December 19, 2023 • 7 mins
Jason Bramblett helps you understand and profit from Real Estate in the Piedmont Triad of North Carolina.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:06):
Hey, welcome back to the JasonBrawnlett Real Estate Show. Hope everybody is
enjoying their day, enjoying getting readyfor the well the busiest time of the
year, and we were running outof time, that's for sure. So
we were talking about some changes intwenty twenty four and how interest rates and
selling and how that can impact anythingall of these different things. Does it
(00:28):
impact investing in real estate at all? For twenty twenty four, We're definitely
going to see some shifting, anddefinitely on the commercial real estate side,
I think that is something to watch, is definitely something that I'm watching.
You know, Residential certainly is goingto be certain opportunities that come up,
but in so in commercial, youknow, a lot of the terms that
(00:54):
these folks you know, started thatwhen they started to buy, they're going
to start to come to an endbecause of how they cycle with commercial real
estate. Just to kind of giveyou an overview, it's not a thirty
year loan and so it's uh,it's it's it's a shorter term. And
they and they buy these things basedupon what they call capitalization rate, and
so they they were really aggressive becausethey had cheap money, and so they
(01:17):
were buying them as low as afive to seven percent cap rate, which
probably doesn't mean anything to most ofyou, but let's just say very not
conservative, okay, and so veryaggressive. And you know, I think
a lot of it is because itwas venture capital, private equity groups.
This isn't typically your your mom andpop in This money was a lot of
it was coming right out of WallStreet, and so it wasn't like it
(01:42):
was a bunch of people's money,you know, kind of grouped together if
you will. And I don't know, it's it's gonna it's gonna be.
That is one I am. I'mexcited because of the opportunity. I always
say I don't want to see peoplelose their businesses because I already did that
through two cycles in really state.Now, I don't want to see that.
But you know, they just paidtoo much, bottom line is and
(02:07):
they got real aggressive. And Iguess some people could argue and say that,
you know, some homeowners did thatas well. But unlike your mortgage,
in commercial that's it's typically like Isaid, at a shorter term,
so it's usually like a three,five or seven year lock. That's what
you have guaranteed and it's also calculatedon a twenty year cycle, not a
(02:28):
thirty year cycle most of the time. So kind of what that looks like
it could be. It could bea train wreck in that. Let's just
say, like you're getting like,I don't know, fifteen sixteen thousand dollars
a month in rent on your commercialbuilding, and your payment's eighty five hundred,
which is cool, all right.Then you got another twenty five hundred
taxes, so you're like, whateleven thousand dollars all in with your taxes,
(02:50):
insurance and all that. So you'remaking decent money, but that was
based off four and a quarter fourpercent, And if you're at the end
of that term and your rate allof a sudden goes eight and a half,
you just want to zero or evennegative. And so in commercial lending,
they don't like to hear the wordszero and or negative. Yeah,
(03:13):
No, they judge a lot ofwhat's going on with the rents that are
coming in. They call it arent roll. They'd like to see who's
paying you and how much and areyou actually making some money? Are the
tenants is this an asset that isproducing? And here that's where the second
issue comes in. The commercial bankcan decide that your property, you're building,
(03:34):
your land, your whatever, isactually not worth what it used to
be based upon the cash flow,and then they have the right to do
this thing and call your loan.And so they can say, hey,
when we gave you this loan,your building was whatever, two million dollars,
and now, based upon higher interestrates, you're not maybe vacancy,
(03:57):
all those different things we think you'rebuilding is only worth I don't know,
one million, but you owe onepoint five. Yeah. So typically they're
kind, they'll give you all ofthirty days to pay them five hundred thousand
dollars. They'll just or they'll justtake your building sadly. And and it's
a regulation that's put on them,so they have a lot of pressure on
(04:20):
them, and that's why they're aggressivewith it. And this happened to a
lot of folks that I know inthe triad back of their in the market
crash, a lot of developers,a lot of builders, They had these
type of loans and when the ratiogot to where the bank didn't like it,
they just took the property. Now, do not freak out on your
home that you don't they're not goingto be throwing people out on the street.
(04:43):
So this is commercial real estate I'mtalking about. But there's going to
be some opportunity out there. Soif you're a commercial guy, I mean,
I know some guys they got theyou know, the guys that got
the most cash, are probably gettingreal excited about what's coming. You think,
Yeah, I think they're gonna getwell and sadly, this is kind
of where the rich get richer,you know, And that's it just it
(05:03):
starts to compound and compound and compound, and I don't know, but I'm
going to be watching it. Andso if you are in the commercial space
and we're in the commercial investment,you're probably doing the same thing, you
know. Yeah, what about opportunitiesin your company? I know you were
hiring real estate agents before the Overthe last couple of months, where's that
(05:24):
headed. Yeah, definitely still onehundred percent hiring real estate agents for a
retail side of the business. Soif you're an active real estate agent licensed
and or you got your license andyou'd like to talk to us, we'd
love to talk to you. We'redefinitely going to be adding more agents all
throughout the triad. Actually, we'llbe expanding into Raleigh and Charlotte this year,
so we'll have opportunities for some folksin there. We're going to create.
(05:47):
Our websites getting bigger, so we'llstart to bring all three markets into
that and maybe even in the twentytwenty four but twenty twenty five, for
sure, we'll have the whole entirestate of North Carolina covered under are Living
in North Carolina brand. But wealso have other opportunities for folks that are
not licensed through our commercial non retailside, where you do not need a
(06:11):
real estate license. So maybe you'rereally good at sales, but maybe you
got a little bit of a historyand you can't get a real estate license.
Not saying he didn't turn your lifearound. You're a good old person.
Now, well, we'd still liketo talk to you. Yeah,
there's still opportunity out there. Butyou know, I mean, it's just
gonna be it's gonna be a funyear. I'm excited about twenty twenty four,
(06:32):
excited about what we got coming up, the radio shows and things that
we can do. But if youlike sales, don't have a license,
be happy to speak with you,go to the real estate side. It's
still right now Jason brownetrealestate dot Comor you can go over and give us
a call. It's five five threezero seven ninety six, and we can
talk to you about our commercial nonresidential side. And for this particular group
(06:58):
of folks, you won't do notnow. If you have a real estate
license, that's fine, but youdo don't have to have one. And
there's a lot of good folks outhere that have sold you know, everything
from you know, insurance to whatever, and some of them may be mortgage
and they just don't even want todeal with going through the classes of getting
the license. So here's an opportunityfor you. If you like sales,
you like servicing people and helping people, that's what we're looking for. So
(07:20):
you can get all that information.It's Jason Brown at real estate dot com
or go to or I guess Texas, or you can give us a call
five five three zero seven nine six. Will that folks have a fantastic Saturday
as we get closer to the endof the year, Christmas, New Year's
resolutions, presents and all kinds offun stuff. So we'll talk. That's
(07:44):
it, it's here. We'll seeyou next week.
Hey, welcome back to the JasonBrawnlett Real Estate Show. Hope everybody is
enjoying their day, enjoying getting readyfor the well the busiest time of the
year, and we were running outof time, that's for sure. So
we were talking about some changes intwenty twenty four and how interest rates and
selling and how that can impact anythingall of these different things. Does it
(00:28):
impact investing in real estate at all? For twenty twenty four, We're definitely
going to see some shifting, anddefinitely on the commercial real estate side,
I think that is something to watch, is definitely something that I'm watching.
You know, Residential certainly is goingto be certain opportunities that come up,
but in so in commercial, youknow, a lot of the terms that
(00:54):
these folks you know, started thatwhen they started to buy, they're going
to start to come to an endbecause of how they cycle with commercial real
estate. Just to kind of giveyou an overview, it's not a thirty
year loan and so it's uh,it's it's it's a shorter term. And
they and they buy these things basedupon what they call capitalization rate, and
so they they were really aggressive becausethey had cheap money, and so they
(01:17):
were buying them as low as afive to seven percent cap rate, which
probably doesn't mean anything to most ofyou, but let's just say very not
conservative, okay, and so veryaggressive. And you know, I think
a lot of it is because itwas venture capital, private equity groups.
This isn't typically your your mom andpop in This money was a lot of
it was coming right out of WallStreet, and so it wasn't like it
(01:42):
was a bunch of people's money,you know, kind of grouped together if
you will. And I don't know, it's it's gonna it's gonna be.
That is one I am. I'mexcited because of the opportunity. I always
say I don't want to see peoplelose their businesses because I already did that
through two cycles in really state.Now, I don't want to see that.
But you know, they just paidtoo much, bottom line is and
(02:07):
they got real aggressive. And Iguess some people could argue and say that,
you know, some homeowners did thatas well. But unlike your mortgage,
in commercial that's it's typically like Isaid, at a shorter term,
so it's usually like a three,five or seven year lock. That's what
you have guaranteed and it's also calculatedon a twenty year cycle, not a
(02:28):
thirty year cycle most of the time. So kind of what that looks like
it could be. It could bea train wreck in that. Let's just
say, like you're getting like,I don't know, fifteen sixteen thousand dollars
a month in rent on your commercialbuilding, and your payment's eighty five hundred,
which is cool, all right.Then you got another twenty five hundred
taxes, so you're like, whateleven thousand dollars all in with your taxes,
(02:50):
insurance and all that. So you'remaking decent money, but that was
based off four and a quarter fourpercent, And if you're at the end
of that term and your rate allof a sudden goes eight and a half,
you just want to zero or evennegative. And so in commercial lending,
they don't like to hear the wordszero and or negative. Yeah,
(03:13):
No, they judge a lot ofwhat's going on with the rents that are
coming in. They call it arent roll. They'd like to see who's
paying you and how much and areyou actually making some money? Are the
tenants is this an asset that isproducing? And here that's where the second
issue comes in. The commercial bankcan decide that your property, you're building,
(03:34):
your land, your whatever, isactually not worth what it used to
be based upon the cash flow,and then they have the right to do
this thing and call your loan.And so they can say, hey,
when we gave you this loan,your building was whatever, two million dollars,
and now, based upon higher interestrates, you're not maybe vacancy,
(03:57):
all those different things we think you'rebuilding is only worth I don't know,
one million, but you owe onepoint five. Yeah. So typically they're
kind, they'll give you all ofthirty days to pay them five hundred thousand
dollars. They'll just or they'll justtake your building sadly. And and it's
a regulation that's put on them,so they have a lot of pressure on
(04:20):
them, and that's why they're aggressivewith it. And this happened to a
lot of folks that I know inthe triad back of their in the market
crash, a lot of developers,a lot of builders, They had these
type of loans and when the ratiogot to where the bank didn't like it,
they just took the property. Now, do not freak out on your
home that you don't they're not goingto be throwing people out on the street.
(04:43):
So this is commercial real estate I'mtalking about. But there's going to
be some opportunity out there. Soif you're a commercial guy, I mean,
I know some guys they got theyou know, the guys that got
the most cash, are probably gettingreal excited about what's coming. You think,
Yeah, I think they're gonna getwell and sadly, this is kind
of where the rich get richer,you know, And that's it just it
(05:03):
starts to compound and compound and compound, and I don't know, but I'm
going to be watching it. Andso if you are in the commercial space
and we're in the commercial investment,you're probably doing the same thing, you
know. Yeah, what about opportunitiesin your company? I know you were
hiring real estate agents before the Overthe last couple of months, where's that
(05:24):
headed. Yeah, definitely still onehundred percent hiring real estate agents for a
retail side of the business. Soif you're an active real estate agent licensed
and or you got your license andyou'd like to talk to us, we'd
love to talk to you. We'redefinitely going to be adding more agents all
throughout the triad. Actually, we'llbe expanding into Raleigh and Charlotte this year,
so we'll have opportunities for some folksin there. We're going to create.
(05:47):
Our websites getting bigger, so we'llstart to bring all three markets into
that and maybe even in the twentytwenty four but twenty twenty five, for
sure, we'll have the whole entirestate of North Carolina covered under are Living
in North Carolina brand. But wealso have other opportunities for folks that are
not licensed through our commercial non retailside, where you do not need a
(06:11):
real estate license. So maybe you'rereally good at sales, but maybe you
got a little bit of a historyand you can't get a real estate license.
Not saying he didn't turn your lifearound. You're a good old person.
Now, well, we'd still liketo talk to you. Yeah,
there's still opportunity out there. Butyou know, I mean, it's just
gonna be it's gonna be a funyear. I'm excited about twenty twenty four,
(06:32):
excited about what we got coming up, the radio shows and things that
we can do. But if youlike sales, don't have a license,
be happy to speak with you,go to the real estate side. It's
still right now Jason brownetrealestate dot Comor you can go over and give us
a call. It's five five threezero seven ninety six, and we can
talk to you about our commercial nonresidential side. And for this particular group
(06:58):
of folks, you won't do notnow. If you have a real estate
license, that's fine, but youdo don't have to have one. And
there's a lot of good folks outhere that have sold you know, everything
from you know, insurance to whatever, and some of them may be mortgage
and they just don't even want todeal with going through the classes of getting
the license. So here's an opportunityfor you. If you like sales,
you like servicing people and helping people, that's what we're looking for. So
(07:20):
you can get all that information.It's Jason Brown at real estate dot com
or go to or I guess Texas, or you can give us a call
five five three zero seven nine six. Will that folks have a fantastic Saturday
as we get closer to the endof the year, Christmas, New Year's
resolutions, presents and all kinds offun stuff. So we'll talk. That's
(07:44):
it, it's here. We'll seeyou next week.
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