On The Market

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Dave’s Housing Market Data

Black Knight

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Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-27

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26: Rates Drop Below 5%, Opendoor’s $62M Mistake, and Jamil’s Dead Deal Aug 15, 2022

Show notes

Interest rates are dipping below five percent, hedge funds and institutional investors are starting to sell off their homes, and inexperienced syndicators are getting stuck with bad deals. Is this the everyday investor’s version of a miracle? Nope, it’s just another week in the wild 2022 housing market! Joining us is the entire On The Market panel to talk about which up-to-date, hard-hitting stories affect investors the most.

To start, we’ll talk about Invitation Homes, one of the most prominent institutional real estate companies, and how they’re being accused of using unpermitted work to renovate their recent acquisitions. Within the same vein, Opendoor, another institutional investor, was fined a whopping $62M for “deceptive marketing”, but did they really make promises they couldn’t keep? Don’t worry, this isn’t an entirely iBuyer-only episode.

Our last two stories cover commercial real estate and interest rates. More commercial deals are starting to see cracks in their literal and figurative foundation, as inexperienced investors are being slapped with higher fees and rates from banks as their properties become less valuable. But, some good news for investors is that mortgage rates have finally dropped below five percent, getting us closer to the rock-bottom rates we were used to in 2020 and 2021. But can these rates be counted on, or will they skyrocket back up once the Fed has had enough?

In This Episode We Cover

Why hedge funds are hurting and failing to keep up with maintenance on their properties

The “deceptive marketing” tactic OpenDoor used to lure in new customers

How rapid “repricing” is changing the way commercial real estate deals are done

Jamil’s $2.5M mistake and why you should always focus on your own area of expertise

Low interest rates and why banks are offering them even as the Fed pushes for increases

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

Henry's Instagram

James' Instagram

Jamil's Instagram

Hear More About Jamil’s $15M Wholesale Deal

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-26

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25: How Work-From-Home “Hotspots” Drove the Housing Market Even Higher Aug 12, 2022

Show notes

What do work-from-home employees and the housing market have to do with each other? Surprisingly, a lot. At the start of 2020, as the first lockdowns were rolling in, many companies made the wise decision to allow their workers to temporarily work-from-home. As temporary became seemingly eternal, more employers started developing permanent work-from-home regulations, allowing employees to, on average, work at their residence for about half of the workweek.

With this enhanced flexibility, employees were more likely to move to places their jobs didn’t confine them to. If they were used to snow and sleet, they may have moved to Arizona, Texas, or Florida. If they were stuck in urban areas like New York City and San Francisco, the more suburban allure of Boise, Denver, or Raleigh pulled them even closer. Now, these high-paid, location-flexible workers were on the hunt for houses. And as a result, home prices skyrocketed while affordability plummeted.

It’s becoming more and more evident how much of an impact remote work plays on the housing market, but what can landlords do with this information? Dave has already dug through the research so you don’t have to, and he brings on this show three factors of a work-from-home “hotspot” that could forecast big home price appreciation. These three factors could point you on the path to buying in the nation’s next best real estate market!

In This Episode We Cover

The latest remote work trends and whether or not working from home is here to stay

How work-from-home policies have affected productivity in the workplace

The three factors of a work-from-home “hotspot” that could explode in popularity

How more remote workers affect the housing market, migration, and home prices

Whether or not a recession could end the work-from-home movement and force workers back into the office

The real estate markets that are starting to cool after huge home price appreciation

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

The Do's and Don'ts of Returning to the Office by Adam Grant

NBER: Pandemic-Induced Remote Work and Rising House Prices

Listen to Our Episode with Redfin’s Taylor Marr

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-25

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24: Climate Change: Why Top Investors Are Paying Attention (and You Should Too) w/Cal Inman Aug 08, 2022

Show notes

Climate change and real estate. Most people would say that they’re related, but not in a substantial way. We all know that homes can flood, catch fire, or be blown away from a tornado, but how many real estate investors are looking at the climate risk data before making a real estate-related decision? Institutional investors have been using climate change data to make educated decisions for decades, so why aren’t we doing the same?

Cal Inman, lecturer at UC Berkeley and principal over at ClimateCheck, saw that real estate developers were regularly looking at climate data to make decisions. As a small landlord himself, he struggled to find this same type of data for his residential properties. As fire and flooding became more prevalent throughout the United States, Cal knew that this data was imperative for homeowners, not just large-scale investment firms.

Now, thanks to ClimateCheck, homeowners, buyers, and sellers can look at the climate change-related risk before they put any money into a property. Cal also shares why and where climate risk is rising, the safer parts of the US to invest in, and how different regions of the country are preparing for more elevated climate-caused catastrophes. If you’re investing on the coasts, in the plains, or anywhere in between, the data could completely change your investing strategy.

In This Episode We Cover

How real estate developers use climate data to make better investing decisions

Whether or not climate risk is rising and in which markets is it impacting the most

Why coastal investors especially need to be specific about where they decide to buy

What small investors can do to mitigate the risk of losing their properties to climate emergencies

The impact climate change will have on US migration and renting/buying trends

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

Check Your Home’s Climate Related Risk with ClimateCheck

Redfin and ClimateCheck’s Guide to Climate Data

How Much Risk Does Climate Change Actually Pose To Real Estate?

Connect with Cal:

ClimateCheck

Cal's LinkedIn

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-24

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23: 2022 Recession Recap: Falling GDP, High Inflation, & More Uncertainty Ahead Aug 05, 2022

Show notes

The US economy has seen a couple of recessions over the past two decades. The most brutal one being the great recession, which remains an anomalous event. Fast forward twelve or so years, and we entered into the 2020 recession, one of the fastest recessions ever recorded that resulted in a massive run-up of stock, crypto, and real estate prices. Now, as a recession looms on the horizon, Americans are struggling to figure out whether or not we’re about to hit a short-term speed bump or a long-term depression.

So many different economists, newscasters, and financial bloggers love to debate whether or not we’re truly in a recession. By definition, we should be, but the experts are slowly taking their time, trying to calculate the true impact of this latest economic cycle we’ve entered. But does being in a recession really matter? Yes, recessions affect almost every aspect of financial life. Labor slows down, consumer prices go up while asset prices drop, and it’s harder to make economic progress. But, is that what we’re experiencing in 2022, or is the term “recession” just propping up fabricated fear that matters far less than we think?

In this bonus episode of On The Market, Dave gives his insight into whether or not the US economy has entered a recession, how this affects real estate investors, and why experts can’t agree on a definition. If you’re actively investing, Dave gives some good advice on how to keep your head screwed on straight while every news outlet plays chicken little.

In This Episode We Cover

Why experts can’t agree on whether or not we’ve entered a recession

GDP decline and how inflation has outpaced our growth as an economy

How past recessions compare to what we’re going through today and what we can learn from them

Mortgage and interest rates and how a further economic decline could affect investors

The three most important metrics to watch as a recession becomes more likely

The key performance indicators that show economic growth, not decline

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

On The Market 14 with Logan Mohtashami

On The Market 17 with Rick Sharga

Our Recent Panel Discussion on Home Prices

U.S. GDP Shrinks By 0.9%—White House and Experts Push Back On Recession Claims

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-23

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22: Will 3D Printed Houses Solve the US Housing Crisis? w/Zachary Mannheimer Aug 01, 2022

Show notes

Your next property purchase might just be a 3D-printed house. Don’t believe us? With lower housing costs, immediately replaceable/printable parts, and homes that can be built in six months (or less), traditional real estate developers may find themselves in a pinch when trying to compete against these perfect printable properties. With a huge inventory shortage and housing crisis throughout the United States, 3D-printed homes may just be the ultimate solution nobody believed could happen.

As a true believer, Zachary Mannheimer, CEO and founder of Alquist 3D, knew that 3D printed houses would sooner or later become the future. With labor and material costs skyrocketing and real estate development becoming eye-wateringly expensive, Zachary became keen on finding an affordable solution. His team now has plans to build 200+ homes for underserved communities and has already begun expansion across the eastern United States.

And this isn’t all theory. Zachary’s team has already built multiple 3D printed homes, one of which has a family living in it. They’re facing an influx of orders and can’t keep up with demand, but are slowly building economies of scale to make 3D printed housing one of the biggest industries in America. Zachary confidently estimates that by 2025, you won’t be asking if 3D printing is possible, you’ll be asking when you can preorder your next property.

In This Episode We Cover

The true cost of a 3D printed house and how labor and material costs will shrink as the industry expands

Project Virginia and how Zachary’s team is building affordable, high-quality housing for communities with rock-bottom inventory

How to buy and build a 3D printed home by working with Alquist 3D

The new 3D printing industry that will create hundreds of thousands of jobs over the next decade

How long it takes to build a 3D printed house and how to print your own materials

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

Check Out Zachary on This Month’s BiggerNews Episode

Watch 3D Homes Get Printed

Connect with Zachary:

Zachary’s Team at Alquist

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-22

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21: A Supply-Starved Market and How Investors Are Already Taking Advantage Jul 29, 2022

Show notes

Is some alleviation from inflated home prices headed our way? Over the past two years, sellers have taken the housing market for a ride, getting dozens of offers on every listed house. No matter the condition, area, or age of the property, buyers were filling open houses every weekend just to make an over-asking offer on what should be a reasonably priced house. Now, the tables are starting to turn, and as a result, sellers are getting desperate.

Interest rates are rising and buyers are backing out of the market by the dozen. Instead of twenty offers in a weekend, sellers are looking at two, and none of them are over asking price. This is good news for home buyers and great news for investors, as deals are becoming easier to come by while the housing market hysteria takes a breather.

We brought the entire On The Market panel in this week to see where they’re finding deals, how their own markets are fairing, and what investors should look for on the horizon as demand steadily starts to slow. We also go into the future of housing inventory and how another inventory crisis could be coming soon.

In This Episode We Cover

June housing market updates and why the housing market is starting to slow

Why fear-first sellers are dramatically lowering their asking prices simply to sell

Could we enter into another inventory crisis and why some investors think this dip is only temporary

Where to find deals in today’s market and why real estate agents may become a phenomenal deal source for you

How flippers and BRRRRers can prepare for housing prices to head back down

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

Grab This Episode's Data Drop (Lead Indicator Data for US Housing Markets)

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-21

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20: Real Estate Wholesalers: Profit Parasites or Property Investors’ Best Friend? Jul 25, 2022

Show notes

Real estate wholesaling is one of the most hated, commonly criticized, and least-trusted types of real estate investing. Most people paint real estate wholesalers as those who lie to sellers, incorrectly run comps, and try to market bad deals to unexpected investors. This is all said while top real estate investors around the country continue to buy from wholesalers. So what is it? Are real estate wholesalers a parasite to the property investing industry or are they the symbiotic counterpart every successful investor needs?

To put it simply, wholesaling real estate is when a wholesaler will put a property under contract for a certain price, then market the property to investors at a higher price, and keep the difference once the property is handed off. Think of wholesalers as the middlemen between a distressed seller and a real estate investor looking for undervalued deals. In a perfect world, all three parties walk away from the transaction happy. But how often does this happen?

Jamil Damji, James Dainard, and Henry Washington are on this week to talk about how to wholesale, what most wholesalers get wrong, and whether or not real estate wholesaling still works in 2022. Jamil and James are both active wholesalers, while Henry often buys his properties from wholesalers. They give a “wholesaling 101” course to any new investor looking to find deals as well as to new wholesalers trying to get their seed money started.

In This Episode We Cover

Whether or not a recession is here and how high interest rates may go in 2022

What is wholesaling and why real estate wholesalers are so hated in the industry

Is 2022 a good time to start wholesaling or should investors wait until home prices drop

Why wholesaling may be the single best way to get a world-class real estate investing education

Which properties to wholesale vs. keep when investing and flipping contracts

Vetting your wholesaler and how to know you’re buying a real deal

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

Grab This Episode's Data Drop (Questions to Ask Your Wholesaler)

The Newbie’s Guide to Wholesaling in 7 Simple Steps

The Big Mistake I Used to Make When Qualifying Wholesaling Leads

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19: Is The Stock Market Drop an Opportunity for Real Estate Investors? w/Clay Finck Jul 18, 2022

Show notes

Does a stock market crash affect real estate? We’ve seen home prices hit record growth over the past two years, with a slight slowdown happening right now. But nothing in the real estate market compares to the stock market selloff that has happened over the past six months. Index funds are down over twenty percent year to date, tech companies are quickly losing valuation, and the stock market doesn’t show any signs of slowing down. Is this an opportunity for real estate investors?

Instead of letting landlords try to explain how equities work, we brought on Clay Finck from the Millennial Investing podcast to help educate us on what a good (or bad) buy looks like. Clay has spent years learning about value investing from the best stock trader of all time, Warren Buffett. He’s designed his portfolio to model the trading techniques Buffett engineered and thinks that this latest dip poses some interesting opportunities for investors of any asset class.

Clay talks about recession-resistant stock picks, how to know whether a company is under or over-valued, and why stock investing could be a more passive alternative for the stressed-out landlord. We also have our panel of expert guests give their take on the stock market, how real estate investors should invest, and what their own portfolios look like. If you’re heavy on the real estate investing side of things, make sure you listen until the end, as there are some serious stock buying opportunities you may have never thought of.

In This Episode We Cover

How the Fed influences the stock market through quantitative easing and rate hikes

Which stocks win during a recession (and which ones to stay away from)

Dividend stocks and how to cash flow without owning any real estate

Dollar-cost averaging as a smarter way to invest even as prices fall

Whether or not to put your money into the stock market to save for your next deal

Why some stock investors are ditching equities to make headache-free gains in real estate

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

Grab Your Ticket to BPCon 2022

Which is Better? 145 Years of Real Estate vs. Stocks

Get Featured in Our “Crowd Source” Section by Posting on The BiggerPockets Forums

“Millennial Investing" Podcast

Book Mentioned in the Show

Real Estate 101 by Michele Cagan

Connect with Clay:

Clay's Twitter

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-19

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18: Hosts vs. Hotels: Is There Still Room in The Short-Term Rental Market? Jul 15, 2022

Show notes

Short-term rental investinghas been one of the most profitable, fastest-growing types of real estate investing strategies in decades. When the events of 2020 happened, most vacation rental owners thought that their passive income stream had been shut off, only for the exact opposite to happen in a big way. With low interest rates, investors were scooping up short-term rentals every second they could, and their occupancy rates just kept on increasing. But is all of that about to change?

We’re back with another bonus episode of On The Market where Dave does a data-first deep dive into what’s happening with the short-term rental market. From occupancy rates to second home sell-offs, and hotels regaining their prestige—everything you wanted to know about vacation rental investing is packaged up for you in this short-term rental recap.

Dave also gets into the recession data behind short-term rental investing and why some investors might be calling a quits too quickly. And even with interest rates rising, a buying opportunity may be on the horizon for investors who are fast enough!

In This Episode We Cover

Whether or not demand has stayed consistent as the economy enters into uncharted territory

Hotels vs. hosts and which vacation stay is getting more popular over the next few months

How inflation is affecting the average American’s vacation budget and what that means for investors

Second-home demand and why so many owners are looking to sell

The massive influx of new vacation rentals and the effect it's taking on occupancy

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

It’s Not Too Late to Join the Short-Term Rental Investing Game

Access More Short-Term Rental Data with AirDNA

Watch Tony Robinson’s Video on Short-Term Rental Investing in 2022