Expected Air Date: 7/23/18
Opening
What are the guiding principles you use in your investing activity? We all think about returns, but do you consider other data points as well? Ok, some of you right now are asking, “what other data points?” If you are looking at a property to buy and hold and you are only looking at cash flow or only looking at capitalization rate, or only looking at net income, you are not looking far enough.
Even if you are considering all three of those, and they ARE separate numbers btw, there is much more to consider. You need to think about the area, the past trends, the future projections, infrastructure, employment opportunities, and much more.
So you need data. If you listen to the show much you know that our analysis is data driven. And we look behind the data for assumptions, theoretical models, and the methods used to combine data to reach conclusions. I realize that not all of you listening to this show can be that much of a nerd. It’s ok. We get our hands a little nerdy around here sometimes so we can help you make the best decision possible.
That means we have sources for our data. One of our favorites is Attom Data Solutions. Coming up in a few minutes I have Daren Blomquist, Executive VP for Attom Data and we are going to bless your life with a little data talk.
Now before you turn this off and switch over to yet another rerun of Gilligan’s Island or Big Bang Theory, let me tell you a few things we are going to be talking about. Attom data is the same company formerly known as RealtyTrac.com. That means they are experts on foreclosure data. We will talk about that. Want to know about crime rates in a prospective area? How about information about the particular property and its history? They’ve got those.
Want to know what a neighborhood is like? Income level, percentage of college grads, crime rate, and more? They have it. Want some juicy stats on investor activities? Done. How about a list of distressed or potentially stressed properties? Where do you think the list brokers get theirs? Yeah – go straight to the source and we are going to tell you how.
We are going to tell you how to get your hands on their Bi Annual Report on Single Family Rental Home prices. And you don’t want to miss this part — in the last segment I ask Mr. Blomquist to look into his crystal ball and tell us what he sees happening with housing prices and the markets. His answer is coming up!
With RealtyTrac since 2001, Daren Blomquist has been instrumental in many facets of the company’s business as it has transformed into the industry leader it is today. In addition to being one of the company’s longest-term employees, Daren is RealtyTrac’s primary media spokesperson and resident go-to expert on foreclosure statistics and trends.
Daren is also managing editor of the company’s monthly newsletter, the Foreclosure News Report, which was named the “Nation’s Best Newsletter” by the National Association of Real Estate Editors, and is directly responsible for the creation of the company’s U.S. foreclosure market and sales reports, which are cited by thousands of media outlets nationwide — including all the major news networks and leading publications such as The Wall Street Journal, The New York Times and USA TODAY.
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Data Resources
Check out the Neighborhood Index.
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Read the Bi-Annual Report on Single Family Rental Home Prices
Topic: Flash in the Pan
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Motivational Thoughts for the day
- “It doesn’t matter how slowly you go as long as you do not stop.” -Confucious.
Transcript
[0:00] Music.
[0:28] Time for flipping America the show that teaches you how to make money in real estate wherever you are whatever your situation there is an opportunity for you.
Flipping America is brought to you today by Braswell Capital Solutions commercial lending made easy
on the web at Braswell Capital solutions.com and now here’s that flipping America guy Rodger Blankenship.
Here’s a question for you friends what are the guiding principles,
you use in your investing activity not just talking about stock market any kind of Investments that you make what are the guiding principles,
aren’t we all think about returns but now I’m going to zero in on real estate little bit do you consider other data points as well.
Locate some of you right now asking though besides Returns what other data points are there well if you’re looking at a property to buy and hold and you are only looking at cash flow or only looking at capitalization rate,
or only looking at net net income you’re not looking far enough.
[1:35] Even if you were considering all three of those and they are separate numbers by the way there is much more to consider.
[1:43] You need to think about the area.
Past Trends future projections infrastructure employment opportunities and so much more so you need data.
[1:55] Know if you listen to the show very much you know that our analysis here is data-driven and we look
behind the data for assumptions theoretical models in the methods used to combine data to reach conclusions I realize that not all of you listening to the show can be that much of a nerd
it’s okay
we get our hands a little nerdy around here sometime so we can help you make the best decision possible you know I used to sit in graduate school in my statistics course,
and wonder how am I ever going to use this in my future life you know kind of like we all did in Algebra 2 write and actually I use the information that we learned about analyzing statistical studies when I read these news articles and I see the conclusions that are made and sometimes based on false assumptions and sometimes
based on disconnected assumptions and I’m I’m happy that I’m able to point that out it’s because of the training alright well one of our favorite data sources here.
[2:52] Is Adam Data Solutions and that’s Adam a t t o m I guess they put two T’s in it so that way they could get a URL I don’t know,
but the animated Solutions coming up in a few minutes,
I’m going to have a conversation with Darren Bloomquist to the Executive Vice President for Adam data and we are going to bless your life with a little data talk
now okay before you turn in this off and switch over to yet another rerun of Gilligan’s Island or Big Bang Theory let me tell you a few things that we’re going to be talking about because I think you’re going to want to stay tuned to hear this Adam data is
the same company formerly known as realtytrac.com now that may not mean a lot to all of you but some of you out there are going to be familiar with realtytrac can you know.
[3:37] They are experts
on foreclosed your data we’re going to talk about that we’re going to talk about the other data points I just mentioned you want to know about crime rates in a perspective area how about information about the particular property you’re considering and its unique history
they got that want to know what a neighborhood is like.
They got neighborhood level information talking about income level percentage of college graduates crime rate and so much more.
They have it you want some juicy stats on investor activities in an area done how about a list of distressed or potentially distressed properties.
[4:16] Where do you think the list Brokers get their list yep you’re going to get to go straight to the source and we’re going to tell you how.
We’re going to show you how you can get your hands on there by annual report on single-family rental home prices and you don’t want to miss this part in the last segment I asked Mr Bloomquist to look into his crystal ball,
and tell us what he sees happening with housing prices and the Market’s is answer is coming up.
[4:42] Daren has been with realtytrac since 2001.
And it’s been instrumental in many facets of the company’s business as it is transformed into the industry leader it is today look for
the government buys data from these guys in addition to being one of the company’s long-term employees during his realtytrac’s primary
primary media spokesperson in Resident go to expert on foreclosure stats and Trends there and is also managing editor of the company’s monthly newsletter,
the Foreclosure news report which is named the nation’s best newsletter,
by the National Association of real estate editors and is directly responsible for the creation of the company’s us foreclosure Market in sales reports which or cited
but thousands of media Outlets Nationwide including all the major news networks and leading Publications as such as the Wall Street Journal,
New York Times and USA Today it’s a great privilege to have Darren with us on the show and he’s coming in just a few minutes,
if you’re new to flipping America let me tell you how to reach us find us on the web at flipping America network.com we’re all over social media with the username.
Flipping America especially Twitter and Instagram please find and follow us on Twitter and Instagram
and you’ll see that we’re posting any of 15 to 20 times a day and it’s articles about real estate that you probably want to pay attention to if you really want to stay on top of things.
[6:04] We have a profile on Google + + + LinkedIn + houzz.com and even Pinterest so we’re everywhere on social media ever on Facebook to a course on Facebook you have to look up flipping America media
just had the word media to the end of it.
We have a way that you can get your questions answered if you have investing questions we answer every question that comes into the show and it could be about any aspect of real estate or real estate investing
if we don’t know the answer we pledged to get you the answer
and sometimes we do have to go and do a little research and look up and we kind of enjoy that part because we learn from your questions about that but we’re not going to pretend to be an expert in something we’re not if we need to introduce you to someone else we will do that
we have a lot of experts on the show and we know a lot of people in the business so we’ll get your question answered it’s a free service that we provide so don’t be shy
questions at flipping America network.com that’s questions of flipping American network.com and
if you don’t want to send the email so you can call us on our national comment line for 04369,
1018 404-369-1018 Darren is coming up right after this break book so stay tuned.
[7:19] Music.
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[9:26] Music.
[9:42] I’m online with Darren Bloomquist from Adam data is it Adam Data Solutions that’s right all right they’re welcome to the show.
Thank you so much for having me it’s ready to be here man I had excited to get you on the show because I’m a big fan of Adam Data Solutions and in the in our conversation before we came on the air here.
We were talking about Adam Data Solutions being a basically the same company as realtytrac.
And about how that involved a long time since I’ve seen the evolution of her time but we started out as realtytrac play back in 1996 collecting foreclosure data.
That used to be just available through.
Through mailings you got your foreclosure list mailed to you and we started putting it online that was really around the time Al Gore invented the internet I believe and.
[10:39] I’m sorry sad a great invention will will put this online and I wasn’t part of that at that time but in any case we were about foreclosure dated for quite some time,
and obviously I became a go-to source for foreclosure dated because there was no government agencies collect and had believe it or not during the crisis and
attend following the crisis in the last 2 years we started acquiring other types of data.
Public record data what we called tax deed and mortgage dated from the tax assessor’s office is from the county recorder’s office is similar in nature to foreclosure for public record foreclosure date of collecting but.
Different types of data and so we really wanted to expand and the other thing that happened is.
We started fighting an appetite to license that data in bulk.
[11:31] As realtytrac really we’re making a foreclosure date available on the website to individual individuals of many of them were real estate and still are Real Estate Investors who use realtytrac to find foreclosure.
But we found an appetite for this kind of data in bulk and so we we started licensing and in bulk to in some cases actually government agencies and companies that,
need real estate data to help them make decisions or help them Market to Their audience and so we’re as we evolved we really wanted to,
get a name that took us away from just being identified in the Foreclosure space even though we certainly do still track foreclosure data and that became Adam Data Solutions the idea is that we have the full.
Data table of elements like the Periodic Table of data elements that’s kind of Italian with the scientific piece of the atom name and so we’ve been Adam since 2006.
[12:31] And it’s been great just to see that business grow but we do still operate the realtytrac.com website and
and do that have that service for Real Estate Investors and others to to find individual properties that are in distress,
okay alright that’s that’s a good description I appreciate that but now let’s let’s back it up baby let the plane off and go up to 30,000 feet and give us the elevator pitch or whatever it is you’re 30 seconds synopsis I have work for Adam Data Solutions in this what we do,
God is great. We are hi I work for Adam data solution and what we do it is we collect and then we sell or license,
public record real estate data primarily to businesses that need that data to help them make better decisions to help them analyze the market.
[13:21] To help the market to their customers to help them understand their customers better and and also did for policymakers to help them understand what’s going on in the housing market,
better and our mission is to increase real estate transparency in the marketplace by providing that data,
and an easy format provided and was called bulk format which is basically just a huge giant file of this data that we update regularly and we also provided via API so many web websites and portals,
is that too just to feel their platform with real estate data,
okay I am Mary investor an investor name Mary in Boulder Colorado and listening to this conversation right now we’re on the air hey Boulder how you doing and,
I’m wondering what day to do you have to sell and how can I use this in my own investing business I’m in the fixing and flipping and I also,
you know by some rental properties Chicago time.
We have a lot of free resources that would today first of all for investors if you go to Adam data.com and actually put into T’s d.
[14:34] If you go to The Newsroom that’s actually a lot of what I personally do is I get to play in the sandbox to the Dayton put out Trend reports and what’s happened in the marketplace so for the high-level view of what’s happening in,
the US housing market as well as your own,
local housing market click on our knees button and you’ll see we have a regular diet of reports that we put out on the housing market that are completely free so that’s the first level.
We do have platform specifically for investors that I did mention in a lot of our clients now or businesses or ingesting is data in bulk but we do have platform specifically for individuals like the real estate investor.
Why does being realtytrac.com the subscription service where you can go to find deals and it is more like a.
For lack of a better word is Zillow for foreclosure data.
It’s you know it’s a similar look and feel but it specifically for foreclosure properties most of which are not going to be listed on the the market with the MLS.
Step Beyond that though for investors is in terms of identifying deals and Market finding homeowners who may be interested in selling especially off-market deal.
[15:48] We have a little more direct access to our data through a platform called Adam list.
Which the website there is a list. Adam data.com and this is to create custom marketing list for either the types of properties are the types of homeowners.
That use an investor looking in and it looking for so if you’re looking for a fix and flips like you are there in Boulder Colorado probably a better Market to do Fix and Flip then to try to buy and hold their with the price of property,
you can go in basically you’re accessing our Nationwide database of 155 million us properties and you’re saying.
I want to list of properties in Boulder Colorado that you can.
It doesn’t have different flags that you can use to filter that down you can say non-owner I want to find on an occupied properties I want to find out-of-state owners people who.
On the properties as investment but live out of state maybe you’re motivated to sell.
[16:47] Foreclosure is one of the flags of course as well Equity you can do it you can create your list based on Equity this.
Person has I want to go after Equity Rich home owners who have a lot of equity in a home or possibly.
Hello Equity homeowners to who may be more motivated to sell for a different reason vacant land.
Undeveloped land or property types of vacant land is one of the options are and,
for sure yeah and and then you know if you’re looking for him that’s how you want to buy a multi-family property on a single-family home you can you can filter by property type.
As well and a bunch of different filters so that’s a great resource for creating those custom marketing list knows we’re going to buy or is this a free part of the free resources.
Starting with realtytrac that’s starting into the pay resources a realtytrac is a subscription Adam list is not a subscription per se but it’s cost per record so.
Let’s say * 155 million properties Nationwide you narrow that down in Boulder Colorado to.
[17:55] Let’s just say a thousand properties for.
That fit your criteria or maybe it’s a hundred properties you to pay per record it’s a.
The pricing can be flexible based on volume if you’re doing a lot of volume of marketing lists the cost will go down but the starting point is about 13.5 cents a record and.
[18:20] And I’m so if you’re buying a hundred.
Properties is pretty reasonable price for that typically most investors we talked to you or going to it is a numbers game so you may you probably want to send out more than a hundred a lot of times to get the type of feedback you want.
To type of responses you on.
Out of a hundred he may find one or two homeowners who are highly motivated to sell okay we got to go to a break when we get back let’s talk about some of the things that you have done.
[18:47] Music.
[19:01] Do you want to learn how to flip houses I want to show you how to flip houses and there’s probably no one in the country better qualified than me to show you I flipped hundreds and hundreds of them,
and I also have some training and degree and experience and education so I could show you how to do exactly what I’ve done hundreds of times don’t believe me.
Head on over to put starter event.com but in the meantime Give a listen to Pat caywood.
[19:27] Cleveland Tennessee and I’ve been.
Doing some flipping since about March of this year and had started with a Nationals program that was very expensive I’ve spent today with Roger Blankenship.
Learning about his program and boy do I wish I’d met Rodger.
[19:49] He has a clear concise program and many tools that are going to be very hot.
[19:55] And starting and managing a program and the mentorship and Leadership and coaching that he saw frame are invaluable.
Thank you so much Rodger Creager.
[20:07] Music.
[20:55] Is there an I’m Rodger I teach people how to make money in real estate but one of the resources I rely on our
the resources available at Adam Data Solutions and I spend a lot of time looking at their stuff and reading reports and reading stories from other people that quote out of Data Solutions and so it’s real pleasure to have you on the phone and.
We we okay I gave you a hypothetical person in Boulder Colorado and you answer that question very well
you got list we can drill down and you know I look at your data for the trends I I didn’t even know that there was the connection was real to track my bad
I guess I didn’t dig deep enough,
but maybe are bad for not taking that connection well when I looked at your profile I saw that you had work for real strike and I didn’t see where that ended and you went over to Adam and then you explain to me that
you really think so that’s good what are the kinds of things does Adam day to do at outside of the property that serves that premature.
[21:54] Offer investors I’d say that’s the main application is a property list and the day realtytrac resource now we do have if you really are a.
Data driven investor and and,
probably on the on the larger side and in looking to evaluate which markets you should be going into we do have custom report off options,
one of those is the home flipping report which there is a free version of the home flipping report you can we put out quarterly on our website but if you really want to drill down get into the Weeds on what’s going with Tom flipping.
In a given Market or in a series of markets we do have a custom report you can buy.
On a quarterly basis to to get that inside it even goes down all of our data really at the end of the day.
Goes down to the address of also one of the things that’s been popular on the home phone.
[22:47] Is what we call the flip transaction date and now this is primarily to be honest not so much investors looking at it as it is lenders,
and folks who are trying to Market to investors they’re looking at the flip to hit a they’re trying to identify people who are flipping a lot of properties to offer hey I want to loan you money to help you flip property and so that’s.
But there may be some investors you want to look at that and see what.
The competition is doing who’s the biggest player in a given Market it’s down to the address level on on that data
well when we here at flipping America we get offered things from cross-country you know pretty much all the time we might like to.
Jump on something but pass it off to a local investor and so we could find local investors that way right yeah absolutely.
[23:40] That that flip report would be one way to do that or just a wee dude custom list of investors you know some people want a certain profile of investor.
That’s fine XNX number of properties a year or owns X number of properties that they may want to have as a resource.
Cheat for different reasons to contact no way identify cash.
[24:04] That’s a good thing I got a good thing for the atom lustration to us cash owners who own free and clear.
Or who are buying with cash that’s it appear flag that’s probably a real estate investor involves there so if if you were you’re the data guy.
Somebody comes to me at that flipping America offices and says,
where should are they email me all the time and they say where should I be investing in rental property and I get this is a standard thing from the coastal areas either East or West Coast people say.
I can’t buy any cash flowing rental properties in my area I need to be looking somewhere else,
where should I look and how should I decide let me just throw that question off to you because I’ve got an answer that I threw out there but I’d like to hear from the data guy and I’m pulling up we do a report.
That and this is all this is by annual stock quarterly looking at the single-family rental market so that’s in our Newsroom as well where we.
[25:11] Jacob is very high level look not not the type of look at that you’re going to do when you actually are doing your due diligence on a property but looking at.
Based on home prices and rental rates across hundreds of markets Nationwide what what types of return potential returns can investors get and then we actually rank the market this is by county.
Because the rental date is available by county and so.
[25:37] Just on paper and again this is on paper this is not taken into account necessarily some of the other factors you might consider that just looking at the returns the potential gross,
annual rental yields that you could get the best Market in the country where showing right now is Baltimore City Maryland with the highest,
potential gross annual yield in in 2018 followed by Macon Georgia,
counties in these areas Montgomery Alabama Wayne County which is Michigan and Detroit and in Clayton County in the Atlanta area are the top five,
and now there’s a lot when I’m sure we’ll talk about this some more in a second once you provide your inside I miss that’s based on this year.
Penciling out potential returns and Zarias there’s other factors of course you consider but the takeaway I take from that is.
The coast generally speaking Coastal markets that are priced so high that it’s hard to find those rental returns and so you are going to have to be going you know.
Southeast.
[26:46] Restaurants in those areas Mid-Atlantic Baltimore where where you can find lower-priced housing,
to get this kind of better returns did I hear you say that your criteria primarily for your report is a ratio between selling price and rents.
Yes at the end of the day yeah it’s pretty simple just here’s what your gross rental income would be based on Fair market rents in that area and that County,
that’s why it’s countywide it’s it’s it’s very broad-brush I did I have to admit that but at least it’s.
It’s a starting point to say where are the type of markets that you might want to look at but yes those fair market rents as a percentage of,
the purchase price right and you know you’re I know you do that report because I’ve read it on more than one occasion and he gets picked up by the other services like realtor.com they’ll do
kind of a summary report and I liked it and,
my listeners like it when we do like the top 20 hottest markets in America coming to you from Adam data or CoreLogic or whoever and as reported by Zillow or realtor.com.
We we have a lot of fun with those things and there’s always some surprises in sneaking into the list and I was kind of surprised that you say Clayton County Court.
[28:08] Flipping America’s national office is here in the Atlanta area I’m very familiar with Clayton County I have flip probably 200 or more homes in Clayton County over the years
and I know the market in Clayton County we’re coming up on a break and that when we come back from the break I want to
throw out some thoughts for you about how we combine your data with some other reports and maybe it could be that you guys are doing this research to write will be back in just a minute.
[28:43] Music.
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[30:23] Music.
[31:04] I’m Rodger he’s there and we’re talking about data and investing in real estate.
And so we were talking about the biannual rental where you called what’s the full name of that report so people can look it up.
Yeah I’m a big believer that real estate investing is
can be segregated from the overall economy in the market you know that you can do well in real estate if you know what you’re doing regardless of what’s going on in the market and the economy was the stock markets up or down or volatile which it usually is.
[31:40] But there are certain things that you need to look at in a rental in the rental market that.
Are not they’re not easily Quantified one of the things is,
employment opportunities what’s it what’s the future what’s the upside of that area look like course in Clayton County Georgia we were picking on them earlier the
world’s busiest airport is just a couple of miles north of Clayton County
that’s you know Hartsfield-Jackson International Airport here in Atlanta.
[32:12] And so there are a number of employment opportunities there we look we tend to look at the upside for the market.
Do you have a number of employee major employers there or is are all the jobs spending on one you know manufacturing plant like there’s a Ford plant in town but that’s all we’ve got or.
And in the quality of the schools and we look to the greatschools
rating which is the best I can come up with we just want to see you know if
it’s solid working-class folks are going to be there and want to pay the bills and then they have decent schools and that sort of thing is there anything out there that kind of puts all of that
data into a report and scores it question the way I have a couple.
Free resources on this for kind of light use of that type of thing and then I’ll talk about us a report we do but we do have a website we run actually in addition to realtytrac we’re on a couple other websites one is called home fax.
And that’s really neighborhood data focused and Community data Focus so you can go in and find things like schools crime.
For individual properties as well as employment unemployment jobs that sort of thing and though.
[33:31] And it’s a free website.
That’s a great resource another one is called home disclosure. Com which is actually fairly similar in nature but,
it is you can actually print out reports from their what we call a home disclosure report on an individual property that includes a lot of that information,
and there is there is a cost associated with those reports and then we actually do a man I oversee this is a.
[34:02] Prey The Neighbourhood index base after we’ve been doing it the ZIP code level we just acquired some new day that allows us to do it more Grant early add an actual neighborhood level by the names of the neighborhoods.
And we’re going to be releasing that actually in 2 weeks for for this year but it does combine several factors it may not be everything but one of them is going to be employment and income.
Factors along with crimes in schools and
and that we traded in two acts off of all those factors and basically grade neighborhoods across the country from a through F and if you looked at we have one posted it was pretty popular last year.
If you look in our knees are in the neighborhood index it’s about a year old now Neighborhood Housing index a debate Associates just Google that you’ll find that now.
That’s theirs we have a heat map where you can go in and do a lot of that stuff free.
[35:02] But we have had interest from investors actually purchased that report at did the actual data behind it so they can then use that.
It marked much more flexibility and using that to identify markets and that is a big factor you want to layer that kind of thing for sure as you’re saying on top of.
[35:22] Yeah they mail it look great to get the type of returns you can get in Detroit friend sent but there’s certain blocks of Detroit that look like
Star Wars and then you probably don’t want you if you’re going to go in there you wouldn’t if you want to go there in there with eyes wide open and know what you’re getting into you right that may be true of a lot of the areas that have apparent High ratios of rent to purchase price.
[35:46] Okay these are great I’ve ever eaten at all these websites and nobody in the show notes and so if you’re listening to this and maybe you’re driving right now don’t worry.
Flipping America guy got it down I’ll I’ll have it in the show notes and if you listen to the show on the app or if you come to the website you’ll be able to access all of these sites will linked it all of it and will probably.
Joe links out there on social media to show up earlier,
you know here in Georgia and I believe in Texas foreclosures move really fast when the data becomes public you got less than 30 days before it’s sold so.
When you have a cycle that goes that fast how does Real Track handle that yeah I mean it’s difficult to get.
All investors want to get the their leg up on the other investors by getting the data as early as possible and the Foreclosure dated because that’s where we started we were very proud of that day that we,
that’s that’s of all the data set so we have it’s the one we have the most out of the accountability with because we act we have.
[36:55] A very strong network of data abstractors who are actually physically in most of the location that we’re collecting the data and Gathering the data from.
The record the public records sources that are available in each County so we are on one front we’re getting it as quickly as we can and if we ever get complaints it the date is.
[37:16] Behind or late and in an area we can go to that abstract in that area and either fired or tell them to improve their their data collection.
So there’s a lot of accountability there but certainly even with that there is a limited amount of of public.
A limited time frame in a place like Texas and Georgia Arizona’s well Arizona gives you one more time but those two for sure are pretty quick there’s this posting. And then within 21 days I believe it is in Texas
the actual foreclosure sale can occur sometimes it’s postponed takes longer,
doesn’t give you a lot of time where is in many other states is three or four months between that initially notice and when you’d see.
The auction occur so you know that that becomes it can become a challenge to become an opportunity competitive Advantage as well for investors who.
Are able to jump on mad and have a process in place to act quickly on those types of properties I would also just mentioned you know if we’re not afraid of this is.
[38:23] Some of the companies that we license the data to.
Add value to the data in a way that we are not able to and so instead of just come in and getting the data from us you can go to them there is a company out there.
Specific there’s a few companies but one that comes to mind for investors,
that’s a lot of value for investors using Predictive Analytics and machine learning is a company called out danchuk.
[38:48] Now this is going to be for the bigger investor they there’s some but because they do at a lot of value to the data it’s a little bit more costly.
[38:58] If you’re a larger investor what they do is there actually predicting before the property gets a pre-foreclosure notice saying Texas.
They’re predicting properties based using our data and pulling in demographic and other data there.
Farmer Facebook engineer who’s using Predictive Analytics and artificial intelligence and machine learning to say.
They’re scoring properties in Tampa this property is very likely to sell to a real estate investor specifically at a discounted price until that’s giving you,
Advantage even before that public foreclosure notice is filed to approach that homeowner so that’s I mean I love talking about this stuff
it’s some cutting-edge stuff that some of these folks are doing with our data is kind of nerdy
but I like it too I like the fact that there’s a bunch of nerds that collect up all this dating you figured out how to sell it and that’s good okay I’m a closet nerd don’t worry I’ll danticat a u d e n t i c would you stay
man I got that damn we got to go to break when we come back I want to ask you to look at your crystal ball a little bit alright alright.
[40:10] Music.
[40:20] Not too long ago we did a one-day flip starter in Chattanooga Tennessee and low and behold one of my old College friends came out to the event his name is Peter Faulkner and here’s what he had to say about the event.
[40:33] Peter Falkner here I tended a one-day flip starter training session led by Rodger black.
And I was amazed to see what has happened in Rogers Live from the last.
Plus years flipping over 800 houses and then this one day training he told how he did it and what the pitfalls the blessings the benefits.
And how to do it and I was so impressed with how well organized and how smooth the training went today.
You’re tempted or in courage to go go I was not a bad price and if you get a chance to do it even just to consider in bed.
But I just want to thank Rodger for a great day today.
[41:16] Music.
[41:35] When were the last break we had just finished the talking up and talk a little bit about the foreclosures but in this segment I appreciate you hanging in there for at least one more segment.
[41:47] I want to know people come to me and I hear people talking and you know.
Oh there’s a lot of people that will get up in front of group of people Express their opinion without any dated a back it up and I usually sit there and keep my mouth shut unless called upon to answer,
I’m
we here at flipping America show take pride and looking into the data and trying to stay on top of things and to bring a practical application of that data to our friends our listeners and our own.
I work in flipping houses and in buying rentals in Yale real estate investing so,
there are number people who say we are on the bubble and we are destined for another real estate crash because it happens every 10 years,
so that’s the sum total of the logic it happens every 10 years until it’s been 10 years since the last crash and prices can’t get any higher and so we’re about to crash again.
How would you respond to that same thing and I think there’s at least some.
[42:49] You got to put some stock in the fact that when you look back historically the market operates in cycles and so we would expect at some point there to be.
Eccorrection however it’s the trick is of course predicting when that’s going to happen and.
[43:07] We don’t see any.
[43:09] We see we definitely see some stresses on the market that could eventually develop into triggering.
A some kind of Correction I say correction it’s hard to Envision at this point it with the data we look at.
Anything on the scale of the crash that we saw about 10 years ago now what are your data reasons for saying that.
Number one is the loan the quality of the loans that are being originated,
is much much better than 10 years ago and we actually track foreclosure rates by vintage of loans and the the Vintage of loans.
There’s a there’s a sharp divide between a the Foreclosure rate.
Between up until 2008 and in 2009 and following there was some problems still in 2009 but especially if you look at 2010 vintage loans in following that the Foreclosure rates are extremely low in fact that in most cases.
[44:13] Not just back to him but we expect his normal foreclosure rates their below normal so debit and spit lenders for the most part event been extremely conservative and some cases historic lows of foreclosures.
That’s right one on the other hand there is some one of these,
very early signs of maybe some weakness in the market there is it specifically starting in 2014 with FHA Loans we do see a little bit of elevation in the Foreclosure rate.
So FHA loan going to first typically first time home buyers low down payments little bit lower credit scores.
[44:54] And typically I’ve always had to hire foreclosure rates but.
When we met without getting into too much of their weed when we look at the 2014 vintage is particularly there is an elevation of that foreclosure rate that stand out from.
The 2010 to 2013 years seimetz there been some listing of credit but overall.
I would say that’s a strength of the market is is tight lending and and something that would.
Would cause us to say there’s not even a huge crush and the other one is in his inventory which a lot of people talk about the last boom.
Images into being driven by.
What I would call artificial demand because anybody could get a loan to buy a property even if they can truly afford it.
There was also tens of Supply being built last time around and and so when the market did correct.
[45:55] Lance Laird on the problem the fact that there was so much.
Additional Supply out there and we just don’t have as many homes being built now Builders are starting to.
Chicken. Close to Historic levels of building but over the last few years it’s been below.
Historic norms for building homes I was going to ask you if you guys track new housing starts.
Well are not specifically in our proprietary data but certainly I do keep an eye on those from,
from the Census Data that spits put out to a monthly why do you think I’m just asking your opinion now man why do you think we don’t see more Builders jumping back in.
[46:40] Yeah I think it’s because.
There’s a psychological reason witches they got burned last time around in the same with the lenders and so they’re being much more cautious in this bedroom and the other is is very much purely economical Day art camp.
[46:58] The numbers don’t pencil out for a lot of types of properties in a lot of areas it doesn’t pencil out for them to make profit even though there is this really strong demand.
Ask for the doubt they’re at least the price points if they can build at and,
what they can sell the properties for it doesn’t pencil out in,
one concern on the builders part right now is the terrorist that were imposed on Canadian Lumber last year.
[47:29] One thing that was recently listening in on a the chief Economist of the National Association of homebuilders and and his estimate is that’s going to cost.
Builders in extra $9,000 per home to build which is going to eat into their properties in or eat into their numbers even more than and make it even
less profitable to build homes and it has one by the way one area where we see possibly.
[48:01] Oversupply at least in some Market is in the multi-family multi-family has been hot because home ownership rates are.
How to reverse 10 years ago home ownership rates were going to record highs,
so the builders Rob building single family homes to try to to fit that Demand right now in the last year’s ownership rates have been very low so there’s lots of renter’s out there there will focus of builders.
It just proportionately has been on building apartments in another rental properties and we do see and at least anecdotally in some cities if there’s.
Pass probably an oversupply of apartments that could have an impact in and some of these especially bigger cities
yes and amen on all of those we’ve been talking about the the oversupply multi-family but also just on the last show we talked about the Canadian tariff some on soft wood and what is doing the home prices now I have not heard 9500 I had heard 7500 and I’d also heard something like
7% of the cost 72 Koster up 7% to build that is a problem but I did another story on.
[49:14] American Lumber Mills are gearing up and expanding and trying to meet the demand is she an opportunity I don’t know that that’s going to result in a dropping of price is right away it’s kinda like gasoline the price goes up very fast and comes back down real slow
that is alright man I tell you we’re out of time but we got to do this again saying about 6 months when you got the next round of data I want to
stay on top of what’s going on all the time and if it’s okay with you there and I’d like to just come right to the source.
Yeah absolutely we love to have to do this get the word out that we have this data so.
Thank you for the opportunity we’re going to be spread the word we appreciate you joining us today Darren Bloomquist with Adam Data Solutions and I’ll put all the websites that he’s given to us.
In the show notes and make them available to you thanks for joining us.
[50:06] Music.
[50:24] Pretty cool stuff right.
Yeah I knew it wouldn’t disappoint hey I want to talk to you a little bit about that the idea of a flash-in-the-pan have you heard that phrase flash in the pan.
Some people think that it comes from the California Gold Rush of the mid-nineteenth century you know Prospectors who pan for gold supposedly became excited when they saw something glint in the pan only to have their hopes dashed when approved to be not cold but a mere flash in the pan
it’s plausible but this is probably not what it is this is probably a reference to a misfire of a musket type of gun.
You see there’s a little pain in there that would hold the charges of gunfire gunpowder and when you attempted fire the musket in the gun power powder flared up but the bullet didn’t fired then you had a flash in the pan either way.
What you end up with is a disappointment something that looks like it’s going to be real exciting and it just doesn’t pan out now why am I bringing this up because.
[51:22] I need someone new just about every day,
who is excited about getting into this business maybe they’ve been watching it on TV for a while maybe they’ve been thinking about it for a long time or maybe they just got introduced to the idea but they come to me with dollar signs in their eyes and they’re all excited.
Here’s what I would like to say to you.
[51:42] Figure out really what it is you’re trying to do before you dive into this and here’s what I mean.
[51:50] Today I did a strategy call with a good person who has a great job that she loves and
she does very well and she makes good money and she wants to get into fixing and flipping houses simply because it looks like fun and there’s another way to make money and her goal is to become wealthy.
All right there’s nothing wrong with a gold become wealthy especially when she explain to me
that her goal for becoming wealthy was so that she could do this one particular on nonprofit thing that she was looking to fund I understand that completely because that’s just
that’s where my heart is too if you listen to the show for anytime you know that we’re trying to help the foundation for Renewal and get started and going and making a difference.
But that’s different subject now here is a recipe for becoming a flash in the pan get all excited.
And jump out there without any information now I know I spend a good bit of time and courage you guys just to jump just to Google do something get out their move make an offer do a deal do something.
[53:02] However the flip side of that coin is can get a little bit of information before you go too far
she did the right thing by scheduling a strategy call with me because in our call I helped her understand what her goals were and she kind of knew what they were she said she had done a good job with that but how her goals were
a little bit inconsistent with even her high paying job because to achieve the kind of income that she’s looking for to fund her Ventures she needs to own her own business.
[53:32] But I didn’t encourage you to quit her job and I want to see again we don’t encourage people to drop what you’re doing start flipping houses like you see on TV it’s not for everyone.
In fact there is a way that you need to eat yourself into a gradually
and part of it is to see if this is really a good fit for you so you don’t become a flash-in-the-pan we see people all the time and go out there and make an offer maybe it’s not the best offer maybe the numbers are tight and they’ve got a property under contract or maybe they’ve already bought it and they come to us for help
well at that point it’s a little too late,
you need to be getting that information I appreciate the the desire to ready fire aim and I I like the fact that you’re leaving but you do need to look a little bit before you leave,
alright so understand some things get some information talk to somebody who’s been down the road before you just go because I don’t want to see you become a flash in the pan
in this particular case this lady was ready to sign up for the flipping America mentoring program and I told her that was not,
the option for her
it’s not because we didn’t like her or not because we didn’t think she would do well it’s because it’s not the right time in her life she has a job that she loves she does well she makes a lot of money instead we directed her to think about
our cash flow Mastery training because she needs to be thinking about passive forms of income which can be had two other things besides real estate but we know is real estate until we talk to her about that.
[55:00] And that’s the purpose of the strategy calls folks to help you not be a flash in the pan I want you to just go to the website flipping America network.com.
[55:09] On just about every page that you can encounter on that site you will see a blue button at the top of the page that says,
you can start a new career by clicking here for free Saturday session and that strategist there’s no cost or no obligation but it’s 30 minutes of conversation with me or one of the people that one of our strategy,
advisors here at flipping America office is a free service there’s no cost no obligation.
And we do it this is a service to you to help you out if it turns out that our training is a good fit for you we’ll talk about it.
In at least half of the calls that we do it’s not the right fit or it’s not the right time so don’t be shy come on email us.
Schedule a strategy session let’s talk.
[56:00] All right I think we have time for one question and let’s take Alyssa from Grand Rapids Michigan says what do you do for security in your fix and flips.
[56:09] I have one in a marginal area and I’m a bit worried about materials left on site and basically the house itself
that’s a very good question and this one that we wrestled was over the years we try not to buy houses in the really terrible areas but sometimes we buy houses in areas where we are cells wouldn’t want to live there up and coming and people that want to live in the up-and-coming area well have that it hears a great house but in the meantime before it gets occupied what we do
well Alyssa you know there are and we don’t have any of these folks sponsoring the show yet so I’m not going to name any Brands here but,
there are security systems that can be installed without a lot of hassle without wires they work wirelessly they they recognize the things and we install security in our house is just put it that way.
[56:58] So when someone once we started taking possession of a property and and valuable things are there now we don’t do it right at the beginning but as we,
close to completion on the property there will be a security system there that will recognize glass breakage and those are the kinds of things what are the kind of things that you know if you have a vacant house what,
why would people break in well I’ve had appliances get stolen more than once I’ve had appliances taken the probably the day that they appeared and of course we’ve had multiple air conditioners taken in,
we found
air conditioners at the homes of the sub contractors that install them because they installed them we inspected and we went back to cut the check in while we were cutting the check they were unsullied in putting on their trailer and and basically stealing from us that’s happened a time or two.
[57:48] Unfortunately has not very often but we’ve had that AC units or a big thing and sew in a question Larry there we will sometimes put a cage around them
the Cajuns kind of a message though to the potential home buyers that we don’t always want so a lot of times we will save the installation of the condenser unit outside to one of the last things same with the appliances they go in for the staging but then
serious security on the door lock and a
and a wireless alarm system and now thanks to our good friend on DeRosa and his talk on the Smart House.
We got a completely Smart House that says hello to people when they walk in the door.
[58:28] So that show that y’all need to go back and listen to because we got a lot out of that alright that’s all we have time for today we’ll talk again soon.
[58:35] Music.
[58:52] Confucius said it doesn’t matter how slowly you go as long as you do not stop.
[59:00] This that was brought to you by the foundation for Renewal working together.
With communities across this country of ours to impact and improve lies find them on the web at renewal fund. Net and is always your gift in any amount is both appreciated and tax deductible.
[59:16] Music.