REB 135: Everything is Falling Apart! How Do We Get Through It?

I typically operate with a high level of confidence in myself, but there are time when I feel as if I have made all the wrong choices.  How do we get through?

Transcript

SPEAKER_00 0:01

Hey, welcome back to Real Estate Bites. This is episode 135. So, what I want to talk about today is there have been a good number of episodes in my life where I have had this crisis in confidence. Okay. So people who are close to me have heard me say, and most trainees that I've ever worked with have heard me say overconfidence is one of my character flaws. I don't know if I quite suffer from the Dunning-Kruger effect, which is a complete over-evaluation of one's skill set in a high belief that they can accomplish stuff that they really cannot. I do tend to believe that if something, if I set my sights on something, I can achieve it. That is one of the things that allows me to take risks. I believe I can. I believe that I can see my way through it. I do my best to study and calculate the risk before entering into it. I do my best to understand what the potential downsides might be and protect myself against them. And I also believe that whatever obstacles I may face, I can overcome in pursuit of my goals. That said, there come times in this whole thing, you know, um, where I wonder, do I know what the hell I'm doing? Am I gonna make it through this? Or the worst of all, am I making the right decisions at all for myself and my family, or for the agents in my brokerage, right? So the latest thing that triggered me was um I had a niece who graduated high school, and uh my sister, uh not her daughter, but my uh daughter of another sister of ours sent me a video um of my niece walking across the stage, and I wasn't there, and I couldn't help but think how much I miss of my extended family and the things that they go through in life, and it makes me wonder if I'm making the right choice. Now, that little crisis in confidence was short-lived because I also understand that most likely things aren't gonna change in that regard. I'm going to continue to do the things that I do, I'm gonna continue to take on the responsibilities that I do that consume the vast majority of my time. And so that isn't really gonna change. But you know, I would say over the fall, the winter time, you know, I uh there was a good month long where I really struggled to figure out what I am trying to do and create with this business. Um, you know, I it's I don't just want to go through a routine. I want, I'm attempting to create a small community inside of this business where there is mutual support for those who are doing the work, where there is um, you know, ways that we can help one another develop uh as human beings, as professionals, and grow in and create something wonderful for ourselves and our families. I mean, you know, one of the things I've loved about a career in sales is it helped me move from a position where I depended on the state to pay for my little baby's health insurance and to provide us with a lot of the sustenance that we need with the women, infant, and children food stamps, right? Um, and I came, I went from that to uh, you know, ultimately being able to open my own real estate brokerage and live comfortably and travel and invest and and do things that were, you know, at the time that I was taking food stamps to the giant eagle grocery store and slapping them down on the counter full of shame, I thought was an impossibility to live the way that I live now, right? So, and I and I owe that to a career in sales. And so I I believe that a career in sales, a dedicated professional approach to a career in sales can be transformative for people. And I want to help people realize that. I want to help people uh again who are willing to do the work because it's required. Um I want to help people to set that up, to build that book of business, and to create something magic for themselves. You know, but along the way, um there have been many, many times where I've had this crisis in confidence. Uh, even when I took my very first sales job and I entered into it, I wasn't but a few months in and I thought, there's no way I can succeed at this. I don't know what the hell I'm doing. Every time I learn something, I realize there's volumes of things that I don't know and I need to learn. And will I ever be able to learn? I remember calling my mentor in sales, Blake Hobson, early on in that career and saying, Blake, I don't think this is gonna work. And he's like, What the hell are you talking about, Jonathan? I said, Man, you know, um, I just don't see where this business is gonna come from. I don't feel like I know enough about sales. I don't feel like I know enough about the products we sell. You know, I'm six months into this, and and I don't feel like I am anywhere near where I need to be in order to succeed at this. And he said something to me that it was one of the first sort of great lessons, uh, not just in sales, but in life in general, that I have tried to pass along. And he said to me, and he said it more than once, you know, Jonathan, if you get up and you do the right thing by the job, then the sales will come. You know, my first question was, what the hell are you talking about? What does that even mean, man? He said, Okay, tell me what you did last week. And I told him, tell me what you've done this week so far. I told him, What's your plan for today? I told him, How about tomorrow and next week? And I told him, I had these things planned. And he said, just continue to execute the plan. That's what I mean. Come up with a plan, execute on it. Even if you don't see what the end result is supposed to look like, have a plan, come with it, and execute on it every single day. And that is doing the right thing by the job. That and taking care of the people whom you come across in the marketplace that are going to hire you for your product andor service, take care of them. That's doing the right thing by the job. And if you do the right thing by the job, every single day, the sales will come. And uh, I trusted him, you know, and I had faith in them, um, honestly, for no greater reason than the fact that uh having left the food stamp state carried insurance lifestyle. Well, shit, at that time, the state was still carrying my baby's insurance and we were still getting wick coupons. Um, but the promise of leaving that lifestyle, you know, made it easy enough to say, all right, man, I'm gonna put my faith in that and and trust you and just keep doing this. And you know, he was right. Um it did, it took time. Uh, you know, uh success is not an overnight thing for most people. Uh I'd say the vast, vast, vast majority of people. There's few people. Um, uh, for that matter, I don't know anybody. I've never heard of a single story where success just happened overnight. Everyone, you know, it's it's uh the Michael Jordan line, you know. People, people look at what I've achieved, but what they don't see is the thousands of failures that have come along the way, you know, and I think that is true for everybody. I mean, I'm I'm reading a book right now by um the great Napoleon Hill called Outwitting the Devil, and he likes to talk about Edison and you know the 10,000 little failures he had along the way to inventing the light bulb, you know, and creating electric light. Um, he spent years and years dedicated to that one pursuit and failed thousands of times before he found it. So, at any rate, you know, where I'm getting at is um I had to have faith. And that was the first time I really had in this path of recreating myself, this real sort of crisis in confidence. And it's it's happened a number of times. Um, you know, it's happened a number of times. And some of the greater crises that I've gone through were, well, when I left that job to start into real estate, you know, I was earning a pretty good living when I left the industry of park equipment sales. And I decided to move into real estate and start over. Um, a lot of people close to me said, What are you doing? What are you doing? And uh I had to ask myself the same thing. What am I doing? Uh, you know, I'm I'm rolling a dice here, betting on myself. And um can I? Is this gonna work? And and obviously it has. Um, but I had to have faith, right? And and in each of those moments, I I literally would turn to God and say, Um, I don't know what I'm doing, but I'm gonna keep plugging along, and I just pray for your help and your guidance to to take me in the right direction. You know, one of my common prayers is simply to be a vessel for the Holy Spirit in an attempt to lift up those around me. I am certainly a flawed and imperfect human being, and I know that uh I don't do that as well as I could or should. Um, but that is my desire. It starts here in my own home with my family, um, and trying to be the husband and father that provides my wife and kids with the security and the confidence to go and do whatever awesome things they want to. Uh, and then I from there I move it into my neighborhood and my community and the girls and the soccer team whom I coach. You know, that's that's what I ask for. I ask for the Holy Spirit to work in my life and in my presence and to lift up those around me. I I never ever imagined that I would be where I'm at today 10 years ago, well, 20 years ago, um, 15 years ago. Yeah, I never, this wasn't even in my mind being a broker and owning a small real estate brokerage. Um, but I've asked God to lead me. And uh every once in a while I feel a calling. You know, um five years ago I started to coach this team. This is my second year as head coach. Um, in each of those steps, um, you know, I uh didn't know if I was making the right decision when I started coaching. I didn't know if I was making the right decision when um I took on the head coaching position. I feel great about it, I do, and I love it. But I can tell you there are many nights where I can't sleep wondering if I'm screwing it all up. Uh, the first time I purchased a rental property, shoot, the first, second, third, maybe even the fourth time uh I purchased a rental property, I can clearly remember multiple times standing inside of this new acquisition while I'm doing the work to renovate it and get it market ready and looking around and wondering, what in the hell have I done? What have I gotten into? Can I do this? Am I screwing up bad? But hey, here I am, and you know, I felt led to it. I felt it was what I was supposed to do, and so I'm gonna have faith and keep doing the right thing by this every single day, and with essentially the promise that the reward will come, right? It's kind of the promise, isn't it? And uh to date, not only has it been this way, you know, um, but every time I reach that crisis point in life, whether it's been financially or my beliefs or my confidence has been shaken in a heavy way, I've leaned into faith, I've leaned into God, I've asked for guidance, I've continued to do the work. Um, it's never comfortable, it's it's never a good feeling, it's always high stress, high tension. Um, but each and every single time when I come through that phase, I come out on the other side in a stronger, more stable, and better position. To date, every single time. Um, I have had failures along the way. I started a soccer club with a friend of mine, and it did not work out. After a year, we folded up shop. Um, but boy oh boy, what I learned in that year was invaluable. I learned about how I want to operate within an organization. I learned about um communication and dealing with people around me, more specifically, how I failed to do those things in that endeavor. And I was able to take those lessons and apply them in my future endeavors, right? Um, it's one of those things where, you know, it's only a failure if you don't learn from it and apply what you've learned to your lifestyle, you know, and and all these things. This is not just business, this is anything and everything in life that you come across this fork in the road or this crisis point um where things feel overwhelming, maybe a bit dire, um, where you lose faith, you you you lose faith, you lose confidence, you wonder if it's worth it, etc. I admonish everybody who comes into those moments in their life, do not stop and do not quit. Right? Um, do not give up. You know, keep working. It's oftentimes at that point where some of your greatest breakthroughs are gonna happen. You know, um, when I got my first sales job, that that, you know, it's funny because I was raised in a community in a neighborhood, uh, very blue-collar. And uh the folks who I grew up around, you know, they all thought white-collar workers and especially salespeople were just the height of scumbaggery in the United States of America. And and I understand salespeople have they've earned that bit of a reputation, right? Um, you know, unscrupulous salespeople have spoiled, uh ruined the reputation for many, many good people. And those good people have to work a little bit harder to earn trust from their clientele. But of course, once you do that, you separate yourself from the masses, you know. So um, nevertheless, when when I took that first consultative sales position, uh boy oh boy, I had no idea what I was getting into. I really thought, you know, I was in such a desperate financial situation that I was willing to compromise my morals and do this job just to feed my wife and baby. Realized very quickly that that was all crazy talk that I I not only didn't I have to do that, but um I was able to help people and be a good person and be honest and uh and make a good living. And it was a wonderful revelation to me. Absolutely wonderful. Uh, one of the reasons why I love sales and uh think it is a wonderful way for an average person, common person like myself, there's nothing special about me guys, uh, to make a very comfortable living and and and you know provide for a family and and create something for their family. And uh, you know, that that very first step into sales was a huge question mark, hugely insecure about it. Um, you know, and and again, all kinds of every every time I've I've stepped into something new, um, and I've thought about should I continue? Is this not the right thing? Am I screwing everything up? And I have found the faith to just keep working, just keep showing up and doing the right thing every day by the job. I was able to work through those moments of doubt, those moments of insecurity to find stability on the other side of that, and then after stability, growth and flourishing, and a level up in lifestyle, a level up in income, uh, a level up in life in general, a level up in who I am as a human, right? So I admonish you, I implore you, I uh encourage you when you reach that point. If you're at that point now, don't give up. Do the right thing by the job, do the right thing by whatever it is you're getting after every single day, and I promise you the reward will come. All right. It's been a minute since we talked about real estate statistics, so let's get into it. Um, here are the statistics from last week of sales in Lorraine County. After this, I want to show you some charts as well to just sort of give us a visual indication of where we're at with the market. Okay. So here we are. This morning there were 445 single families and condos. I do not include multifamily, nor do I include uh mobile homes in these statistics. And again, all of these statistics are in Lorraine County, Ohio. I believe that this county provides a sample that's representative of the entire Midwest, not just uh Northeast Ohio, not just Ohio, but really the entire Midwest. Things really change and shift along the coasts and uh in the south, but I think what we look at here is pretty representative of what's going on in the Midwestern United States. So again, 445 units for sale as of this morning. There were 86 closed sales last week. The median square feet of homes sold last week was 1,769. The median sale price was 319,250. That's the highest that we've seen. So I have been tracking these statistics now for 142 weeks. That is nearly two and three-quarter years. And um, 319,250 is the highest number that we've seen. Median square foot value, $174.31 per square foot for the home sold last week. 22 days was the median time on market for those homes. This morning, a 30-year conventional note had an interest rate of 6.65%. And then the big sale of last week was an Avon Lake, Southport Road, $999,900. We'll take a look at that after we look at these charts. So here are the charts that I wanted to show you to just indicate what's happening with the market. Our price is going up, our prices going down, what's affecting it, etc. So take a look here. Um, this right here, this point right here, 290, right? Um, this is the amount of homes that are on the market each Friday, right? So every Friday I'm collecting these stats, 8 a.m. thereabout, I'm taking a look, right? So right here we are at 290. That's the lowest since I've started looking at stats that we've seen. Um, these this is median square foot value. This chart here is homes on the market. This chart here is interest rate. And let's take a look at how oh, I'm sorry. These are actually yeah, this is this is inventory. So we've got median square foot value, inventory, interest rate. Okay, so we see low inventory here. First of all, let's look at median square foot value, okay? This line right here is $150 a square foot. So in the beginning, and and disregard these, I screwed this up early on in my tracking, so that's why all of these eight weeks are the same, but after that, we have true recordings, but you can see how often we were recording underneath $150 a square feet, a square foot, right? Since I don't know, uh I obviously the first you know year of doing these recordings, we see everything except for one week, and that's right here underneath everything is above $150 a square foot. And you can see as we go through time, it gets higher and higher and higher. Until now, we're I mean we're approaching on a few occasions $200 a square foot, right? So we continue to see price appreciation, even with lower demand, right? Um, so here is inventory. This is all-time low inventory, right here, guys, right? And it really hasn't changed, and you can see here, even with inventory having gone up about 20% year over year, from this point to this point, we are still seeing increasing prices on homes. This our housing affordability issues in the United States of America is an inventory story. I, you know, I hear all the time this is the worst market, it's the toughest market, and yeah, it is because not only do we have all-time low inventory, but we also have all-time low demand. So it's hard to find homes for sale, and it's hard to find buyers who want to find them for a lot of agents. Half of all agents the past two years have sold nothing. That's incredible. Um, that said, even with all-time low demand, we still have all-time low inventory, even with a 20% year-over-year increase from 25 to 26, right? We still have or late 24, late 25, 25 to 26, right? Even with that, we still see prices increasing. And that is because the inventory is so low, and demand, while at an all-time low, has not dipped enough to put downward pressure on pricing. Now take a look here. What did interest rates do to inventory and demand? Over here, we had a spike. We're over 8% at this point, right here, right? And I think that had an impact on inventory. I think it had an impact, it certainly had an impact on demand. But, you know, um, even with that going on, uh we are still looking. Um, you know, we got down to a low point here, another low point here. It's been steadily climbing since here. Nevertheless, prices are steadily climbing as well. Um, we need more houses, guys. We we need more houses built. We need local municipalities and states to work together to make it easier for builders to build. Um, however, they need to do that, whether it's tax incentives for building specific types of homes and specific types of areas. Um we we need more homes to be built. We need the prices of the commodities used to build homes to come down. That's a gigantic factor. You know, with lumber and metal, um, you know, and plastic prices continuing to inflate, that's going to cause the prices of these homes to inflate. You know, and uh with high regulation in certain areas, you know, the the bigger the city, the more regulation there is for building in those areas, um the higher it costs to build in those areas. And uh, you know, I I honestly don't see an end in sight to these prices continuing to creep up and up and up unless a lot of inventory comes back on the market. There's only two ways to do that, guys. That's either building or that is economic recession to a point, just like in 2008, where people are running away from their mortgages because they can't afford it anymore. Homes are going into foreclosure, homes are selling short, people are getting out before it gets too bad, and then we see a flood of inventory come back on the market. That's the worst case scenario, right? What we need to see are more homes being built because people are more incentivized to build homes, especially affordable homes. Guys, here in the Midwest, the most competitive price point is underneath $200,000. If it's a decent home under $200,000, it flies. It because you know, people's wages have not followed the inflation trend. Um, their wages have remained static while everything continues to cost more. So a lot of people who could afford a $300,000 home five years ago, four years ago, are now buying a $200,000 home because the prices have gone up, but their purchasing power has not. All right. So let's take a look at the big sale of the week. It was at Southport, Navon Lake. We're gonna share this guy. Big, beautiful home. All right, the one thing I really wanted to express to all would be sellers out there, take a look at the color patterns. All of this white can be very boring and very bland. But in my experience, listing and selling homes, in my experience, watching buyers react to homes, and in my studies of both reading about home staging, reading about how to prepare a home for the market, talking with people who design and stage homes for a living, this house is perfectly set up. White pretty much everywhere, and what you want is some accent. So this is this is done absolutely beautifully and perfectly. You have white walls, white cabinets, stainless steel appliances, these little doors with glass in it are colored. This island matches it, white countertops, the furniture is blue. The color that you have is from the decor and furniture that you bring in. So the palette or the base of the home, right? The canvas of the home, the walls, the cabinets, the countertops, the floors, like you see here. Very, very neutral. You have brown floors, white walls all over the place, um, white cabinets everywhere, white shelving, and then the color and the depth is from how you decorate it or furnish the home, and that's what pops off of the neutral color pattern and really sets everything apart. But the white, it makes the place look bigger, it makes the place grow. Uh, and this is if if you are thinking about putting your home on the market, start looking to do this now. This is a timeless look. I don't care what market, what day, white walls, white cabinets, light countertops are always a benign, neutral, and attractive color palette for the prospective buyer of your home. It is a clean and fresh look. It's inviting, and it makes the home look larger. It makes the home expand and grow. And then you have these accents of color in your fixtures, in your furnishings, and in the decorations on the wall, right? This this house is uh staged uh and prepared for the market beautifully. And not to mention, that's what you get in the Southport neighborhood for a million dollars in Avon Lake. Don't even have a finished basement, right? If that basement were finished, we're pushing up above the million dollar mark. You know, if if the landscape, I mean, this is a million dollars, folks, and uh let's take a look here. We got 3,800 square feet, that is the home plus well, no, that's the basement. So a nice big home. But if that uh landscape is expanded further, right? You know, you got a back patio, deck, whatever, stone paper, maybe an outdoor grill, a covering for shade, you know, finish out that basement. Um, you know, you're looking 1.1, 1.15 million. All right. That is a wrap on episode 135 of real estate bites. I appreciate you guys joining me for a longer one than normal. Um, listen, we end the same way every single time. I mean it from the heart. Take care of yourselves, take care of one another. I love you, people. We'll see you next week.