the oil-rubbed bronze and all those things. So money well spent to remove that brass. So we have got lots and lots of tips if you go to Jason Bramblett dot com. Click on the email icon. You can shoot us a message over there any time you like. Remember be safe out there this weekend guys. We will be back next week as we continue walking you through every step to get the house ready to sell.
Jason: Hope everybody is doing well. Market, the market, the market. What is going on? It is crazy out here, Jason. Yeah, it is a little bit. It is that time. We are getting into the peak season, the prime time to sell the property and or buy one. That is the mantra. Of course, statistically, we sell about the same houses every quarter. So it is more of a feeling than it is reality. But that is okay as long as you are feeling like buying a house. Give us a call. It is 553-0796 at the office. So we have been talking about getting the house ready. So whether you are now a seller and want to sell today or you are one, two, or three years out, we have been talking to you in the last couple of weeks in the series on getting the house ready. If you are wanting to sell to achieve the highest potential price, that is what we are really looking at. As I have said before, you do not need anybody to sell it for the lowest price.
Mikell: No, not at all.
Jason: You can do that all on your own.
Jason: I can assure you. So it is about maximizing what you have and maximizing what you have done and or are thinking about doing to the house to get well, potentially the greatest sales price that you can possibly get. And that is what we are looking at. So grab your pen, your paper, and if you do not have that and you are driving now. Do not worry. Hit the website Jason Bramblett dot com. You can listen to the podcast, the show notes, and everything that you would want to see plus a little bit of behind the scenes stuff that we fill in there. Sometimes we run out of time. We just run out of time. Time goes no matter what. Last week’s show, we got a boatload of emails in, but one in particular stood out, so I am going to share that with you as we kickoff the show.
So Sandy writes in. Mr. Bramblett, I will be selling in the next three years, so your show and the topic is perfect timing for us. You mentioned adding a new heating and cooling system will give us a return of about 80% on our money. Is there anything we could do to the house that will return more than 100% of our money? Basically, getting an investment. We want to make money on our home and not lose on everything we invest. Thank you, Sandy.
Mikell: That is an excellent question.
Jason: It is a great question. That is one that we deal with a lot. It is one that if you did not send it in, it is one that you probably were thinking as we go through this stuff. Hey, we have got thousands of people listening, so this is a benefit to everybody. So the answer to her question is not what most people want to hear. The answer to her question is no. To my knowledge, there is absolutely nothing that you can do to your home to improve it that you can get more than 100% return on.
Jason: All things being equal. Now, you can fact check me. Go to your big box store, orange or blue, whichever one you choose, okay, and they actually have some amazing data out there. They have about every product or improvement that you can purchase at one of the big box stores, they give you a synopsis of what the return is of that purchase throughout the entire United States because it does vary based upon where you are. And so what you will quickly notice is there is nothing that is 100% plus percent. It averages anywhere from 30 to about 82% is the highest return.
Jason: So if you put let’s just say $10,000 in an improvement in your house, and we will just make math easy because it is well, it is radio. If we do $10,000 investment in the house, then perhaps you are looking at about an $8000 return on that. So hence, not getting to 100%. Right? And so, here is the thing, guys. It is not really because of the improvement. It is the product. The product is the wrong time. It is the house, not the item. And the reason that nothing is more than 100% return on the product is because it does not generate any income. Okay? It is an expense. No matter what you do, no matter how you look at it, if you are living in the property, even if it is paid for, on a spreadsheet, on your P&L, it is a negative. It is not a positive. So whether you have a paid for house and you are paying taxes and insurance, it is an expense to you, not an income.
Jason: The house, the mortgage, it is an expense. So it is not that updating the property is wrong. It is just the wrong product. Right? And so the product is where you live. An investment is something that other people pay for, not you. That is impossible to do in your own home or unless you turn it in to a boarding house. Most of us choose not to have renters under our same roof. Some of us –
Mikell: That does not sound fun.
Jason: That does not fun. Some of you even worse. You have tenants in your home, and they pay nothing. Actually, they are a double expense. They are called 40-year-old sons that cannot grow up, and they live in the basement. Right? And they play video games or whatever it is they do. Anyway, they need to be introduced to the front door perhaps would be a good place to start. But that is a different show. We do that one on Sundays. You can come out and take a listen. But here is the thing. If you pay, again, radio, so bear with me. You can get the show notes. It makes more sense when you see it in writing. So it is a $250,000 house. All right? You have done some work over the past ten years. Things, you have got to keep the house up or it just turns to shambles. Right? It is interesting. If you look at vacant homes, vacant homes deteriorate faster than homes that are occupied, and the reason being is weather. Stuff happens. Temperature change. All these different things. But a vacant home can actually go down hill really, really quick if not properly checked on weekly, regularly, and somebody is there to look after it.
So let’s say you replace the roof for $10,000, and I am just making up numbers because it is radio again. You changed out both the HVACs. That was $10,000. You painted the house at $5,000. You put $5,000 into landscaping, $5,000 into new appliances. And then you decided that well, the kids are gone and the dog is gone, so we will get new carpet or floor coverings and that was another five grand. So you have invested all this over ten years. $40,000. About $4,000 a year. Very within most budgets of what it takes to keep a home updated in today’s world for a $250,000 house. Ten years later you decide to sell. You want to downsize, and you sell that property for $300,000. And most of you would say I win. I did it. I bought this and I made $50,000. Well, however, when you start looking at the math and what you put into the property, well, the difference is actually ten grand, and you are like well, I still won. I got $10,000 more than I put in. But then you forgot one little thing is you have got to sell the house, and it is going to cost money to sell the property. So you have to hire the most awesome real estate company in the world, which would be Jason Bramblett Real Estate.
Jason: And you pay commissions, closing costs, and attorney’s fees and all that, it ends up looking like about $25,000 to sell your $300,000 house. And when you do that math, you end up with $15,000 backwards. Right? Now, some of you will say well, that is crazy. Real estate is easy to sell. I would never hire the greatest real estate company in the world. I would do it myself. And that is a possibility. You are going to put that $25,000 in your pocket because I am a do-it-yourself kind of guy, but in actuality what really happens is only about 3% of the properties sold in America sell at the result of a For Sale By Owner. Not my numbers. Again, you can fact check me. Go to the National Association of Realtors. They are some digit heads out there that put all this together. You can check with them. But then the other thing is, out of the 3%, about 50% of those properties are actually sold to family members.
Mikell: Yeah, that is what I was thinking.
Jason: So it sold to somebody they know, or it is either sold to a family member. That always works perfectly. Right? When you sell to a family because everybody in the family is like hey, I will buy your house and I will pay you top dollar. Not normally. Most of the time –
Mikell: They want a deal.
Jason: -- they want a deal. Hey, you are my mama. I want a deal. Mama needs to get paid. Right? It does work out that way in which most of those sales are actually discounted. This is why the bank actually looks at that. They want to see what they call an arm’s length transaction meaning you do not know this person, and if it is not, then sometimes there are different qualifications in that, and they take those things into consideration. Where you really see it is in the short sale process. Most banks will not allow a family member to buy a short sale. So let’s say if the kids are struggling, and they are behind on the mortgage and Mom and Dad want to buy the house. They make an offer and it is below what is owed. Normally, the bank will not accept that offer because it is not an arm’s length transaction. You know the owners. You will actually sign an affidavit at closing that says you do not know these people, and the reason why is because the banks know most family members are going to work a deal. Right? They want to get the most money for that house. How do you get the most money? You sell it to a stranger. You sell it to somebody. You put it in the free market. Right? You put it out there into the free market where anybody and everybody can buy it, not just your family member. So we have got 3% of sales are by owner. Those are the people that are tempted to sell or save that $25,000. 1 ½% typically sell to family members. Well, we already concluded no deal. Right?
Jason: It is not going to happen. You are not getting anymore money by selling it to the family. So then we really got 1 ½% of those sales that are left, and then what we see is they are still going to have one agent involved most of the time. There is going to be at least a real estate agent typically in those 1 ½% of the sales. Most of the time they are going to have a buyer, somebody representing the buyer in the situation. So even if you are doing it by owner as the owner, most of the time, the buyer will have an agent. So let’s just make it easy and say okay, let’s just split the difference, 50-50. So instead of it costing you $25,000, it is twelve grand. You are still $2,000 less than what you had in the house. Okay? So think about that as you are improving things and you are looking through those. This is math you need to know. This is math that before you make that purchase, you need to think about down the road. Does it make sense to do that? So you see it is not really what you are putting into the house that is the problem. It is actually the house. It is the product. It is just the wrong product. Compare it to a hotel. Most people have stayed in a hotel. This should be a good visual for you on the radio. If I put money into my hotel, restaurant, apartment building, whatever it is, I do this with the full intention and plan of increasing revenue. All right? A remodeled, updated hotel always have a higher room charge than a rundown, dated property. Always.
Jason: Same situation. But that money can get more than 100% return on the product because the product helps me increase revenue. If I stay the way that I am, my revenue could actually decrease because I am not keeping up with the times. I am not keeping up with the changes. You will see a lot of hotels typically every ten years do a complete transformation and remodel. Sometimes they even switch complete brands. They may go from a Holiday Inn Express to whatever.
Mikell: A Holiday Inn Suites.
Jason: Yeah, there you go. A suite or switch it to a Hyatt or whatever. They change brands completely. Change the look. It could change ownership. But they update the brand, they update the look. Why? They do not update the look because they got money and they have nothing to do with it. They update the look to increase the revenue. Right?
Jason: And so you simply cannot do that with the home that you live in because it is an expense to you. So no matter what you put in, you are never going to get a higher return because you are the one that is paying in both scenarios. You are paying the mortgage, taxes, and insurance, and you are also the one making the investment. So remember the key to owning a home. First and foremost, it is a place to raise your family and enjoy life, and have a safe, clean environment to live in. And then it is a really, really savings account. And that is owning a house. You buy it for shelter and a great and wonderful place to raise a family or just to live your life. And then secondly, it is a really, really bad savings account. It is not a terrible, it is a terrible return as far as savings go. It is actually not a bad thing. But keeping it in perspective, and that way you have the right understanding when buying a home. So many young people watch a lot of these TV shows. I am going to buy a house. I am going to buy it for 250 and sell it for 300, and I am going to make money. If you did nothing to it, okay, yeah, that math works. But show me any product or any home out here that sits for ten years and nobody has done anything to it, and they have made money. Very rare. Very, very small percentage. Why? Because we like to change stuff. I like to change the colors. Think about it. Go back when you bought your home. Did you leave it the same color? Now some of you painted it yourself, and we have already talked about that. Remember? There is a difference between painting and schmearing. You guys are schmearing, not painting. Okay? Some of you would be better off leaving the paint brushes alone because all you are doing is applying color to the wall, not painting the wall. There is a difference.
Jason: For sure. Believe me. Here is your tip or clue. If you painted, and you have paint on your ceiling from the roller, that is when you should have hired a professional. Okay? Because it does not come out of that popcorn very easy, and when you pick the colors you picked, which is everything under the rainbow, most people like neutral. They do not like whatever that color is that you cooked up.
Mikell: True. And I realize a lot of people let their kids pick the color.
Mikell: And then it really gets creative.
Jason: It does. It does for sure. So over the past ten years, you have made all these payments. You have done everything that you are supposed to do. You made your payments on time. And here is the good thing. You built equity. Savings. That is what that is. That principal payment is basically being set aside for future use down the road. Right? And so think about that as you think about putting money into your home, do it wisely. Let’s do this. We are going to take a quick timeout, go pay some bills. We are going to come back. We are going to go paint some walls. We are going to come back and dig a little bit further. There is a second step to this mathematical equation we will dig into. You are listening to the Jason Bramblett Real Estate Show, and we will be right back.
Mikell: And we are back.
Jason: Welcome back to the Jason Bramblett Real Estate Show. So we are digging into does it make sense to put this money into the house? Sandy sent us a question and said man, I want to put things and invest in my home that are going to get a return. So we walked through that. Which leads to the question is Jason, why in the world would I ever put money into my house? If I cannot get a return, why bother? Right? That is kind of a logical place to go. And there are reasons. Right? There are reasons why we do everything. I talked about the vacant houses you got to keep up with it. Well, one thing is you live there, and most people fix things up because why, we like them. Right?
Jason: It is like why did you buy a new car? I used to give people when they would argue with me, I would help them with their budget and their financing, and they would, or finances, they would say well, we had to get a new car because we have a baby and it has got to be safe. I am like, at that time, I was like well, I drive the safest car they made in 2014, and I did not need to get the 2019 version because the 2014 version worked just fine.
Mikell: Just fine.
Jason: And it was the safest one on the market, and I bought it used and let somebody else take the hit and depreciation on it. Most cars, if you will buy a 3-4 year-old model, most of the depreciation, 30-40% of it has already been hit, has already been got. So you can save yourself quite a bit of money right there. But I know you want to buy the safest car on the market.
Jason: So you are trying to tell me that they were just putting out a bunch of junk to kill people? No.
Mikell: Those would be recalled by now.
Jason: Yeah, they would be recalled by now. It is the same argument with the car. It is hard to see anymore because money is so cheap, and people do love to buy new cars because they can buy what they want. They look cool driving down the road. But you could go back and you could find a 1990 Honda on the market and on the road. You could probably buy it for probably $1000.
Jason: And it will get you to work. It may be 14 colors.
Mikell: Great starter car.
Jason: Great starter car. It may smell like Cheetos.
Jason: And not your Cheetos, but it will still get you to work.
Jason: It will have another really cool thing that goes along with that. It is called it is paid for.
Mikell: There you go.
Jason: Or you could drive the bank’s car to work. The one that you are making payments on every month.
Jason: You could do that.
Mikell: With high insurance.
Jason: And it will be cleaner, and it will look better, and you will be broker, but that is not a good investment. So let’s get back to houses, but it does work the same for them.
Mikell: One thing that I did want to say, Jason, is I know it did sound crazy earlier like why would I invest in something that I would not get my full return on? But it is like if you think about selling an item, you never sell it for the price you actually paid for it.
Mikell: Do you know what I am saying?
Jason: Unless you manufactured it with your hands.
Mikell: Exactly. It is the same concept where you have to take yourself out of it.
Jason: We have, as a society, tricked ourselves into believing that oh, you buy real estate, you never loose money. Not true. Not true. You definitely can lose money in real estate. And you have got to buy it with the right purpose in mind. And again, the right purpose is to have a great place to live and raise your family or your kids or where you want to be in a safe environment, and it is a really horrible savings account. As long as you have that in perspective, you are going to be fine.
Mikell: One reason I love talking to you is because you give the real advice, and you are really in the field. We see so much things on the internet or how to flip houses or how to make money, and you are basically telling us, it is not, it is not false, but it does not have a lot of truth to it as well.
Jason: There are ways you can make money in real estate, flipping houses, no question.
Jason: But it all comes back to it is really not what you did to the house. It is what you bought it for.
Jason: People are like how do you make money in real estate? You buy it right. Now buying it right does not mean you go in there and you lowball everybody because not everybody is in the business of helping you be an investor. Right?
Jason: You have got to buy it from the right institutions in order for that to happen. You are typically in the foreclosure realm. You cannot get the best deal and sell it at the highest price, and it be the same product. Okay.
Mikell: Not every time.
Jason: Not every time and not in residential. When there is income involved, the game changes. So I could take an apartment building that somebody wants $10 million for, and it is worth $10 million, and I could pay $11 million for it, and I could still make money. What do you mean you still make money? You lost $1 million. You overpaid for the property. No, the X factor is there is income coming in every month.
Jason: If you do that with your house, there is no income.
Mikell: No, not at all.
Jason: Again, it goes back to the product. Wrong product. Are there things that you should be fixing out in your house and do? Sure. You might want to put an AC in. You ever try living in the South without AC? Let me know how that works in July. July 4th we will just rub the fireworks up against your house and they will light up. It is going to be hotter than fire out there. But think about this, and here is where we see this. This is why I say still owning a home is a great thing even with the perspective of it is a really bad savings account because I have sold hundreds, and hundreds, and hundreds, and hundreds of houses over the years, and sometimes we sell them when they are at the end and all the kids are gone and it is Mom and Daddy or Grandma and Grandpa and we sell their house, and they have no money because Americans only save, or they save less than 1% a year. And at least the house forced them to save money. They have got nothing in the world but a very small retirement because they never saved any money. They started too late. They have got under $100,000 cash in the bank. No other investments, but they have a paid-for house. That is still better than nothing. Right?
Jason: So at least when we go to sell the home, it is paid for, and now 100% of that money we have options and things to do. This is why it is still a good deal because if we did not have that, if the payments on your home were interest only, where would you be down the road with no savings? So owning a home is still a great thing to do. Go to Jason Bramblett dot com. We will have more notes up there. Send us your questions as always. You can click on that email icon. Fire it over, and we will share that on the air. We love sharing your stuff. So Jason Bramblett dot com, check us out online, and it is 553-0796 at the office. Have a safe and great weekend, and we will see you back here next week.
Jason: …man, there isn’t anything to do in Raleigh. You do not want to be in Charlotte. Take Charlotte out of your GPS. You are home. Just stay right here. There is no need to go. There is nothing to see in Charlotte. You want to go to Charlotte, you can do that on a day trip. You do not want to get caught up in all that mess. Life is short. Do you want to spend it on I-40, 77 –
Mikell: No. Not at all.
Jason: No. Not at all. No way. Forget it. No chance. Spend it here. Go take a drive today. Go checkout Winston-Salem, Greensboro, High Point. We cover those. We talk about you guys all the time. Let’s talk about some of our other fun places. Have you gone over there and checked out Lewisville? How about Mocksville? Mocksville and Lewisville have some pretty cool little downtowns actually. You can go over there and just, I do not know. They are just kind of Mayberry-ish.
Mikell: Oh wow.
Jason: There is not a lot to them, but that is what is cool about it. Right? It is just relaxed. Go to the park. Walk down the street. They actually have sidewalks. Those type of things. Oak Ridge, Summerfield, Pleasant Garden. You got all these great little towns. Sophia. Some people were like I did not even know there was a Sophia. We have got some great new houses coming up in Sophia. You need to check out our website. Hit Jason Bramblett dot com. How about Wallburg, Ramseur, Julian, all those places?
Mikell: Never heard of them.
Jason: Never heard of them?
Mikell: Never heard of them.
Jason: They are a nine iron just south of Greensboro all around.
Mikell: Really? Okay.
Jason: So there are lots of great little towns here. Advance, Bermuda Run, you got Burlington, obviously. Mebane or if you are from the North it is Mee-bane, but we do not say it like that here. Phonetically, it is Mebane in North Carolina. But how about we got Blues Creek, Walnut Cove. We have got Brown’s Summit, and Brown Summit because they cannot even decide up there how to say the name. And so, it is either way. What is crazy is you can get there with the S or without the S. It does not matter. Everybody knows, but there is still an argument whether it is Brown or Browns Summit unless you are from there, and then they are emphatic about what it is. But you need to go there and ask them. Go up there and hang out in Browns Summit and see what happens. But it is interesting. So we sell in all those, and we have a great time getting to meet the local people. All these great cities and towns that we have around there. We are your full-service, one-stop shop buying, selling. We cover 36 towns and cities, located all over the Triad. And I know I have left off some of you. I did not forget you, King, do not worry about that. Walnut Cove, Wallburg. Who else did I miss up there? I am sure somebody. Send me the email and I will make sure I mention you next week. I promise you. Most of you guys know we are all over the place. So come over to Jason Bramblett dot com. Send me a message. Get on that email link up there and we will get you on our mailing list because we have some interesting things and things that people are looking for that pop up, and sometimes we have to reach out to people in our database to say hey, you have what somebody is looking for. Have you thought about selling it? Because maybe you attempted to sell your home 3, 4, 5 years ago during the dark ages of real estate when nothing was going right. No appreciation was happening, and we were just stuck in the ditch pretty much in the Triad for, oh I do not know, about a decade. It just took a while to climb out. Now, we are finally climbing out and some of you actually have not got the thought back in your head of maybe I can move now. Actually, you may very well be able to. You have been paying down the mortgage for 3, 4, 5, 7, 8 years now. Real estate is actually just starting to tick up just a little bit so we have some appreciation. So between you making payments and paying down the mortgage, real estate ticking up a little bit, now we have this thing called equity created. You may actually have enough equity to be able to make a change.
Mikell: There you go.
Jason: You just do not know. What do we have to do? We have just got to do the math and take a look at it and see is it a good decision for you. And that is what we will check out and take a look at. Hey, Jason Bramblett dot com. Put in your city. Let’s talk about it. How about that? Let’s do it. What else do we have coming up today?
Mikell: All right. So, we talked about that the spring market has kicked off. Is it too late to get a house on the market?
Jason: Oh absolutely, no. You are good. You are good. I say that. Some of you, some of you, you are going to need some help and some love, but that is okay. Actually, here is the deal with selling a house. A lot of times everybody is trying to figure out the exact time to hit the pinnacle to get the best, to get the most. Here is the truth of the matter. The right time to move is when you are ready to move.
Jason: And that could be October. That could be December. It could be (indiscernible). The benefits of selling now, well you have more buyers hitting the market now because of the time of year more than anything else. The downside to selling now is you also have more houses hitting the market. Therefore, you have more competition. So if you are one of ten that are hitting the market in your price range, and nine of your neighbors have outperformed you in cleanliness, upgrades, updates, all those things, they have been listening to the show for the last 12 years. Right?
Jason: They have taken hold of all the wisdom and knowledge that I have dropped on the Triad real estate market. Right?
Mikell: The gems.
Jason: The gems. That is it. Yeah, they jumped right in there. And so, they are way ahead of you because maybe you just tuned in last week and the only thing you got last week was something about the ACC tournament that I was ranting on. But anyway, they are ahead of you. It may be that now that that competition is there, you house does not look quite as good as it used to. Whereas, maybe if you had put the house on the market in December when nobody was on the market and people had absolutely no choice, all of a sudden, hey, the bridesmaid became the bride. Right? It was like wow, there is not anything else. This is what we will have to go with. So there is a downside to selling in the spring market. It is what most of us will consider the peak, yes, and most of the houses do sell in this cycle. But here is the thing about looking at trends and cycles. With real estate especially, the only way you can know if you were ever at the top is you have to look backwards. So it is not a trend in which you can forward, you cannot see it coming forward. In order to know that you were at the top it is what we call it is in arrears. Everything happens in the past. So when you put a house under contract, that sale is not recorded that day. That sale is recorded in 45-60 days when it closes. Therefore, the buy trend is always in a lag of usually 45-90 days. So we will not know what the top was until probably we are 45-90 days past the top. And now what do we see is the ski slope it is heading down the other way. So now we have people chasing the market down, which is never fun. And if you need a visual of that graph, just google anything over the last ten years in the Triad real estate market, and you will look like you were on Beech Mountain headed down really quick because that is what it looked like. It looked like you were skiing Black Diamond. This was not bunny slope, tow ropes, gentle, little rolling meadows. This was a cliff that just went straight down. So this was double Black Diamond, holy smokes, here we go. That is the visual.
And what you do not see is that lag. So when it is perpetually for nine years, you see it, or nine or ten years, but the bottom line is this. Real estate in general is all about timing. It is all about your timing. If everybody could pick the winning ticket everybody would be winners. Right? It does not work that way.
Mikell: Of course.
Jason: Another thing we have got to look at is most people when I get a question like timing is they are trying to maximize the investment. They are attempting to squeeze as much as they can out of that. But by definition, an investment is something that is earning you money for effort that you are not having to do and potentially, like in the case of real estate, other people are paying for your debt. That is a win. So I have a rental unit, house, condo, townhouse, apartment, whatever it is. If I owe money on it, the tenant is actually paying that money back. The difference between what I owe and what the tenant is giving me is profit, or at least income of some kind. It may not be profit, but it certainly could be income.
Jason: And to qualify this real quick, your 40-year-old deadbeat son living in your basement paying you rent is not really investment property. Okay? That is a parenting issue. Right? That is not income property. Put all things together equally here to understand what is, just because somebody is giving you some dollars does not mean you have got an investment property. The house you live in is technically, under that definition I just gave you, not an investment. Why? Unless the kids are paying for it, I cannot get rent out of mine. I have tried. They just do not go for that. They are still hopefully on the we-work-for-food program. Right? If you can get them to do a little something around the house.
Mikell: Just a little bit.
Jason: Just a little bit. Just lean into it just a little. Right? But by definition, the home you live in, if no one else is paying for it and you are, it is a liability. It is actually not an investment property. Could you make money off of the home that you are living in? It is possible. It is rare, but it is possible. Typically, what it ends up becoming is a really, really horrible savings account. And the reason why is we actually always over-improve our own property. Why did you do that? Why did spend $14,000 on your kitchen? Because I liked it.
Mikell: My wife told me to probably.
Jason: There you go. That is it. That is it. That is not investment logic. That is keeping everybody happy logic.
Jason: Which is more important. See there is a return of value there. It is not monetary. Money. But it is lifestyle. I did this. Mama happy. Everybody is happy.
Mikell: Everyone is happy.
Jason: It is priceless.
Jason: You cannot put money or put a money factor on that. Now, we look at houses all the time that are over-improved. Why did you that? Why did you put that there? We loved it. This is what our family does. Our family is an outdoor family, so we put a $60,000 outdoor kitchen in. Okay.
Jason: Okay, great. You can do that, but you may never ever, ever get that money back and probably will not because there are not that many people. Now, people will take it all day long –
Jason: -- but they are not going to pay you what you paid for it. But I like the fact, I like the $60,000 outdoor kitchen. It is awesome. I just do not really want to pay $60,000 for it because I could take it or leave it. Right?
Mikell: Leave it. Yeah.
Jason: It is kind of like a horse barn. We sell horse properties. A horse barn is an awesome feature to have if you have horses.
Mikell: If you have horses. I was going to say.
Jason: If you have no horses, it is absolutely a useless building on your property. So it has different value for different people. Same principle with your house. And typically, we get in the situation where we over-improve our house. But real estate investing is great to do, but it is investing when other people are paying you money for what you either own and or they are helping you pay it off. That is when it becomes an investment. That is when it becomes good. That is when you start making sense of those things.
Now, all that to say, is it the right time to sell. The right time to sell, what I am getting at, the essence of this is do not spin your wheels attempting to time out a market in which no one can predict and or no one has ever really timed out. Because it is always in arrears. You never know where the top is until you are past it. You can get close. You can kind of get in the window. You can do whatever. The right time to sell the home that you are living in is when you are ready to do it. That is the bottom line. Because all of those factors. Because even if I sold my house seven years ago when the market was horrible, but I sold it in order to take a new job in Tennessee that was paying me 40 or $50,000 more a year and I lost money here, it was probably still a good decision for the family.
Jason: It was a horrible decision as far as real estate goes. Maybe I should have never bought the house to begin with. But the fact of that new opportunity, me being able to get rid of the home, I was able to take advantage of that opportunity. So lots of different things out there. Mikell, let’s take a quick break. We are going to come back. We have got something coming up you might be interested in. Have you ever thought about, I do not know, sticking your toe in the real estate world? Well, we are going to talk about our career night coming up in April. So stay tuned. We will be right back in just a minute. Jason Bramblett Real Estate Show live right here. (in/out music)
Mikell: All right. We are coming back from the break. We talked about our rental properties and investing.
Jason: Absolutely, and then we kind of well, we threw out that little teaser out there of have you ever thought about well, what it takes to actually be in real estate, be in sales? Have you wanted to stick your toe in the water, kind of check it out? Well, we are doing a career night coming up in April. Actually, it is April 10th, 6-7 o’clock, and I am going to walk you through what it takes to, well, an opportunity if you will. I guess. We are going to talk about what it takes to be successful, but also the opportunity we have created within our company that you could potentially come in, take a look at what it is, and everybody has got their own opinion of what real estate sales really is.
Now look, I am not talking about order taking. Okay? There is a difference. Okay? If you have been to a really nice restaurant and you had somebody take your order and you have been to a really nice restaurant where somebody has given you concierge service and served you well, and or hopefully you have bought something in which somebody did not just say, what you want to drink? That is called order taking. All right? When you have a great experience, and that is what we want to create is the experience of real estate, not just sitting back, taking orders to either buy and or sell. If you are the type of person, your whole experience is doing open houses, eating chips and cookies, that is not what we are talking about here either. We are talking about selling at high level, but really here is what I am talking about. We are looking for leaders. I am looking for people who understand that serving their clients, what it is like to do that, and to do it at the highest level possible. People that pick up the phone and make things happens instead of waiting on the phone to ring and reacting to what is happening. There is a big difference in the two.
Mikell: Taking initiative.
Jason: Yes. You might want to rewind that later and listen to that again. That is the difference between you taking ownership of your life, your sales career, and or your sales career happening to you. There is a big difference. The other big difference are the zeroes at the end of your paycheck. Okay? There are definitely different levels of compensation in all of sales, and the people that serve their clients the best offer the greatest service, provide the best concierge-type service, and do it at a very, very high level earn the most money. That should not be a big surprise to anybody. And I know some people will say that is not fair. Well, guess what? We have a fair in October. It is called the Dixie Classic Fair, and you can go there and ride the rides because that is what a fair is for.
Mikell: Bring the family.
Jason: That is it. Life is not fair. Get over it. If you have not figured it out by now, I am sorry. I do not know where you have been hiding. But it is not fair. It is not fair to all the young kids that got snowed in to going out and getting a higher education, $80,000 in debt and they are working at the big box store with the circle and the pretty dog at the checkout counter. Right? Sorry for you, but it is about taking initiative for yourself and getting out there and making it happen. Okay? And you cannot just go through the motions.
Mikell: That is true.
Jason: That is what we are finding out. That is what this generation is finding out. Going through the motions. Well, sometimes going through the motions smacks you right into a concrete wall, and it is no fun.
Mikell: It is not.
Jason: I have hit a few concrete walls in my career.
Mikell: I have, too.
Jason: And guess what? They are hard.
Jason: And you have got to move through them or over them. Right? But you just cannot sit there and just stare at them and talk to them. Right? They are not going to move. You have to make the one making the move. So April 10th from 6-7 at our campus here in Greensboro. We are going to dig into that. Get in touch with my office. You go to Jason Bramblett dot com. You know the deal, drill. That little email icon in the top right corner. Shoot us an email. Put in there career night. My team will reach out to you. We will get you an Eventbrite sent over so you can register. There is no cost to this event. We actually paid all the handling charges for you, so there is no cost to take a look. We will get your money later. No, I am kidding. Just relax. It is not one of these sales pitchy things. You cannot buy anything when you come there. I have a couple houses for sale if you want to buy one when you are there. That is fine. But really what we want to do is we know this. In the Triad, there are an extensive amount of phenomenal, great sales people that are looking for the right vehicle and the right opportunity, and where they are at now, it is not there. So real estate can be it. The wonderful thing I love about real estate is that you have a lot of control in your destiny. I have had in the last 90 days four really good friends that work for pretty large companies for years, one of them well over 25 years, and at that age where they are making pretty good money. So they are probably making anywhere between $80-90,000 a year, making a great living, been at the company a long time, and all of a sudden, they wacked the whole division.
Mikell: Oh wow.
Jason: So when you are 55 plus and you are in the job force looking to replace a $70, 80, or $90,000 income, that is very, very difficult to do.
Mikell: In today’s society, it is very hard.
Jason: In today’s corporate workforce, like 41 is hard.
Jason: So when you get up to 55 plus, one of my friends, 61 years old, and you just cannot touch, there is nothing. Nobody that he found, I should not say nobody. Few, and nobody that he found was hiring a 60-year-old person at the income level that he was at. And what do you do? Here he is. He is too young to retire, too young for Social Security. Most all the retirement benefit cannot kick in. Right?
Mikell: No. Yeah.
Jason: And you are stuck in this abyss until you reach those years. And the real thing that stinks is usually with Social Security, my understanding of it is, what you make in your last few years is kind of the most important part. Right?
Mikell: Yes, it is.
Jason: That is what establishes some of the tables as to what you are going to get.
Mikell: True. It is kind of hard to downsize your life before you really want to.
Jason: That is right. Yeah, well yeah, think about that. It is like here I got this great plan. It is awesome, and everybody set the timeline, whoever did that decided it was 65. I do not know who. Or 67, I guess it is. They move the cheese a little bit every year out there a little bit.
Jason: So 67, I have got my plan. I am working my plan, and all of a sudden, my plan does not work anymore. And that is out of your control.
Jason: The great thing about real estate is you have control. We actually had a couple times I have known, I have been around a while, so I have known agents who are up in their years, and we actually had a really, one of our top agents in the Triad pass away a couple of years ago. The interesting thing about that was when he died, he had multiple homes still under contract. So there was actually money coming in even after he was not with us anymore.
Mikell: Oh wow.
Jason: So all the way to the very end, you could actually be in control of your own destiny, making money. That money could go to your family, your estate or whatever it is. But my point is you have the control of that and not maybe somebody with a pencil out of state in a different part of the world that does not really, I will not say they really do not care about what you are doing, it is just that they are not living in your shoes.
Mikell: That is true.
Jason: The only person I want living in my shoes is me, and I want to be in control of them.
Jason: Real estate career night, come check it out. It is going to be April the tenth, 6-7, get in touch with our office. Go to Jason Bramblett dot com. You can get all the information you need there. The last little thing I just want to throw out. We have new homes popping up all over the Triad. We get this question all the time, especially in the spring because they seem to pop up like the tulips and the daisies and all that stuff. Should I buy a home directly from the homebuilder? Interesting enough, I had lunch this week with one of the area’s top homebuilders, and I was pleasantly surprised, not surprised, encouraged that their team, they really push the fact that they want people to have representation. They actually want another set of eyes there. So there is a perception that you can save money by buying direct and not having a real estate agent. And with this particular builder, and they sell a lot of homes, and most of them out there, that is simply, it is a myth. It is actually not the truth. You are not going to get the house at a cheaper price. The only thing you are going to get is no representation. So think about that. We are going to do a show on that coming up next week. You can stay tuned there and stay tuned obviously to WPTI. We have got great stuff coming up like basketball –
Jason: -- all day, and of course, I do not know. I am sure Duke is going to win –
Mikell: I am sure they will.
Jason: -- but that is my bracket. It is not totally busted yet. Everybody have an awesome, awesome weekend. We will be back here next week. Go to Jason Bramblett dot com to sign up for career night, and we will see you then. Enjoy the weekend, guys.
Mikell: Enjoy the weekend.
Jason: Good morning, Triad. I hope everybody is doing great today. It is another fantastic day here in the real estate world, and we hope that you guys are out here having a good time, enjoying your day, getting ready to go out and get into whatever it is you do. Maybe, just maybe, you are going to tear up something. Before you do, we are going to walk you through the things that you may or may not want to get involved with in reconstruction and selling of your house and all those things. We all have got those honey-do lists, and sometimes those honey-do lists are with a sledgehammer. So before you grab that, let’s sit down and let’s talk. Grab some coffee. Get a pen, get a paper. We are continuing on with our walk through the house. We are digging into what to do to sell now, but also what to do if you are selling in the next one to two years. So getting a game plan together, getting something prepared so we are ready to go. Go to Jason Bramblett dot com. You can always shoot me an email over there. If your email is something that we believe will benefit the communities that we serve, all 37 of them, we will absolutely share right here on the air. So go to Jason Bramblett dot com. Click on the email icon in the top right corner. Shoot me an email. I love reading all your attaboys and all the other comments. I read those, too. Anyway, so joining me in the studio, Mr. Mikell Montgomery, pushing all the buttons, making everything happen.
Mikell: Yes, sir.
Jason: And we welcome your calls. You can give us a call. We are live in the studio. It is 882-7874 or at the office, 553-0796. Mikell, what do we have lined up today, man?
Mikell: So last week we were talking about outside of the house. Of course, we were talking about selling your house. So we are going to talk a little bit more about the mechanical part of selling a house.
Jason: Yeah, yeah, the mechanics of the actual house and the mechanics of actually going through what do I do, what is the next thing to go. So moving parts. Moving parts always create an issue. The thing with moving parts is eventually they stop moving, right, and so these are the wear and tear things that we have on a house. What we see is with the heating and cooling systems, your HVAC systems, when you get somewhere in that 15 to 20-year range on those, this is where we run into some problems where it actually will affect the people that potentially would consider buying your home. You will also typically see this consideration in the offers that they make on the house. Okay? So if you have a 15 to 17 to 18 to 20-year-old heating and cooling system, do not be surprised if your offer that you received on the house is somewhere between $4-6,000 less than where you want it to be or where you think it should be. Why? Because this person knows 100% guarantee pretty much that they are the guy that is going to replace the system, and nobody wants to do it. So they are factoring into their numbers hey, I am the guy that is going to be writing the check for 4 or 5 or $6,000 to fix one, two or three of these heating and cooling systems depending how many you actually have. So do not be surprised when you see offers that reflect this. Now, I know many of you guys out there will say well, Jason, my heat pump is 38 years old. Congratulations. You have won the lottery. Right?
Mikell: You definitely got your money’s worth.
Jason: You definitely got your money’s worth.
Mikell: And then some.
Jason: You do not see that often. We do not see that happen very often. There are times though when we do see that with the proper maintenance and the proper keeping up with the systems, you can actually get extended life. For some reason, mentally though, the public, the consumer, the people buying the home, they have this 15-20-year block in their mind, and regardless of what you have done to keep it up, and it may last another 20 years. They are not going to plan on it, and they are going to speculate that they are the ones that are going to replace this, and therefore, you will see that reflected in their offer. The same with the roof. If you get a house where the roof is anywhere between 15-20 years old, we see the same type of thing. Now, there are some roofs obviously that have 30 and 40 and 50-year shingles, and or whatever the material may be to give it a little bit extra life. Again, it comes back to that mental thing, and the only way that you can go through that is with the proper education. With the ability to prove that you actually have maintained the product, maintained the actual system. How? Through documentation. Right? I have a contract. I have got somebody that comes out to the house twice a year, and here is what they do. That could give some peace of mind, but psychologically, these folks still for some reason will have in their mind that 15-20 range. One thing you can do, we are blessed in the south with great weather, but it also comes with humid weather, and that grows stuff. Like we are in a big petri dish down here. Right?
Jason: So if you end up with black streaks on your roof that is like this mildew mold thing that happens, and I have talked about Chris and his team over at Whitman Home Renewal many, many times because they deliver some of the best return I have ever seen. The biggest bang for your buck. A clean house always sells better, faster, and for more money. There is no better time and effort you can put into your home other than cleaning it. I do not know why Febreeze does not make a bleach-smelling scent, but if they did, it would probably be their top, number one seller as opposed to whatever the other fragrances they have out there because if the house still stinks, to put it nicely –
Jason: -- eau to flower and cover-up smell is not too good of a scent. Right? Something about bleach. Bleach is just magical. It always smells clean and people like it. Now, it does not need to be like a chlorine pool. Right?
Jason: But think about, use it wisely.
Mikell: It gives you that confirmation like oh, someone cleaned.
Jason: Absolutely. It is just a good thing. It is just a good thing. So water heaters. That is another one that comes up. We have seen that quite a bit. Water heaters, depending on who you talk to, somewhere between that 8-12 year lifespan, and these are things that you will see folks that will ding you on. So if your water heater is 10 years old, you are thinking about selling your house in the next 2-3 years, it might be a good idea to consider replacing the water heater. You will get about 80% return is what we typically see. It is one of the higher things that you actually get a return on. So if you spend $1100-1400 on a new water heater, which is about what it costs, you could get about 80% of that back. One thing that I will caution you with. Heating and cooling, water heaters is when you replace them, in every single municipality that you can hear me in, even probably in Virginia if you hear me there, the code is that for the City and or that municipality, a permit is required to change these things out.
Jason: And so, you can hire a contractor, and they will change them out, and they will not get a permit. And then what will happen is you will reap the benefit of this action down the road when you go to sell the house because your house was built in 1984, and it obvious that it is not the original heating and cooling system or the water heater, and the first thing that a good real estate is going to ask is where are the permits? Meaning who did this. Darryl and his other brother Darryl? Or did you hire an actual person, a real company to do this. Now some municipalities may have different rules as to where an owner can do certain things and changes those out without a permit. But if you are thinking about selling your home, the consumer wants the protection knowing it was done by a professional, not you Mr. Homeowner.
Jason: Spend the $100 to get the permit. It is money well spent. And it will reduce a lot of headaches down there. So if you have an irrigation system, make sure it is in working order. If you do not use it, and you do not know or recall the last time in which it was ever used, you either want to get it up to par or you want to just go ahead and dissemble it and get rid of it if you are not willing to make it operational. Because these are things people are going to see and they do not know that it has not worked in seven years. They will assume that it broke last week and you just do not want to deal with it. All right? So if you have a pool, it needs to be open and running, and people need to see it. They want to see what the pool looks like. I know we winterize a lot pools here in this area, but if you are going to sell your home, you need to go ahead and invest in and plan on the extra money it is going to cost you to run the pool and the pump during the winter if you are selling in the winter. People want to see the pool. They do not want to see green sludge and have to deal with all that. Pools are not very common in our area, and so if you have one, show it off. That is what people want to see. They do not want to see a big hole with a tarp over it. Right?
Jason: That is what a swimming pool is if it is not open and clear and beautiful that people can see it. It is nothing but a hole in the ground with a tarp. What are you hiding? What are you covering up? What is the problem?
Mikell: Are there dead bodies?
Jason: Are there dead bodies in that? Right? What do you have in the pool? And people want to see that. So obviously, especially if it is in summer, that is an easy time. If you have a pool, I would highly consider selling your home in the summer if you can actually control the time and the plan and all that. Summer is a great time to sell a pool especially when it is 98 degrees and they are melting on your deck and they are like wow, that pool looks really good. Right? Hey, you might need to come over on Saturday and take it for a spin. Right? Give it is a shot.
Appliances. Appliances are huge, huge, huge in selling a house. They need to be consistent, and they need to match the quality of the home. I have seen way too many homeowners get real cheap on replacing appliances for their $300,000 house. It is a $300,000 house. The quality needs to match. Right? So do not put in a, I will pick a brand, do not get mad at me Whirlpool. You are just the one I was thinking of. But do not put a spin dial Whirlpool 3-setting dishwasher in your $399,000 house. Right? There is an expectation that the quality of the features in appliances are going to match the price of the home.
Mikell: I guess you would expect the black appliances as well.
Jason: Really, they just all need to be consistent.
Jason: Sometimes what we see is a white dishwasher, a stainless steel refrigerator, and a black wall oven. No.
Jason: The consistency. Pick a flavor. Every color of the rainbow is not good in the kitchen. Right? Pick a flavor. Pick a color, and stick with it, and make sure that the quality matches the price point. It is an amenity, but it is five levels below the standard. So it is worthless. You spent money that is absolutely worthless because more than likely, they are already planning in their offer hey, we are going to have to replace all these appliances because they do not match the expectation. Right?
Jason: Just because it is new does not mean it is the right fit. So make sure that when you are going to go through the trouble and aggravation and all that of switching appliances out, buy the appropriate appliance for the price point. And wow them. And if you really want to one up your competition, buy the next level up. Buy the next best thing. You do not need a TV in the refrigerator and all that crazy stuff that is out there now, but something that is of top quality, if you will, for your price point, and if you one up it a little bit, that helps you one up your competition. And it is a few hundred bucks. The great thing about appliances is once you hit a certain level, you can step up a model or two for just a few hundred bucks. You are not talking about double the price. You are talking about maybe $3-400. So money well spent.
Now fixtures. It is where it all falls off the rails. Right here. Fixtures. You have got to make sure that the fixtures in the home definitely match the quality of the house. The good thing is most of the big box stores are selling the quality and colors that are out there now that most people want. That most of our buyers are looking for. If you have time and you are out there and you are one to two years out, the great thing is you can take your time. You can look for the deals. Right? You can check out the sales, and you can be patient. We overpay when we are in a hurry. When it is the last minute, we overpay. Right?
Jason: Hence, fast good. Hence, convenience stores. I am in a hurry. I do not want to go to Sam’s and buy 48 bottles of water for $3. I will go in the gas station for $2.59. Right?
Jason: Think about the ratio. It is 40:1 ratio almost. You are overpaying a lot. Same situation in houses. When we get in a hurry, we overpay. Make a plan. There are things that come up that we cannot control. Job transfer and things like that are maybe you got transferred out the door and you were not expecting it. That is another transfer like here, we have a joke at our office is here your white box. Right? Go fill it with your stuff. It is your packing box. So those are the things that a lot of people experience.
Mikell: Well, there is a new term that most people use now. You get promoted to customer.
Jason: There you go.
Mikell: That is the nice way of putting it. You are were not terminated. You were just promoted to customer.
Jason: You are a really lousy employee, so we are going to promote you to a customer.
Mikell: To a customer.
Jason: Yeah, I like that. I do not know that that actually will fly. I do not know if I want to do business with you, but it might make them feel a little better. But anyway. So the type of fixtures you are choosing. Satin nickel, oil-rubbed bronze are still top of the food chain, if you will. Top market. This is what people are looking for. I am sure most of you that have been listening to me for 12 years on the radio know that brass is not anything that anybody is requesting. Okay? If you have brass, all it does is scream 1990. All right? Unless you are playing Bruce Springsteen in the kitchen, nobody is really going to, it is not what they are looking for. It is not a desirable product. Make the change. And here is the thing. If you have got a couple years before you are going to sell, just do a door a night. Pick a weekend. Like this weekend, this Saturday, I am going to change out these two doors. Right?
Jason: You do not have to do it all at once. If you have friends over and they are not impressed because three of your doors are oil-rubbed bronze and the rest are brass, then you question to yourself is are they really your friends. Right? Because if they did not like it, you would say, hey, I have got 16 more sets in the garage. You want to help me?
Mikell: You want to help?
Jason: You want to help?
Mikell: Chip in.
Jason: It is called will work for food. Right? I will feed you dinner. Come help me change out my brass here. So think about those things. Get a plan. Brass in the master bath is another one that we see more so than anything. Brass fixtures in a master bath always get reflected in the offer. So if you want to invest in one thing to start out with and yes, it is not cheap, especially when you have garden tubs and shower heads and all this stuff and all the little knobs and all those things that are brass and you want to make the change over. It is not cheap. So budget. Put it, look at it, and do it over time. People do not want fixer up homes today. They want move-in, ready-to-go homes. So think about that as you are going through it.
Now all this is assuming that you want top dollar for your house. If you want the lowest price, just well sell what you have got. Right? Do not worry about it. These are tips and ideas to get you the most money for your property when you are ready to sell. So we are going to take a time out. Go pay some bills. We will be back. We are going to dig into a few other details of the house. This is Jason Bramblett Real Estate Show. We will be right back in just a minute.
Mikell: All right, Jason, so coming back into it, we got an email from Steve and Joyce. I am going to read that for you.
Jason: All right. Very good.
Mikell: It says Mr. Bramblett, we intend to sell in the next two years, and yes, we will be calling you.
Jason: Of course, you will. Absolutely. Thank you.
Mikell: My bathroom has a garden tub and a small shower. I am considering taking out the tub and replacing it with a larger shower only. Is this a good investment?
Jason: Okay. It is a great question. This is a question we get that is a very popular question because a lot of homes are designed this way. So it is something that we are very, very familiar with, Steve and Joyce, and what we typically see is this. Here is the big factor in all that. Where is the window in the bathroom? And the reason why that is the biggest factor is most of the time a lot of times these garden tubs are placed, there is a window placed over them or above them. And so now we have got, not only do we have an interior issue or interior project, we have an exterior project. So it can be done. It absolutely can be done, but really what we have got to do is look at that modification. How are we going to match the exterior? If we just say that window is 4x4, and we have a 4x4 hole on the outside of the house, how are we going to be able to blend the materials to match to where that does not look like a big eyesore. Right?
Jason: One thing that is a challenge with a lot of materials like let’s just say that the house had vinyl siding. Well, if the vinyl siding has been up there for ten years, the sun has faded the siding. If you go buy new, it is going to stick out like a sore thumb. Right?
Jason: Brick. Brick is colored and dyed, and the dye lot is going to be very, very impossible to match. You can get very close, but it is amazing the human eye can pick up just a small distinct color difference can really stand out. You see this sometimes in new construction where some guys did not buy the brick all at the same time. And you look at a house and you are like is that two different colors? Why does the brick look that way? Well, they did the foundation so they did the crawl space and then you stop. Right? You get inspections done and you brick it up to a certain level. And then you put your band board on and then you build the house. And then the last thing you do, or the close to the last thing you will do, is rebrick the rest of the home. If the brick was bought too far apart, you will see a distinct color difference. You can actually look at it and specifically tell where the crawl space is at because of the color variation in the brick.
Jason: The same thing will happen with this window. Now here is where it really benefits. If you planned on painting the exterior of the house. So if your house was hardy board, wood, or even brick, to get the home ready to sell, you plan on repainting the exterior of the house, well, this is a perfect time. Because now you can put the brick back, makes no difference. It does not even matter what color brick it is as long as it is the same size and it has the same finish, and then once you paint the exterior, you will never know that there was a window there. The same could be true with wood if you are going paint it. Where we run into issue are products that are not going to painted. How do I camouflage? How do I make this window not appear on the outside like there is something really odd about the house? Right?
Jason: Now the other thing is you may have a garden tub that is in the corner or now window at all. Let’s just assume that it is in a location where there is no window. So this is a great thing to do. Yes, getting rid of the garden tub, which is the least used feature in a home, most people, most of the time when I go to a house, the garden tub is full of plants.
Jason: People do not even use it. And so, if you do not use the garden tub, you may relate to that, and you are like, yeah, that is exactly what it is. Or it is a big dust collector, if you will, and so a lot of people do not. Now, one question that we do see, is it bad or is it going to be a negative not to have a tub in the master bathroom? Typically, if you have a nice 60” shower with multiple jets and those types of things, no. Most people in today’s time do prefer the shower over a tub. However, you need to make sure there is a tub somewhere in the house especially if you think a family with small kids is going to buy the house. Most moms do not like to baptize their babies with a shower. Right?
Mikell: Not at all.
Jason: They like a bath, and the kids like a bath, and they play in the bath and they splash water all out of the bath, and it all ends up on your dining room ceiling. Right? And or downstairs. If you have a two-story home and small kids, you probably know exactly what I am saying. Usually when I go into a dining room and the sheetrock is messed up in the ceiling, I look up and say kids? And 100% of the time it is yes. Kids. Kids are amazing, amazing at destroying things. No, I am kidding. They are good for other things, too, like cutting grass.
Mikell: Changing doorknobs.
Jason: Yeah, changing doorknobs. There you go. Changing out doorknobs. Good call. Yeah. So holding stuff. Right.
Jason: So, anyway, but if you are in the situation where that is a question, but a 60” just step-in shower with multiple jets is a very good upgrade and I would highly consider that. The other thing is the kitchen, and we will run out of time. We will pick this up next week. But the kitchen can really make or break a sale. The biggest thing you want to figure out, again, goes back to the appliances and make sure the updates and upgrades match the price point. Okay?
Jason: Granite is kind of an expectation in certain price points. If you are over $300,000 and you have Formica countertops and your home is maybe 15 or 20 years old, that is going to be a real problem when you go to sell. Once the big box stores started selling the granite, it really became an expectation. We sell $80,000 condos that have granite countertops.
Jason: There are $150,000 houses out here now that have granite countertops. Now, some of you first-generation granite folks may argue and say it is not the same quality. It is a rock. I am pretty sure nobody cares. It is hard. Okay? I know that is hard to hear when you paid extremely ridiculous amounts of money for your granite 15 years ago, but do not shoot me. I am just the messenger. I did not go to the place and dig it out of the quarry. So we are going to dig in next week to the kitchen specifically and then talk about basements. Everybody’s mysterious space that we do not know what to do with. So we will dig into that next week. You can go to Jason Bramblett dot com. Shoot me your questions, and we will share them on the air. Everybody have an awesome weekend and thank you for listening to the Jason Bramblett Real Estate Show. We will be back here live next week right here on 94.5.
Jason: Good morning, Triad. I hope everyone is doing well on this, well, it started off right. It looks like it is going to be an awesome, awesome day. Hopefully, we will dodge any of this crazy weather coming in, and hope everybody has got some fun plans. Well, what else would you have to start your Saturday, but getting some real estate knowledge right here?
Jason: Why not? So joining me today, Mr. Mikell Montgomery on the board, pushing the buttons, making it happen, making sure I stay on track here in good time as always. Right?
Mikell: Yes, sir. Good morning, Jason.
Jason: Good morning. Good morning. So a couple things I want to dig into today. We are going to get you ready to sell that house. I am going to break it down room by room and how you can evaluate each one of your individual rooms as you go through the house. Actually, we are going to start outside the house today and dig through that. We will not get through the list today, but we will continue it next week as we work through each step and come up with an action plan to get you prepared to get top dollar for your house. This is one question I have never had, Mikell, is I have never had anybody come in the office, Jason, we hear you talking on the radio and see your TV ads and all that stuff. Can you get me the lowest price possible? Do not have that one. No. So we have developed a plan to get not only what the market will bear, but to squeeze out every possible ounce that we possibly can out of the market.
Jason: So some of you guys are now. Some of you are a year, some of you are two years down the road and beyond. And the things that we are going to talk about, there is a timeline for all of it, and what we want to look at is what makes sense for you. So really timeline dictates how fast you are going to move on these things. The actions are really going to be the same. It is just the amount of speed in which you move through the process. So if you are two years out, you will not need to go as fast, but you have more time to plan. If you are two weeks out, it is pedal to the metal, lightspeed and you have got to get going today. Like as soon as we get off the radio show you are headed to the big box. Right.
Mikell: There you go.
Jason: To get your Jason-Do list done in addition to your Honey-Do list. Grab a pen. Grab some paper. Let’s get started. We are going to hit first off with the curb appeal. Curb appeal is not only, it used to be back in the day when folks drove around looking for properties, it would be they drove around. They see something that catches their eye. They call the sign and say we like the outside. We would like to see the inside, and now, with the day of technology, internet, 3-D virtual tours, everything that there is in the world, I can actually get all the curb appeal I want about your house from the comfort of my Lazy Boy. Just relaxing. Got the phone. Heck, you can even put it on the TV now. You can just stream right up on to the TV --
Mikell: You sure can.
Jason: -- and do the virtual tour, walk through the house. So lots of things have changed. The amount of physical time that it used to go out and find a home is really reduced probably by about 70, 80%.
Mikell: Like we always say convenience.
Jason: Convenience. That is it. Absolutely. And we love convenience. So we can go through. Now the good and the bad of that is sometimes you see homes at their absolute best portrayal online and then you get there, and it is a little different song and dance.
Jason: It is kind of like the movie trailer. You saw all the best of the movie in the trailer. Right? And then you watched the movie and you are like well, that is two hours of my life I will never get back. I could have watched the trailer again. Right? Because that is where all the action was at, and then everything in between is just kind of eh, whatever. Well sometimes, in real estate, that can be the case, too. The other flip side of that is sometimes a home that is not represented well actually when you go into the property can wow you in a different way. So we are going to walk through this. A timeline, the things that we are talking about that your timeline kind of dictates the priority and or the plan that we are looking at here. If you are now seller, then when you look at the outside, one thing you want to do is make sure you have got some color, make sure you got some things that pop and give the house some appeal. So the closer you are to selling, the more mature these plants you need to buy. Do not buy the dollar-forty-nine little flowers the size of your finger because it will not really do anything. Right?
Jason: It is too little and too short amount of time. So you want to get something that is going to pop, something that is a little bit bigger, more mature, and something that adds color to the house. Whether they are annuals or perennials, you will have to decide there. Remember annual makes it one year, and that is it. So if you are three years out and you are planting annuals thinking man, I am good to go. No, you are not until next year. And then so, be careful with some of your perennials because well, they are great and they look good, but they only look for a short period of time. So you need to gauge if you are going to perennial planting gauge the time of year when these things are all in bloom and budding and all that. That is when you want to sell a home and or at least get photos. Right?
Jason: And so, if you have, just a little side note from my notes that I have, if you have great pictures of your home in the spring from different times, as long as all the plants are still there, we can use that. So if you are selling your house in December, everything is dead as a doornail. Right?
Jason: You may have some phenomenal photos of what the yard looks like in the spring. Well just because it is winter does not mean we cannot use those. Right? So we can show that story or tell that story. We just need somebody to capture that. So if you are thinking about selling with us, we are happy to send our photographer out at any season. So if you are thinking hey, my yard looks awesome and I am going to sell in the fall, well, give us a call. We will come out, take photos right now, and get it captured. Get it professionally done and that way in the fall when everything is kind of leaning toward the end of its life, we have got great photos of the spring.
Mikell: And you said that you, your company takes those photos?
Jason: That is right.
Mikell: Wow. That is great.
Jason: So we will send somebody out there to capture the best. I have a friend he is like whatever we do, let’s always put our best foot forward. Right?
Jason: And that is what we want to do. We always want to make sure that we are leaning toward the best. The other thing with colors and schemes and all that, primary colors appeal to the most people, so you can get some exotics and stuff, but just be careful. I have had some folks that have had amazing yards, but they are a little intimidating to the novice. Obviously, it is easier to kill stuff than it is to keep it alive. Like do not water it. It is one of those things where you can go a little bit overboard so be careful with the types of plants and or the colors. Because if you get a little weird, I will not say weird. Weird is not the right word, but if you get a little eccentric, a little exotic, it just does not appeal to everybody.
Mikell: A little creative.
Jason: A little creative. Yes. A little creative. You guys are definitely creative. I have been over to your houses. You are definitely creative. Some of you guys are creative not only in your décor and your repairs and your painting especially. It is all great, and you did it for you and it is awesome, but remember when you go to sell, you are not doing anything for you because you are leaving.
Mikell: It is not about you anymore.
Jason: It is not about you anymore. You have got to think like a retailer. You have got to think like somebody that is putting something on display that wants to appeal to the most people. You notice when you go in certain stores, some stores they have mannequins and whatever they are pushing for sale is dressed, is properly, accessories are right and all that. And that is a certain price and certain premium they get for telling the story. Right?
Jason: This is what you can look like if you lost 35 pounds and you were six-four. If you went to the gym every day you could fit in that Under Armour shirt, but nonetheless, this is the story we are going to tell. This is what you could look like in this suit, dress, whatever. And then there is a different price for stores you go in and stuff is just kind of folded over laying on the shelf and kind of tattered because everybody has kind of rummaged through it. That is different price. Right?
Mikell: That is.
Jason: Is it clothing? Sure. Does it serve its purpose? Yes. Is there a different price in the product? Absolutely.
Mikell: I suppose different quality as well.
Jason: Could be. Absolutely. So make sure what you are portraying, you want to think like a retailer if you want to get top dollar. And that is all I am talking about. If you do not want to get top dollar, then I do not know. Go back to bed. This is what we are looking at is how to get as much as we possibly can out of this. If you are thinking about selling, any time you are getting ready to within that 90-day window is when you really want to start to concentrate on that outside. And I highly recommend, no matter what time of the year it is, pine needles, bark, mulch, whatever it is you are putting out there. Within 90 days, hit the front yard and make it look good no matter the time of year. You can get it pretty much anywhere 365 days a year here in the Triad. But there is nothing more that just gives that curb appeal and that pop than freshening up. So if you do it in the spring and you are not selling until the fall or you are not selling until December, it loses some of its pop. The fresher it is, the better. I like within 90 days. Tease up the front yard. Getting it looking good, and I found that more people in the Triad prefer pine bark as opposed to pine needles or pine nuggets they are called. I think some of the places call them. But those tend to be the preference or the décor of choice, if you will.
If you have some lights outside, obviously make sure they are working. Make sure they are bird nest free, hornet nest free, spiderweb free. All these things. Realistically, most people spend more time at the front door than they almost do at any other place in the house just waiting on the real estate agent to unlock the door, and they have nothing to do but to sit there and stare at the lights, the door, the whatever.
Mikell: That is true.
Jason: So you want to make sure that front door is freshly painted, clean. Clean goes a long way. We talk about that all the time. You have got to make sure that the property, no matter if you are going to update it or not, a clean house will outsell any house on the market always. And so, eau to bleach is a good smell. Okay? It is smells fresh. It smells clean. It smells crisp. Now not overwhelming, but you get the point. So if you have got the black and mildew stuff, we are still talking about curb appeal, if you have got that black mildew or that streaks that get on the roof, this is where you want to reach out to my friend Chris over at Whitman Home Renewal. He can get rid of all that stuff. Makes the roof look brand spanking new. It makes a huge, huge difference. They can also take care of your driveway, your sidewalks, all that stuff. And remember as we have talked in the past, if you do not know how to pressure wash, do not do it. You will create a mess. Although I know it seems like a simple task, you take the machine, you point it at what you want to clean and it works. But remember, it is only clean two to three inches at a time.
Jason: Divide your driveway by three inches. That is a lot, a lot of time. And what happens is we start out good for about the first ten feet and then it gets boring.
Mikell: It gets a little sloppy.
Jason: And then we start moving it out a little further and a little further, and we end up with this tiger stripe driveway or sidewalk, and it looks, well, you might have just left it dirty. It looks that bad. The proper companies and they are not that expensive. Invest in this, and they make a huge, huge difference. These things make a huge difference in getting that curb appeal, getting those things that you want to really stick out and pop and make look good. So reach out to my friend Chris. You can go to our website. All his information is there. So windows. We like to remove the screens because it makes the windows look cleaner, but in order to make the windows look clean, they actually have to be clean.
Mikell: They have to be clean. Yeah.
Jason: You are going to have to do that ahead of time. So we want to make sure that the windows are good. If there are broken seals, where they have that kind of cloudy, milky-looking haze to them, you want to get those replaced. They range anywhere from $110-$160 a window to get that glass replaced, and it makes a huge difference. Every single buyer out there will ask for this. So go ahead and address it up front. And it makes the house look a hundred times better. Imagine going to a store. You want to see what is in there, and you cannot because the windows are fogged. That is not what we want to do. Same thing with a house. Mikell, let’s do this. Let’s take a quick timeout.
Jason: I can get through my little allergy condition I have. So we will grab some coffee. Get a pen. Make some more notes. We are coming back, and we are going to get inside the house. We will back here in just a minute. You are listening to the Jason Bramblett Real Estate Show.
Mikell: Good morning. We are getting back to it.
Mikell: So we were talking about the outside and the curb appeal. Now the question I have for you is it seems like, not really a question, but what you were going over, it kind of sounds overwhelming.
Mikell: And I guess it is just really important to make sure you are constantly investing in your property.
Jason: That is right.
Mikell: Even if you are not selling. You do not want to basically rush all this in one to two or even three years.
Jason: That is right.
Mikell: My suggestion if you see the cloudy window, if you see the driveway, go ahead and save up some money for that. Do like a yearly investment. That is how my parents did it.
Jason: Yeah, absolutely. It is the only tale. How do you eat an elephant? One bite at a time. Right?
Mikell: One bite at a time.
Jason: And so every year, yeah, you need to have a maintenance schedule. If you are really a planner, and unfortunately, a lot of people are not, but just even if you just took one thing once a month and said okay, this is what I am going to concentrate on or this is my goal to get this particular thing done, it really it makes a heck of a lot easier to sell down the road when somebody like us comes through. The team comes through the house and we look at all these things. It is easier when you have had a maintained home. No question.
Jason: And we have the whole gamut of people that are so meticulous that their house is five years old and you thought they bought it last week.
Jason: To people that bought their house five years ago and you cannot even recognize what year it was built depending on how it has been maintained. So maintaining, this is why, and some people do not agree with me, but I still believe that not everyone should own a house. Just like a lot of other things in life, people should not do. Like maybe have children, but that is a whole other show on a different channel. Not here because we talk about real estate.
Mikell: Real estate.
Jason: And we keep between the lines except for when I go around in circles sometimes. It is. Have a plan, and that is what I want to give you, and then obviously it is a lot to go over in a short amount of time on the radio. Especially we cannot see things, so this is where our team comes out. We do an evaluation. We walk through the house. We give you advice. We give you tips. We give you ideas to enhance your property. And some folks when we come out are pleasantly surprised and they are prepared and they are happy and they are excited, and some people get very defensive.
Mikell: I can imagine.
Jason: And it is kind of all over the place, but the ultimate goal is to get you the most money. If you do not want the most money, it is fine. Not everybody needs the most money. They just need to sell. And your equity position will dictate that. Some of you have to get the most money because you borrowed most all the money, and therefore, we have got to get you top dollar because there is no other way to get you out of the house other than mailing the keys back to the bank, which is not necessarily a good business plan. So we want to make sure that we do these things. So as we walk through the house, we find all your lovely art and colors and stuff and your tastes and these things. We more than likely are going to mellow those out some. Although I have sold a home with every color in the rainbow in every single room and depending on the location and depending on the demand of the property is going to dictate whether or not you can get away with that. Some homes have such a high demand that there is more flexibility in what you can do. But if you have a very unique home that has very little demand, then it is going to be a much different thing. It is going to be a much different strategy than we have. Homes that are in high desirable areas can get away with more. That is just all there is to it because the demand is so high people will put up with the inconvenience of fixing your problems.
Jason: If your house is not in a high demand area, all that expectation is going to fall on you. And especially as that price gets higher. The higher the price, sometimes the higher the price, the more eccentric the house, and we really kind of have to change some stuff. And some of the owners do not like that because it is their taste and they do not care. And that is fine. If you do not care, just understand that there is a different price for I do not care as opposed to the price you are going to get to appeal to the masses. Right?
Jason: So every one of those is different. Every single person, we look at every situation, and we give our opinions and our advice based upon what you need to accomplish. Because there are some folks that just a need a fire sale and they have got to go, and maybe we do not have time to do everything that we need to do. And then there are folks that make a plan that hey, I am not moving for two years, but I want to have a step-by-step. That is what we can help you create. So demand is going to dictate that. But you want to get as neutral as possible, and my recommendation is just Google most popular colors 2019, 2020, 2021. They are all going to be within that same kind of trendy hue even though it is 2021 years away. The color palette is already kind of established. It does not usually go from purple, red, green, yellow. It migrates slowly. Like we went from grays to now we are kind of blue-grays.
Jason: We will probably be green-grays, and everything is kind of in the same family and a little bit changes slowly over time. We do not usually typically jump from one extreme to the other. I highly recommend you go to model homes. Go to builders’ model homes. Go to open houses. Go the Parade of Homes. You can get an idea of what the taste is, the flair, what is up and coming. Greensboro just had its Parade of Homes. I think Winston is coming up or maybe it is even this weekend. Go out and check them out. Just go to a builder’s home that is kind of your price range and go in there and look and see what they have done. Look and see what they have, the décor they have put in and the colors. So outside of the driving force of location, these are the things that you can fix. These are the things that you have impact over, so choose your colors wisely. If you are moving in two years and the house is nine different colors, slowly bring it to a more neutral palette in the next 24 months.
Mikell: Let me ask you this, Jason. So a person, I am really big on finances. For a person who has to see the numbers, say if I am moving in three years, what is the budget I need to save? What is the monthly budget I should put aside to do these investments?
Jason: Sure. And some of it is going to be based upon the size of the home, the quality of the property. The big things, the big ah-ha’s, the big things that get you and that is kind of where we are headed with some of the mechanical things that we are going to talk about on a house, just look at the replacement cost. You can get a quote on a roof and most, let’s just say the average in the area is $7000 –
Jason: -- and it lasts for 25 years. Somewhere around that. So just divide it out. Seven grand, 25 years. That will tell you how much you are going to have to set aside for the roof. Let’s just say it is $30.
Jason: Whatever that number is. And then save $30 a month. So I am saving, let’s just say, every single month, I have got $250 –
Jason: -- in my budget for house maintenance of which $30 of it is for the roof, $50 of it is for the heating and cooling or maybe even $75 because it lasts a shorter amount of time. $15 is for a new water heater. And these are all things that are going to happen, but what we typically do is we do not save at all.
Jason: Zero. We have no plan, no budget, and we just deal with the emergencies as they come, and we hope that it was hail damage, or a tornado came through so insurance covers it.
Jason: Because otherwise we do not have any clue how we are going to get a new roof. Or you end up with no plan, no budget, and no financing, and you need a new roof. And you call a roofer and they are happy to do it, and they will happily finance it --
Mikell: Finance it for you.
Jason: -- at 15%. So you bought your roof and your neighbor’s. So having a budget and setting aside some money every month, you do not want to spend 100% of your housing allowance on the principal and interest and insurance. Set aside a portion of it for these maintenance things. Set aside some money to make sure that you have got these ah-ha’s. They are going to happen.
Jason: That is just the way it is. It is going to happen. Lightening is going to strike in the field next to you, and your well pump is going to get fried. Your septic tank, when you got the new deck put on, your contractor ran over it and you did not know it broke until whatever, a year later. The pipe came undone underneath the house and you did not know it, and you end up with a swimming pool in your crawl space. These things happen.
Mikell: An unwanted swimming pool.
Jason: Yes, and so think about the age of the systems that you have. Think about the age of the products that you have in your house and create a sinking fund in which you could sink some money away to head off any of these surprises. Grandma called it a rainy-day fund. Right?
Jason: Set it aside for a rainy day. We have got an entire list of things, and we did not even make it in the house yet.
Mikell: We did not.
Jason: And so next week, we are going room by room. We are going to stick with this to give you a plan. So come back. It is Jason Bramblett Real Estate. You can go to Jason Bramblett dot com. Give us a call at the office, 553-0796, and we will look forward to seeing you here next week.
Mikell: Have a good weekend.
Jason: Good morning, Triad. I hope everybody is doing great. What a beautiful, crisp spring day out here. Spring morning. That is just what you need to get you up and going in the morning is a little crisp air, and we have it served up for you today. Power-packed show coming at you. This is Jason Bramblett live in the studio, and of course, my man Mikell Montgomery running and pushing all the buttons like he does every week.
Mikell: Yes, sir. Good morning.
Jason: Good morning to you, sir. And then you, all 1900, well maybe no, let’s go back. How about, I think the numbers the last time I made up was just like, let’s go with like 190,000. Yeah, I like that number, Mikell.
Mikell: I like that.
Jason: All 190,000 of you out there listening today. It is an interesting thing radio. You never know who is listening, but I can tell you this. When I get back to the office, my email is full. Our voicemail is full. We have got great listeners, great questions you guys send to us every single week. And if you have a question, go to Jason Bramblett dot com, and you could shoot us an email. Just go up in the right corner. Click on the little email icon, shoot over a question, and if it is something that we feel will benefit the community of the Triad, we will share your question on the air. We will hide your name to protect the guilty, so you do not have to worry about us divulging too much information about you out there. But we do have some great listeners, great questions, so please send those over to us anytime. Jason Bramblett dot com or you can call the office 553-0796. And today, we are just looking at all kinds of different things, but the real estate game is how to get into it. So many times we get questions, Jason, hey, I want to look at getting into real estate. Well, that is a big category, and so how are we looking to get into it. Is it the buy and hold? The flips? Multi-family? How about just buying your first house? All that stuff plays into the real estate game and what you may be attempting to do out there. So we are going to dig into all those things today. Burn through as many of them as we possibly can, and of course, you can always fire a question over to the office. Should I not answer it on the air here. And again, that is Jason Bramblett dot com. Shoot it on over. Real estate is the greatest wealth-creating vehicle on the planet. How about that? More wealth is created through investing in real estate than any other venture out there.
Jason: And it is one of the top things. If you look at the wealthiest people in the world and the United States and North Carolina, and then you dissect it down by city, you will find that they all hold considerable amounts of real estate. And this is not just the house that they live in. Remember, Warren Buffet did not become a millionaire because he got a good deal on his house. Okay? Just understand. So when you are out there negotiating this weekend and you are squabbling over $500 and the seller will not come down or the buyer will not go up, just buy the stupid house. It is $500. It is not going to change your life. I promise you. Heck, if it is $2,500 it is not going to change your life, and a lot of you get caught up on these little nuances, and it is more of a game. Then what happens is we hear some frustrations in the market place. I travel all over the place talking to different real estate agents, and one of the things they will, the frustration is they have got a buyer hung up on $2500, and they did not buy the house. But they won. Yeah, you showed them by not getting the house. Real good. Okay. The only thing you got was nothing, and you might have a very unhappy spouse depending on who really wanted the house.
Mikell: Yuu do not want that.
Jason: You do not want that. I will promise you. You will triple down on that number next time. I promise you.
Mikell: That is true.
Jason: The next house will not get away no matter what. Do the right thing. Just buy her the house, man. Come on, $2500 over 30 years is nothing. Just buy the stupid house. It is going to be okay. Again, you are not going to get wealthy off of it anyway.
Jason: $2500 is not going to change your life. Get out there, buy the house, make her happy. But let’s dig in, Mikell. What do we got lined up? What is our first little topic here we are going to jump into?
Mikell: We want to start with buying a house and what that plan actually looks like.
Jason: So just like the first one. Like walk us through that. Is that what we are going to do?
Mikell: Yes. Yes.
Jason: All right. Let’s do this. So, first time house, where or where do I start? Especially if you are looking at it from long-term investment, and that is what we want to talk about is I want to get into the real estate game. Well, the first way to get into it is to buy your first property. Now, if you want to be a real estate investor long-term the way you need to look at this is you need to look at this I want to buy this property for future cashflow. Not for cashflow today, but for future cashflow.
Mikell: So start some passive income there.
Jason: Yeah, to start some passive income, but I am not worried about it, the now. I am worried about it 10, 15 years down the road.
Mikell: Of course.
Jason: So the first thing we are going to look at is buy your first home because everybody needs a place to live. Right? And then this is what you want to convert into your first rental, whether that be a condominium, a townhouse, or a single-family property. And you could look at your duplexes and quadplexes. We just do not have a lot of those in the Triad, but you could look at those as well. Condo, they are great first rentals. I suggest you look at all different types and all different things. But here is the key. You have got to find one that does not have a ridiculous HOA fee. Because the HOA fee is what kills your cashflow. So you want to make sure that you buy one that has the lowest HOA you can find. A low HOA tells me it is properly managed. A high HOA tells me that whoever is managing it does not have a clue, and or you could have this issue where you have got a lot of vacancies in the complex, if you will. So say there are 200 units. If a large proportion of those are in bankruptcy, foreclosure, short sale, or vacant, the question is maybe nobody is paying the HOA.
Jason: When nobody pays, guess what? All the people that are paying get to share, to carry the weight of the people that are not. Right?
Jason: That is just how it works. That is what you signed up for. My break number is $180 a month. So if it is $180 a month or more that tells me it is not being managed properly. Now, that is not for all properties, so if you are paying more than that and you are the HOA president, do not send me an email screaming at me. This is a generic statement. But it is a guide in which I look at $180 or more a month typically tells me that it is not being managed properly or it was not being managed properly. I know you, Mr. New HOA President, are going to fix it. I am on your side. Get those HOA dues down and what will happen is it will also increase the value of the units. The interesting thing about condos and townhouses, the higher the HOA you actually will see a drop in the valuation. That kind of shows you, this proves a theory that I have talked about for years and years on the radio here. You do not see it as much in single family because it is disguised and it is hidden, but it is real obvious on townhomes and condos where you have a set number of units. So say we have 200 units, and what I see is if that HOA creeps up, the values push down. And the reason why is people buy what they can afford per month.
Jason: The end price really does not matter.
Jason: Whether it is $18 million, $180,000 or $200,000, people buy based on what they can afford per month. So if you have $1000 a month cap, and that is your audience, if you will, and a proportion of that, $200 a month is going toward the HOA, that is $200 less that can go towards principle and interest. Right? And when we look at the compounding effect of what that $200 looks like in borrowed money, it is a big number. It also squeezes the value of the properties down. So if you want to time it really well, you look for one that is climbing out of that, and you can pick up a property there. But condos, townhouses are excellent ways to get started. The other nice thing is when your tenant moves out, well, you do not have to worry about cutting the grass. Somebody is doing it for you. Right? That is why you have the HOA.
Jason: And so you have some of that maintenance that is being taken care for you. Whereas, if you own a single-family home, there is a lawn, there is grass, there are all these things to deal with, and the tenant moves out. If the tenant was taking care of them, then you either are as the owner or the property management company. Somebody has got to step in and do that. Otherwise, you are going to end up with a forest around that. So what I am looking for condos and townhomes and that $125 a month HOA tend to be really nice properties, or well-managed, I should say. And that is what we are looking at. Single-family homes, only buy three-bedroom, two-bath or four-bedroom, two-bath. That is it. And you want them to be in the best schools. The best schools drive the market in rentals. Okay?
Jason: So people do not say hey, where is the absolute worst school system. I want to make sure that I invest in my kids’ future by putting them in the worst schools possible, and I want to live there. It does not happen that way, guys.
Mikell: Not at all.
Jason: Everybody wants to be in the best school. And here is the other thing. I have found in Greensboro and Winston-Salem both there are families that will rent and not buy because maybe in that best school district the price point has exceeded their budget, and or they just simply cannot afford to purchase. But they can afford to rent a smaller home in that area, and they will choose to do that. They will choose not to be owners to actually get their kids in a better school system. They will actually sacrifice that in order to do it. That is what you are looking for. Those are the best tenants ever. Especially if they have two or three kids and you catch them on the way through middle high school and you end up with ten years of an outstanding tenant in a property. You are looking for that longevity. Tenants, flipping a property every year is not the best way to make money. You want tenants that are going to stay. I have sold a lot of homes over the years and some of the rental properties that I have sold for some of our investors, and I am just amazed. I remember selling one for a gentleman. The tenants had been in there for 33 years.
Jason: They paid for that house.
Jason: 33 years. They paid for that house. He was a generous man, and when they moved because he was getting up in age, he actually helped pay for all their relocation, moved them out of the property, helped them get into another property. And that is the type of landlord you want to be when you have got somebody that is committed to you for 33 years. I would argue to say that if you have got somebody how would commit to you for ten years, you probably ought to treat them that way as well. So positive cashflow is important. Do not get me wrong, but it is not what I am looking for right off the bat. I am not trying to retire based upon the first house that I buy simply because, well, let’s face it. You are not going to be able to retire off one property’s income anyway.
Jason: Unless it is an amazing property. So what I am looking at is I am buying cashflow for the future. Now I want to make sure that I have a little bit of money coming in to cover incidentals. Right? To cover things that come up. Let’s face it. Homes have moving parts. Right? They have got the HVAC system, water system, dishwasher, appliances, all these things have a life expectancy, and they die eventually, and you have got to replace them. And so, I need to have a little bit of cashflow there to put into a nice little fund that I call a sinking fund that allows you to reach into your pocket and pay for those things as they come up and they are not a huge big surprise. That is the key to this particular aspect of buying. Buy a property in which you can turn it in or convert it to a rental down the road and take that money that you are making and set it aside. Sinking fund is basically like insurance. Right? You do not really want to have it, but it is nice to have when you need it. So if you are making $100 a month or $1200 a year on a property, take that $1200 set it aside. Forget that it is there. Hide it, get it away from you. Do not spend it. Do not go buy stuff, and you keep it, and that way when the hot water heater goes out and it is $1350, you are covered. Right? And after 3, 4, 5 years of dumping that 12 or $1300 a year into a fund, you have got 4, 5, 6, $7,000. Leave it alone. Because the next thing that is going to come along eventually is going to be the roof.
Jason: And it is going to be five to six grand, and guess what? Now you have the money. And here is the cool thing. Guess who just paid for your new roof? Your tenants.
Mikell: Your tenants.
Jason: How awesome is that? And if you get a good roof, you will not have to deal with it for another 30 years. So that is what we want to do. So do not touch that money. Put it to the side. The other thing that you really want to consider is hire a professional management company.
Mikell: I am sorry, Jason. Let me ask you a question. So from the money that you make from the tenants, what percentage would you say should you invest back into the property or save for the property?
Jason: I am going to save 100% of it.
Jason: 100% of that money I am going to put in the sinking fund. And the reason why is I do not need the income now. I have a job.
Jason: Everything I am looking at, I am looking at 10-15 years down the road.
Mikell: All right.
Jason: So my goal is I am going to buy this property. The tenant is going to pay for it.
Jason: And if something goes wrong, I am going to use the cashflow that is there, maybe just a $100 a month or whatever it is. I am going to use that money to improve the property that the tenants gave me over time.
Jason: All right?
Jason: Now the best way to secure your asset to make sure that it is being taken care of is to hire a professional management company. Here is why. Using a third-party mediator has proven over 100 years now that they always do a better job than you do. And the reason why is they are not personally vested in the deal. This is why a real estate broker can always get a better price for you on your house. Do not shoot me. It is the national statistic. Poll the data. Get it from, go to Google. Google knows everything. Right? You will find that the stats are 16%. Well, if most agents are charging between 6-8% to sell your property, and they are getting you 16% more, you are money ahead. Here is why? You have an emotional tie to this property, and you do stupid when you have an emotional tie. When I am negotiating your house, I do not give a rip. It does not mean anything to me. It is a box with windows. Right?
Jason: And so, it does not, I have no memories there.
Jason: I have nothing vested in it other than my time. I have not lived there, dwelled there. I do not know all the nooks and crannies. I do not know that the grandkids were playing in the backyard and have that emotional thing. The first baby was brought home to the house and all these things that factor into this emotional, illogical decisions that we make. Here is the thing. I am in the real estate business. I sell real estate. I am the worst person to sell my own properties as well that I have lived in.
Mikell: Wow. Okay.
Jason: Because I have that emotional tie. Right?
Jason: Now, I have trained myself and taught myself over 22 years to get unemotional about that in my own personal thing. But if Mikell is selling his house, I will assure you, it has no emotional dwelling in me at all. Zero. It is nothing more than sticks, bricks and shingles. But what that does is give me the power to hold firm when we need to because I do not have that emotional tie, and I can make clear, good decisions. Good business decisions for Mikell because Mikell cannot because his head is swimming in all the emotion of this house that he bought.
Jason: And I have no emotion to it whatsoever. And this is why third parties can not only sell for more, but also they can manage your property better as well. We make poor decisions based upon emotion always. 100% of the time.
Mikell: That is true.
Jason: 100% of the time. So having a professional management company is going to be key. So we have got a lot more stuff coming your way. Stay tuned. We are going to dig into several more aspects of investing in real estate including multi-family and then the all amazing thing of flipping those houses. So do not go anywhere.
And welcome back. This is the Jason Bramblett Real Estate show. Live in the studio. We are diving into all things real estate. Mikell, what else we got on the list today?
Mikell: So I did have this question for you. Some people give me advice on real estate. So when buying a rental property, I do take the equity from one rental property and use it as a down payment for my next rental property. Is that correct?
Jason: Well, most people look at it as this is the trade-up theory. So a lot of folks will buy their first home.
Jason: And they are there, and here is normally what we do. We get married. Everybody is happy. Right? Carry the spouse, she carries you across the threshold. Right? You get in the house, and then these little critters show up called kids. And then all of a sudden, you need more space. Normally, what we do in America is instead of keeping the house we bought, condo, townhouse, or single-family home as our first rental, we sell that, and we take the equity from it to buy the bigger, better house.
Jason: And then we do it again and again and again, and then the downside is we end up with a 3-$400,000 house a lot of times, which is a horrible rental should you ever try to rent it. Right? So if you ever got into a situation where you needed to rent a $400,000 house, the problem is a lot of times they will not even, you cannot rent it for enough to even pay the mortgage.
Jason: And so somebody is going to make up the difference. The other thing, too, is you are not diversified. You have all your eggs in one basket. So if you could train yourself to keep your first home you buy and never sell it and do not use what they call a HELOC to buy your next house. So you would actually save your down payment for your second home and use and keep the first house as your first rental. Now, really disciplined home investors will buy the same type of property. So they will go from a three-bedroom, two-bath home that they purchased as their first house, and then they will buy another one, a three-bedroom, two-bath in the same school district, and they will keep building that up. And then they will end up with an inventory of 5, 6, 7, 10, 15, whatever it may be over their lifetime of paid for real estate in which they have got, let’s face it, if the average rent in our area is $1500 a month, and you have got ten of them –
Jason: -- and you did that over 20 years, if you have no debt and you can’t live on fifteen grand a month, you have got some spending issues. Right?
Mikell: You really do.
Jason: Yeah, so you can build a really amazing portfolio. Now, I would argue and say that ten is probably not enough to be diversified. You would want more, but it is a real good start.
Mikell: What I was going to say when you were speaking about it earlier, especially with the houses in the great school districts, it seems like those are goldmines to have.
Jason: They can be for sure. It is something, sometimes it is hard to duplicate. If you got that property, let’s face it, if things are going right, then real estate is going up in value. Right? So if you bought it for $150,000, in ten years it should be $200,000. Right?
Jason: If we are just playing the real estate game. Here is the thing. If you kept that, and your basis is $150,000 and you get it to zero, you get it down to where it is paid for, and now you have got great tenants in there paying you $1500 a month, man, I want to buy every house in the subdivision that way. Right?
Jason: And just keep going. Because if it is close enough to the school, now school districts do change, and you need to think about that. The only way I know for sure that you are going to remain in the same school district, I guess, is buy the house next door to the school because they probably will not move that. But those are things that do change, and you need to think about that as you are investing in real estate, if that is your goal. But here is what I want to say. Do not cash out all the time and keep growing the house. That is kind of the tradition in America, and I am not saying it is wrong. But if you want to be a real estate investor, use the first property you buy as your investment. So use your condo, townhouse and those things. Right? And speaking of those, if you have a condo, we are in the market of buying those. Actually, we are in the market of buying anything. So if you have got any kind of real estate, we want to take a look at it. You may see our billboards rolling around town. Offer on your house in 72 hours. That is because we are buying stuff. We want to take a look at it. So if you are struggling to sell your home, and or you just do now want to deal with putting it on the market, give us a call. 553-0796 or go to our website, Jason Bramblett dot com. I would like to take a look at your property to see if it something that we could potentially add to our inventory as well. So you go to Jason Bramblett dot com for all your questions. We will be back here next week live in the studio. Everybody have an awesome, awesome weekend, and do not forget. You are buying future cashflow, not now cashflow when you are buying real estate. So think about that. Put it in your plan. Next week. Flip or flop, and we will be back. See you then.
Jason: And good morning, Triad. I hope everybody is having a great day. It is a little brisk, a little chilly. Slid in some cool weather for us, but all in all, the sun is shining, and the rain is finally gone, which is awesome. So I hope everybody had got great plans and some fun stuff planned for the weekend. At the top of that list should be, as always, buying a house and or selling one. Right?
Mikell: Of course.
Jason: Absolutely. Actually, joining me in the studio today Mr. Mikell Montgomery on the board doing what he does best. Keeping me out of trouble.
Mikell: Yes, sir. Good morning, Jason.
Jason: That is right. That is right. So we are going to dig into some stuff, but first of all, Happy Easter to everybody. If you are in the area, we did serve up some pretty good weather for you. I think there are a couple of Easter egg hunts out there. Other than needing a jacket, you should have fun. Plenty of loot. I saw several churches out there already spreading out the joy.
Mikell: Oh wow.
Jason: They are getting ready for their Easter egg hunt. Actually, I think Calvary Church out there on Pleasant Ridge Road, they have got about 25,000 Easter eggs they are doling out today.
Jason: I do not know what you guys have been doing all week, but the Easter Bunny has been very busy. That is for sure. So Spring market is here. It is looking great, and if you have thought about selling your home, we need to talk. It is that time. Interesting this particular time of year, it is kind of like the kickoff to the home selling season, if you will. But this year is a little different. The inventory is a little lighter than most. We did such a great job selling all these wonderful houses in the past I guess nobody wants to move right now, Mikell. They are all just kind of hunkered down and enjoying life. So we have got to get some folks out there to raise their hand and say hey, I want to take advantage of this. It is time for me to maybe downsize, and or, well, if somebody is downsizing, somebody had got to upgrade. Right?
Mikell: There you go.
Jason: It takes the pendulum swinging both ways. If you are considering buying a home actually you do not go anywhere. We have pretty much dedicated this whole show to buying a house. Now a lot of times when I say that people that have bought homes are like I got this. You might want to stay tuned because several things have changed. We did have this thing called, I do not know, a housing crash, and when that happened, a lot of the banks changed some of the procedures. The rules definitely were changed, and how you went about buying your last home is going to be a lot different than it is today for sure. You want to stay tuned. Grab a pen. Grab a paper. Obviously, if you are driving, do not do any of that stuff. We are going to have this posted up on the web for you. You can go back, hit the podcast anytime. Go to the website Jason Bramblett dot com or you can always give us a call at the office, 553-0796. So we have got that coming up. If you are buying, do not go anywhere. Even if you have bought many, many homes, you want to stay tuned. Plus a few of your email questions that came in this week. We are going to hit those and kind of dive into that.
So this week, the sponsor of the show is our awesome, awesome group of folks out there in Summerfield, North Carolina. Tabitha’s Furniture Nook. New little place. It is a fun little place. They have got gently used and new furniture. So if you are in the market to buy some furniture for your new home or the home you are in, go check them out. Cindy and her team they have got a great group of folks there, and 100% of the proceeds go to support the Tabitha’s House, which is a ministry helping women getting back on their feet that have basically suffered the experience addiction, abuse, and homelessness. So it is a wonderful, wonderful thing. And if you have furniture that is gently used, not your junk, not your sofa out on your porch, give them a call. You can get in touch with them. But the address there is 4547 B Highway 220 in Summerfield. You cannot miss it. It is right next to the second only intersection in Summerfield. So it is easy to find. No problem. It is very simple to find. But go check them out. Tell them that Jason and the crew sent you up there, and they can really help you out. Get some stuff either offloaded or, if get rid of stuff, you need more. Right?
Mikell: That is awesome. That is awesome. Getting back into it, so you know that I am interested in buying a house.
Mikell: So tell me where to start.
Jason: It is a process in which takes a plan.
Jason: And like all things in life, if you do no have a plan, well guess what? You still have a plan. It is like zero. It is still a number. Right?
Jason: Which most people do not want to get to. So if you do not have a housing purchasing plan or selling plan, no plan at all is still a plan. It is just one that you do not know what the result or the outcome is going to be. So we would like to set folks up to succeed. So if you are in the market to buy, then you want to make sure you listen to up, especially, as I said, if you purchased in the past because things have changed. Everything is kind of different than it was. So five years ago, a lot of different things started clicking with the real estate market and the lenders out there and the mortgage and the banks and those guys said okay, we have got to redo things differently this time. Some of that was directed by our government. They had no choice. Right?
Jason: You pass laws and say this is the way we are going to do it. But qualification has become a bigger deal than it has in the past. So as you can imagine, the days of fogging a mirror and getting a home loan are gone. You just existing, breathing, and saying hey I have got a job, that is not going to be good enough anymore. You have got to do some more proof, if you will. The banks want to dig in a little bit further, and so you really have to make sure you have your ducks in a row especially if you are self-employed. Self-employed people, by nature, are creative. They are creative in all things, their businesses and their taxes. So we need to make sure that if you are self-employed you really want to be making sure you, one, filed your taxes, and two, you have got great, you have an accounting system. You create a P&L, a profit and loss. Hopefully it is just a profit. I do not like P&Ls. I like P&P. Profit and Profit.
Mikell: I like that.
Jason: That is what we want.
Mikell: That sounds good.
Jason: Loss is no fun. Loss is not something we want in business for sure. So they are digging deeper. The banks, the mortgage lenders, and they are asking more questions. So here is what you want to do. Things that you may have forgotten, Mikell, when you put on your application, and this is where diligence comes in and you want to make sure you have got a good coach or somebody working with you. An agent that is there to guide you through that, and also a good loan officer. Things that people just pay all the time, they kind of forget like student loans.
Mikell: Oh wow.
Jason: Alimony. Received and paid out both. If you are getting money, that is probably a good thing. You should hopefully if you went through that scenario. But if you are paying out child support, that is a debt. That is something that they look at. That is something they are going to reduce your housing allowance by.
Mikell: I can see a lot of people withholding that information.
Jason: Some people –
Mikell: Not on purpose though.
Jason: Absolutely. They just kind of forget about it. And so there are things out there like that new car that you just bought. Ooops, forgot about that.
Jason: Oh, is that already on the credit report? I just got it three days ago. But those are the types of things. So you need to have all that out in front of the bank. Why? It is going to come up, folks. There are no secrets. There is no hiding it. There is no way to get around it. It is going to be there just like your job. They are going to verify it. They are going to verify right before closing, so when you get the loan, you want to make sure that you still have the same job two or three days before closing because if you decided to switch careers in the middle of getting a mortgage, you might be staying where you are at. Unless you moved into the same field, different pay, something like that. But if you totally shift directions in your career, then they are going to want these lovely two years of verification that you are actually going to keep your job. Right? And so two years seems to be the benchmark that they are looking at.
So just slow down a little bit. Think about what you need to get brought together. A good lender can help you with that. We have multiple lenders that we work with, so if you need a good recommendation, you go to Jason Bramblett dot com or give us a call at 553-0796. The thing that the, you just want to be clear in this picture. You want to be clear in what you are giving the bank. And remember, the bank is in the business to loan money. So when you walk in the door, the answer is yes. We want to do the loan.
Jason: And so, the only thing that gets you to no is some of this missing data, some of this missing information and or well, some bad history. So you want to make sure that you are current on your payments. I had a young lady call the office one year, and she was telling me all about this house. She wants to see it. It is great. I love it. I want to move in it. It is my house, my dream house, everything and all this. I said, well, you qualify for a first-time homebuyer’s loan, an FHA loan has a little down payment. You do not have to have a lot of down payment. Everything sounded great. And I said well, one of the conditions is you have to be in your job for two years. She said I am good. I said great. I said okay, the next thing is you have to be current on all your payments for the last twelve months, and her next response was all of them?
Jason: And yeah, just optionally the ones you want to pay are not, it does not work out that way, guys. So yes, you have to be current on all of them. I get this question a lot. Why start with the loan? I want to start with the house. The house is the fun part. But remember this. The key to being successful and getting what you want is proper preparation. So you want to make sure you start out with the right reasons to buy, and you also want to start out with the right product. And there are lots of loan products out there. Most people just assume the 30-year mortgage. But maybe a 15-year is really in your best interest, and it fits your budget, which is a phenomenal loan to get.
Mikell: So are you saying basically see what your allowance is before house shopping?
Jason: The thing of it is the money an important piece. You need to know how much upfront and you need to know how much per month.
Mikell: Got ya.
Jason: Just because you are paying $1500 a month in rent or $500 a month in rent does not equal out always the same to that is what I can afford in a mortgage. Other things that mortgages have and when you own a home have that you do not have as a renter are these things called taxes. And these things called insurance. So insurance, taxes, homeowner’s association dues, all these things factor into your reoccurring payments and reduce the amount that you can borrow. So with rent, it is rent. One payment, one deal. That is it. And maybe you have some renter’s insurance. Hopefully you have some renter’s insurance. But with a mortgage, you have other factors in there. Not only do you have the principle and interest of the loan, if you are buying in a subdivision, you may have that HOA, and of course, you are going to pay the government because you love those sidewalks that we get to walk on. Right? And they are not free. They do not fall down from the sky. They actually, somebody had to put them there and somebody had to pay for them. But we, as humans, just do not make good decisions when we start out with excitement. The excitement part is, go find the house. That is fun. That is exciting. That is what we all want to do.
Jason: The problem is we get too excited and we do not make good decisions. This is where the hold my beer videos started on YouTube. People got excited, and they are like hey man, hold my beer. Watch this. Right? And you have seen those videos. Usually something very bad is going to happen after that (indiscernible)
Mikell: That is true.
Jason: We do not want you to have that kind of experience when you are getting ready to purchase your home. So making good, solid financial decisions that are not emotionally charged, puts you in the right place. And remember, the mortgage is the most expensive piece or part of buying a house. The house is the little number. You will not see that in full until you get to the closing and you look at the disclosure, and it has in there principal and interest and a total. The total is a little different than what you are paying for the house. Depending on your interest rate, it could be significantly different. When I started selling real estate, interest rates were probably 9%, and so, at 9% it is almost three times the amount you paid for the house when you look at the interest over 30 years.
Mikell: Oh wow.
Jason: So you did not think you were buying a $300,000 house, but when you got to the closing table and looked at the interest over 30 years, holy cow, it adds up quick. So rates being a little better than they are today. It is not quite that shocking. We do not get people about fainting or passing out as we used to, but it is something you need to pay attention to. Looking at the money is the key to making a good financial decision when you are buying a house. We are going to make a good financial decision right now. We are going to take a break. Go pay some bills. Got to go pay the Easter Bunny for all the eggs he is slinging around the Triad, but we will be back here in just a minute. You are listening to the Jason Bramblett Real Estate Show.
And you are back live listening to the Jason Bramblett Real Estate Show. I hope everybody is having a great weekend. So we have been talking about that whole home-buying process and why it is important to get that loan, get that pre-approval and start with the best foot forward.
Mikell: And you were talking about it and I think that now that I think about it, it is actually important because beside the taxes and the mortgage, you also want to have money for maintenance as well.
Mikell: I was just thinking about that during the break. That is an important part.
Jason: Absolutely. Even though your home could be made of brick, it does crack and there are things that do happen and there are maintenance things. There are moving parts on your house like your heating and cooling. In July, you will really want to have that air conditioner working.
Jason: I can assure you.
Jason: Just like heat is important. It is all about setting yourself up for success. One of the things that our team is doing to win this market and winning some of our buyers are getting homes that are very competitive is because we are doing the due diligence up front to make sure that they are ready to go, to make sure that they are well, we could easily prove to the seller that our buyer can actually do what they say they can do. They can actually make this offer and close on your home assuming you have presented your home properly and it is exactly as you represent. But so many times we see people go out there and they want to just do the house thing first. And this is not really for first-time homebuyers. This particular issue has probably more to do with ego than anything else. We have folks that will call our office and are like well, I bought three houses, Jason. Well, that is great, but you did not buy them this week. And things change and qualifications change, and debt-to-income ratios change and the way that banks look at your credit profile has changed. So lots of different things. Here is the big one. You go out and find the house. Right? It is the one, and you are not there. You are not ready. The only thing you know is you like it and you want to make an offer. But it showed five times today, and the other four people are ready to go. Letter in hand, approved, money in the bank, ready to take action, and you are not. Now, if you are the seller of a house, who are you going to look at? You are going to look at the guy that says I can actually buy your house or are you going to look at the guy who can actually prove?
Mikell: It is that expression money talks.
Jason: Money talks, and the fact is that it is backed up by a third party. This is what we call paper ready. You are ready to go. Those are the ones. Those are the buyers that are winning it over. And the seller does not want to wonder about if. If is not the word you want to hear when you are selling your home. Right? If I can do this. No, you show me you can do this, and then we will agree to the price and terms, and then as a seller I will start packing my stuff. Right? But if buyers are getting beat out left and right in this market because it is a fast-paced market. In my opinion, if you do not have an approval, you really do not even have an offer.
Mikell: Right. Right.
Jason: You might as well just call them and say here is what I think I can do because that is basically what you have done. The only thing you have done is you have put it in writing. No seller is out there looking for the if kind of maybe, kind of seem, sort of, might be able to do this buyer. No. I am not packing a box for that person. I want to know when you come and bring and offer that you are backed up by the bank. You have it in writing, and they said hey, as long as your house appraises for X, we are going to move forward with the loan. That is what the seller wants. They just want to be able to back up what you said you are going to do. That is it. Pretty simple. That is what they are looking for in today’s world, if you will.
Mikell: Let me ask you something. Is there anything else I can help get my offer to the top of the pile for the seller?
Jason: Yeah because there are, in this day in certain price ranges, there is a pile. So there are competing offers. Yeah, one, obviously like we said, be ready to go. But there are several other things that we utilize are tools to help our clients get their offer accepted is tell them about yourself. Tell them a little story about who you are. Most sellers out there have built amazing memories in their house. They have either got the kids growing and they have got all the little heights marked off on the door. And Johnny was whatever, four feet tall when he was this age. Or Grandma does if it is Grandma’s house. And the grandkids and they built this legacy kind of thing in this house, and they want that to continue. They want it to go on to the next folks. We were just in a multiple offer situation, and the couple that we were working with has two small kids. They wrote a great little letter about what they do and where they are from. Two small kids and the listing agent called me and said well, it worked. Nailed it. Not even considering anybody else.
Jason: It was not even really about the money. It was about they wanted to carry on all the joy, love, all the fun times that they had in that house for 30 years. They had owned it. They just wanted to share that with somebody else.
Mikell: So if I have kids I should use them?
Jason: Use them. Absolutely. Absolutely. Not only do you use them to get the house, you use them to help clean the house.
Mikell: Awesome. Awesome.
Jason: Absolutely. You have got to earn, you have got to put a little elbow grease into that thing every now and then. But the thing about it is people want to do business with people. And they like to know a little bit about you. Now there are sometimes when that does not work. There are some sellers that are very transactional, and they are just like look, I do not care who you are. I want the money. Okay, so it is not going to work in those situations. It is pretty few.
Jason: This is a very emotional decision on the seller and the buyer’s part, and most all of them are going to actually want to know, it is almost one of the first questions we get from every single seller after they get some feedback on the house. Well, what do you know about them? Who are they? Well, you are not going to be living there, so what do you care? But they do care. They do care who it is. They do care who is going to buy their house. Why? I have no idea. It is a psychological thing. It is something that is just in us, and usually it goes back to the great memories. The great memories that we have had, we want to share those. We hope that whoever buys our home actually shares in that same benefit that we had. The other thing you can do to get ready or get your offer may be pushed to the top is consider letting the seller stay after closing. This is not a popular thing in North Carolina, but it is in most every other state in the United States. Buy the house and let the seller stay for two weeks and give them that time to move out.
Jason: It gives them great confidence in that hey, I do not even have to, if I can pack my house in two weeks, just what do I not have to do? I do not even have to do anything at all until I have that check in my hand. And when I have that check in my hand here is one thing that I do know. My house is sold. I do not own it anymore because I have the money. Right? And so there is great peace to a seller especially if they can get out of the house in two weeks, and a lot of can. Even starting from zero. They do not even have to do anything until they want to. Because the biggest frustration in real estate is when you have got a deal put together and all of a sudden you get a week out from closing. The seller has already made an offer on another house. They have already packed up their entire home. Everything is moving forward, and then all of a sudden, we have got a hiccup.
Jason: And then the whole deal blows up unfortunately.
Jason: Because something changed. Sometimes something changes and it was not the buyer’s choice like hey, I went into work today and they said guess what, nobody works anymore. We closed the department. We closed the company, and or we sold it.
Mikell: That would definitely be your worst nightmare.
Jason: Yeah, especially when you think you are staying there for the rest of your career and you just put an offer on a house and everything is rainbows and unicorns and all of a sudden, somebody ate all the fruit out of your Lucky Charms. Right?
Jason: And it is not fun anymore. Lots of moving parts to buying a house. So in the Triad, if you are thinking about moving, you need to reach out to us. Jason Bramblett Real Estate. Go to Jason Bramblett dot com. Give us a call at the office at 553-0796. That is 553-0796. And head on up there to Tabitha’s Nook. Get some furniture or drop some off. Make sure it is in good quality, and we will see you back here next week.