Jason Bramblett 1-20-24 Part 1

Jason Bramblett helps you understand and profit from Real Estate in the Piedmont Triad of North Carolina

Episode Transcript

(00:01):
I need somebody, not just anyyou know, I need someone. Good
morning and walking to Jason for astate show with the Ranks having a fantastic
Saturday. It's a little bit cooltoday, that's all right. I like,
I see I'm crazy. I wouldactually take this over ninety five one
hundred degrees. I just would.Yeah, it gets your attention. I

(00:24):
will say that I got lots ofclothes to put on Jayson. There are
lots of close I tell my wifethe same thing. I'm with you.
I'm like, I want to go. I like walking outside and just like
getting that shock and like, okay, thet's take on the day. Let's
do this. I can't hike inthis. I mean this is a little
bit cold, you know at least, but honestly, thirty six, thirty
seven, thirty eight, I'll gohike. Yeah, for sure, put

(00:47):
a hat on, some layer up, go hiking it absolutely and probably break
a sweat. I'm with you.I'm with you so well. Real estate
is exciting. It's not getting exciting. It is exciting. There's lots of
stuff that is going on. I'mgoing to unlock some of what I've learned
over the last twenty five years.Today and share with you that and and
why you know, why is it? Why is real estate career worth considering.

(01:11):
We're going to talk just a littlebit about that. But for all
of you that don't want to makea career change is here's one for you.
Why should I invest in real estate? You know, there's a lot
of things to invest in. Iwant to share with you why. I
believe most of you are sitting inone of the greatest assets, the greatest
investments, and you might not evenknow it. So we're gonna a little

(01:33):
zoom out, take a look atthat how to get started investing in when
should you do it? Plus yourquestions, my answers, all those things.
So grab a pen, grab somepaper, get that coffee, t
whatever it is you're doing, andget ready to get your learn on,
as they say down here in theSouth. So you can go to Jason
Brawitt real estate dot com or callthe office bill answer your questions five five,

(01:55):
three zero seven ninety six. Sothis is gonna be a good one.
I mean, honestly, some ofthe most listened to radio shows,
some of the most show watched TVshows are all about real estate investing.
It's something that I know our listenersare very very interested in. So I
want to I want to dig rightin. How do I I've never invested
in real estate before? How doI get started? If this is a

(02:16):
path I want to go down right? And oh, I'm so glad you
phrased it that way. That's theperfect lead in. Not even stage,
nothing like that. This is justKeith doing Keith stayin. I'm not invested
in real estate yet, but yethe has because he owns a home.
And and so for many of youout there, you have invested in real

(02:37):
estate. And now what I wantto do is walk you through a little
bit of shift in your mindset.And I mean, this is going to
be so good. This is goingto be so good. Some of you
guys are going to have this ahamoment to day. So here's the thing.
I have actually never seen a bettertime than now for this consideration.
And let me qualify that it's well, it's probably not actually what you think.

(03:02):
Most you know, most think becausehome prices went up, you know,
and they did, and and youknow, and that's not that exciting.
And then you got this other factorof interest rates, and so you
know a lot of people were talkingto about investing there like, oh,
this has got to be like theworst time ever to even think about buying

(03:27):
a house. And really, youknow, investing in real estate prices are
super high. Interest rates are youknow, well, when you compare to
two point eight, it's like interestrates are horrible. You know, they're
horrible. It's like the worst ever, Like they're they're like six percent.
You know. Well, here's thething, they're just slightly below average.
Yeah yeah, yeah, exactly,just they're underperforming right now, Yes,

(03:49):
for sure. So here's the thing. Two factors that I think have actually
never even existed at all. Maybeever i'd have to go back and really
digging and look but for the realestate investor, and actually may never happen
again. And the reason why itwill make more sense to you is we

(04:10):
break this down, or I breakthis down. Record low interest rates for
a decade. Okay, in thehistory of interest rates, since we've been
actually tracking them, we went througha ten year cycle of the lowest ever
sub five percent. If you goback and look at all the charts going
back to nineteen seventy two, whichis exactly what fifty one years ago,

(04:31):
I'm pretty sure that's right. Fiftyone to fifty two, depending on I
guess when you're counting. But ifyou look at the if you look at
that time, interest rates have averagedseven point seventy five percent all the way
up to sixteen and as low asone point nine during the last ten years.
Last ten years has been a gift. And it was fake. Don't
forget this. For all of youthat are waiting on it to come back

(04:54):
around. Remember it was fake,fake, fake, fake. Can't say
enough it was fake. This wasthe government manipulating the market, buying down
the rate. This was not themarket. This was not the market,
guys. And so these two factorslowest rates in a decade, I mean,
think about it, somewhere as lowas sub three percent. Second largest

(05:18):
increase in rent in the last thirtyyears. Largest and actually really truthfully,
that happened in the last six years, especially here, especially in the Triad.
Especially rent on average in the Triadhas went up on average, guys,
on average thirty five percent in theTriad in the last four years.

(05:43):
Thirty five percent. That is that'sbig. The article I saw said that
for a one bedroom apartment it rosethe highest anywhere in the nation. Wow,
right, the one bedroom apartment righthere, the highest of the highest
increase in the country. I dobelieve it. And part of that is
because, for whatever reason, Idon't know why, well I do know

(06:03):
why. It's people weren't moving here. You know, for a decade we
had, we were the most stagnantarea in all of North Carolina. North
Carolina was exploding. Raleigh, Charlotte, Wilmington, Ashville tried sitting duck like
dead as a door nail. Fromtwo thousand and eight to twenty eighteen,
homes appreciated two point four percent ina decade. That is pretty much horrific,

(06:28):
like horrible. And guess what,because homes didn't go up, neither
did rent, and so rent waslagging way behind. So thirty five percent
increase. So okay, Jason's whoopee. That was that, And you know
that's the past and what's happening now. Now let's talk about today. So
rates pretty much are double and homeprices are up. It seems stupid to

(06:55):
buy real estate, is what Ihear on the street, or is it?
See you're looking at the math wrong. And this is where I want
to zoom out a little bit andhelp you guys. See this because you
are setting If you own a home, you are setting on a great asset.
It is called your personal house.And here's what we know. If
you own a house with a subfour percent interest rate, so anything below

(07:19):
four and many, I mean hundredsand hundreds of people were talking to every
month. They're saying, I'm twopoint two two point three. We've had
one at one point nine, buttwo point three to two point eight is
kind of like hundreds and hundreds ofyou guys out here that we're talking to.
If you have a three bedroom,two bath, two car garage or

(07:40):
a four bedroom, two and ahalf bath, two car garage and you're
in a good area, well,my friends, listen to this judging because
I'm going to walk you through whyyou actually are living in one of the
best investments actually that you would probablyever do. I mean, I know
people that are professional real estate investorsthat don't even see this, like they

(08:05):
they're like, uh, yeah,I didn't even think of it that way.
And so let me help you havethis aha moment. You're living in
this amazing asset. So if youpurchase your home pre twenty nineteen, and
I would just say this, thisis a good old Southern term. You're
kicking it to the creek man,like you're doing good, because pre twenty

(08:28):
nineteen, almost everybody's home is almostdoubled in value. It is went up
amazingly. And so let's just sayyou bought that house in twenty fifteen,
sixteen seventeen, and you borrowed twohundred and fifty thousand dollars at three percent.
Well, your payment's about eleven hundredbucks a month, and it's on

(08:48):
a thirty year, And I knowsome of you guys are smart and refinanced
to a fifteen and you know,actually I talked to somebody the other day,
Keith that he he has a twopoint two percent rate. He was
on a thirty okay, like atthree point two, So I mean horrible,
right, it was just absolutely horrificthree point two. They refinanced to

(09:09):
a fifteen year at a two pointtwo. And he's sad because he only
has eight years left to fail hishouse because he's like, I'm gonna lose
my rate. You know. It'slike he's like, can I get an
extension for like ten more years?You know, I mean, and I'm
like, well, you won't haveany interest at all once you pay it
off. But the time is it'sit's clicking along, like he's like,

(09:31):
he's like, man, this fifteenyear note, he goes to zero fast,
and it does because because at thatrate, I mean, you're paying
almost nothing in interest. So it'skind of it's kind of fun. But
anyway, now, the homes thatI just described, those three bedroom,
two bath, two cargearage and thefour bedrooms and et cetera. Right now,
currently, if you look at therent in the triad, those homes

(09:54):
are renting somewhere between two thousand totwenty eight eight one hundred dollars per month,
two thousand and twenty eight hundred dollarsper month, and that has given
you anywhere between one thousand, perhapsthis up to sixteen hundred dollars in cash
flow, meaning you can rent themfor more than your mortgage is. And

(10:16):
the difference is what we call cashflow in real estate investing. Now here's
this is just crazy good. It'sa house that I would never sell if
I had that house at that rate, I would never sell it knowing that
I could pull out by renting onethousand to sixteen hundred dollars a month.
I mean actually for some people,when you're getting up to close to sixteen

(10:41):
seventeen, eighteen hundred dollars a month, I think that is what some people
get, like in solid security,Like that's kind of what their check is.
You know, think about that,You've got one little asset that could
pay you that right now, andthen when your mortgage goes to zero,
then what, well you just pickedup on an other are thousand a month,

(11:01):
So now you're getting what twenty twohundred to three thousand dollars a month
coming in every single month. That'skind of cool. And so you know,
think about it, guys, it'sthe house I wouldn't sell. So
there's lots of options out there.I just wanted to zoom out and kind
of give you the opportunity to letyou know, hey, you already are
a real estate investor. It's justa different way of thinking about it makes

(11:22):
sense. Yeah, I mean listen, I understand the math and that part
of it sounds great. But youknow, it's pretty cold out right now.
I'm not sure that under the bridge. It was July maybe yeah,
but under the bridge it's probably notan optimal location right now with it,
like you know, fourteen degrees atnight. Right, you know I have

(11:43):
to live somewhere, and if Irent out the house and I have to
go buy another property. Sure,Now I'm roped into the and you can't
see the quotations on the radio,the really high interest rate in quotations.
So how does that work? Yeah, move to the desert. No kidding,
I'm kidding you stay here. Wewant you to stay in North Carolina.

(12:03):
No, don't move to Scottsdale,even though it is a fantastic place.
Great observation, great observation, andyes and no are both the answers
of this. I'll walk you through. And here's the reason. Well,
the new mortgage on a new home, you're gonna have a higher interest rate,
there's no question. So yes,why not sell the property? Why

(12:24):
keep it? Well, i'm gonnawalk you through why to get in consideration.
Now, this is not gonna workfor everybody, but let's just say
that it did. So I'm gonnago buy the new house, the house
that I actually want. But theinterest rates are current. You know,
they're six, So let's just sayit's double. Right, I give the
example of three. They're six now, so it's like, oh, it's
double Jason. That seems like adumb idea. Here's the cool part.

(12:48):
Let's just also say you do buythat bigger, better home, you know,
the one you actually love, theone you actually wish you would have
bought. You know, you don'tfeel trapped in the one that you're in
just because you don't want to loseyour rate. That's the other thing.
I can't even tell you how manypeople we talk to every month that are
like, we hate our neighbors,neighborhood has went to crap, but we

(13:13):
have a two point two percent interestrate, so we I mean, we'll
put up with the gunshots, We'llput up with the you know, the
vandalism of the teenagers, we'll putup with we have two more kids now,
and we're about ready to kill eachother because the house is so small.
Uh, We're gonna put up withthat because we you know, it's
not worth giving up, you know, a two point two percent interest rate.

(13:37):
And you know who you are.I mean, we've been talking to
you guys every day, and we'rewe're you know, we're giving you,
we're giving you some help, andyou know they hate their current home.
We'd unbelievable. We talking to peopleand are like, yeah, we don't
like anything about where we live nothing, but man, we got to killer
interest rate. And I'm like,okay, we got to repurpose this.

(13:58):
So but they won't change. Andhere's here's here's the deal, guys.
It's kind of like this. It'skind of like working that job that you
hated for ten years for some ofyou, just because you're afraid to like
bet on yourself and get out thereand do something different. You know,
I don't know, is that toosoon? I'm sorry. I know it's
a new year and some of youall been thinking about this is my year.

(14:20):
I'm gonna make a change. I'mgonna do what I want. I'm
gonna get out of this dead endjob that I've hated for a decade.
Well now it's like, you know, January twenty something or whatever, we're
getting close to and you're like,eh, oh good, I'll just stick
it out another year. It ain'tthat bad. It ain't that bad.
It ain't that bad. You know, they still pay me a you know,
I still get a check, andand you know, me being miserable.

(14:41):
I'm just taking one for the teamfor the family because the family's happy.
But mom and dad. Nah.Nah, we're miserable. Nah.
Okay, let's get back to thenew home. So let's just say the
new loan's four hundred thousand dollars orsix percent. Okay, you're like,
Okay, Jason, you talked meinto it. I'm gonna go get the
house I really want. Sick ofthe neighbors, sick of a small house,
sick of this situation, I'm movingon. We're going to buy a

(15:05):
house. I don't want to paysix percent interest, but I'm going to.
And then here's what it comes outto be. Now, your paying
is twenty three hundred dollars a month, so basically thirteen hundred dollars more than
what you're paying now, which isn'ta joke. Thirteen hundred dollars is a
lot of money. But here's thething, guys, think about this.
Our newly converted rental, the houseyou live in now converted over to a

(15:30):
rental, almost pays and may insome cases pay one hundred percent of the
difference in that payment. But asthey say on TV, but wait,
there's more, right, there's more. Did you see it? Did you
pick it up? Did you catchit? Not only do you get the

(15:50):
home that you really want. Therenter, your tenant is now paying for
the house that you're living in.Think about that. You are now paying
one hundred percent of your mortgage.Therefore, you are one hundred percent paying
for the house that you live intoday. And then we converted to a
rental, and now your tenant ispaying one hundred percent of that house.

(16:14):
They're covering. The rent covers onehundred percent of the mortgage on the house
that you're living in. Oh butguess what, there's excess because rents went
up thirty five percent and your payment'seleven hundred, and you're renting the house
for I don't know, twenty twohundred, twenty four hundred, twenty six
hundred. And now we've got money, we've got cash flow, we've got

(16:36):
anywhere between I don't know a thousandto eighteen hundred dollars extra per month that
we can now apply to our dreamhouse, the one that we really wanted.
And think about it. I toldyou your payment between you bought the
you borrowed two hundred and fifty atthree percent. Now you've borrowed four hundred

(16:56):
and six. The difference in yourpain meant is thirteen hundred dollars. Well,
if your tenant is paying you morethan that for the house, your
house you're in now, basically youhave a zero sum game. You are
getting exactly what you want. Andhere is the cool thing. The tenant

(17:19):
is one hundred percent paying for theold house one hundred percent, and they're
paying for the difference in the newhouse. And so what are you contributing
uh Thirteen to fourteen hundred dollars amonth, which is exactly what you're doing
now in the house that you absolutelyhate. And here's the cool thing.

(17:41):
Let's just say you were one ofthose smart guys that I talked to earlier
and you said, hey, Jason, I don't want to give up this
rate because I've got a great rate, but I only got eight years left.
Well, one eight years goes wayfaster than we think, and once
you eclipse probably forty five, youknow that. The second thing is that
more we'll go to a zero eventually. If everybody pays on time, it's

(18:03):
going to go to zero in exactlyeight years. And now your cash flow
is going to go to twenty twohundred, twenty five hundred, twenty six
hundred dollars a month and you havea paid for home and now it's all
gravy money coming in which allows youto do different things. So something to
think about. Zoom out, thinkabout what I said, Grab an extra
cup of coffee. We're going totake a break. Would be back in

(18:26):
just a minute. You're listening tothe Jason Brownlot Real estate Show.