Finding the Coming Housing Market Crash | Noob vs Pro.

in this video I'm going to show you

exactly how to find out what's going on

in your real estate market this is

really important because you're thinking

about buying a home or investing in a

home or even a rental property you want

to make sure you're not buying and

catching a falling knife because volumes

and property values are about to tank

volumes have already tanked let's go do

some research and figure out what's

going on in a particular market and I'll

show you exactly what we're looking for

obviously there's a lot of clickbait on

YouTube about a housing market crash so

what I like to do is figure out well is

housing actually crashing so what I like

to do is I go to an expensive house in

an area that's what you start with

number one start with an expensive house

something that somebody probably over

improved spent a little too much money

on remodeling or adding on to then

that's what I've got here we're in about

an $750 to $800,000 neighborhood and

this came on the market for

$870,000 and the first thing I did is I

said I'm marking this as a favorite not

because I want to buy it but because I

want to see what happens with it because

as soon as you get the slightly more

expensive ones in your neighborhood not

selling and sitting and they panic and

start cutting prices everybody else gets

hurt so what did we find out about this

one oh what's up Mr Jack I got Mr Jack

here he's my partner in crime today

right yep so what did we find out about

this one it's remodeled it's got some

nice finishing touches right you saw the

pictures of the inside we called the

agent because that's what you do call

the agent figure it out they got

multiples and self for a lot over but

they sold for about

$115,000 over now that is actually a

good tell that at least at this very

moment in time which is about mid

October we're not seeing the bottom fall

out from the market people are still

buying which is wild because mortgage

rates are like 8.3% but on one hand we

could say but affordability is low but

there's uh you know they're low buyers

therefore the low inventory shouldn't

battle right well that's why you have to

actually go touch and feel the

properties you you look at the

neighborhood what do you got well you

got beautiful remodeling over here

amazing Landscaping they put some money

into the house these folks put some

money into their home as well yeah we've

got some that are still a little more

dated but that's okay that's a normal

mixed sort of California style

neighborhood but what this is telling

you at least is that the upper end isn't

getting hit yet slightly outside the

median again if the median prices in the

neighborhood are 7 to 8 or 750 to 8 and

something that's listed high that is

larger but listed high for that

neighborhood if that's moving the

Bottom's not falling out that's part one

now let's go to part two now here you

could see the neighborhood a little more

uh less upkept so this is now what I

call the low comp so I wanted to come

touch and feel the low comp why because

when you look at the pictures online you

could see on the inside it's not that

bad it's got newer Flooring by the

kitchen the kitchen looks newer

bathrooms it's all been updated within

about the last 10 years got dual paint

windows but then you look and it's like

ah you know we could have pressure

washed we could have painted a little

bit it's a little funky over here you

know I mean there's there's junk on the

side this has falling off uh you know

it's it's a little crusty around the

edges so why does this matter well it

matters because this property is on the

market for

$719,000 it was on for 7:30 and we're

basically in the same neighborhood was

in for 7:30 sold as it went into escrow

the deal fell apart now they're at

519 now we call and go hey how's yours

because if the bottom is truly falling

out of the market this won't have any

offers right but they have an offer at

7:05 so now what we've done is step two

we've bracketed the neighborhood that's

an appraiser term where you go what's

the high what's the low the high was

like 2300 ft 885 the low was like 1100

square fet 705 and that is a present

offer on the table now our comps are

bracketed now we know okay we can play

in this zone so for example if we think

a home is worth eight and you could get

something for six you got maybe a 200k

spread there as an example right let's

keep looking now this one right here was

listed for

$6.95 which is out of the bracket and

it's low with its square footage around

1 1350 Square ft it should be worth at

least $20,000 more than where that 705

offer was on the 1100 square foot one

right remember don't go cost per square

foot where you're dividing into price

usually in most areas you're going to go

about a 100 hundred bucks a foot for

nominal changes generally what we see

what's fascinating is when you do that

math that brings this one to

725 and guess what it just sold for 725

so that again tells you with three

examples now based on comps either

active offers new escros or sold from

today that all three of them are

suggesting well the Bottom's not falling

out so how do you know you're in the

right spot well one of the things that

you should do as well so add this to

your list remember we're going to

bracket bracket High bracket low call

and get the data then what are we going

to do well then we're going to try to

understand are we in a seasonal Market

or we in a market that's pretty stable

throughout the year so I'll show you one

way you can analyze that using rent data

but first I got to remind you to check

out househ hack.com it's my real estate

St startup we are looking to take

advantage of whatever we can to build

wealth for not only our investors but

the communities that we help improve by

bringing tenants to fixed up homes that

we bought as fixer uppers go learn more

at house.com we're raising money now you

can invest with us check out the

offering circular for more information

again house.com so what do you want to

do well my opinion check out something

simple like the Zillow rent manager if

if you throw in let's say the San Diego

California real estate market and you

zoom in to what's going on with rents

you might just look and say oh my gosh

it looks like rents are plummeting right

now but then you look wait a sec that's

the same thing that happened last year

now of course there's a little bit of a

decline here and we want to pay

attention to these declines but if

you're in a market that really pops off

in April May June and then start slowing

down in September and October often

times that'll actually translate to the

sale Market as well and if you're in a

market where the market slows down after

back to school and goes into the

holidays could be a good opportunity to

go hunting from some deals for sale now

the next lesson is model match comps

we've gone to a slightly different

neighborhood here but what you'll notice

behind me is a 1,040 square ft house

it's small something else you'll notice

is you know you've got somebody who's

done some improving some dual paint

Windows here but how could still use a

little bit of love you've got a house

over here that has had a little bit of

love which is nice but then you've got

you know some that leave a little bit to

be desired whether it's the RV the

landscaping or over here the stuckle

work around the house

itself what do we know about model match

though well what we know is that this

property has offers somewhere around

$640,000

what we also know is that there's a

model match a few streets over and the

model match a few streets over when we

look at the pictures is gorgeous it's

granite countertops it's the newer

flooring it's the newer baseboards it's

the newer light fixtures the newer

Hardware the newer appliances looks

pretty nice and it's a model match now

what do we want to know about the model

match well let's say you're buying this

one for I don't know 6.40 and now you

have a model match that's 740 well you

want that model match to sell you want

to hear 740s getting multiple offers and

it's skyrocketing what did you just hear

bro uh so you called the agent uh 20

days on Market yeah and it's got one

offer pulling in at 720 and he said yeah

write it up so uh 720 is probably or 715

or something 7 if he was yeah write it

up that probably means 720 is actually

higher than the offer they have right

now he said it's over seven okay so

where it has a seven in the front so it

could be 7:05 710 something like that

but even let's say it's 720 now all of

sudden you have an $80,000 spread

between where you are on this deal and

where that property is and if you need

to put $80,000 in to fix this up you

make zero and this is why it's really

important to watch what active comps are

doing a big mistake that noobs make is

they only look at the sold comps from

the summer the hot Sizzle time then you

look at the actives and you make the

phone calls like this you start

realizing what's actually happening in

the market is the bottoming bottom

falling out no but are we skyrocketing

away no if anything there's some

compression which means you have to get

that pencil sharpener out before you

start writing offers let's keep going

now the next thing you got to keep in

mind is pictures on the internet are

deceptive you should know that already

from being signed up to Instagram and

seeing the girls on Instagram okay

perception versus reality this on the

internet looks fantastic and you know

what here I am I mean it doesn't look

bad right I got dual paint windows and

everything right but let's back a little

bit Christian let's let's show this

property a little bit more here we've

got dead Landscaping we got nasty paint

we've got when we when we look inside

you could actually probably just take a

peek by looking through the window do

somebody yoint the door threshold off

the bottom of the door back there and

I'm thinking to myself wait a minute is

this just like lipstick on a pig over

here or what I mean look at this they

didn't even care about all the termite

damage right here so you're going to

sell a remodeled home at least at least

put some Bondo in there would you it's

little things like that but it's not

just the crustiness that's going to turn

off a buyer over here because those are

the minuses there are also pluses that

are hard to evaluate when you're on a

computer for example look at this this

is a 200 amp electrical panel now I

don't think they permitted the panel

given that there are no arcal circuit

breakers in here but I know that because

I'm also experiencing construction uh a

lot of spiders in here but that's pretty

typical so look there's some simple

things that could be done to this house

that actually make it sell the question

is what is it actually going to sell for

it doesn't look like it's going to sell

for 740 it'll probably sell for 720 even

if after they touched it up this winter

it's probably a 720 comp that means the

other one in order to be a deal has to

probably be about 720 minus 50 $60,000

worth of work puts you at about 660

minus about 100 you probably want to be

in the upper fives to get a good deal on

the other one now because you've seen

the properties in person what you do is

you heart this on your Zillow or red fin

app or whatever you're looking at and

when it finally closes maybe it sells in

6 weeks or 8 weeks or 12 weeks whatever

it is when it closes you look back and

go whoa they got 740 they got full price

that tells you okay Market's actually

doing better if you look and go 690

you're like oh it's softening Jack what

do you think this is on the ground right

there I don't know does it look like a

rod that in the

ground yeah it is called a copper

grounding rod you literally ground the

electrical panel by taking this giant

drill and

going and you put the rod in there

although they did a bad job look how

loose it is the looser it is the worse

cuz you have less contact with the Earth

you got to get in there deep son really

deep really hard Jack what you get for

Mom beautiful bro all of these little

things like a grounding Rod or a little

bit of damage here or some of the Dead

Landscaping here are those really going

to make massive changes to the price of

the property not really maybe 10 $15,000

here or there but what you're doing is

you're marking the market and as this

moves up like if this had multiple

offers then we know we're in a really

hot Market because it's kind of crusty

the fact that this has one lowball offer

and is sitting is going to start

depressing values in the entire

neighborhood now again you compare to

the neighborhood it looks okay we got

somebody with a front yard over there

it's pretty nice that one's okay these

folks like wave Runners those F folks

like wave Runners on their grass now a

lot of people in real estate they're

like oh but Kevin all the houses are

still getting multiple offers have you

ever sold anything on eBay okay this is

easy man this house behind me was listed

for

$6.99 and it's 200 ft more than the two

we were just talking about and it's

moving ready it's cute it's beautiful

it's on a nice Street it's by a park

it's got all the amenities so the point

is why would they list it for $66.99

well sell it before the winter season

you get multiple offers on purpose you

do that strategically you list low on

eBay on purpose if they listed this for

$199,000 I guarantee you they would end

up with 200 offers on it and then what

you're going to make a clickbait YouTube

video going Market Sky Marketing we're

getting 200 offers out there it's all

based on what the original valuation is

right so this is probably a house that's

worth $7 40 720 somewhere in that range

now that hurts that other property that

fix upper really suggests that fix upper

has to sell for Less so we called the

agent and found out there were about two

offers and about 720 on this that hurts

that other one where we're like hey uh

you know uh what you got any offers and

they got one like 705 701 710 that hurts

that one but it says that moving ready

and clean and cute on a good street it's

worth about 720 for 200 ft more compared

to the one for a th000 over there 1,000

square ft well that's probably a

$700,000 home so now again if a good

deal comes on the market a hoarder home

or whatever for $550 and it needs

$50,000 worth of work do you buy it well

yes because now you're into it for six

and it's a $700,000 house great we watch

the market and we adjust as necessary

now what happens if you get a movein

ready property that comes on the market

Market that's 775 and all of a sudden it

sells with multiple offers and it's only

1,000 square ft well that's a sign the

market is picking up again and those are

the adjustments you kind of move your

brackets that you have to work with to

make sure you're not getting screwed at

buying real estate so is the real estate

market crashing here in Southern

California well at least in the

neighborhoods that we looked at the

answer is no for now it looks like we

hit a soft Landing in some of these

areas for now that could turn into

slippage you know some people dollar

cost average and you got this going on

so you want to watch but it looks like

we're within bands of stability the

summer was a little bit higher kind of

adjust down for the winter and the

question is what's going to happen in

Spring do we adjust down again or do we

adjust up either way the best way to

insulate yourself is not sitting on the

market with analysis paralysis all the

time deciding should I buy should I not

buy the answer is you're always a buyer

you're always an investor at the right

price so do you know how to identify the

right price do you want to take the

effort and do that well you got two

choices number one you can invest with

us at house Haack go to house hack.com

you can invest in the company itself

we're offering founder shares learn more

about that read the offering circular or

number two learn how we do this by

checking out the courses on building

your wealth whether it's real estate

zero to millionaire or the new burst Pro

real estate courses where we have a

special Q4 q1 how to buy real estate

during that time and you get the special

secret sauce as well check it out link

below or go to meet kevin.com

congratulations man you have done so

much people love you people look up to

you which I say yes meet Kevin where

does this mean we are in the economic

cycle should we be thinking about buying

real estate should we be thinking about

buying stocks I have a background in

real estate as a real estate agent real

estate broker real estate investor a

stock market investor and fund manager

why not advertise these things that you

told us here we'll we'll try a little

advertising and see how it goes oh it's

great to have you on Kevin PA their

financial analyst and YouTuber meet

Kevin