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What Realtors & Lender actually get paid for! Guests Chantry Abbott and Michelle Evans (St. George Real Estate Radio Show)

 

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Below is the actual St. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Andy: News radio 94.9, 890 KDXU. Good morning to you. Tell me this guy has the coolest music in the biz right here. It is Jeremy Larkin. I did not even want to turn it down. You have got Jeremy Larkin, St. George Real Estate travel show, and I know Jeremy is trying to get all is tech set up and everything over there. Are you ready, Jeremy?
Jeremy: I loved how you stuttered there. You had a hard time.
Andy: Well, it has been a weird kind of –
Jeremy: I do not know what else to say about it, Andy. Let’s just name the elephant in the room. Right?
Andy: It has been a weird kind of day. You look outside and our red rocks are covered in white snow. I know you had issues this morning with the two-hour delayed start for school.
Jeremy: Yeah, this threw the kids’ schedule off a little bit this morning. No one in this room has a child going to school except for me.
Michelle: That is true.
Jeremy: And there are a whole bunch of us in this room. There are five people in this room. You know what is amazing?
Andy: I have two by the way.
Jeremy: Oh you do have two high schoolers?
Andy: Yes.
Jeremy: Okay. So you do.
Andy: Yes.
Jeremy: That is nice. That is good. So for them, it is cool. They are like I have got to sleep in and I will just drive to school. I have two boys that are going to school at odd hours. So normally the one is going either at 6:55 at the bus stop or he is being delivered at 7:30, and then the other goes at 8:15. So with the radio show and then a meeting at 9:30, I am finagling this kind of thing. It is being finagled as they say.
Andy: That is a good work.
Jeremy: Really, it is. It is being finagled. Today, Andy? Whoops, I dropped my microphone. I am going to invite you to lend that microphone to these guys today because we are going to have three of us on the show today.
Andy: Okay. Okay.
Jeremy: I have got some incredible guests in the studio. Andy Griffin is almost a guest because he is brand new. I have got Chantry Abbot with Guild Mortgage, on the air with us. One of our great friends, incredible home mortgage lender. And I have got, well, why don’t you introduce yourself, Michelle.
Michelle: Hey, Michelle Evans with the Larkin Group. Glad to be here.
Jeremy: I like it.
Michelle: Glad to get here safe and sound in all the slush.
Jeremy: It is kind of slushy out there. It was 33, I think, all night long.
Michelle: Oh perfect. One degree.
Jeremy: And I think that is why school did not get cancelled. So the kids can blame one degree. Because I think at 32 degrees, you would have had some really extra nasty roads and it would have been different. Right?
Michelle: Yeah, I was surprised that they were all right. They are slushy, but it is doable.
Andy: Yeah.
Jeremy: Chant, what do you got over there?
Chantry: See this kid is making a snowman. Kind of cool, right?
Jeremy: Isn’t this amazing?
Chantry: Bluff Street Park.
Jeremy: Yeah, it is absolutely incredible. We are at the Cherry Creek Studios on North Bluff Street, which is on the west side of Bluff, up on a hill. And those of us watching our live feed, we are on Facebook dot com slash Jeremy Larkin. Or we are on YouTube Live which is YouTube dot com slash Go St. George TV. But from here we see everything. Like we see everything.
Michelle: It is a great view.
Jeremy: It is incredible. It is amazing. So we are looking out at Bluff Street Park, and the famed snowstorm of 2013, we could not get up this hill, and last night they were forecasting five inches. I would be shocked if we even got two inches. I do not know.
Michelle: Yeah.
Jeremy: Chantry, what did you get at your house? Maybe an inch?
Chantry: Yeah. But I think there was more in like Santa Clara. I saw some folks this morning that got quite a bit.
Jeremy: Where it is higher.
Chantry: It was pretty hard.
Jeremy: Yeah. I went up to the Ledges last night at 8:30, eight o’clock, maybe to take my kids to a little get together and it was like a full-scale, winter, just a blizzard on the way up to the Ledges. It was incredible. And there was this fog later between here and the Ledges.
Michelle: Yeah.
Jeremy: So then you were going up and then it was snowing and you could not see, and it was wacky. So anyway, gang, look, clearly everyone knows it is snowing outside, and all of our friends on Facebook are going to make sure that we know that. Are they not? Everyone is going to do that today. So we are going to have a fun discussion. I do not know what Jesse has got going on. He is over there. What do you have going on over there? What is that? My phone died? I do not know, man. Who knows? So we are running Facebook Live. We are going to talk today about what realtors and lenders actually get paid for. Is that fair?
Michelle: That sounds good.
Jeremy: So Chantry has been with us for a really long time. How many years? A decade?
Chantry: I remember working with you back when you were starting to take over all the foreclosures. So that was probably –
Jeremy: 2010.
Chantry: So let’s say 2010, 2009 or 10.
Jeremy: 2010.
Chantry: I am tangled with my coat here.
Jeremy: So there you go. I do not know about this phone. So it is funny, guys. We are running a Facebook Live, and for whatever reason, it just died on us. I hope we are still live, but I think we are still going to, we are good to go. We are good to go. So 2009, 2010, you came into our world. Right? And since that time, have you ever been paid a salary to close mortgages?
Chantry: I have not.
Jeremy: Right. Michelle, how long have you been in the real estate business?
Michelle: Going on ten years.
Jeremy: Ten years. Have you ever been paid a salary to sell real estate?
Michelle: Never.
Jeremy: No, so we only get paid, right, gang, when the deal closes. That is the only way to describe it.
Chantry: Yep.
Jeremy: Right. And so Michelle and I were in this discussion I think yesterday talking about this dynamic that folks perceive, so this is the perception. So the perception is like Michelle goes out and shows homes and that is where she is doing the work. So the real work she is doing is showing people homes. Like find me a home. Correct?
Michelle: Right. It is all in the finding.
Jeremy: Yeah, it is in the finding. And the perception of course, is that that is where it is. That is where the pay –
Michelle: The value (indiscernible) –
Jeremy: Where the value is.
Michelle: Yes, to open the door.
Jeremy: It is to open the door, and at the end of the day, let’s all be frank with ourselves. What hourly rate could we pay someone to open doors? Could we pay someone minimum wage?
Michelle: We sure could.
Chantry: Sure.
Jeremy: Yeah, what is minimum wage anymore?
Chantry: Seven-fifty or something. Right?
Jeremy: Yeah, $7.50 a hour. We could theoretically pay someone $7.50 to open doors. And the issue is that for us in the real estate business, the real work, the real work especially if you are buying a home, right, begins when Michelle?
Michelle: When it goes under contract.
Jeremy: Right. So, what do you mean by under contract?
Michelle: Well, and putting it under contract, too. So it is the negotiation of getting it under contract, and particularly in the last few years where it has been a seller’s market, so you have really got to know your stuff to be able to win that contract for your buyer.
Jeremy: Yeah, absolutely. Right? So the work for the real estate agent happens we, like when it goes under contract, and of course, what Michelle is saying is when we get into the negotiation for the contract. Right?
Michelle: Right.
Jeremy: That is the issue. That is the issue.
Michelle: Yes.
Jeremy: You told me a cool story, and Chant, I am going to have you chime in here momentarily. You bought a home here how long ago?
Michelle: Yeah, back in ’05.
Jeremy: Okay, and you were not even an agent at the time.
Michelle: No.
Jeremy: Of course.
Michelle: I was teaching out at Tuacahn High School and I used Will Potter, who is now our competitor.
Jeremy: Yeah.
Michelle: He was great. He did a great job.
Jeremy: Great guy in town.
Michelle: We had three days to find a home. He blocked that out for us. We looked at 32 homes. I just want to say, so sorry, Will. I am just going to apologize publicly for doing that to you.
Jeremy: 32 homes. That is ten a day. That is a lot of homes.
Michelle: Oh my gosh, we ran the guy ragged. And ironically, we went back and bought the very first home that we saw. Anyway, and then I was teaching out at Tuacahn High School and he called me and he said when is your lunch hour? I said well it is from 12-1 or whatever it was, and he said I need to come out and have you sign this addendum. I said well you do not have to do it then. You can do it later or whatever. I had no perception that we have legal confines, legal deadlines that, he said, no, I need to have you sign this by five o’clock. I was like wow. Okay.
Jeremy: Hey, come on, you do not have to do that. It is fine.
Michelle: Like it is okay. I was trying to be so nice to the guy. Clueless. And what is funny is that I had bought four homes prior to that. So I think a lot of times agents think oh well, they have been around the block. They have bought a home or two before. And granted, I was probably not as smart as most about it. But you just do not realize what is the process once it is under contract? And I think that is probably some of the pushback of millennials. Well, I can find a house online.
Jeremy: Correct.
Michelle: And we are like right. That is just getting us into the game.
Chantry: And you probably will find it online right?
Michelle: Yeah.
Chantry: No matter how many –
Jeremy: 95% likelihood, guys.
Chantry: And no matter how much somebody tells you what they want –
Jeremy: 95% likelihood.
Chantry: They know what they want. Right?
Michelle: Yeah.
Chantry: They cannot really relay it. So look online. That is just the beginning. That is the easy part.
Michelle: Yeah, yeah. That is the fun part.
Chantry: Jeremy, when did you get in the business?
Jeremy: 2005.
Chantry: That was probably right after they had the books. Do you remember the books?
Jeremy: The books were obviously previous to my time.
Chantry: Not by far though, right?
Jeremy: I do not think by far.
Chantry: Probably late 90s, early 2000s.
Jeremy: What was the MLS called at that time? The Multiple Listing Service. It was called –
Chantry: I do not know.
Jeremy: Oh, what was it? It was this weird –
Michelle: I do not know.
Chantry: So those you that do not know, was it once a month, once a month the Board of Realtors would print out a book with a page for every single listing that was out there. So if there were 500 listings, there were would be 500 pages that would have property for sale.
Jeremy: Right.
Chantry: There was not an internet so the buyers could not go find the homes. So they really did need to sit down with an agent and flip through this book and try to figure it all this out and which ones were sold and which ones were not.
Michelle: Right.
Chantry: Now with the internet you find a house on the internet.
Michelle: Right.
Chantry: So anyone can do that.
Michelle: And the contract was so much less back then. So it really was, their perception was correct.
Jeremy: Yeah, we have added five more pages of contract paperwork.
Michelle: It really was finding the house. The weight was more on that.
Jeremy: Right.
Michelle: And much less with the contract. Now it has flipped. Now it is reversed.
Jeremy: Well, and let’s understand how buyers, let’s hit that door. These guys are exceptionally loud down the hall, aren’t they? Let’s remember how a buyer finds a home. Right? And so this is really good. If you are a home seller, I hope you will really listen really closely to this today. So what will happen is someone will put their home on the market, and they will be like if I can just broadcast this enough times, if I can just be in everybody’s face long enough, we will find a buyer. Right? But how do buyers, in fact, find the home they want to buy?
Michelle: Almost always online.
Jeremy: But how? When I say how, how does a buyer find a home? Do they go hey, a realtor called me and said they have the home for me?
Michelle: Oh, no never. They are out on the home websites. They are out looking. They are searching themselves. They can do it online.
Chantry: So wouldn’t you say really the only accurate, there are others. Yeah, we talk about Zillow and stuff, but only one that is truly live, real-time accurate is probably the Multiple Listing Service that you have to get by –
Jeremy: Yeah.
Michelle: Primary source. That feeds all those websites.
Chantry: — through a real estate agent.
Jeremy: Yeah, so let’s think about this. Chantry, let’s say that you want to buy a home today. What kind of home would you want to buy? Let’s just have some fun here.
Chantry: If I were to buy a house today?
Jeremy: If you were to buy a house today, what would it be?
Chantry: Let’s buy a million-dollar house in Green Springs.
Jeremy: And what would be a couple basic criteria that you –
Chantry: Really nice swimming pool, maybe a game room in the basement.
Jeremy: Okay.
Chantry: Four or five bedrooms, maybe a big casita. Kind of know we are dreaming. Right?
Jeremy: Okay. No, we are dreaming. Okay. Beautiful. So what you would do, where would you go to start looking?
Chantry: Well, me, knowing what I know, I would call a real estate friend, one of you guys, and say hey, this is what I am looking for. Set me up on a search.
Jeremy: Yeah, so two things that actually happen. Right? Number one, you call an agent and say set me up on a search. Tell me if you find anything. And then number two, you and your wife at eleven o’clock at night would be on a computer –
Chantry: Yep. Michelle said –
Jeremy: — or on an app searching. And you would be like Zillow dot com. Show me every home that is four bedrooms, three bathrooms, 3100 square feet or bigger, in the Green Springs area. I want a pool. It needs to be under a million dollars, and here is what would happen. You would actually burn yourself out looking, obsessing, you would obsess. Let me explain. This is really good. Jesse, just yell. Am I accurate with how buyers search for homes?
Jesse: Oh yeah.
Jeremy: They will drive their agent crazy searching. Hey, I saw this new one. I saw this new one. Did you see you the new one? Hey, what did you do this weekend? Well, actually we know that we are working with you, but we drove around, and we went in 27 open houses because we figured that somehow what we wanted you were not showing to us. But we could not find anything. And then we went to Craigslist and then we went to KSL dot com and we went to Zillow dot com, and then we came back around. They will literally drive themselves sick and they will get to this point of fatigue where they are like I do not even think I can look at another home. So what I always remind sellers is that if your home is a great home priced in a proper way, will buyers find it, yes or no?
Michelle: Absolutely.
Jeremy: Instantaneously.
Michelle: Many times over.
Jeremy: Yeah. So here is the other thing that sellers do not realize. Is it the buyer that is overlooking your home? Probably overlooked it like 30 times. Here is why. They tried KSL. They saw it there. They went to Zillow. They saw it there. They figured maybe realtor dot com would have it. They saw it there. They are getting listings emailed to them from five different agents because bless our hearts, that is what we do. We are consumers. So we go around and we see five different real estate signs. We call all of them, and all the agents being agents the way we are, hey Michelle, thanks for calling. Hey, how about we set you up on a home search. We will send you all the new listings in the morning. Wouldn’t that be great?
Michelle: Oh yeah.
Jeremy: Chantry is smiling because that is exactly what we do. I will just get you what you want in the time you want. Won’t that be great? There is a real estate script. They are getting listings from 5 to 10 agents based on their criteria. Are they seeing the home, yes or no?
Chantry: Absolutely.
Jeremy: They have overlooked your home so many times. Actually, you would be offended at how many times they looked at it and said no. We have seen it. No. Right? So we are having this interesting conversation here today about understanding the consumer’s mindset. Right?
Michelle: Right.
Jeremy: So the consumer’s mindset is number one, from the seller’s perspective, well, maybe there is someone out there who does not know about my home. Trust me, everyone knows about your home that is looking for a home, especially if you hired a good agent.
Michelle: And when they come in for a consultation and we pull up a list of homes that they are interested in and I will say hey, I just want to make sure we vetted the process. Have you seen this one, this one, this one? And not only have they usually seen it, but they have named it. Oh yeah, the big tree home. Oh yeah, the lion house because there is lion statue on it.
Jeremy: They have named every home.
Michelle: They are very familiar. They have seen it multiple times on multiple occasions.
Jeremy: And this is a my reminder I would give to sellers. For people who are selling and trying to find a home, I want you to think about what you are doing. You are doing what I am saying the buyer for your home is doing. You know you have seen all the homes. So the buyers come in. You take them out, Michelle, and for $7.25, $7.50 a hour, no pay per hour, you show them homes. And the real work begins the day that you say oh we found a home.
Michelle: Yeah. We want to make an offer. We do not want to let this one get away. So then we start the negotiations.
Jeremy: What kind of paperwork is required to buy a home right now in the state of Utah?
Michelle: Well, you have got the contract, six-page contract.
Jeremy: Real Estate purchase contract.
Michelle: Right.
Jeremy: A Rep-C.
Michelle: Yeah. Then you have got a buyer-broker agreement so that we have –
Jeremy: With the broker.
Michelle: — a right to represent you in the deal.
Chantry: Six pages does not do it justice. There is no inch that is not used. It is a lot.
Michelle: Yeah, it is a lot.
Jeremy: It is 29 sections, 26 sections.
Chantry: It is not like hey let’s just hand this to a, we have seen horror stories when people try not to use a realtor. It is like let’s just take this contract and fill it out and turn it into a seller. There are so many things in that contract that if they do not know exactly what they are doing, they are going to miss out on something.
Jeremy: Yeah, so it is six-pages. There 26 sections.
Michelle: Yeah.
Chantry: 26 sections, yeah.
Michelle: Yeah, and for example like what loan are you using? What loan are you using? That will determine an additional addendum that is required for that loan.
Jeremy: Okay.
Michelle: Then there is the buyer due diligence checklist that the state requires that. So that is something to warn the buyers hey here is a list of stuff to be sure that you are checking off so that you make sure that you are making the right decision. That has to be included. And then negotiations go back and forth which will add addenda to the contract. It can get pretty –
Jeremy: Addenda.
Michelle: Yeah, did you like that?
Jeremy: You know what is interesting?
Michelle: Not addendums.
Jeremy: How about this? How about this? Section 8.4, additional earnest money. If the Rep-C has not been previously cancelled by the buyer as provided in Sections 8.1, 8.2, or 8.3 as applicable, then no later than the due diligence deadline or the financing appraisal deadline, whichever is later, buyer will or will not deposit additional earnest money. Any additional earnest money deposited, if applicable, and sometimes referred to herein as the deposits, that the earnest money deposit or deposits, if applicable, shall be credited toward the purchase price at closing. Did anyone hear anything I just said?
Chantry: It is very attorney-speak.
Jeremy: That is one stupid paragraph —
Michelle: Yeah. Legalese.
Jeremy: — of 26 sections of a contract. Right?
Chantry: And I know I should not use this term, but I do tell them when they are working with Michelle or someone that is really good like Michelle that Michelle is your attorney. You can find the house. She has to let you in, and there are a lot of things that she does need involved there, but she is your attorney, really.
Jeremy: Yeah, because they sign (indiscernible) that we are not legal help but we are playing that.
Michelle: Yeah.
Jeremy: How about this, and by the way, I have got Michelle Evans with the Larkin Group with our team over at the Keller Williams Realty. I have got Chantry Abbott, Guild Mortgage. So Chantry, you are a lender. What about if somebody submits a contract to you and it has deadlines that say that there is a financing and appraisal deadline? You get to deal with that. Right?
Chantry: Yeah, we have to make sure that we have got their loan approved and their appraisal reviewed, and everything looks good, otherwise they are potentially risking their earnest money deposit, which if you do not know what that is, like a security deposit, and sometimes it can be really expensive. We have seen $5,000, $10,000 can be in trouble if they are not having a real estate agent that is taking care of those deadlines.
Jeremy: How many pages in your typical loan contract to close a loan? I do not mean the contract with you. I mean the actual loan agreement with the bank. How many pages? Typically.
Chantry: Like at closing, it is probably roughly 30 pages.
Jeremy: 30 pages. Has anyone ever read one of those? It is epic. Right?
Chantry: Yeah.
Jeremy: It is epic boilerplate –
Michelle: Take your dictionary.
Jeremy: — legal-speak. Right? So Chantry, what if I turn in the contract to you that says listen, Michelle, wrote an offer. The offer is contingent on an appraisal. It is contingent on –
Michelle: Due diligence
Jeremy: — due diligence or a home inspection. It is also contingent on the seller who is in San Francisco selling their home, and there is an addendum that says that they have just put their home on the market in San Francisco, and they have 21 days to sell the home, and if they do not sell the home in 21 days, then we can cancel the contract and come back. While that is at it, we have a 72-hour clause that will allow other buyers to come in and the other buyers can make offers on the listing that Michelle wrote an offer on and then they could kick the first buyer out of place. Do you see that stuff as a lender?
Chantry: Yeah, quite often.
Jeremy: All of the time. When does the work begin, guys? The work begins at contract.
Chantry: Yes.
Michelle: Very much so.
Jeremy: And so if we are selling your home, by the way, the work, of course, begins when we start marketing your property. Of course, right? But we are really more, the day that we sign that listing agreement and we start saying let’s schedule photography and let’s do what we do. But if you are buying a home, the heavy-duty work, that is contract work.
Michelle: And I think that they do not realize that there is a second set of negotiations. So during that due diligence period, that is 10 days, two weeks roughly that you have to get a home inspection done and then there is a second set of negotiations. Because a home is sold as is, but often sellers will defer maintenance and just feel like well the buyer can take care of that.
Jeremy: So you mean there is a negotiation to buy the house and then there is another second negotiation once they have done an inspection?
Michelle: correct.
Jeremy: What if the appraisal comes in low, Chantry?
Chantry: Another opportunity for a negotiation. Right? So I guess that is a third potential negotiation.
Jeremy: What percentage, Chantry, of deals do you see have an appraisal come in low right now?
Chantry: Probably 95% of them are just fine. So maybe 1 out of 20 or something along those lines. There is an appraisal something. Sometimes it is not just value. Maybe it is the roof has an issue that needs to be fixed or things like that.
Jeremy: Guys, it is snowing really hard out there. I just want to interrupt this previously scheduled program.
Michelle: Gosh, it is pretty.
Jeremy: So, Michelle, Chantry, so happy you are with us today. Let me share some statistics with some folks this morning. It is February 21st. We got a little bit of a slow start at the Larkin Group this year. Last year, we had 173 buyers or sellers, families we helped. But we have 21 properties under contract, representing a buyer or seller. We have closed 13. So all that paperwork we just talked about, 13 times we have closed it. We have 21 under contract. We have executed 31 contracts since January 1st, meaning we took a buyer out, went through all that nonsense, negotiated a purchase price, negotiated a deal, went through the inspections, went through the appraisals, went through all the headache. Chantry, does sometimes days before closing a lender, like the underwriting lender come back and say that they need a pay stub from 2007 to prove that these people are actually real?
Chantry: Can. We sure try hard to avoid it but yeah, it is just one of those things sometimes. Right?
Jeremy: Yeah, right. So we have put 31 contracts together like this, and eight of them have fallen apart so far this year. That is the numbers so far. So 8 of 31 have fallen apart. And why do contracts fall out, Michelle? Like what would be the reasons? Why do deals fall apart mostly?
Michelle: They cannot qualify for their loan is a big one. They change their mind is another one. Something happens during the home inspection and if the seller is not willing to credit or repair that issue, then they are like we are out.
Jeremy: Yeah.
Michelle: So that is another thing.
Jeremy: You mean they get scared. They get nervous, they do not like the neighborhood, they do not like the church, parish, whatever they went to. They found five broken roof tiles and maybe they are concerned that, and the list goes on and on. Right?
Michelle: It does.
Chantry: Appraisal. Appraisal does not come out good. There is an issue.
Michelle: Their home does not sell. It was contingent on –
Jeremy: Yeah, they had to sell their home.
Michelle: Their contract fell through back in San Francisco or whatever it could be.
Jeremy: Yeah, the domino chain. Chantry, as we wrap up, final minute. Most important message you feel like buyers and sellers need from a lending perspective today.
Chantry: Yeah, I just think that I have preached about this a bunch of times. But interest rates, we all know at some point, are going to be going up. Right? They have gone up about 1% in 2018. They went up about 1% in 2017.
Jeremy: Yeah. By the way, that costs people 20% of their purchasing power.
Chantry: And that is what I was going to tie it into. Perfect.
Jeremy: Ooops.
Chantry: If that goes up, no, it is great. If that goes up 1% again in 2019, which it probably will, most likely, who knows, but probably, that impacts their purchasing power or their monthly payment by 10%, which means home prices would have to change by 10% or they would have to buy a 10% less home. So I know the price of the house matters. I bought a place in 2007. I still have it. I have a ton of equity.
Jeremy: Worst possible time to buy a house.
Chantry: I have a ton of equity because it does not matter that much unless you are going to sell it next year.
Jeremy: Yep. Exactly. Exactly.
Michelle: Yeah.
Jeremy: Michelle, thank you for being on here with us today.
Michelle: Thank you.
Jeremy: And for bringing your expertise and talking about what realtors, I was about to say real estate agents, real estate agents and mortgage professionals, mortgage lenders, we get paid to produce an outcome. Right? At the end of the day, we do not get paid for the hours we work because sometimes we work 100 hours and sometimes, we work seven on the same deal. Right?
Michelle: Right.
Jeremy: We get paid to produce an outcome. We get paid to walk somebody through the most complicated and emotional process of their life, and that might include needing to reduce their price if they are selling the home. All sorts of things.
Chantry: I think we protect them through that process. Right? That is what we do.
Jeremy: Bingo. Bingo. Guys, I want you to visit St. George Home Searching dot com. St. George Home Searching dot com because we are talking about the MLS. If you want to look at every single house that is on the Multiple Listing Service right now, St. George Home Searching dot com. You can click on the link there to find out what your home is worth. Check it out. Thanks, Chantry Abbott, Guild Mortgage. 674-1090 if you want to speak with him. 674-1090. If you want to reach out to us, 275-1690. Sold in St. George dot com. There you go. End of story.

 

St. George Parade of Homes Ticket Giveaway and Consumer Survey! (St. George Real Estate Radio Show)

Below is the actual St. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Andy: You know what that music means? I do. I think it means Jeremy Larkin is in the house.
Jeremy: Hello, everybody. You know what, Jesse? We are going to reset this live feed, guys. We have got a Facebook Live feed, and I do not think we are on Wi-Fi. So I think we re going to reset it. Good morning to everybody here. Jeremy Larkin, host of the St. George, what?
Jesse: St. George Real Estate Radio Show, the Morning Drive.
Jeremy: You almost got it. See? I was testing you. I was testing you. I was testing you.
Andy: You guys are so tech-savvy.
Jeremy: The St. George Real Estate Morning Drive. Okay? Can we get it right? The St. George Real Estate Morning Drive. We have got to get Andy trained.
Andy: Yeah.
Jeremy: Andy, here is the thing, Andy. You were just calling Hurricane H-Town.
Andy: H-Town. Yeah.
Jeremy: Right.
Andy: Is that not good?
Jeremy: I like it, but now I want the St. George Real Estate Morning Drive. Can people see his shirt? They cannot see his shirt because he has got a face for radio.
Andy: Maybe we ought to do a close-up on Facebook.
Jeremy: He has got a face for radio. Do you love that?
Andy: But he has got a shirt for the world. His shirt is amazing.
Jesse: Hey, my wife gave me this shirt two years ago, and I think it has taken me a couple years to get the courage to wear it. So.
Jeremy: (Indiscernible) woman.
Jesse: It is sexy.
Andy: This is the debut of the shirt today?
Jesse: No, I have worn it before, but not like this. Not on air.
Andy: Oh, okay.
Jeremy: It is a debut.
Andy: He has lips on his shirt.
Jesse: If you cannot see it, you can go to the Larkin Group. We are St. George Experts on Facebook and look at our Facebook Live and you can see the lips. I feel like Mick Jagger.
Jeremy: they are not that big.
Jesse: I almost like Mick Jagger this morning because in the middle of the night, I stole my wife’s pillow and she got up and almost punched me.
Jeremy: Let me see if I can explain something to all of our listeners. He moves. You know the song? Moves Like Jagger? This guy moves like Mick Jagger.
Andy: Yeah?
Jeremy: He actually does. So I got a question out there for people. How many folks are YouTube Live? Does anyone watch YouTube? I do not know. Because it is a thing.
Jesse: I do. Not live, but I definitely am a YouTuber.
Jeremy: So what we are doing now is we have taken the show and we are running it on YouTube Live. So we run the show on Facebook Live. We run the show on YouTube Live. Now, we killed our live feed for just a minute. I am Jeremy Larkin, host of the St. George Real Estate Morning Drive. Because we thought maybe WiiFi might be helpful, Andy.
Andy: Is it working?
Jeremy: It is. We are going to be back on right now. So guys, I want to wish everybody out there a very, very lovely happy Valentine’s Day. Andy, what do you got, what is on your schedule today?
Andy: Dinner and a concert for me and the wife.
Jeremy: Where is the concert?
Andy: It is Cox Auditorium. It is the Carpenters’ tribute band. I do not know if you are old enough to remember the Carpenters.
Jeremy: Come on, of course.
Andy: They were very romantic.
Jesse: No, the Carpenters.
Jeremy: Come on.
Andy: I said something in a room the other day about going to the Carpenters’ tribute band, and everybody gave me the three-mile stare like who? What? Who? She has been dead for 30 years. But yeah, I am pretty pumped about tonight. We have not figured out where dinner, we are not sit down with cloth napkins and have a steak type people very often. So we are going to have a nice dinner and a concert, but it will not be, I am not going to spend $100 on dinner.
Jeremy: Very fair.
Jesse: Or wait for 2 ½ hours.
Andy: I have got a reservation. No, no, I do not want to do that.
Jesse: Valentine’s Day is the craziest restaurant day.
Andy: What about you, Jeremy?
Jeremy: For what it is worth, I have got reservations, by the way.
Andy: Really?
Jeremy: I have got reservations at the Ledges, 5pm.
Andy: Oooo.
Jeremy: So don’t anybody out there dare think that I did not plan ahead. I got those reservations a week ago.
Jesse: Wow. A week in advance and you still got –
Jeremy: Now, I might be there alone, but I have got reservations at the Ledges. Do you know what I am saying?
Andy: You planned ahead though. That is good. I am impressed.
Jeremy: No, I absolutely did. I have got reservations at the Ledges with a very lovely woman. Happy Valentine’s Day to Kayla Evans, and to Jesse Poll here and all of my –
Jesse: And to Leia Frances Poll. That is my wife.
Jeremy: And to Leis Frances Poll. Yeah. And to all of the beautiful women at our office, and also the beautiful men at the Larkin Group. I do not know.
Andy: Can’t they be handsome?
Jeremy: They can be handsome. They are beautiful. Guys, we are back on Facebook Live if you are not there. Facebook dot com slash Jeremy Larkin. Check it out. We are live, back on. Just trying to see if we can get our feeds to run a little better. Okay. The funny part is I was going to look in my photos this morning. This is what I love about technology. I was going to look in my photos and did not prior to the show to find out what I was doing last Valentine’s Day. That is the thing with the phone is you can actually find out what you were doing on any Valentine’s Day. Right?
Andy: Was there something cool?
Jesse: Because of your photos.
Jeremy: No, yeah. Just because your photos it is a scrapbook. It is a living scrapbook. How many photos do you have on your phone, Jesse?
Jesse: Thousands.
Jeremy: How many thousands?
Jesse: I do not know. My phone is over there. Well, I have had to delete it a few times because my iCloud gets full.
Jeremy: Okay.
Jesse: And I just cannot see paying $12, $20 a month because it just keeps adding. When I can take it all over to Google photos and get almost unlimited if I save it right.
Jeremy: Absolutely.
Jesse: So it is challenging to make that happen. With an iPhone, it does not seamlessly happen.
Jeremy: It is not quite as seamless as you want it to be. Well, I want to let you guys know that I have 11,000 —
Andy: 11,000?
Jeremy: — photos.
Andy: Wow.
Jeremy: How do you like that?
Jesse: I do not have that many. You must pay for serious storage or you have a big phone.
Jeremy: I have a gigantic phone.
Jesse: Okay.
Jeremy: It is basically like the brick phone from Saved by the Bell. Remember the one? You do not know.
Andy: I used to broadcast games on those big things.
Jesse: Oh, I remember those.
Jeremy: Oh gosh.
Jesse: Those came out when I was actually a teenager, I think.
Jeremy: Yeah, it is a big old brick phone.
Jesse: Miami Vice.
Jeremy: Yeah, Crockett and Tubbs. Right? Remember those guys?
Andy: Oh yeah.
Jeremy: We are going to have some fun this morning. So we are going to give away some Parade of Homes tickets. We are giving away on the Larkin Group Facebook page dinner for two. A gift card for some folks. Should we start with that?
Jesse: Let’s do it.
Jeremy: Okay, we have got a Valentine’s giveaway. By the way, I am Jeremy Larkin, host of the St. George Real Estate Morning Drive, and I have got Jesse Poll here, my business partner, co-host, and we are talking about, we are going to talk about the St. George Parade of Homes –
Jesse: Let’s do it.
Jeremy: — because it is so massive and we ran a survey that is very, very interesting. Now, I think the data is, I think it is lopsided and weighted because it is data that came from out real estate database.
Jesse: Right. Right.
Jeremy: Does that make sense? So is it really, it is not reflective of what the public is doing.
Jesse: Right, but I think we are going to do another one, I believe.
Jeremy: Yeah, we will probably do another one. Okay.
Jesse: To really make it fair.
Jeremy: We will do another one. But the first thing I want to tell folks is would you like to win date night? You have already got yours planned.
Andy: Yeah.
Jeremy: So folks can still win it. Over at the Larkin Group Facebook page. It is Facebook dot com slash St. George Experts. Facebook dot com slash St. George Experts. Some fun photos. Tag your Valentine and post a photo of you and them on the feed there. We already have 11 beautiful couples have posted and good morning to so many of them. So cool, so fun. Have you seen it? It is pretty fun. Hop on there. Facebook dot com slash St. George Experts, and post a photo of your Valentine together. You two together.
Andy: Yeah.
Jeremy: And we are going to draw for one lucky couple today. Number two, we have got a St. George Parade of Homes ticket giveaway that is going on right now. And I know we are giving people so maybe things to track down, but it is okay. They are going to survive. Right?
Jesse: If they want it, they will track it.
Jeremy: If they want it, they will track it down.
Jesse: We will chase the things that we want.
Jeremy: Yeah, we will chase things that we want. And by the way, I chase the things that I want. Very, very, very much chase things I want. So, want to let people know we are doing a giveaway and if you want to get in on this giveaway, visit St. George Real Estate Videos dot com because we posted the link there, and it is a survey about the Parade of Homes. Should we talk about the results, Jesse?
Jesse: Let’s do it.
Jeremy: It is a very simple survey. We asked people three questions about the Parade of Homes, but maybe most importantly, we asked questions about what their plans are in real estate this year because we want, it is like what are people thinking? What are they feeling? What are they going through? Are people buying homes? Are they selling homes? What are they doing? Right? Okay. So how many responses have we had to our survey?
Jesse: 118.
Jeremy: 118 folks answered three questions. And what were the questions, Jesse? Do you know off the top of your head?
Jesse: The first was have you ever attended the St. George Parade of Homes? 79% said yes. 20% said no.
Jeremy: Okay. And this is in our database?
Jesse: Yes.
Jeremy: So, so 80% said yes, more or less. 20% said no.
Jesse: Right.
Jeremy: Now, not surprisingly, what was the next question and answer?
Jesse: Do you plan to attend this year’s Parade of Homes or the 2019 Parade of Homes? 80% said yes. 19.3 said no.
Jeremy: So essentially, exact reflective answer. All the people who said they had been to the parade said they are going to the Parade. Have you been?
Andy: I have, yes.
Jeremy: It is very cool. If you go this year, if there is anything you want above say $2 million, we would be happy to write it up. Okay? Just want you to know that.
Andy: That would be dollars because that is a little out of my price range, Jeremy.
Jeremy: Yeah, I know. I get it. I get it. Third question. What do we have?
Jesse: Third question. Do you plan on making a move or change of residence in 2019? 55% said no. 44.5 said yes.
Jeremy: And that was baffling. So understand that this survey was conducted out of our database. So for our real estate clients, by the way, who we market to. We have almost 10,000 now —
Jesse: Right.
Jeremy: — recipients on our email list. As a matter of fact, our last, I do not know what yesterday was when we sent out the Parade of Homes giveaway, but we were at about 9200 successful deliveries. That is how big our database it. That is how big the group is that we are now marketing to, that we are marketing your listing to if you are selling a home. Right? That we are sharing about the market. And anyone who is on that list knows that we share, it is like 90% value, content, 10% hey, can you help us out? Can you send us a referral? That kind of thing. We are putting tons and tons of content into this database. So the point being we queried that group, and in that group, not surprisingly, lots of them go to the Parade of Homes. Lots of them plan to go to the Parade of Homes, and almost 50%, did you say 45? Said they are going to move this year.
Jesse: Yes.
Jeremy: Holy cow. Okay.
Jesse: 44.5.
Jeremy: Let’s talk about some of the things they said, and by the way, of course, I am not going to ever share names. Here is a couple of things I noticed by the way. We are thinking of downsizing. We are thinking of downsizing. We are thinking of downsizing. I think I saw that yeah three times. We are thinking of downsizing. Isn’t that fascinating?
Jesse: I am looking at one right here. The first one that popped up. When will the bubble in real estate bust? When will the prices plateau?
Jeremy: Okay.
Jesse: Will Washington County pricing peak anytime soon?
Jeremy: Oh, this is so awesome. So when will the bubble burst? So –
Andy: Is it a bubble even?
Jeremy: You are just, thank you for being wonderful. Andy, have you ever had something go really horribly wrong for you?
Andy: Oh, of course.
Jeremy: Yeah.
Andy: My first day on the air here, as a matter of fact.
Jeremy: Beautiful. And here is a question for you. After the first day on the air, this is actually perfect, and I did not set you up for this.
Andy: Nope.
Jeremy: After the first day on the air, and it went horrible is how you felt about that. Okay? Did you believe that all of the other days were also going to be horrible because that one was horrible?
Andy: No.
Jeremy: No. So do you see where I am going? There was a bubble a decade ago.
Andy: Right.
Jeremy: And because there was a bubble, people are so shell-shocked of what do they believe?
Jesse: There is going to be another one.
Jeremy: It is going to happen again.
Jesse: What is interesting is the last time, it had been so long since we had had anything like that it was not even in their mind.
Jeremy: Correct.
Jesse: And now, because we are back to a normal cycle, right? It should cycle every ten years. Up and down. Up or plateau.
Jeremy: Yes. Yes.
Jesse: So last time, it was one of the longest stretches in history. So it was out of our mind. The 70s and 80s is the last time that it probably really happened (indiscernible)
Jeremy: Literally. Yeah, when you are talking about major economic issues with 70s and 80s –
Jesse: Right.
Jeremy: — you had interest rates hit 18%, and then for people to even buy or sell real estate it was all seller-financed, and weird and wrap-around mortgages. And you can have the use of my four-wheeler. It was three wheelers by the way in the 80s. Those things were fun and dangerous.
Andy: And dangerous.
Jeremy: And dangerous.
Jesse: My son got a three-wheeler that did not run, and he made it run on fumes. He created a gasifier engine.
Jeremy: A gasifier engine.
Jesse: In high school.
Jeremy: Oh my goodness.
Jesse: Good old three-wheeler. They made it a chopper three-wheeler.
Jeremy: I love it. I tipped one over. 600 South downtown St. George.
Jesse: Nice.
Jeremy: But at the time it was like you can use my three-wheeler and then also my house boat at Lake Powell and then I will give you $20,000 down and then if you will, it was this crazy stuff people had to do to sell real estate. We do not have any comprehension how good it is now. Because see if you do not know what the bitter is, you do not know what the sweet is. So folks, we are in a wonderful real estate market. We are in a healthy real estate market. We are probably getting into a more healthy real estate market than we have seen in the last couple of years.
Jesse: Right.
Jeremy: When will the boom bust? Bubble burst? We do not think there is a bubble. Okay? Fair enough?
Jesse: I agree.
Jeremy: All right. So what is another question we have got in here? These are so incredible. Incredible issues. We basically could run a radio show for the next two years off this.
Jesse: I think we should because the next one that popped out on me –
Jeremy: Thank you, everyone.
Jesse: Nothing to do with the Parade of Homes, but this stuff comes up all the time. We are thinking about adding a two-car garage to our home with a two-car garage. And that would be four would be attached. What affect will this have on the home’s value?
Jeremy: Okay. So let’s run this. Let’s break this down now. They want to add a two-car garage.
Jesse: To a two-car garage. So it would be a four-car garage.
Jeremy: Two two-car. All right. So, Carl Wright was in our office last week –
Jesse: Two to two.
Jeremy: Yeah right. So Carl Wright was in our office last week. Carl Wright is with R1 Appraisals. I hope I do not butcher this. I think they have done 120,000 appraisals. His company. They might have a feel for the market.
Jesse: A little one.
Jeremy: And what was fun is that most everything he said reflected what I knew which made me very happy and kind of pat my own back. Stretch back there.
Jesse: He did, too.
Jeremy: Yeah, I did. I went ahead and gave myself a scratch and a pat and hug.
Jesse: And asked us for one, too. And we gave it to him.
Jeremy: I know you did. Depending on the home, 7-10,000 per garage bay if you are in a more expensive home. $5-8,000 per garage bay if you are on a less expensive home. Let’s call it 10,000 a garage bay. And let’s just maybe go ahead and say 15-20 grand. Now, but here is maybe more important. That is 15-20 grand on an appraisal.
Jesse: Right.
Jeremy: But more importantly, if they were to put it on the market, it is much more marketable.
Jesse: Right.
Jeremy: Right? And we do not know. We do not know what, well, aren’t you guys real estate professionals? Well, yeah. But we do not know everything. Right? There is no classic, perfect metric for that. But here is what I would say to the person who answered that question. If you want to put a two-car garage onto your existing two so you got a four, you are not doing that for another buyer. Who are you doing that for, Jesse?
Jesse: Yourself.
Jeremy: Yeah. Have you upgraded your home ever, Andy?
Andy: Yeah, years ago.
Jeremy: What did you do?
Andy: We added a little bit of room. We also built on kind of shed-type space and a carport, and then we added on an awning in the back.
Jeremy: Beautiful.
Andy: Made the back very livable.
Jeremy: So did you like that?
Andy: Oh, yeah. Oh, yeah.
Jeremy: And who did you do that for?
Andy: Did it for myself, not for the future owner.
Jeremy: Right.
Jesse: We were just having this conversation the other day.
Jeremy: But there was a benefit for the future owner, but it really was not for them. It was for you.
Andy: Exactly.
Jeremy: There you go.
Jesse: We were just having this conversation the other day. We have got a couple coming soon listings. One in the Legacy that is a walk-out basement. Another one in Bloomington Hills, and we are talking about well one of them has completely remodeled it. Just beautiful home. And we were talking about man, what value can we really get out of this? Can we get it back? That will be coming on the market here in a few weeks. We are really excited about that and see what the market says.
Jeremy: Incredible home in the Legacy. We are –
Jesse: Oh, it is so awesome.
Jeremy: — talk about a couple of properties today.
Andy: Jeremy, let me mention real quick. I have a Mustang.
Jeremy: Hey, Andy, this is my show. I am kidding. Keep talking.
Andy: I just want to enhance your point though.
Jeremy: I just wanted to go ahead and see if people could be uncomfortable. I could not even stand this discomfort –
Andy: I can turn off your microphone –
Jeremy: I know you can.
Andy: No, I am just kidding
Jeremy: So go ahead.
Jesse: He controls this show.
Andy: I have a Mustang. Last year I bought some Boss rims for my Mustang. I did not buy the Boss rims because someday I am going to sell that Mustang and I want to get that money back. I bought the Boss rims because they are cool, and I wanted my car to look really cool. Same point.
Jeremy: And here is the irony. Because not only did you not buy it for the future purchaser of your car, what is actually going to happen to the value of that car over time?
Andy: It is just going to go up. Yeah.
Jeremy: It is going to go up, or people may or may not ever even want that and you may just give those Boss rims away for free. Right? Because you do not know what someone will want.
Andy: Right.
Jeremy: When we talk about selling a home in this market, we have had this conversation so often. You envision this giant funnel, okay. Giant. Like a Washington County size funnel. And at the top of the funnel is every buyer for every property. Okay? Townhomes, condos, single-family homes, luxury homes, trailers, trailers on rented lots, trailers on owned lots, land, every property, every buyer goes into the top of the funnel. Well, here is the issue. Out the bottom of the funnel, Jesse, if you are selling a home, what do you need? You need one person to come out of the bottom of the funnel who wants what?
Jesse: To buy this home.
Jeremy: That home. So Jesse lives on 200?
Jesse: Yep.
Jeremy: In Hurricane, H-Town. I love that, Andy.
Andy: H-Town. Yeah.
Jeremy: He is home that was built –
Jesse: Downtown.
Jeremy: — in 19 what?
Jesse: 1922.
Jeremy: 1922. The home is gorgeous. Okay? And, not but, and it is a historic home.
Jesse: It is definitely an historic home.
Jeremy: So here is what has to happen if Jesse wants to sell his house. He has to find someone, number one, who wants to buy a home. Number two, they want to buy a home in Hurricane –
Jesse: Yep.
Jeremy: — Utah. Number three, they are okay buying a home built in 1926.
Jesse: 22.
Jeremy: 22.
Jesse: Yep.
Jeremy: And all that comes with a home that was built in 1922.
Jesse: Yes, it does. You start digging into those and you find problems you did not even know existed.
Jeremy: Okay. We have got our buyer, but yet, we do not. Now, they have to be able to afford it. Next, number five, they have to want to afford it.
Jesse: Yep.
Jeremy: That one is what people, maybe I do not want to afford it. Oh, I could afford it. I just do not want to afford it. Right? They have to want to afford it. And then we just come circle all the way back around to what we talked about. Then they have to love the style. Going in the house has to feel right the day they went there because maybe the husband and wife or husband and husband or wife and wife or whatever we are doing now, right, we are in a fight in the car on the way to the home. Do you realize the couple fighting in the car on the way to the house could ruin the sale?
Andy: It is true.
Jeremy: Right.
Andy: That is true.
Jeremy: Do you love it? Anything could affect the marketability of this home.
Jesse: Oh my gosh, that is great.
Jeremy: So out the bottom of this funnel is the person that buys your home. And so we just have to realize that this is not like oh, I got the best home on the block. I realize you might have the best home on the block, but buyers are looking at a lot of homes.
Jesse: There are a lot of other dynamics. I was just talking to somebody yesterday that was doing an inspection on a home and their agent, the seller’s agent, is just disconnected. They are not, it is just who they are.
Jeremy: Okay. Agent representing the seller of the property. Okay.
Jesse: The seller. So they are doing inspections. The buyer is doing an inspection and this seller is just livid. And their agent is not available to help calm them down. This is just what happens. This is normal. So it may go south because something you cannot control. The seller, the buyer cannot control, the agent should be controlling that. Or at least doing some future prepping —
Jeremy: Correct.
Jesse: — of what to expect.
Jeremy: Future prepping. Future pacing.
Jesse: Pacing. There you go.
Jeremy: Is what we call it okay. Okay. One more question. Andy, what do we got for time today?
Andy: You have got about three minutes.
Jeremy: Last question, Jesse, and then we are going to talk about two real estate things, two homes.
Jesse: Okay. There was one on here. Let me look.
Jeremy: Okay. When is the best time to refinance? How about that?
Jesse: That is a good one.
Jeremy: You ready? You ready? The best time to refinance is when interest rates are lower than your current interest rate. And by the way, people say by how much? At least a half of a point.
Jesse: Yeah.
Jeremy: If it is not about a half a point, you are going to pay a lot of money unless you are really truly planning on staying in a home for 30 years. When is the best time to refinance? When is the best time to plant a tree? 25 years ago. When is the next best time? Today.
Jesse: And that also depends on what you are doing. I went to go refinance and Chantry Abbot over at Guild Mortgage actually talked me out of it and sent me to a different institution to get a HELOC because it made more sense for me.
Jeremy: That is what happens, by the way, when you work with professionals. How about this? Two minutes. Robert did this on our team. Congrats, Robert. Happy Valentine’s Day, Robert. Just wanted to personally, and you have done this. He talked the seller out of selling their home.
Jesse: Yeah.
Jeremy: Went to visit with the client and said I do not even think this is a good idea. Folks, a couple of incredible properties coming up. We are listing, putting on the market tomorrow afternoon a home in Ivins that is just, it is literally like a little, it is not a diamond in the rough. It is like a little, fields of diamonds. More like that. It is in your backyard. They coined it mini farm meets pool paradise, and these are amazing people.
Jesse: They are amazing people and an amazing house.
Jeremy: Yeah, it is really fun.
Jesse: It is going to be a lot of fun to sell that.
Jeremy: Yeah, I love it when we bring a home to market that is just not another home. 2355 square feet, four bedrooms, but most importantly, they have built this oasis in the backyard. Chicken coops. It is just so freaking cool. So anyway, check this out. This home is coming to the market tomorrow. Number two, Legacy and we are not going to give you anymore. By the way, if you want to see this property upcoming, you can see it at Go St. George dot com. Legacy.
Jesse: I have got one in Bloomington Hills coming up.
Jeremy: Incredible.
Jesse: Walk-out basement with two kitchens. Just awesome mother-in-law apartment.
Jeremy: Two kitchen. Oh. Guys, incredible properties. Check them all out at Go St. George dot com on our coming soon listings. They are not all there yet because we are working with a lot of clients. If you would like to win the Valentine’s, a date night for you and your Valentine, visit Facebook dot com slash St. George Experts, and post, you will see the post. Post a picture or photo of your loveliness together. And if you would like to get in on the Parade of Homes, we are going to give away at least ten tickets, five sets of tickets.
Jesse: Nice.
Jeremy: Get involved in the Parade of Homes survey that we asked today. Have you been? Are you going? And do you plan to buy or sell this year? To give us a sense for what people are doing at St. George Real Estate Videos dot com. Man, did we jam it in there?
Andy: You got it done.
Jesse: Good job, Jeremy.
Jeremy: Sponsored by Coke Vanilla Zero.
Andy: I know. Nice product placement.
Jeremy: Look it is a downgrade from Red Bull. I am trying to get off that stuff. I love the product placement. The problem is guess what they are giving me? Nothing.
Andy: St. George Real Estate Morning Drive with Jeremy Larkin. Jeremy, I loved the show. Thank you, man.
Jeremy: Thank you, man. Appreciate it. Cheers.

St. George Economic Summit 2019 Recap with Jeriah Threlfall (St. George Real Estate Radio Show)

Click on Facebook Live. to see the entire recorded show from Facebook! Below is the actual S. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Mike: KDXU news time. It is 8:35. Good morning and welcome. Southern Utah morning news. Your time once again for another look at the St. George Real Estate Morning Drive as we check in wit the voice of St. George Real Estate Jeremy Larkin.
Jeremy: Good morning, and I hope you are driving, all of you out there driving somewhere important. What time did you all get up this morning, guys? Chantry, I want to know about you. 4:30? Mike, that mic is not live and I just said Mike twice. I love it.
Chantry: How about now?
Jeremy: Mike, we have been talking about the mic. And Mike says the mic is live. All right. Love it. 4:30.
Chantry: 4:30.
Jeremy: Ouch.
Chantry: I know. Everyday. I cannot help it.
Jeremy: What time do you go to bed?
Chantry: Early. Like I am in bed by nine.
Jeremy: Okay, Mike, when did you get up? I want to know. He is not on the mic, but he is going to tell us. How early was it, Michael?
Michael: 4:45.
Jeremy: 4:45. He got up in 15 minutes, Jeriah. What have you got?
Jeriah: I cannot compete with that. Six o’clock.
Jeremy: Yeah, you know what? 6:30 for me. I have got Andy. Andy is the new guy in the studio today. We do not even have him on. Andy, when did you get up? Like seven. He was five. Okay. So he did not roll in here. Jeremy Larkin here. We have got the St. George Real Estate Morning Drive. I thought we should find out when everyone got out of bed this morning. Actually, the problem is I was not asleep, so I spent much of the last two hours of the morning thinking about, you know the psychology?
Chantry: Yep.
Jeremy: I should go to sleep. What is going on?
Chantry: Stressed yourself out. Yeah.
Jeremy: I do not know what is happening. Something must be weird. I do not know. Is the house going to cave in? Is my kid alive? This is the stuff that goes through your head. Right? Finally, at 6:30 I said maybe I should just get myself up, and that would help it. Jeremy Larkin, host of the St. George Real Estate Morning Drive. The voice of St. George Real Estate. Happy to be with you all this morning. It is raining, and it needs to be raining, by the way. We are in St. George, Utah, and if it does not rain and it does not snow for everyone who is bellyaching this morning, I am going to tell you something. There is not going to be any economic development because they are dry.
Andy: Yeah, water is a big thing. We need it for sure.
Jeremy: It is huge deal. So I have some friends, close friends and family, oh the rain. This is just the worst thing. You have to realize that in late January or February, and typically during the Parade of Homes –
Chantry: I was going to say it is going to wait until the parade, doesn’t it?
Jeremy: Typically, during the Parade of Homes it is going to rain for three straight days, but these are these soaking rains that give us the moisture that we need to run this community. So we are happy to do it. Today is January 17, 2019. I do not know how many times you all put 2018 so far on whatever your putting dates on, but I have definitely had a couple.
Chantry: Oh yeah, lots of times.
Jeremy: Well, yeah, you are doing mortgages. I have got Chantry Abbott here who is one of my very close friends and just an absolute amazing home mortgage lender. Someone who, he and his team, Steven Stout and the people at Guild Mortgage, they help people get the money they need so they can buy a home. And I have been having such fun discussions with my kids lately, my 12 and 13-year old. Because they will be like, Dad, how do you buy a house? What a great question. Dad, you do not have $300,000 laying around, do you? Well, no I do not. And then I get to talk about –
Chantry: That is cool.
Jeremy: Right.
Chantry: I have not done it for a while, but even a handful of years ago I had a college professor that taught finance. I would go teach him about credit even at the college level. That was kind of fun.
Jeremy: Oh yeah, it is. Right?
Chantry: Even now, adults do not have a clue yet still. Unless you have bought one, there is just no way to know.
Jeremy: There is no way to have any real kind of concept of that. So I have this conversation with my boys. Well, no, most people, some do, what percentage of deals are cash right now?
Chantry: I have heard like 40%. It is a lot.
Jeremy: It is a lot.
Chantry: We are always higher. The national average is probably more like 25.
Jeremy: It is a lot of cash deals, man.
Chantry: Southern Utah has always been high, right. Just because it is a big retirement, selling homes in California, it has always been a high cash market.
Jeremy: Right. Right because, and Jeriah says he is surprised. And if you think about this for a minute, gang, and we are going to introduce him better momentarily. A lot of these folks they have a home. Regular people, ooops, I knocked that right off. Regular people have a home in California. A regular home. Like regular folk, as they say. They buy a house for $250,000, $450,000. It now appreciates to $850 or a million and they go to sell it. They have been paying the mortgage down for 15 years.
Chantry: Yep.
Jeremy: And they show up in St. George with $500,000 in their hands. Right?
Chantry: Yeah.
Jeremy: And they look, it is different than you think. And they look really rich. Like man, these rich buyers from California. A lot of these people are regular people just like me and us and our listeners. These are not people who are so independently wealthy. They are just folks who bought at the right time, they held real estate. We have been talking on this show for five years that it is such an incredibly better decision. Chantry, you probably heard us talk about, maybe you have been on here, the average net worth of a homeowner over 60 years old, over 64 years old is $300,000, and the average net worth of a renter over 64 years old is five grand.
Chantry: Wow.
Jeremy: That is what Keeping Current Matters put out.
Chantry: When you speak about the average, a lot the California people –
Jeremy: There is no net worth.
Chantry: The average buyer typically what we see is they are retired on a pension. We get a lot of firefighter, retired policemen, school teachers, five grand a month pensions, not very good in Southern California, but here it is pretty good. They can do well.
Jeremy: Yeah, you are not doing anything in Southern California.
Chantry: So that is what happens is –
Jeremy: That is your property taxes.
Chantry: — they have to change.
Jeremy: So I have got Chantry Abbott here with Guild Mortgage. We have got Jeriah Threlfall. I love saying your name, and everybody does. I got up this morning and I just said it a lot of times so it could be easy. He is with St. George Economic Development. Do we call it the Economic Development Council anymore?
Jeriah: Yeah, sometimes we do. Economic Council office. Anything works.
Jeremy: I am going to put into my English, and I am going to let him correct me. But these guys work with really pushing healthy growth for St. George, and what we are talking about is economic development. Right? Bringing businesses in, especially value-added businesses. I am going to have define that momentarily for our listeners.
Jeriah: Okay.
Jeremy: And the reason I speak with fluency, right, because, you might remember, but my first career was with Gilbert Jennings and Larry Gardner. That was my first real career doing Fort Pierce Industrial Park. I got a lot of experience at the time. Scott Hershey. But these guys are looking to bring commerce to Washington County, jobs to where we live. So define value added, Jeriah, for us. What a value-added business is.
Jeriah: To keep it simple, historically, we have always looked for people that make something in our area and then it sell it to someone outside of our area.
Jeremy: Beautiful.
Jeriah: Just a really dumb-downed version of value added. We try to look for people who are not competing with established businesses in the area, and then recently, we have expanded as well. We are also looking for professional. We are having some good success going and recruiting, for example, like small engineering firms out of California.
Jeremy: Cool.
Jeriah: Need a place to relocate. It is interesting you were talking about a pension. Five thousand a month pension does not do as much for you in California as it does here. We have got companies where their engineers are making $160,000 a year –
Jeremy: Good grief.
Jeriah: — and they cannot buy a house.
Jeremy: Yeah.
Jeriah: And they live four hours from the coast. It is not, they are not trying to buy a beach house.
Jeremy: Yeah, they are not on the water.
Jeriah: They are in a climate that is almost exactly like ours. Kind of a high desert. They cannot afford. The older, the people who have been at the company 20 years or so, they have their houses. They are okay. But the people coming out of college, unless the husband and the wife are engineers, they cannot buy a house at $160,000 a year.
Jeremy: Is that wild, Chantry?
Chantry: That is wild. Yeah. How many people in St. George do I meet that are making $160,000 a year? That is very few.
Jeremy: How many? How many a year? What percentage?
Chantry: A handful. Less than 1%.
Jeremy: Less than 1% that come through your mortgage office are making 160. Combined incomes.
Chantry: Yeah, probably combined household. Yeah.
Jeriah: Yeah, one of the companies that we have been working with is in Paso Robles. I think their median home price is like 675.
Jeremy: Yeah.
Chantry: So 675, what would you say ours is?
Jeremy: 300.
Chantry: 300. So yeah, more than double.
Jeremy: They might see 330 but 300 realistically. Because the median is the middle. Right? And Jeriah makes a great comment here about value-added companies. So for instance, Olive Garden is not a value-added company. Right? Because it is almost like to tell people, show people what it is not.
Jeriah: Right.
Jeremy: Talk to me about a company that is coming to St. George. Let’s talk about the economic summit from a week ago and then we can put this in perspective.
Jeriah: People who are coming right now? We have got a lot of people we are working with that we are still under confidentiality agreements with.
Jeremy: Okay, what type of business?
Jeriah: If you look at someone who presented at the summit was Ram, the Ram Company.
Jeremy: Okay.
Jeriah: Textbook. They are value added. They make their solenoids and their aircraft parts and all these things and they sell them all over the world. So they are taking money from other local economies and bringing it in to our economy.
Jeremy: Versus coming in and saying well, we are competing with all the other companies locally. They are really not.
Chantry: So value added, let me understand that one more time. They do not compete with somebody local.
Jeriah: They can and still be value added. We try. We are not going to go recruit someone who does the same thing Ram does.
Chantry: Ideally, not competitive, but (indiscernible)
Jeriah: For us. Yeah.
Chantry: But the main thing is they are exporting outside of our area, so they are bringing money into Washington County that Washington County is not paying for.
Jeriah: Fresh dollars.
Jeremy: Yeah.
Chantry: Wow. That is cool. I love that, too.
Jeremy: I love that. Fresh dollars. That is a good way to say it.
Chantry: I have known Jeriah for years. I have been to the Economic Summit for years.
Jeremy: You did his mortgage loan. Right?
Chantry: Yeah.
Jeremy: He did. Yeah.
Chantry: And we get this all the time. I get this all the time.
Jeremy: Even Jeriah had to borrow money to buy a house.
Jeriah: Just a little bit of it.
Chantry: People always say I wish St. George would get some jobs. It is like it is not lack of effort. It is just probably a long road.
Jeriah: It is.
Jeremy: Sure.
Jeriah: It is, and it is interesting that when the economy is down people are nervous to make a move because they are like things are down right now. And right now, we are facing the battle that the economy has been good for so long that people are afraid it is going to go down. And so, time is huge. We have got companies that have relocated to the area. Most of them have made initial contacts with us two years before. Sometimes you get a really quick one on a smaller-sized business, but we have got 13 projects in our pipeline right now.
Jeremy: Whew.
Chantry: What do you guys do to help the company?
Jeriah: It depends on how sophisticated they are on their own end. If they are a bigger company, they will have their own, like Family Dollar that just recently came here. They have their own site selection team. So, we help them. We make connections for them. We help line up state incentives, local incentives, anything we can do to help.
Chantry: So some of these companies can get state government incentives or local –
Jeriah: Right.
Chantry: — money to help them come here.
Jeremy: And this is kind of cool. I am just throwing a thought in here. So, Family Dollar comes to down. Do you remember what they spent on that land? I am trying to remember. It was a ton.
Jeriah: It was a lot. It was right before my time, but it was a lot.
Jeremy: It was. So they come into town. They buy the land, which pumps tons of money in the economy.
Chantry: Yeah, think about how much that cost you.
Jeremy: They built this massive facility, which pumps tons of money into the economy. They create jobs. Right? Which is creating jobs. Then the facility is now using, has usage, uses things. It uses power, and of course, one of the number one reasons that these companies go to Fort Pierce is, Jeriah, drum roll, please.
Jeriah: Cheap power.
Jeremy: Cheap power.
Jeriah: Very reliable. Very good power.
Jeremy: Cheapest or second cheapest power grid. Was that what I remember?
Jeriah: In the nation. Yeah.
Jeremy: In the nation. Is that crazy, Chant? Dixie Escalante.
Chantry: So that is a big reason that they are coming.
Jeremy: Huge reason, man.
Jeriah: We are working with a company right now that is in Southern California. On this on, southern California helped us by taking their building for eminent domain.
Jeremy: They kicked them out.
Jeriah: So they are in a building they do not like right now. But yeah, just what we can safe them in power will cover the lease on a building here.
Jeremy: Could you imagine? Think about that. Just what they save in power, and that is Dixie Escalante right out there on Brigham Road in Bloomington.
Chantry: So I am just a mortgage guy. That is all I have done my whole life. I do not know any of this stuff. That is really interesting, I think, for the average person that is not involved in the development to think that the county is actually trying to give money, finding ways, grants, to bring these businesses. It is a tiny, tiny investment for the return the county is going to get probably.
Jeremy: Correct.
Jeriah: The way I think about it is 90% or more of all incentives that are given are actually just a return on the property tax that they are going to pay. So you take a vacant piece of land and whoever owns it is paying $2000 a year on property taxes. Making up easy numbers.
Chantry: Because they are just being taxed on the value of the land –
Jeriah: Right.
Chantry: — which is not a lot.
Jeriah: Then you go throw a million-square-foot building for Family Dollar –
Jeremy: A million square –
Jeriah: — and all of it that entails and all of their equipment and everything, and now, they are not only paying $2000 in property tax. Maybe they are paying $100,000. So the incentive actually isn’t cash typically out of anyone’s pocket. They pay that property tax and say we, however it gets approved. I think each project, depending on the jobs they bring it and everything—
Jeremy: Right.
Jeriah: They may get 20% of that property tax back for the first five years. So it is not even new money. It is not taking –
Chantry: That is crazy.
Jeriah: — money out of our coffers, so to speak.
Chantry: The crazy part is we are making our money back on the property taxes. You did not even mention that. You mentioned jobs and employment –
Jeremy: Yeah, property taxes.
Chantry: — and building the building and all those other cool things that go along with it.
Jeriah: The companies that, I say we, Scott was here forever.
Jeremy: Sure.
Jeriah: For those that know Scott Hershey. He was here for 20, 21 years before I came in when he retired. The companies that our office has brought in over the last 25 years, the property tax, we went through just for fun once and added it all up, and then allocated it out. And for example, just those companies that we helped, let alone all the rest, contribute about $750,000 a year to the school in property taxes.
Chantry: And all property taxes are county-driven, right? Each city gets a little click, but you are mostly talking about the county?
Jeriah: Yeah, so the county gets, say out of this, I cannot remember the numbers. I should have brought them. Say it is a million dollars, just for easy, that these companies that we brought in pay in property tax per year. The county would get about $20,000 of that. Most of those companies are located in St. George, so they would get about $75,000 say. The school district, the library, the mosquito abatement gets like $2000 a year. All the different tax amenities, the water conservatory district gets some. Any taxing entity gets their portion –
Chantry: Very cool.
Jeriah: — and that is all set by, that is all pre-set.
Jeremy: Right.
Jeriah: When you look at your, when you get your property tax bill, you can go and look at the same thing. It says right on it what percentages, what multiplier, how much goes to the school district, how much goes to the –
Chantry: Jeriah is the monopoly man on a county level.
Jeremy: He is. He actually is. Utahopoly or whatever it is. You guys, I am going to ask both of you. So Jeriah is with, of course, St. George Economic Development. Chantry Abbott is a great lender here in town, and Chantry was at the economic summit last week. I was not. I was here. So give me the highlights. What do you feel like the highlights were? And Chantry, speak up, too, because you attended.
Jeriah: For me, the highlight was all the technology worked and there were no glitches because that is what I sit there and worry about the whole time. If the mics quit working or everyone has videos. It just stresses me out.
Jeremy: How many people attended, by the way?
Jeriah: About 900.
Jeremy: So you have got 1000 people almost. All of them on their phones. All of them on the free wi-fi.
Jeriah: Yes, we have issues before but the Dixie Center has upgraded and it went flawlessly this year as far as the technology goes. But I really felt like the keynote speaker in the morning, Shawn Nelson, the CEO of Lovesac –
Jeremy: Lovesac.
Jeriah: — just absolutely killed it.
Chantry: He nailed it, man. It was awesome. I loved it. He was my favorite part, too.
Jeremy: People said he was great.
Chantry: He is just very like super down-to-earth guy. Even kind of had some funny photos. You know the 10-year challenge that is going around right now?
Jeremy: Yes.
Chantry: Before the 10-year challenge last week, he had like three photos of him of when he was on, in fact, he was on a show with Richard Branson.
Jeriah: Yeah, the rebel billionaire.
Chantry: And he actually –
Jeriah: — with the bad hair. He kept saying –
Chantry: He wore it and had like, I want to describe whose hair, but I, it is like bleached, really long, like down to his shoulders, kind of a chubby-faced looking 20-year-old basically when he started this thing. It was cool.
Jeremy: Oh man. Boy-band hair.
Chantry: Yeah, and he is just making fun of himself, just really easy going.
Jeremy: Who are we talking to? It is his brother-in-law. Who are we talking to this week?
Chantry: Jeremy Back.
Jeremy: Jeremy Back. Thank you. It is Jeremy Back’s brother-in-law. Jeremy Back is my, really the only other Jeremy really in real estate right now, and the CEO of our brokerage.
Jeriah: Okay.
Jeremy: It is his brother-in-law. Classic. Okay, so Shawn Nelson was awesome with Lovesac.
Jeriah: Yeah, he really was amazing.
Jeremy: What is a takeaway from him?
Jeriah: His message is incredible as far as the sustainability of their business model. But the thing that I got the most I went home and told my kids that are little, inspiring entrepreneurs is that he never gave up. His first order was for 12,000 lovesacs, and he did not have a way to make them. So he went and got an agricultural loan and bought a tractor and a haybuster and used that to shred foam. So he got a USDA agricultural loan, drove it to downtown Salt Lake, parked his tractor outside the building, ran a pole in so he could turn the haybuster and shredded foam to make this order.
Jeremy: This is so good, man.
Jeriah: He had to put a ticket to Shanghai, China on his credit card so he could go order the fabric.
Jeremy: Right.
Jeriah: He did not know he could speak Mandarin Chinese thanks to his mission.
Jeremy: Yeah.
Jeriah: So he was able to negotiate better than the average 20-year old.
Jeremy: Oh heavens.
Jeriah: It was incredible.
Jeremy: This is good.
Jeriah: It was a great story.
Chantry: Same thing and then I think the order wanted, the first company wanted a $60,000 deposit, which he did not have $600.
Jeriah: Right.
Chantry: For the order. Right?
Jeriah: To the factory, the Chinese factories.
Chantry: He said well I am Lovesac, and I have never had to pay a deposit.
Jeremy: He put it out there.
Chantry: And they thought wait a minute. So they gave him the money because he just acted like he had it figured out.
Jeriah: The factory needed 60,000, so then he called the people who placed the order and he said yeah, I need the 60,000 deposit. They are like we do not do deposits. He is like well we have never done one without a deposit.
Chantry: I am Lovesac. I have never done a deal without a deposit. Which is true because he had never done a deal.
Jeremy: This is pretty funny.
Jeriah: He kept saying we are the best not beanbag company in the world. It was like him and his cousin.
Jeremy: Wow. I have to tell you that it is super helpful to me just a couple of thoughts you just shared there.
Chantry: And the journey he went through I think was the point Jeriah was making. Knowing how hard it was, would you start over and do it again? I do not know. It was, was it 20 years in the making and he has had a lot of, he has failed a lot of times and had a few really crazy successful moments.
Jeriah: Yeah, he showed pictures of the Lovesac Limo and then the restructuring and then the ups and downs. But the thing that I kind of relate everything to my kids and how interested they are in things. And the thing that I told them that I was really impressed with is that he had an idea and he got off the couch and did it. And that is his slogan is get off the couch, and it makes sense because get off the couch and onto a Lovesac, but it is also a life creed. How many 18-year-old kids, he tells it he was just sitting around eating a bowl of Captain Crunch like a week after school, and he was like how cool would it be if I had a beanbag that was as big as from me to the TV? And then he was like I am going to get in the car and go to Joann Fabrics and make a big beanbag.
Jeremy: We are going to do it.
Jeriah: And now he is the CEO of a publicly-traded company based off getting off the couch for that one good idea.
Jeremy: Yeah, a northern Utah kid.
Jeriah: Yep.
Jeremy: Born and raised in Utah at the risk of the risk. A Mormon kid. Right? They are not Mormons anymore. It is the Church of Jesus Christ, but truly a local kid. Not Richard Branson. Right? Not Bill Gates. Not Seth Godin, one of the great thought leaders that we follow. Because it is always somebody else. But what he is saying well, not really. Why does it have to be somebody else?
Jeriah: Yep.
Jeremy: Why can’t it just be anybody right off the couch right here? So what other highlights from the summit?
Jeriah: That was my favorite. Do you have anything you want to say?
Chantry: How many people normally do you have? It seemed, I have been to a few and it seemed sold out. It was awesome. A great turn out.
Jeriah: Yeah, we have been growing. We sold about 70 more tickets this year than we did last year. We are about the maximum.
Jeremy: You almost sold me one. Well, Dixie State D1. I do not want to miss that.
Chantry: Yeah, that is cool.
Jeremy: Dixie State announced they are Division 1. It was pretty cool this morning on my way, I live right downtown, Jeriah, close to our office. I am by Town Square, so I take a kid to Tonaquint and then I take a kid to Dixie Middle, and then I come back up to the show. It was fun to see the one up here with the light where the D was not lit up and then you could see the one was completely temporary.
Jeriah: Yeah, it was pretty exciting.
Jeremy: Right. So Dixie State is going Division 1, which, what does it really mean for the university and the town? In a simple overview. Better athletic opportunities, of course, and athletics in college is money to the college.
Jeriah: For me, and I do not speak for the whole university or town or anything obviously, but for me, I think it validates it. There is no higher level –
Jeremy: Right.
Jeriah: — and so we all have believed in Dixie State University clear back when it was the high school, the junior college, the everything in between. The thing that I am excited is to be able to watch them compete against the top level in sports or anything else.
Jeremy: Right, and just for fun, Division 1, just because I know a lot of out, I know you are a sports fan, but a lot of listeners would not know this. So to give you perspective, when we are talking about Division 1, here are your top five ranked football teams – Alabama, Clemson, Notre Dame, Oklahoma, Georgia. That is Division 1.
Jeriah: Right.
Jeremy: So even the non-sports fans are like oh, that is Division –
Chantry: We are one of those.
Jeremy: — yeah.
Chantry: Dixie is one of those now.
Jeremy: We are going to get killed in the short-term at sports.
Jeriah: At first. Well, the nice thing, I was at, they announced that on Friday at the university and they had all the student athletes come.
Jeremy: Cool.
Jeriah: And I was just standing there waiting to talk to somebody, and I heard a couple of the athletes talking about now they are Division 1 athletes and just the pride that they felt in that, that they get to compete at that level for the next four years.
Chantry: That is a good point because if you are high school kid, you want to be able to say hey I went D1. It is top, top level. That is cool.
Jeriah: Yep. I think it is a great thing. It is a great opportunity for all of the students. It is a great opportunity for our town. For me in economic development, it is huge too because anything you can do to get outreach and get some notoriety, and people ask questions like that. It is not, the number one concern is is my business going to be profitable? Can I succeed there? But then right away, they typically go to the university and the culture that it brings.
Jeremy: Yep.
Jeriah: That is where you are going to get most of your plays and your concerts and your sporting events and all of these things and being Division 1 is going to be a good thing for us.
Chantry: So what Division 1 schools are there in the state? BYU? Utah? Weaver? Logan?
Jeriah: Yep. SSU.
Chantry: SSU is D1. And then Dixie.
Jeriah: Utah Valley.
Chantry: They are D1 as well?
Jeriah: Yeah, so we will be in their conference now. And that is the amazing thing is when this started being talked about, we –
Jeremy: Ten seconds.
Jeriah: Because no one thought we could get into a conference and we got –
Chantry: How cool.
Jeremy: By the way, I was a Dixie State graduate when it was a two-year college.
Chantry: Same here.
Jeremy: Got my associate’s degree. You got your associate’s degree.
Chantry: Yep.
Jeremy: Jeriah Threlfall, thank you, man.
Chantry: So cool.
Jeremy: Chantry Abbott, thanks for being in here. Folks, Mike is going to give you some contact information if you have got real estate questions. We will help you in 2019. Thank you.
Mike: Thanks for joining us. If you would like to know more about St. George Real Estate, give them a call at 275-1690 or Sold in St. George dot com.


Title: 36% St. George Home Price Appreciation? (St. George Real Estate Morning Drive Show)

Click on Facebook Live. to see the entire recorded show from Facebook! Below is the actual S. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Mike: KDXU news time. It is 8:36. Good morning and welcome. It is a Thursday, tenth day of the month of January. It is time for the St. George Real Estate Morning Drive with the voice of St. George Real Estate Jeremy Larkin.
Jeremy: Good morning. Good morning. And if you happen to be, let’s see, where could it be afternoon? Europe, Mike?
Mike: I am sure.
Jeremy: I was doing the math. I am like okay, in New York City it is still morning. Listen, if you are somewhere in the mid-Atlantic Ocean, good afternoon. If you are somewhere in Europe, good late afternoon. If you are in Asia, it is nighttime. Right? And then I’m going to come all the way around.
Mike: Yeah, it is another day over there.
Jeremy: So anyway, welcome to the world geographic and weather program where we tell you all sorts of fun facts about time zone you are in. Good morning to our Facebook Live, YouTube Live, now this is really fun. Now, Jesse, when we put on the YouTube Live, did we make it public?
Jesse: I do not know.
Jeremy: That is what we do not know. You might want to check on that. Just so everybody knows, we now broadcast the St. George Real Estate Morning Drive live on YouTube and Facebook simultaneously. It is classic. It is classic. As a matter of fact, I will get a photo of this right now. Jeremy Larkin here, host of the St. George Real Estate Morning Drive. So happy to be with you. I have got my good friend and cohort, business partner, Jesse Poll –
Jesse: Good morning.
Jeremy: — looking very sharp in his suit coat. I have got Mike McGarry, who is a short-timer here at KDXU radio. Just over here, he is really, he is spinning the tracks.
Mike: That is right. By the way, it is 3:38 in the afternoon in London.
Jeremy: Thank you.
Mike: Just doing it for you.
Jeremy: So it is eight hours, right?
Mike: Yeah.
Jeremy: Eight hours. Okay. Eight hours. Thank you. Thank you. Okay, give us Singapore. Will you just do one more? What about Singapore? Why am I saying Singapore? It seemed like a place that is far away, and I was looking last night, gang, at the Costco Travel Guide. You know when you are coming out of Costco, there is the travel guide on the wall and I was looking at what time is it, Mike?
Mike: 11:38pm.
Jeremy: 11:38pm in Singapore. So there you go. You did not know that, did you Jesse?
Jesse: I did not.
Jeremy: Yeah, it is kind of fun.
Jesse: I have heard Singapore is a pretty cool place to visit though.
Jeremy: Yeah, it looks really cool, so I was looking at some Costco Travel, and there was Singapore and there was Bora Bora where you can go stay, the bungalows, the over-water bungalows. Now here is why I did know more or less what time it was in Singapore. So for many years at the Larkin Group, for our listeners, you understand that we help people buy and sell real estate here in Washington County. Buy and sell means purchasing a home for their family, selling a home because it is time to move, and of course, work on purchasing a real estate investment property. We have a gal by the name of Charmie Mendoza, this is so fun. So fun. By the way, with her bonus, she is going to help her son buy a laptop. His first laptop.
Jesse: That is really cool.
Jeremy: She is a single mom. She lives in the Philippines. She is right outside of Manila, and we hired her through some friends of ours in Sacramento who run a company where they hire Filipino folks to help real estate agents. Culturally, they are really, really incredible at tasking. Like you give the list of 200 tasks, and whatever it is, they just nail this. Right?
Jesse: Something that will take me 30 minutes, she will do in 5.
Jeremy: In five. Right? So, she has worked for us for four years, four years. She is a single mom in the Philippines. So by the way, it is 11:30, 12pm, probably the same time in the Philippines, right, Mike?
Mike: Yeah.
Jeremy: She has gone to work for us right now. So if I were to message Charmie right now, she is sitting at her desk. Her son has gone to sleep, and she will work for us through the night. So she works nights. She will work all night long, and then her son will get up, and she will send him to school and then she will go to sleep. Just like anyone who works nights. Sometimes I will email her at about 10pm our time. I will sit down and be shooting some emails out, and I have seen her respond because now she is back up. It is afternoon there. Amazing woman, and we did a Christmas bonus for her, and she is going to get a laptop for her kid. Kind of fun.
Jesse: That is cool.
Jeremy: I know you think about real estate as HGTV and what you do is you go and you look at three homes and you go to open houses. Our business is very different from that. It is a very digital business. So when you are hiring a great real estate agent, they are going to have a whole digital backend that you do not have any idea about, and that is what she does for us. She handles a lot of our digital marketing.
Jesse: Speaking of digital business, this report that we were looking at, it is something like in the 80-something percent, I am looking for it right now, of homes find their home or clients find their home on the internet. That is a huge –
Jeremy: I thought it was ninety, I thought it was like 90%. Was I wrong?
Jesse: So let’s see. Newspapers are down to four, less than five percent?
Jeremy: How do people find their homes? Give it to us.
Jesse: Yard signs is about 20% and the rest of them, so about 75% will find their home first on the internet.
Jeremy: Yeah, so to be clear about this, this is the home they purchased. Okay? The home they purchased. Good morning again to our Facebook Live and YouTube Live listeners. So if you want to check it out. I do not even know who is a YouTube Liver, but what YouTube Live is allowing us to do is, more than anything, save the show straight to our YouTube channel, which is YouTube dot com slash, if you would like to look it up, Go St. George TV. Slash Go St. George TV. So what it is allowing us to do is already have the show, when we walk out of here it is done, and it is posted to YouTube, and there is no fuss, no muss. Something like that. I do not know what they say. But with our Facebook Live listeners, if you have got a question, please ask us anything. We are going to talk today about how much you might expect your home value to go up or down. Right? How much will it go up or down, your value in 2019. Amongst many, many other things. Today is the economic summit, the St. George Washington County Economic Summit down at the Convention Center, and I will not be there, which typically for years I have been there. But I have decided, elected that we have got more pressing work. The Economic Summit is really neat, but the challenge is they charge you a hundred bucks to go spend the day there. It is kind of a networking event, but what they do is this is where they talk about all the new business unveilings, who is the big corporation who is going to town and create new jobs. They are going to give a big old massive real estate report. Folks, just so you know. We already have all that information.
Jesse: Right.
Jeremy: I am literally looking at it on my screen right now. So instead of spending $100 and spending 7 hours, we are just going to go ahead and put on a radio show, and then work to help our clients. The Economic Summit is really cool. I do not want to downplay it. But here is the cool part. We will just take the notes and the summary, and we will present it to you. We will have Chantry Abbot from Guild Mortgage here in studio and talk about interest rates and oh my gosh, about the fact that they went down.
Jesse: Isn’t that crazy?
Jeremy: We are actually going to talk about affordability and why it is such an interesting time in real estate, where it is the best time for you to possibly sell in the last decade. People are going to have their minds blown when we show them, when we talk about how much values have gone up and down over the last decade. They are going to be shocked, shocked, and it is such a strange time, where it is the best time to sell and probably still one of the best times to buy.
Jesse: Right.
Jeremy: Because of interest rates. Excuse me, I am getting choked up because it is very emotional to talk about real estate for me, Jesse.
Jesse: You are a pretty emotional guy anyway.
Jeremy: I know I am. So Jesse, did you see the stat that we were looking at yesterday in my office about the appreciation in 2005 of homes in St. George?
Jesse: I did, and I am going from memory here because I just glanced at it. I think it said 39%.
Jeremy: 36.
Jesse: 36. I was close.
Jeremy: Very good. I literally had a piece of paper on my desk, and Jesse looked at it. Folks, I want you to think about this for a minute. Jeremy Larkin, by the way, host of the St. George Real Estate Morning Drive. If you have got questions, comments, happy to hear from you, and we are broadcasting Facebook Live, Facebook dot com slash Jeremy Larkin, and we are on YouTube Live. YouTube dot com, so just look up Jeremy Larkin. YouTube dot com slash Go St. George TV. So 36%, I want you, our listeners to really consider what I am about to tell you. Historic appreciation of homes annualized, how much homes went up in value, is like 5%. Right? Four, 4-5% annually. Okay?
Jesse: And that is a good, stable number.
Jeremy: Like a healthy market.
Jesse: Yeah.
Jeremy: Do you remember the economic meltdown that we had, Jesse, and people are trying to figure out how we ever got there?
Jesse: Yeah.
Jeremy: Home values went up in 2005 36%.
Jesse: That is nuts. In one year?
Jeremy: Correct.
Jesse: Wow.
Jeremy: Basically, they did seven years, seven, eight years realistically, eight years of appreciation in one single calendar year. And then we wonder why in 2007 everything fell apart. Very specifically what was going on in 2005 and 6 and whether you are wondering if we are going to have a bubble. We had what was called Stated Income Loans going on. Stated Income looks just like this. Jesse comes in the office. I am a mortgage lender. I am not a mortgage lender. I just play one on TV. But to be clear, we will pretend I am. He comes in the office. He says I would like to buy a home. Well, what kind of home would you like to buy? I would like to buy a $400,000 home. Great. You will need to earn about $150,000, and here is a form for you to fill out your income. Well, you put on the form that you happen to make $150,000, that you just so happened to make $150,000. People were stating their income. That is called Stated Income. And of course, when a market goes up 36%, and by the way, this was not just St. George. This was all of them.
Jesse: That was nationwide.
Jeremy: It was crazy. Definitely was Nevada, California, Florida, Arizona. Then a lot of fraud started popping up. So we are not in that market, and we are not experiencing a bubble. So 36% appreciation in one year. Now here is what is fascinating. Folks say man, values fell a lot after that and it seems like they have come up a lot. Oh, I will tell you exactly how much they fell. Values fell 46% from 2006 to 2011 in Washington County. 46% they fell. From 2012 to 2018, they have come up 42%. So we fell by 46%. We are back up 42%. We are virtually back to where we were before. And people, but wait a minute. Here is the difference. We did that at about 6% a year.
Jesse: Yeah.
Jeremy: That is the difference.
Jesse: Over a five-year period. Six actually.
Jeremy: Yeah, we did that at about 6% per year. We are in a very healthy real estate market in Washington County. Very, very healthy. But we have clients who are struggling because they are saying man, it seems like my home will not sell at its current price. The reason it is becoming a very healthy market is because buyers finally said we are not going to quite pay those prices. Right? Like this is hang on a minute now. So prices are settling. I did not say there is depreciation, that homes are going down in value. It is simply folks realizing they cannot quite ask what they hoped, and so there is an adjustment going on.
Jesse: Yeah.
Jeremy: So, Jesse, let’s talk about this for a minute. Historic mortgage rates by the decade. Okay? Slide number two, and just so folks know, we are going to share this on our Facebook page today. So when this is done, we will post this in the comments. As a matter of fact, let’s see if it will post into the comments as we speak. Historic interest rates by decade. You got that in front of you?
Jesse: I do not. I am looking for it.
Jeremy: Second slide. Let’s look at this. This is kind of crazy.
Jesse: (Indiscernible)
Jeremy: Well, page, slide three, I guess. 1970s, 1970s. Anyone out there born in the 1970s? I was. I was born in 1975. Interest rates were 8.86%. Do you know what an interest rate is today, listeners? Anybody out there? We are at about four and a half. Four and a half. 4 ½%. 1970s the average interest rate was 8.86%. It was twice as expensive to own a home. Now people say wait, do you mean that homes were twice as expensive? No, I said it was twice as expensive to own it, to pay for it with your mortgage.
Jesse: I think we are looking at different reports.
Jeremy: What is that?
Jeremy: I think I pulled up the wrong report. So I am just going to go with it.
Jeremy: Good. There you go. There you go. We are looking at, gang, interest rates were twice, twice as expensive, twice as high in the 1970s. Twice as high. Okay? Is that crazy? Is that crazy? And by the way, Jesse, we are looking at January 2019.
Jesse: Okay, so I had December.
Jeremy: There you go.
Jesse: I did not see January in there.
Jeremy: It is in there if you pull it up there. Listen. Would someone come on the show and help this guy out? I am just kidding. He is great. He is just pulling up –
Jesse: It is probably the one at the very top.
Jeremy: Yeah, it is the one right in front of you that says 2000, it says January. 1980s. Anyone born in the 1980s?
Jesse: There it is.
Jeremy: Interest rates were 12.7% average. The average interest rate in the 1980s was 12.7%. It was three times as expensive to pay interest on your home –
Jesse: Wow.
Jeremy: — in the 1980s as it is today. In the 1990s, Jesse, where were we at?
Jesse: 8.12.
Jeremy: Twice as expensive to pay for your interest rate. And in the 2000s? Because we are not in the 2000s anymore. We are in the two thousand teens.
Jesse: 6.29.
Jeremy: So 30% more expensive to pay for your interest on your home. If you get nothing else from this show today, nothing else, listen, please listen. I am going to talk to three groups. You ready? I am going to qualify every single listener on this show. All right? If you are an older person, an empty-nester, a retired person and you have adult children who are saying should I buy a home. I think values are kind of high. I do not know. The answer is yes. Most likely yes. We would need to ask a few more questions, and you are going to say Sonny, do you know interest rates were in the 1980s when I went to buy my first home? They were 12.7%. They were actually as high 18. Okay? If you are a middle-aged person saying do I buy a home? Do I move up? I have been wanting to sell my home and move up, but the challenge is I am not sure because if I sell my home, homes are so expensive. The answer is probably yes because remember if you sell your home in a high market, if you buy a home in a high market, that means you sold your home in a high market. So you are trading across, and remember interest rates could be twice this. Could be. They will eventually be back at 8%. It is probably inevitable. If you are young person saying I am not sure I should buy a home. I just want to be flexible. Let me remind you that again, if you had any concept because you cannot, because how could you have a concept. I do not know what it was like to live in the 1950s because I did not. If you could have a true perspective on how cheap it is borrow money to buy a home right now, you would realize that paying your landlord is literally insanity if you do not have to. I said if you do not have to. I am not calling you insane. Are you calling me insane? Right? Jesse, am I right or am I crazy?
Jesse: Well, you are crazy sometimes. But I think you are right.
Jeremy: But I am right. Okay. So year-over-year home prices, this is kind of crazy, values have been up everywhere. Everywhere across the country values have gone up. Real estate values have gone up for the last how many years now, Jess? Six years?
Jesse: Six years, since, they bottomed out in 2011 and started coming back up.
Jeremy: So let’s talk about price changes. Okay?
Jesse: Seven years.
Jeremy: Yeah, seven years. So we look at slide 11 here. People want to know, I asked the question do you want to know how much your home is going to go up in value this year or down in value. Let’s look at 11, 12, 13. Those Jess, right? The mountain region, here is what is really cool. We have data right now. I can tell you how much values have gone up in the Pacific, Mountain, Mountain West, West North Central, East North Central, Mid-Atlantic and the New England states, or I can tell you the South Atlantic. I can keep going. We have all this data. Values in the mountain region, and if you want to know what the Mountain region is go straight down to Arizona and then go straight up to the Canadian border through the inter-mountain West. Values are up 8.9% in 2000, year over year for the last year. 8.9%. What about Utah? Do we have Utah? I think we do.
Jesse: There are two different, I think it is Utah is –
Jeremy: What are we year over year price changes? I am trying to remember if they have it.
Jesse: Year over year is 8.8.
Jeremy: 8.8%. So look at this. We have seen an 8.8% appreciation in Utah over the last year. So we do have that information. The United States, by the way, 5.1%. So we are outpacing, do you know what I mean? We are outpacing it. Now the question is asked isn’t it less affordable right now because values are up? Well, of course, it is less affordable because values are up. Right? And I do not want to interpret for anyone listening to our show today that values, that it has not become less affordable because values are up.
Jesse: Definitely.
Jeremy: Yeah, what we are simply stating is that because interest rates are so stinking low that it will likely be just as affordable to buy a home now, it will actually be more affordable to buy a home now than to buy a home that is reduced by $100,000 at an interest rate that is twice as high.
Jesse: Yeah.
Jeremy: It is just, that is just the way it is.
Jesse: Well, the likelihood that the market will go down by $100,000 is –
Jeremy: That is a low –
Jesse: The economy would have to stop again.
Jeremy: Yeah, that is a very low chance. So every single piece of economic data that we have is pointing to us returning to normal, healthy market levels, which means what are we looking at for price changes? Do we think values are going to go up? What do you think? What are they saying?
Jesse: So what they are saying overall for next year is 4.8 for the country, but in Utah here they are saying 4.7.
Jeremy: 4.7. So that –
Jesse: I think that is true. I think that the momentum that we have right now, it will take more than a little bit to stop.
Jeremy: Who is they? I am going to tell you who they is. This is Freddie Mac. National Association of Realtors. Fannie Mae, a company called Kay Schiller, CoreLogic, I could keep going.
Jesse: There was actually I think 104 different economists or groups that was in the study.
Jeremy: Yeah, yeah. So they went out –
Jesse: It is not just one guy.
Jeremy: They went out and they asked the specialists. There are the specialists and then there is the anyway. They asked the scientists. They asked the economists. They asked any and everybody who is a player in studying this information what do you think is going to happen to the home values in 2019? And in Washington County they are predicting, excuse me, not Washington County. Utah. Four point?
Jesse: 4.8
Jeremy: 4.8% in the state of Utah for 2019. Now your home. What does that mean? It is hard to say because we, your neighborhood is very, very case specific. And I am going to tell you that if you are selling a home in Stonecliff or Entrada, it is a very different situation.
Jesse: Yeah that is –
Jeremy: Very different situation than if you are selling your home in downtown St. George.
Jesse: Right.
Jeremy: Santa Clara.
Jesse: And we will throw a report that will cover that for Washington County, even for St. George because if you are talking Stonecliff, you are looking at probably about a year to two years of inventory that is for sale. If you are talking downtown St. George, you are looking at less than two months.
Jeremy: What do you mean by a year of inventory though?
Jesse: Well, if no other homes came on the market, it would take a year or two depending on what price point to sell every home that is on the market. Downtown St. George, it is less than two months.
Jeremy: Right.
Jesse: So it is a big difference.
Jeremy: How about that? Right? It would take one to two years, up to two years to go through all of that inventory. Can you imagine if cereal was sitting on a shelf for two years? Now there are a lot of preservatives in cold cereal. Right? But guess what? It would go bad, wouldn’t it? And what Jesse is saying is absolutely right. Downtown St. George, it is one to two months. Here is what that means. In two months, if nobody else put their home on the market, we would be out of homes to sell.
Jesse: We would be out of homes.
Jeremy: Okay, and by the way, we have specific areas. If you are thinking about selling a home, we have folks looking for homes and they cannot find them in this market. We played around last week, and we talked about our $1 Listing Program? Is it real? It is absolutely real.
Jesse: It is real.
Jeremy: So, you can sell a home for as little as a buck. Terms and conditions apply. Yeah, you do need to buy another home through us. And guess what? Well, what if I am not going to buy another home through you? We have a program for that, too.
Jesse: We have a program for you, too.
Jeremy: Which is the Save Up to $10,000 Program. So we are having some fun in the month of January. Save as little as $1250. But here is the deal, Jesse, what is that percentage? What can people hope for this year for appreciation?
Jesse: 4.8.
Jeremy: Yeah, we are going to hope for it. The only we are going to find out is –
Jesse: We will have a debate next January.
Jeremy: The only way we are going to find out is we are going to have to spend the next year.
Jesse: Figure out who is right and who is wrong.
Jeremy: I do not know if he is right. There you go. Thanks gang. Appreciate you watching and listening and share this on your Facebook page if you are watching with your friends. Over and out.

What You MUST KNOW About St. George Real Estate in 2019! (St. George Real Estate Morning Drive Show)

 

If you prefer to view and comment on Facebook vs. the YouTube video above, click here: Facebook Live. 

Below is the actual St. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Jeremy: Good morning, ladies and gentlemen. Hey man, talk about shaking off the Christmas, what is it, Craig? I do not know. It is the Christmas cobwebs. How does that sound?
Craig: I can hardly talk this morning.
Jeremy: Well, listen. I am glad you are awake. I am glad you are here. Tell you what. The studio is largely empty, but guess what? We are here. We are here. Jeremy Larkin, host of the St. George Real Estate Morning Drive, live at the Cherry Creek Radio Studios. And the cool part is Jesse and I are wearing similar, similar outfits this morning.
Jesse: We did not plan that.
Jeremy: Listen, this is a new Christmas sweater I have got on. And you know what? Here is the deal. I can go here. I can go hoodie. Do you want to go hoodie?
Jesse: Let’s do it.
Jeremy: I can do the whole show like this. For all of our Facebook live folks, you can see me.
Jesse: Santa brought all my grandkids pajamas with hoodies.
Jeremy: Nice.
Jesse: They were pretty cool.
Jeremy: One piece? Like a one-piece pajama?
Jesse: Yeah.
Jeremy: Nice. Man. Santa, let me tell you about that guy. He knows exactly what kids needs. He knows exactly what grandkids need and granddads and everything else. I like it. You had a good Christmas, didn’t you?
Jesse: Oh yeah. All the kids were here. And the grandkids. It was first –
Jeremy: Beautiful, man.
Jesse: — time I think ever that we have had all the grandkids in one place for more than a couple of hours.
Jeremy: Really? Really? All of them? As in all of them?
Jesse: All four. Yep.
Jeremy: All of them.
Jesse: It was awesome. Last night, the house was just tore up.
Jeremy: Just gone.
Jesse: I got in trouble because I was just sitting there relaxing.
Jeremy: Like what do you want me to do, honey? I am just trying to –
Jesse: Can you not see all these toys laying around?
Jeremy: I am just trying to enjoy myself here.
Jesse: No, not really. Are there toys there?
Jeremy: Well, you know what, let me tell you something. My kitchen was, the house was a disaster. Santa came through. He must have been there at 1am, and then things were fine. I cleaned up, and then the kids decided to do what kids do, and then it was a mess, and then I cleaned it up yet again. Cooked a big breakfast. Do you know what hootenannies are, Jesse? Have you ever heard of them? Do you know what a hootenanny is?
Jesse: No.
Jeremy: Hootenanny is a German pancake. There you go. So a lot of people know what a German pancake is. Have you had German pancakes?
Jesse: I have heard of German pancakes, but I have called them German pancakes.
Jeremy: It is incredible.
Jesse: Or is that crepes?
Jeremy: Nope. Cup of flour, cup of milk, six eggs, salt, you melt a stick of butter in the pan. You mix that all together in the blender. You throw it in there. You cook it for 25 minutes.
Jesse: Hootenanny.
Jeremy: Hootenanny.
Jesse: Did I say it right?
Jeremy: Yeah, I am not sure where that, I would love to know from my mother where on earth hootenanny came from. But we had German pancakes. It is a tradition. Always do it. And guess what? Today is December 27th. The question of the morning: Is it going to snow in St. George today? What do you think, guys? Do we think it is going to snow in St. George today? What do you think, Jesse? Yay or nay?
Jesse: I doubt it. I doubt it.
Jeremy: They are saying maybe. If you are watching us on Facebook Live, chime in. Comment. Tell us what you think. Craig, what do you think? Look, you are the traffic guy. You are the weather guy.
Craig: If you head north probably. I am not sure. It was flurries this morning just barely, but –
Jesse: Yeah.
Jeremy: Yeah. Maybe. Where do you live at?
Craig: Parowan.
Jeremy: Yeah, so you were getting snow then.
Craig: Yeah.
Jeremy: How much snow was down on the ground?
Jesse: Yeah, definitely.
Craig: Not much. Maybe an inch or two.
Jeremy: I knew you lived north, but I did not you were Parowan.
Jesse: That is a dedicated radio dude.
Craig: It was (indiscernible)
Jesse: You are driving what? 65 miles?
Craig: Yeah, about. It is an hour.
Jeremy: Oh, I love Parowan.
Craig: Yeah, I do, too.
Jeremy: There is a building I want to purchase in Parowan downtown.
Jesse: We were just talking about that.
Jeremy: Yeah. I was up there last week, skied, came down, ate at Calavario’s. I love that place.
Craig: Oh yes. I do, too.
Jeremy: It is such a fun little family restaurant. The vibe is amazing.
Craig: Yep.
Jeremy: Great people. Well, we have got Craig Bennett, sticking his neck in here for Mike McGarry. Mike, as they say, his days are numbered, but not that kind of numbered.
Jesse: Right.
Jeremy: This guy, we have got an upcoming change of careers, as in he is going to go to the career that we all want.
Craig: Yes.
Jeremy: The retirement career. So we are going to talk to him. We are going to have a fun show with Mike this next month and talk about his history in radio and career. When I was quite young, Mike was calling a lot of the sports here in St. George.
Craig: Yeah, 41 years.
Jeremy: Yeah, that is a long time. It a long time.
Jesse: That is a long career on the air.
Jeremy: It is going to be a very interesting time as Mike transitions out and we have a new co-host here in the studios. So it is December 27th, 2018, and we had some fun this last week. I thought this would, before we transition, I thought this would, last week, we talked about five things you absolutely have to know about the real estate market, specifically the St. George real estate market –
Jesse: Right.
Jeremy: — as we move into 2019, and this would be anyone who is thinking of buying or selling, and let me tell you who else that would cover because there is really two groups of people. There are people who are thinking of buying and selling, and then there is, might I say there are three. There is a second group that would buy and sell under the right conditions.
Jesse: Right. If I could do this, I would do that.
Jeremy: Yeah, if I could get blank, I would do blank. And then there is another group that it has not necessarily crossed their mind. And this is often, for instance, we have talked about out-of-state homeowners or landlords who go, wait a minute. You mean to tell me that the market is probably at 10-year peak? Well, I do. I do mean to tell you that very intentionally.
Jesse: Absolutely.
Jeremy: We are most certainly at very close, if not at the peak, for this cycle. This might be someone who decides well I could buy an investment property? Well, absolutely you could buy an investment property. You have no idea. There are a lot of things you could do that you are not aware that you could do. These are regular business owners. People who could come in and purchase an investment property, Jesse, and have a stranger pay the mortgage every month plus some profit for the next 10 to 20, 30 years, and you would have quite a little nest egg. So there are three groups. I want to buy or sell. I would buy or sell under the right conditions. I have not really even thought about it, but now that you are suggesting it to me.
Jesse: Yeah, that creates a whole other show right there about (indiscernible)
Jeremy: Absolutely.
Jesse: Really taking the time to do your homework there.
Jeremy: Exactly. That is exactly right.
Jesse: Because that is a long-term haul if you are buying right now.
Jeremy: Well, it is, but it is always a long-term. It is always long-term. So real estate investment is always long term. Buying and flipping homes is something people love to talk about. That is not a play that 97.93% of the people, you know what, no. That is not a play that 99% of the population is ever going to make in their whole entire lifetime. So legitimately, 1% of your real estate investors out there are going to be in the flipping game. And then there is a list of reasons. And that is also a separate show. But we are going to recap those five points, but I wanted to share something kind of fun. This last week, we put a post on our Larkin Group Facebook page, and we are going to give you one shot, one last shot, Jesse. These folks at winning the gift basket.
Jesse: All right.
Jeremy: We said Christmas Eve, but there was a kind of a fun little energy to these comments, so we have a post that says Merry Christmas from the Larkin Group. Would you like a little Christmas boost from the Larkin Group? And if you want to know where this is at, folks, Facebook dot com slash St. George Experts, and you can comment, and you may win the gift basket. Share something on your Christmas list in the comments below, and we will choose one lucky winner from all of our commenters. Right? Commentors. So I thought it would be interesting, because we are in the Christmas season to share what people talked about. You ready?
Jesse: All right.
Jeremy: Do you want to know what they said?
Jesse: I am ready.
Jeremy: Colby wanted a backyard firepit area. Yes or no? We are going to go through each one, and then you tell me yes or no whether you want it. How about that?
Jesse: I have one.
Jeremy: Beautiful.
Jesse: It is just a makeshift right now because it is in the process, but we just had a fire the other night.
Jeremy: And it was nice.
Jesse: It was nice.
Jeremy: A phone call from our missionary from the Abbotts. Well, yeah everybody, these kids that go on all these LDS missions, they only talk to their parents on Mother’s Day and Christmas.
Jesse: Wow.
Jeremy: So it is four calls in two years. That is how that works. That is a long time. Right? So the Graphs, or excuse me, the Abbotts, a call from the missionary. Lynda Wallenfels. She is my good friend. She wanted someone to paint her house. Yeah, I would take that.
Jesse: That I would do because I am right in the process of getting ready to do that.
Jeremy: I love this. Jenae, listen, I hope you are listening Jenae Bang, who is a long-time friend of ours. To sell our house. I responded, yeah, we know how to do that. Andrew Young, who creates our Facebook graphics, all he wanted was an Amazon gift card. That is very simple.
Jesse: I would take that.
Jeremy: You would take it? Okay. How about the Esplins, since I bought all my own gifts, I am excited to open my Instapot.
Jesse: Nice.
Jeremy: I like that.
Jesse: I should just go buy one of those because everybody is talking about them.
Jeremy: Yeah, you need one.
Jesse: I do bone broth every two weeks.
Jeremy: You need one. You need one.
Jesse: In my 20-year old pressure cooker.
Jeremy: You do, man. I will rapid fire these out. Somebody wants new dishes, a sound system for their family room. Steve wants a new, hey a new shave, a nice Christmas shave. A safe trip across the country when we move back to St. George. Welcome back, Quinton and Maury Jensen on the way back. Robert, good morning, my friend, a new backyard landscape. That is cool. We can do that for you.
Jesse: I like that.
Jeremy: St. George Day Spa. Michelle wanted, not Michelle on our team, another Michelle, a full day at the spa. That is all. Jamie Mecham, a Chicago Bears sweater or t-shirt. Somebody wanted our troops to return safe and to be able to speak to their families at Christmas. I think that is fine. Jesse Poll here, you wanted a fancy drone. Did it happen?
Jesse: Not yet. That is a ways out.
Jeremy: Keep the intention out.
Jesse: I do not just want to go buy a cheap one. I want to really plan for this.
Jeremy: I love this. Probably my favorite one, and there is a picture of a tiny, adorable baby with two Christmas stockings that are bigger than the baby –
Jesse: That we already have.
Jeremy: Some money to finish our adoption next month, Tim shared.
Jesse: That is a cool one.
Jeremy: That is very cool.
Jesse: That was very cool one.
Jeremy: So I think it is fun to see what people are talking about. It is Christmas time. These are the things that folks are thinking about, and these are some good answers, some really great answers. If you want to comment this morning, we will draw at noon today. Facebook dot com slash St. George Experts, and that post is pinned to the top of the page. You will see the Merry Christmas and go from there. I better plug this laptop in. It says it is going low.
Jesse: Imagine that.
Jeremy: What do you think? Talk to me about an article that we shared yesterday. Well, we shared it with our team yesterday.
Jesse: Right. Well, this –
Jeremy: The market is shifting.
Jesse: It is.
Jeremy: We have sellers wondering why their homes are not selling. Give us some feedback.
Jesse: We are still in a really strong market even though all over town people are talking about a shifting market. There is still less than four months of inventory on the market. So that is still considered a really strong market.
Jeremy: Right.
Jesse: But there is about 30% or 40% of homes that still fail to sell for whatever reason. They go on the market and they come off unsold. Now there are things that you can do about that. So there are five most common reasons where a home, why a home will not sell in the strongest market.
Jeremy: Let’s hit them fast. I want to hit these because, and then we are going to wrap up the show with a recap of the five things you have to know.
Jesse: Okay.
Jeremy: So what are the five reasons? Because, Jesse, the reason we are talking about this specifically is it is December 27th. On January 1st, which is next Tuesday, there will be a record for the year, number of what we call expired listings. And for our listeners out there, an expired listing is a home listing, the home was on the market for typically six months. Sometimes less. Sometimes more. But typically six months, and it did not sell. And remember that these sellers, these homeowners when they put their homes on the market six months ago, the last thing, they would have had a dialogue that looked like this and tell me if I am close.
Jesse: Okay.
Jeremy: Jesse, how long is your listing term?
Jesse: Six months.
Jeremy: Great, great. Okay. It is June, so that would be the end of December. Well, gosh, there is no way we would not have our home sold by Christmas, right?
Jesse: Oh sure. Yeah.
Jeremy: Yeah.
Jesse: Probably sixty days we will have it sold.
Jeremy: Yeah, okay. That was six months ago.
Jesse: Right.
Jeremy: And now these listings are going to expire. So there are a large number of the home-selling population who are saying what the heck happened? And the market shifted a little bit. What are the five things, five reasons a home does not sell? And we cannot drill the details, but what are they? And then we are going to share this to our Facebook page this morning as well. Go for it.
Jesse: So number one is price.
Jeremy: Number one is price.
Jesse: Number two is the condition of the house.
Jeremy: Bingo. Okay. Keep going.
Jesse: Three is the seller’s motivation.
Jeremy: Okay.
Jesse: Four is the marketing plan, and number five is lack of communication with your agent.
Jeremy: Okay, let me ask you a couple of things here. What do we have, of those five, read those back to us again.
Jesse: Price.
Jeremy: Price.
Jesse: The condition of the home, the seller’s motivation, marketing plan, and the communication or lack of communication with the agent.
Jeremy: So how many of those do we have? Which of those items do we really have control over?
Jesse: We have control over the price, the condition, and the marketing plan, and well, the communication.
Jeremy: I guess we could communicate.
Jesse: So the only thing we cannot control, and I would even say the seller cannot control, is their own motivation. They are going to have, it is going to be what it is unless they have a change in circumstance or a change in perception.
Jeremy: What do we mean by motivation though?
Jesse: Well, I really have to move. I have a new job in 60 days. I have to move versus well, I would sell it if I could get the right price.
Jeremy: If I could get the right price.
Jesse: If it could really be the perfect condition, I would sell. So that is what we mean by motivation.
Jeremy: Right. I think this is really interesting. So four of those five factors, that is what is kind of interesting about this situation is you actually have control over 80% —
Jesse: Yes.
Jeremy: — of the issues.
Jesse: Right.
Jeremy: Here is what we do not have control over, which are not even listed. Exceptionally cold weather, a massive snowstorm, a government shutdown, 2013.
Jesse: Location.
Jeremy: We had both of those in 2013, and they hurt the, location unless you have a mobile, you cannot even move a mobile home. Right?
Jesse: Right.
Jeremy: You cannot control location. You cannot control economic conditions.
Jesse: Right.
Jeremy: We cannot control public perception –
Jesse: Right.
Jeremy: — of the market.
Jesse: You have to meet that right where it is at.
Jeremy: Yeah, that is just reality. So we actually have control over 80% of these factors. We can control the price we are asking. We can control, you as a seller with a good agent, as professional real estate marketers, we can absolutely control the marketing that we are doing for a home.
Jesse: Right.
Jeremy: Okay? We have full power over how much we communicate with the seller, and most importantly, what we communicate with the client.
Jesse: Right.
Jeremy: By the way, us talking to you everyday does not change anything. Us communicating what matters will change something.
Jesse: Right.
Jeremy: So when we talk about these kinds of things, look folks, there are a large number of homes that just are not selling, and we are moving into 2019, and the market has been hot, and there is a perception that well, maybe the market is not good anymore. Right? Maybe the market is not good anymore. The market is great. Jesse, of all of those issues that you just listed, what is the overarching, number one, primary issue that is almost always the issue?
Jesse: Price.
Jeremy: Yeah, it is price.
Jesse: It is typically always price.
Jeremy: It is. It is. Right? Because there is a market, it is interesting. We have talked about this for a while on the show that Red Bull is one of our sponsors. I had to wink at Craig there. If you consider that I pay for their product and they put it in here. I have cut back on my Red Bull consumption greatly. I have got tangerine this morning. Now Craig, you realize this is 100% pure Florida orange juice in this can. Okay. Maybe it is not. It is interesting though. If I go to, I went to the Sinclair here on Bluff Street this morning. I had myself a really good breakfast, but I needed a drink. It is two for five bucks, this product right now. Do you know what the price is on this product at Maverick?
Jesse: I have no idea.
Jeremy: Do you want to guess?
Jesse: Four bucks.
Jeremy: Well, it is two for five bucks at that store. What do you, now I have given you a hint.
Jesse: Actually three-fifty-nine.
Jeremy: Okay. What do you think the price might be, Craig? If it is two for five at this Sinclair, what do you think it is at the Maverick, their competitor?
Jesse: Oh, at the, oh okay.
Jeremy: It is also two for five bucks. Guess what it is at Chevron? It is two for five bucks. Should I keep going? That is the market for these Red Bull cans.
Jesse: See, I was busy messing with my, my headphones keeping coming off, so I did not hear you correctly.
Jeremy: But it is a great question because it catches you off guard. That is why I ask it. There is a market for a product, and the reason I, it is just so funny this morning, I was thinking about it. I thought it is two for five everywhere. Or whatever, five-twenty-five. I do not know what it is. It is around there. Everywhere they are selling this at that rate. Under what circumstances would you pay two for six if you knew you could always get them two for five? Well, I do not know. If I were in a desperate situation and it was a long drive. Is it a long drive to any gas station? Craig has got three or four great ones in Parowan. There are two I love.
Jesse: (Indiscernible)
Jeremy: I love the Maverick, and I love the new whatever you call it out by the freeway. What do you call it?
Craig: Oh yeah, it is KB.
Jeremy: KB. Those are both great.
Jesse: What is interesting though is people will drive clear across town for the best gas price.
Jeremy: They will. They will. They will kill themselves.
Jesse: They will do the same thing for a home.
Jeremy: Yeah, so, so –
Jesse: Get the best value.
Jeremy: Isn’t that amazing? So I understand that your home is special, and I say that with a wink and a nod, because we all think our home is special. And I understand you have the best children. I do not know. Some of the listeners are like no, no, no. We just did Christmas. I assure you I do not have the best children. No, my kids are great. They are happy. They are healthy. They loved Christmas.
Jesse: And they are fighting just like everybody else’s.
Jeremy: Yeah, they were. They were. But the point is that there is a market. Price will always be the number one, overarching factor that is affecting your home’s, Jesse, what factor does this price solve for a home seller? Name some things that price solves.
Jesse: Price?
Jeremy: Yeah.
Jesse: Well, it will solve, if you are at the right price, you will actually get showings.
Jeremy: But what will it solve? What are the problems it solves? What if my home is by a busy road?
Jesse: Then there is no other way to go but to price it correctly.
Jeremy: Oh okay.
Jesse: Because a buyer is going to look at that –
Jeremy: What if I have a crappy view?
Jesse: Well, that is definitely going to affect it.
Jeremy: What if I have no backyard?
Jesse: Definitely going to affect it.
Jeremy: What if I need to renovate my house or replace my carpets?
Jesse: Then it is price.
Jeremy: What if the buyers are not real excited about buying homes right now?
Jesse: Then it is going to be price.
Jeremy: What if interest rates are rising?
Jesse: It would be price.
Jeremy: This is a fun conversation, isn’t it? Is there any issue that price does not solve? Any issue? Is there any single issue? Let’s pretend the government shut down today, and you could only buy a home with cash. What factor would solve the issue for any seller?
Jesse: Probably price.
Jeremy: Price. But Jeremy, everyone is going to stop buying homes. Everyone will not. Everyone will not stop buying homes. That has never happened ever in the history of housing. It has never happened.
Jesse: (Indiscernible)
Jeremy: Right?
Jesse: Yeah.
Jeremy: Price solves every issue. Why homes do not sell in a strong market, let’s give you things you need to know before they move into 2019. Right? We still have a strong market. Jesse, you know these from last week. Let me review them and you ping in here. Number one, interest are or are not rising? They have been.
Jesse: They have been. They have been going up and down, but they are probably going to continue to go up.
Jeremy: They are going to continue to go up.
Jesse: They say they are, but they are just not sure how fast they will let them go up.
Jeremy: So this is number one. Interest rates have risen. They are rising, and you cannot, we talked about putting the pedal to the metal on your car and just drive it at full speed indefinitely. Number one, you will run into something. But number two, it will run out of fuel. The housing market has been on crazy, crazy, crazy pace for a long time. Number two, we are not in a housing what?
Jesse: Bubble.
Jeremy: Yeah, we are not in a bubble. This is not a bubble. And what is it that Chantry Abbott always shares with us, Guild Mortgage when he comes in here, about qualifications for loans now?
Jesse: They are actually a lot better than they were in 2005, 6, and 7. They are still pretty strict.
Jeremy: Yeah, people are actually –
Jesse: You still have to qualify.
Jeremy: Yeah, people are actually qualifying for homes.
Jesse: And they still check your qualifications.
Jeremy: They do.
Jesse: Pretty harshly. I just went through a refinance.
Jeremy: Yeah, they did. They are like you had a receipt for gas from 1998. Is that in the wallet? Did you keep track of that?
Jesse: Right.
Jeremy: It is a file.
Jesse: Where did this money go out of your checking account? Where did it come from?
Jeremy: Exactly. And so I am a little out of order. Number one, interest rates are rising. Number two, we are not in a housing bubble. We are not going to have a bubble burst. Number three, which is connected to number one, which is why I say I am a little out of order. I have some scribbled notes from last week. Rates are rising for a very good reason, which is what?
Jesse: Well, they have been holding them artificially down, and we either let them go back to natural or we are going to cause more of a problem.
Jeremy: Because the market is healthy –
Jesse: Yeah.
Jeremy: — we can do that.
Jesse: Right. They have been holding them down to stimulate the economy.
Jeremy: So if you have got a teenager and did you notice that if they follow the rules and they earn trust, and they do what mom and dad ask that between 12 and 14 and 16 and 18 that suddenly some of the boundaries are lifted, and a little more freedom is given —
Jesse: Interesting to note.
Jeremy: — to that child. Right? The same thing happened with the economy. The government comes in here and puts, originally they put a tourniquet on because literally we were bleeding out.
Jesse: Right.
Jeremy: Okay? Then we did surgery.
Jesse: Yeah.
Jeremy: Then we stitched it up. Then we had a cast and a sling. We are getting back to health in the economy, so the government says all right, we do not have to suppress interest rates artificially anymore.
Jesse: Yeah.
Jeremy: Interest rates are going up, and they are going up because the economy is actually doing great. One of the massive misconceptions that happens when a market starts to shift a little bit, as we wrap up today, is it slows down a little bit and people go oh, the market crashed. The market has not crashed. It is doing fantastic. Okay? Two minutes. Perfect. Okay. I love this. I love this. Number four, renting, excuse me, buying is again, and has always been, a more profitable for the average human being, American citizen than owning. The average net worth of a homeowner at age 65 is $300,000 versus the average net worth of a non-homeowner or a renter at age 65 was, do you remember the number?
Jesse: I think 30, 30, I cannot remember.
Jeremy: 5,000.
Jesse: Oh, 5,000.
Jeremy: There is no net worth.
Jesse: That is ridiculous. That is unbelievable.
Jeremy: Essentially, unless they have a really good retirement. But this is an average, right? We are talking about people who have nothing versus people who have a lot and average it. Average net worth of a homeowner is $300,000, okay?
Jesse: Wow.
Jeremy: So remember that. Last point, home values in St. George are not only not falling, they are at about a ten-year peak, ten-year peak. This will be a time that people will look back and say I wish I would have sold my home, especially people who are non-occupants. Landlords or second homeowners will wish they had done it. Okay? And they are not only not falling, there is the potential with a lot of the forecasts, 94% of the economists interviewed last week in our report, said we think they will go up in 2019. I do not know that they will in St. George. Jesse and I have debated this. I do not know.
Jesse: Well, the market does not turn on a dime. So they might not, they are not going to be at this intense pace, but –
Jeremy: Yeah.
Jesse: — it is going to take a while for them to slow down and turn.
Jeremy: It is.
Jesse: So that is why I say I disagree.
Jeremy: We will see.
Jesse: They will go up a little bit.
Jeremy: We will see.
Jesse: Just from momentum.
Jeremy: I say they will not. You say they will. We will find out.
Jesse: So next year we are going to have this conversation again.
Jeremy: Folks, if you want to reach out to us, please call us at 275-1690 or visit us at Sold in St. George dot com. A lot of people have questions right now about the real estate market. Absolutely no obligation. Sold in St. George dot com or hop on Facebook and make a comment about the Christmas giveaway. I think somebody may win a basket today.
Jesse: All right.
Jeremy: Jeremy Larkin, Jesse Poll thanking you, saying we know this town.
Jesse: Happy Holidays.

St. George Home Buyers React to Sticker Shock (St. George Real Estate Morning Drive Show)

 

Click on Facebook Live. to see the entire recorded show from Facebook! Below is the actual S. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Mike: KDXU News Time. It is 8:35. Good morning and welcome. It is a Thursday morning. It is time for another edition of the St. George Real Estate Morning Drive as we check in once again with the voice of St. George Real Estate Jeremy Larkin.
Jeremy: Good morning, everybody. Hopefully Mike will plug me in here. I do not know where this thing plugs into. It plugs in somewhere. Hey, we are live in the Cherry Creek Radio Studios on North Bluff Street. If you are watching us on Facebook Live, you would see the chaos ensuing. By the way, chaos unneeded in life. It is okay to not have chaos. It is okay to live drama-free. It is not a problem.
Jesse: But it is not fun.
Jeremy: Nah. Yes, it is. It is a lot of fun, and it is okay to live without drama. I assure you right now. Okay? So you have a little, thank you, Mike, little snafu. Plugged in. I can actually hear now and be involved and engaged in, as they say, present with you. Hey, Merry Christmas. You can hear the jingling of the bells. If you are not watching us on Facebook Live, I think just envision a little more than, not lime but not forest green sweatshirt with a bunch of kitty cats all over the front of it with bells, actual bells and a few Christmas bows. I think it is a nice sweatshirt. I asked Jesse to wear an ugly sweatshirt this morning. Ugly sweater, he put on a nice sweater.
Jesse: Well, I could not find my Christmas sweater, my ugly sweater. So I have a shirt. I thought that was for later.
Jeremy: Well, he asked a question this morning in our group feed. Over at the Larkin Group, we run a real estate company. If you guys do not know who we are, I am Jeremy Larkin, host of the St. George Real Estate Morning Drive. Been hosting this show for at least five years. We might have pushed clear back into 2012, which would be over five years. I know we are five years, and we run a real estate company here in St. George, Utah, and we help people through what seems really easy but ends up being the third most harrowing experience of their life shy of a birth, a death, fourth most, a birth, a death or a divorce. Literally, buying and selling and moving is –
Jesse: Yes.
Jeremy: — it seems to be next for most people. We help people through that process –
Jesse: Very stressful.
Jeremy: — of buying and selling and investing and help them make good decisions. But I have got Jesse Poll here, one of my business partners, great guy. But this morning on the group chat, we have a group chat. Right? And he said do you want us to bring a Christmas sweater or an ugly sweater? And I said there is no difference, dude. There is no such thing as a Christmas sweater that is not ugly. It is actually a fact.
Jesse: Now, I am corrected. There you go.
Jeremy: I do not care if you show up with a reindeer on your shirt –
Jesse: That is ugly.
Jeremy: — like a nice stag and you think something like this is cool. This is masculine. It is an ugly sweater, dude.
Jesse: And there you go.
Jeremy: Okay, so as long as we know that. Hey, if you are not watching us on Facebook Live, please, you can pick it up and you can see what we are doing. Ask us anything. This is one of the things that we are going to start talking about on our shows. You can ask us anything about the real estate market. And if you do, it should pop up on our screen here. Today, we are going to talk about, it is, by the way, December 20, 2018 for those who are picking up our show later on the podcast or over at our website, Sold in St. George dot com. If you would like to listen to past shows, you can literally go to Sold in St. George dot com. Each show is about 23 minutes long, 24 minutes.
Jesse: Yep.
Jeremy: And we have them on there again. Sold in St. George dot com and click on the blog. But if you are watching on Facebook, let us know you are out there. Give us a thumb or a heart or ask a question. Ask us anything. We are going to talk about five things you have to know about the real estate market moving into 2018, 2019, excuse me. Because 2018 is eleven days ready to expire, right. Eleven days from now we will be done with this year, and you will be writing, fortunately, most people are not writing checks. We do at our office, and you can stop putting the wrong date on, or start putting the wrong date on everything.
Jesse: This is the first year I did not do that. Maybe it is because I do not write checks anymore.
Jeremy: Yeah, yeah. Well, there you go. There you go. I write a handful. Not personally. Well, occasionally even personally I write one, but typically, typically, I am writing checks only for the business. So you all know what we are talking about. Right? It is January 7th, 10th, 20th, 30th, and I do not even know if there is a 40th in there, and you are still writing 2000, I think you write 2018, the previous year until at least June.
Jesse: At least.
Jeremy: And then you start over. Hey, here is a New Year’s resolution for everybody. Most people burn out on their resolutions by about January 20th, and do you know why? This is actually not a joke. I am going to tell you why if you would like to know.
Jesse: Because they are unrealistic. They are not really goals.
Jeremy: They may be realistic.
Jesse: They are pipe dreams most of, most of the New Year’s resolutions that I have ever done is a pipe dream, and they change my entire being instead of just making a little bit of an improvement.
Jeremy: And I like that. So they may be realistic. They may not, but what you are saying is right. What happens is, so we work in the real estate community, and we will be doing some business planning tomorrow as a team. We will go off site and do some great motivation and business planning for 2019. Well, what will happen is someone will say I want to lose 20 pounds in 2019. Or I want to sell 30 homes in 2019. So they divide that out by the months, and they say okay, I am going to have to lose X number of pounds or sell X number of homes per month. What happens is about January 20th, 25th, they find out that they are already behind, and what we do is we start to hate ourselves right then. We go oh well, this is just like 17, 16, 15, 14, 13, and 12 when I said the same thing. And oh five and six. And instantaneously, we start to hate ourselves for, and I know hate is such a strong word, but I have to be honest, folks. It is pretty much a hatred if you are real honest out there. I realize you are saying are we doing a psychology show? Well, real estate is psychology. But just for fun, here is a New Year’s resolution. You write out who it is you want to be, what you want to have, and what you want to do, and you start with who you want to be because that is what we are going to do tomorrow as a team. Who do I want to be? What will I need to do to have what I want to have? Right? And if I cannot be the kind of person that has those things, then I will not be able to have them, that does those things, I will not be able to do the things to have the things.
Jesse: Right.
Jeremy: Then the resolution, folks, is you just accept yourself where you are at. And if January 20th comes around and you were supposed to lose three pounds and you have lost zero, you say, you know what, I love myself for the effort I am making all the way through January 20th. That is 20 days I was making a stronger effort I was during the month of December when I was eating all the goodies that they kept dropping off at my office. And the neighbors kept swinging by. Boy, it was nice of them to bring me toffee and fudge.
Jesse: Yep.
Jeremy: And then guess what you do? You get up on January 21st, and you reboot, and you try again. That is the resolution that I am going to encourage our listeners to do. Is you love yourself for the goal.
Jesse: You just keep going?
Jeremy: Yep, you love yourself for failing at the goal. You love yourself for your humanity. You love yourself for the fact that you screwed up the previous five years, and then you just keep going.
Jesse: But I think the most important part of what you just said is we do not take into fact that it is going to take a little bit longer to actually get the habit or the whatever we are reaching for –
Jeremy: Right. Right.
Jesse: — to start to show up. Take the weight loss. It may be in the 35th day that it really starts to change our metabolism.
Jeremy: Yeah. We have been thinking a certain way for 30, 40 years most of us, and sometimes 50, 60, 70. So hey, that is your psychology lesson for this morning.
Jesse: All right.
Jeremy: But truly, I think it makes such an impact when you are able to do that. Let’s talk about five things you have to know about St. George and the real estate market. So we, Jesse and I, last night and this morning, excuse me, we spent a few hours breaking down some information provided by a company called Keeping Current Matters and a fellow named Steve Harney. And what Steve Harney does, Keeping Current Matters is he spends all of his days and nights, drum roll please, researching the market. That is all he does.
Jesse: This guy says he reads eight hours a day. Reads.
Jeremy: Reads.
Jesse: Wow.
Jeremy: And we have a lot of real estate. By the way, the failure rate for real estate agents is you make decisions to hire an agent in 2019. The failure rate for real estate agents is 87% over how long?
Jesse: Five years.
Jeremy: Over five years. So, 87% of real estate agents will either quit the business entirely or take another full-time job even if they keep their license active over a five-year period.
Jesse: You know what number surprised me in that data was there is 1.3 million real estate agents, and only 47,000 of those that will do more than 25 units or transactions a year.
Jeremy: Okay, so think about this. 1.3 million real estate agents –
Jesse: In the U.S.
Jeremy: In the U.S., right. And 43,000, is that what they said?
Jesse: 47,000.
Jeremy: 47,000 –
Jesse: Will do more than 25 transactions.
Jeremy: — divided by 1.3 million. 3.6% of the professionals that, because realize, you as a consumer if you are listening to our show, if you know someone who has a license, in your mind, and by the way, you are not ignorant, it is just you have no reason to believe that they would not be a professional.
Jesse: Right.
Jeremy: But we are telling you that there is actually a 3.6% likelihood that they are really good at what they do.
Jesse: Right.
Jeremy: By the way, it might even be lower than that. You might have people selling 30 homes that are not good at what they do. But let’s just assume that by the time you are selling 25 transactions, you –
Jesse: Yeah.
Jeremy: You know what you are doing. Right?
Jesse: Yeah, their feet are wet.
Jeremy: 3.6% chance that you are hiring someone who actually, who has actually really been doing this a long time and who has, who can, they might have your best interests at heart, but Jesse, I might have your best interests at heart when you are laying on the street bleeding, but I do not have the medical ability and professional expertise to save you from dying.
Jesse: Right.
Jeremy: Do we see that? And man, I know that was a gruesome one. That was a good one. Just because someone has your best interests in mind does not mean that they can serve and meet your best interest. So okay, they broke this down, and we are going to nail this thing this morning. This is so powerful, this information. There are five things that we want you to know, and I am going to warm us up this morning because we want you to be, our listeners, the smartest kids on the block. We always talk about that. Right? If you walk away from the show every week saying did not know that, did not think about that. Ring your jingle bells as I am jingling along here and maybe watch Jingle All the Way with Arnold Schwarzenegger. You know he is the world’s worst actor? But somehow it is fun to watch him.
Jesse: I enjoy watching him.
Jeremy: It is like watching a car accident. You just want to see. 1,400 real estate agents in Washington County according to Robert. Good morning, Robert. 1,400, okay?
Jesse: In Washington County.
Jeremy: Times 1,400. That means, that is about right. 50 agents, 50 of the 1,400 in Washington County are really selling at a volume level. I call that 25 or more transactions. Which is actually pretty good since the minimum standard to even be at the Larkin Group is?
Jesse: 24.
Jeremy: 24 transactions. Yeah. So we cannot even have a sales person on our team that is not selling 24 homes. Just too complicated. They do not have enough information to help the client, and there you go. Good morning David and Kierstin. Love having all of you on here this morning. Number one, are you guys ready? Five things you have to know about the real estate market. Number one, we are not in a bubble. We are not in a bubble.
Jesse: Right.
Jeremy: This is not the next housing bubble. Jesse, give us a definition of a housing recession.
Jesse: Two months –
Jeremy: Two quarters.
Jesse: Two quarters of downward pricing or –
Jeremy: Yeah, the economy is slowing down.
Jesse: — is slowing.
Jeremy: If I tell you that we are in a recession, you get nervous. Right?
Jesse: Yeah.
Jeremy: That is a scary word. Right? But if I tell you hey, I was noticing, the economy slowed down the last two quarters. Do you quite get that chill down your spine?
Jesse: Not necessarily.
Jeremy: You should not because they are different. Recession is like a four-letter word, a really naughty one.
Jesse: Right.
Jeremy: Okay? So a recession is nothing more than two straight quarters of economic slowdown. Okay. Folks, if you go to your children’s track at their school this morning, and they line you up and they say you are going to do, you are going to run as fast as you possibly can around this track. Like what do you mean? Am I going to run a mile or two miles? I need to know how long I am running so I will know how fast to run. No, Jesse, I want you to run as fast as you possibly can until you have to stop. How far would you go realistically you think? 400 meters around that track. How far do you think you could actually, far you think you could go at the fastest?
Jesse: How far at the fastest?
Jeremy: Yeah.
Jesse: Probably half way.
Jeremy: That is about it. That is probably about right for most people. You would just about keel over at 200 yards.
Jesse: Yeah.
Jeremy: So what you are telling me is that you cannot keep running at your very fastest speed all the way around the track indefinitely?
Jesse: No.
Jeremy: Neither can the economy.
Jesse: Sixty seconds is about –
Jeremy: Yeah. And neither can your car at 100 miles per hour. It will run out of fuel. Your Tesla will run out of power. The economy cannot continue at this pace. So when we say it slowed down for two quarters, it is like thank goodness. Number one, we are not in a bubble. Okay. Number one, we are not in a bubble. Okay. Number two data point, market interest rates are rising. We have heard that interest rates have been rising. Okay? This is a two point. Interest rates are rising, and the reason is because the economy, Jesse, is good or bad?
Jesse: Because it is good.
Jeremy: Isn’t that an interesting way to look at that? Isn’t that a different way to look at that?
Jesse: Right, but they have needed to rise because the Fed has been actually holding them, they have been paying money to hold them down.
Jeremy: Yes.
Jesse: To boost, or to continue to stimulate the economy.
Jeremy: They have been bribing the economy.
Jesse: We cannot do that forever.
Jeremy: Right?
Jesse: Without some pretty severe consequences.
Jeremy: Lincoln, Darrell, Devin, that is like a triple power. If you guys all knew each other. Well, actually Devin bought Lincoln’s home. So maybe they do know each other. Small world. Good morning, guys. Think about what you just said. Right? Interest rates are going up because the economy is in good shape not because it is in bad shape.
Jesse: And because it is time. In St. George, anyway, for a year we have said wow, this has got to slow down. We cannot continue this pace.
Jeremy: Yeah, I have been watching my kid run around the track for the last several years, and he looks sick.
Jesse: Yeah.
Jeremy: This does not look, this is not good.
Jesse: Right.
Jeremy: I think he is going to have a heart attack.
Jesse: So we have been praying for this, and now it is just time.
Jeremy: Yeah. Yeah. This is fun. Point number, we are going to come up to one about equity in just a minute.
Jesse: Yeah.
Jeremy: So point number one, we are not in a bubble. Okay? We are not even close to a housing bubble and we are going to give you more data to prove that. So the question is are we in a bubble? Is this, okay, we are not in a bubble. Number two, interest rates are rising, but it is because, Jesse?
Jesse: They need to.
Jeremy: They need to. Okay? And by the way –
Jesse: To stabilize our economy, they need to.
Jeremy: Yeah, and by the way, Jeremy, what do you think interest rates are going to do in 2019? I do not know, guys. Honestly, I am tired of making predictions. They keep, they raise them, and then they said they were not going to raise them.
Jesse: And then they lowered them.
Jeremy: I do not know what they are going to do. Okay? Here is what I do know. We have used this analogy so many times. If you are about to travel across 200 miles of open desert in the middle of the summer, and you see a sign that says this is the last gas station, water, and services for 200 miles, and your children are in your car, do you or do you not stop?
Jesse: You stop.
Jeremy: You stop. You are like I do not know. We will buy something. Get some gum and use the bathroom.
Jesse: Yeah.
Jeremy: What I know is interest rates are what they are today, and historically, they are half of historic, half of what they were historically. Meaning, folks, if rates ever go back, we talked about it with Chantry Abbott from Guild Mortgage last week on the show, if rates went back to the historical average, your payment would go up $500 per month if you went to get a new mortgage. Oops. Okay. Number three, this is pretty exciting. Owning a home has always and will continue to be a much better financial position than renting. Let’s talk about the data.
Jesse: That is true.
Jeremy: Okay, this is number three. Did you hear what they said what the net worth of the typical home renter was over the age of 65?
Jesse: I did not. I did not catch that.
Jeremy: Did you miss that? Okay, I do not know if you grabbed it.
Jesse: Well, I heard it, but I do not remember.
Jeremy: The typical renter over the age of 65 in the United States of America has a net worth of $5,000. Folks, do you realize what $5,000 is? It is like when my kids, they were doing the Summit Athletic Rock, $10,000, Dad, what would you do with ten grand? And I said, kids, it would be very disappointing how far that would not go.
Jesse: Right.
Jeremy: Right? Ten grand it just not a lot of money.
Jesse: It is not.
Jeremy: And if there is a listener out there that is like it is to me, it may be to you, but in the world, right, five grand is the net worth of the average renter over age of 65. Why do you think they measure people over 65, Jesse?
Jesse: Well, that is when we really need the money.
Jeremy: Right.
Jesse: We really, once you hit 65 –
Jeremy: How many 25 years-olds are worrying about their net worth? Thinking probably not a lot of them. The average net worth of a homeowner over 65 is? $300,000.
Jesse: Wow.
Jeremy: Net worth meaning your net value of all of your assets if you cashed out. And where do you think all that value is? Well –
Jesse: most of it is in the real estate.
Jeremy: Most of it is in the real estate. Okay? So number three, owning a home is a much better financial play, has always been, and will always be, always be than ever than renting a home.
Jesse: Well, it definitely gives you more control. Because if you are renting a home and it is December, and your lease is coming up in January, you have no idea what is going to happen. Most likely, your rent is going to go up. But if you have a mortgage, it does not.
Jeremy: Yeah.
Jesse: It stays the same until you do something with it or to change it.
Jeremy: Yeah.
Jesse: So you get a lot more control, and you are gaining equity.
Jeremy: Yes.
Jesse: By most of the time, of course, the market rising or paying it down.
Jeremy: Yeah. Point number four, and point number four and five are going to look similar, but they are not. Number four is are prices falling? Home prices in St. George, Utah are not falling. Now, I had an interesting discussion this morning with my brother-in-law. He said a lot of my friends from northern Utah are looking at homes that they were checking out like six months ago and they said they dropped twenty or thirty grand. Did the value of the home drop twenty or thirty grand, or did the seller reduce the asking price that was too high to begin with by twenty or thirty grand?
Jesse: So the seller reduced the asking price, and I have got some data here that is really interesting.
Jeremy: Give it to us.
Jesse: If we look at the Washington County data for just last month. This came out, we put it out on December 2nd. The average list price is 499, but the average sold price is actually 352.
Jeremy: Average ask price was what 99?
Jesse: 499.
Jeremy: Yeah.
Jesse: So those are not obviously on the same homes –
Jeremy: Yeah.
Jesse: — but that is saying that people, the market is just saying okay, sellers are just going to have to reign in their prices a little bit to get their homes sold now.
Jeremy: Correct. So I want you think about this. I had a comment. David, thank you, on Facebook. He said I am kind of worried the prices are coming down, which is a bummer. Hard time to sell. First of all, David, this is a really interesting context. He works in California. Okay? He lives in St. George. He works in California. By the way, I have got a map of all the declining markets in the United States of America. Where are 90% of them? California. Almost all of them are in California, Dallas, Texas, and a handful of other markets. Declining markets. Folks, what is happening with prices right now is that sellers have been asking too much for their home.
Jesse: Right.
Jeremy: And so, we went up and we got up to the peak and then people stretched a little beyond that and said maybe I can get more. Okay? And this is number four. Every single home needs to be reduced. Every listing in the MLS needs to be reduced between 5 and 10%. Virtually everyone. I am going to say everyone. 5-10%. Virtually every home actively for sale, and that includes you For Sale By Owners, needs their price reduced by 5-10% to actually be in line with what the market will support. Okay? Prices are not necessarily falling in Washington County. People were simply asking too much.
Jesse: They are not falling at all.
Jeremy: They were simply asking too much. Okay?
Jesse: Right.
Jeremy: They have not fallen at all. We have no data to support it. Now here –
Jesse: And they cannot. So if you look at the supply and demand –
Jeremy: Keep going. I am going to run out of time.
Jesse: Can you even have a declining market when you have more demand than supply?
Jeremy: Not a chance. Thank you. That is so brilliant.
Jesse: You just cannot.
Jeremy: We still have more demand than supply.
Jesse: Right.
Jeremy: We cannot have a declining market. Here is the fun part okay. Number five, here is the prediction. They asked 100 economists in this report that we went over, they asked 100 economists what they thought home prices were going to do in 2019. 96 of the 100 said?
Jesse: They are going up.
Jeremy: They are going to go up. Now, I do not believe they will go up in Washington County. Okay? Because when they asked economists, do you think they asked an economist in St. George, Utah what they thought?
Jesse: No.
Jeremy: No, they did not. Okay? Of course, they did not. Because of those 100 economists, probably 75 of them were in New York City, San Francisco, and Los Angeles. Okay.
Jesse: Right.
Jeremy: We do not think home values are going to rise in Washington County. Okay? But here is what is happening. David made a great comment. It is hard to sell right now. Not many people buying. So this Steve Harney shared a great example. He and his wife went down to buy a Lincoln Towne Car. He is a big guy. He wants a big car. His wife says I want a Lincoln Towne Car. It has been my dream. They go down and they look at all the Lincoln Towne cars. After they look at them, she gets sticker shock. She is like oh, I am never paying that much for a car. And so just like a good husband, he is like okay, honey, whatever you say.
Jesse: Yep.
Jeremy: They leave the dealership, and they go out and they look all around town. What did she find after she looked all around town?
Jesse: That Lincoln was the best value.
Jeremy: That what she wanted and what she needed and everything factored in, that the Lincoln was the best value. And where did they go back to?
Jesse: Lincoln.
Jeremy: Buyers hit stocker shock. Here we go. This is such a huge point. David, this is to your point. Buyers had sticker shock in September, October, November of 2018. December is an anomaly and it is hard to even predict what is going on in December. They have sticker shock. I made multiple offers. I am in bidding wars. I offered ten grand over and someone beat me.
Jesse: Right.
Jeremy: I thought I was the first guy in and there were 12 people ahead of me. They got sticker shock. Folks, on January 2nd, all the young families, millennials or otherwise, that have the baby that is still sleeping in a crib in the room that they really needed to get out of the room in September –
Jesse: That is such a good analogy.
Jeremy: — but they are ticked off because the home market is too high. Sticker shock will fade and in January what will they say?
Jesse: They will come back.
Jeremy: I love this baby, but honey, we have got to get him out of the room.
Jesse: Yep.
Jeremy: This is driving me crazy. And they will come back, and they are already coming back to the market. Folks, this is a great, healthy real estate market. Have a merry stinking Christmas out there, would you? Jeremy Larkin thanking you saying we know this town. Ask us anything. Write in this thread after this on Facebook.
Mike: You have been listening to the St. George Real Estate Morning Drive here on News Radio 94.9, 890 KDXU, with the voice of St. George Real Estate, Jeremy Larkin. Again, for more information, give them a call at 275-1690. You will find them online at Sold in St. George dot com.

Can You Spot a Shifting Real Estate Market? (St. George Real Estate Morning Drive Radio Show)

 

Click on Facebook Live. to see the entire recorded show from Facebook! Below is the actual S. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Jeremy:  Good morning.  How are we doing, folks?  I am here.  I am alive.  I have got a dead laptop. I am not sure why it is dead.  But guess what?  Does that ever happen?

Mike: All the time.

Jeremy:  So batteries actually die on these things –

Chantry:  Only when you need it though.  Right?

Jeremy:  Yeah, I know. It is okay.  We will plug it in and we will be good to go. I have got Chantry Abbot this morning with Guild Mortgage. Chantry, good morning.

Chantry:  Good morning.

Jeremy:  Give me something good.  What is the greatest thing that is happening in your life right now?

Chantry:  Oh man, the greatest thing that is happening in my life.  I just went to, my son’s doing, he is four –

Jeremy:  Got it.

Chantry:  — and so yesterday, I snuck out of work a little early and well, at about lunch time. Snuck out for a little break, and he is in a gymnastics class.

Jeremy:  Oh man.

Chantry:  And he totally digs it.  Somersaults and all that.

Jeremy:  I have got a 17-year-old who always referred to her gymnastics when she was that age as nastics.

Chantry:  Yeah.

Jeremy:  Something like that.  It is pretty fun.

Chantry:  I have been telling him that the Ninja Turtles do gymnastics, so he is really into the Ninja Turtles.

Mike:  He is sold.

Chantry:  Yeah, he is in that really learn his stuff.

Jeremy:  That is amazing.  I love this. Well, so that is your great thing this morning.  Isn’t that great?  You know what? Let me tell you what is going on great in my life, by the way, folks, is I hauled two kids off to school this morning, and I think they were both just about late.  We are talking about scratching the, oooo, the very edge.  One went over to Tonaquint Intermediate and another to Dixie Middle, and once upon a time they were four.  They were four years old. And there you have it.  We got up.  So but those guys, these two dudes and I actually, all four of the kids, we went up to Bryant Head this last weekend –

Chantry:  I was actually going to say they are probably bummed they were not going skiing today.

Jeremy: Yeah, they probably were.  They probably were.  Bryant Head missed the snow on this storm, but we were there this last weekend, and if anybody out there is thinking about getting up to the mountain, it is actually looking really, really good for this time of year.  I am shocked.  Salt Lake had 14 inches or something overnight.  I saw that.  But it is pretty good for December, I do not know what the day was, tenth.

Chantry:  When do Washington County Schools get out for the Christmas Break?

Jeremy:  So the kids will get out the Friday before Christmas which seems like it is the 21st or second.

Chantry:  So that would be a week from tomorrow?

Jeremy:  Yeah, the 21st. So a week from tomorrow. These kids are seven days left, and then they will have ten days off.  Look, it is the most wonderful time of the year.  The fun thing with Christmas break is that you are actually excited.  For all you parents out there, I think you know what I am talking about. It is actually exciting.  It is fun to have the kids home, and a lot of parents are off of work at least part of that time.  A little easier than summer.  Summer you are thinking, we have got a whole two months of this stuff, don’t we?  Now what am I supposed to do with these kids?

Chantry:  Right.

Jeremy:  And if you are working mom or a working dad –

Chantry:  Yeah, how do I deal with that?

Jeremy:  That gets really busy. Really, really busy. Here we are. We are all on our own plane with our kids and Mike has got his kids grown.  Mine are kind of in between and you have little, a little child.  And that is where we are at.  So Chantry and I are going to be talking about, this is exciting, okay.  It is funny that bad news is often exciting.  It is just so bizarre what is happening in some of these real estate markets.  Right?

Chantry:  Right. It is going to come as a surprise to most probably.  Right?

Jeremy:  Yeah, absolutely. So we are going to talk a little bit about what is going on in Dallas, Texas. Frisco, Texas.  By the way, Frisco, Texas, outside of St. George, fastest growing community in the United States of America.  And just crazy.  There is a Toyota plant there and jobs.  We are going to talk about what is happening with the real estate market.  And the teaser for our listeners out there: builders making hundred thousand and bigger dollar price reductions on their listings, offering real estate agents trips and travel all over the planet to sell their homes.  Some strange stuff going on out there.

Chantry: Yeah, the trip to Mexico caught my eye.

Jeremy:  Oh, is that what got you excited?  Did you want to move out there?

Chantry:  No, I will just take a trip there.  That is all.

Jeremy:  Actually I was just saying to Texas so you can start –

Chantry: I could sell some houses out there.

Jeremy:  So we are going to talk about what is going on with the real estate market and really the US housing boom coming to an end and what that means, and whether you should be alarmed, and whether St. George is next.  November was a very strange month for everyone in the real estate market, both in sales, real estate sales and in lending, that is what Chantry does.  He is with a company, Guild Mortgage, and they have worked with us for so long, at least coming up on a decade and do such amazing work. Of course, what they do is help people find the money they need to purchase a home.  And they have worked with, I do not know, certainly dozens and probably more like hundreds of our clients over the years.  Right?

Chantry:  Yeah, hundreds. Yeah.

Jeremy:  Hundreds of clients.

Chantry:  Families.

Jeremy: And you have been doing mortgage lending, I like to tell people home lending in a way because sometimes people out there in the public are like well, I do not.  Do you know what I mean?

Chantry: Yeah.

Jeremy:  But mortgages or loans for people purchasing homes for how many years?

Chantry:  It will be 13 when the calendar turns.

Jeremy:  Thirteen.

Chantry:  Crazy.  It was 2006.

Jeremy:  This is wild.  So let’s do some history.  So thirteen, 2006, 2008 is when they really say the bubble burst.

Chantry:  Yeah.

Jeremy:  So we are decade. We are having a ten-year anniversary, and we talked a little bit about this on our show last week.  So you read these articles –

Chantry:  That I did.

Jeremy:  — that I am talking about? Should I give folks the highlights?  Let me give you the headline for this article.  It is Bloomberg, and we will post this into the Facebook comments.  If you are not watching us on Facebook Live, you can catch us at Facebook dot com slash Jeremy Larkin.  The way it sounds, J-E-R-E-M-Y, Larkin, L-A-R-K-I-N. Facebook dot com slash Jeremy Larkin.  We are streaming it live.  We stream it live every week and then we post this over to the Larkin Group Facebook page.  Of course, if you are listening to us on the radio, you are either on 890AM or 94.9FM.  So our Facebook listeners, if you want to get on the radio, you can hop to 94.9FM, 890AM.

Chantry:  If anybody wants to, I have got my phone.  I am going to see if there are any comments.  I just barely thought of it.

Jeremy:  Oh beautiful, beautiful.

Chantry:  So if anybody wants to comment on Facebook, we will answer the question.

Jeremy:  Yeah, I love this.  Yeah, if you guys have questions, specific questions for Chantry who is doing lending, specific questions for me. So let me give you the headline:  Free vacations, $100,000 discounts, home builders get desperate with hot markets cooling and mortgage rising the industry turns to incentives to boost sales. And of course, Bloomberg paints this in such a dramatic fashion, do they not?  A real estate broker in suburban Dallas is raking in freebies this year.  Trips to Lake Tahoe and Santa Barbara in California, Cabo San Lucas in Mexico, and a dude ranch in Wyoming.  The home buyers he represents are cashing in, too.  They are winning price cuts of more than $100,000 on top of free upgrades such as media rooms, cabinets, and blinds.  This feels a lot like, when you hear this, some stuff we saw here a long time ago.

Chantry:  Sure, yeah.

Jeremy:  Doesn’t it? It goes on to say the generosity flows from an increasingly desperate home builder market. Hot markets are cooling as fast as interest rises, and this is where they really throw the drama on here.  Some flare.  In the great housing slowdown of ’18, it is like they have added, they have created their own term, shoppers are reclaiming the upper hand after years of soaring prices that placed most inventory out of reach of many families.  Everyone is hungry for buyers, he says. What do you think, man?  When you see that, what are your thoughts?

Chantry:  So sure, has the market shifted a little bit?  Absolutely. Is that an extreme version of it?  Yeah, of course it is.

Jeremy:  For sure.

Chantry:  But anybody that follows the housing market, it is kind of interesting.  It has been very similar to the stock market. So those of you that follow the stock market have noticed some things have changed over the last couple of months, quite significantly. And we have noticed that in the real estate market. But it had to.  It was out of control.  This summer, all of us were looking at each other going there are no homes for sale.

Jeremy:  It was weird. It was ridiculous.

Chantry:  Buyers have no, buyers have no control. And it was not just prices that were that were crazy.  It was terms. It was like they could not ask for anything.  They had to close really fast.

Jeremy:  Yeah.

Chantry: They had to make offers sight unseen.  Just weird stuff that just is not really good for a buyer.

Jeremy:  No, it is not good for a buyer at all. And one of the challenges we have in real estate is anytime that the market turns to where one group has the serious upper hand, either a seller’s market or a buyer’s market, it is going to create weird dynamics.

Chantry:  Not good.  Yeah.

Jeremy:  And this is not good either.  What we are hearing about in Texas. Definitely, when Bloomberg and Wall Street Journal and, and, and start running articles saying that the housing market is coming to a massive halt in Dallas, it scares people.

Chantry:  Sure.

Jeremy: Right?

Chantry:  Yeah.  Especially what happened ten years ago.  We all think oh, can that happen again.

Jeremy:  Excuse me, yeah, there is just no question.  And we do sit here wondering what will happen?  Like coming up here, it is interesting.  It says, let’s talk about some things that are issues that slow the housing market down, and we will answer the question whether St. George is next.  Rising interest rates –

Chantry:  Yes.

Jeremy:  — and we are going to ask you specifically about that. Trump did a tax overhaul that caps the, places caps on tax deductions for mortgage interest.  That is an issue.  Right?

Chantry:  Sure.

Jeremy:  They are hurting really like high tax areas.  New York, massive high taxes that really hurts those people.  4,000 new condo units listed for sale, will be listed for sale in 2019 in Manhattan they said.

Chantry:  Yeah.

Jeremy:  In Manhattan.

Chantry: Wow.

Jeremy:  Not in New York City.  Right?

Chantry:  Yeah.

Jeremy:  4,000 new condo units. You have got, okay, they talked about Austin and San Jose, California. Austin, Texas. San Jose, California. They have put, like immigration restrictions have kind of slowed down high-skilled workers coming into those markets. Some of these places are now less appealing to your Chinese buyers and your foreigners.  We do not see as much of that here.

Chantry:  Right.

Jeremy:  How often have you ever seen a foreign buyer try to get a mortgage?

Chantry:  It is really rare.  Occasionally we will get the Canadians because they love the warm weather here.

Jeremy:  Right.

Chantry:  Really honestly, some of them, it is the first warm place south.

Jeremy: Yeah.

Chantry:  So if you are heading south –

Jeremy:  It is.

Chantry:  — on I-15, boom, first warm place, really nice, great spot.

Jeremy: That is a great point.

Chantry:  So we get a little bit of that. But it does not drive our market by any means.

Jeremy:  No, not at all.

Chantry: But to your point, with the rising interest rates and home prices as we know just continued to go up and up and up, it is all about affordability.

Jeremy:  It is.

Chantry:  It really ends up being to a point where if prices get too high, rates go up, it is just not affordable anymore. So there has to be some sort of a shift back to normal.

Jeremy:  There absolutely does. So what you are saying is, from your perspective, this housing, the great housing slow down of 2018 is not a problem.

Chantry:  Yeah, let’s understand one big difference.

Jeremy:  Yeah, let’s do.

Chantry:  In 2006, do you remember the loan that they called the Stated Income/Stated Asset?

Jeremy:  Oh, for sure, I do.

Chantry:  Okay, so what this was was you are sitting across the desk from a mortgage guy and they say well, you need to make $10,000 a month, Mr. Schoolteacher. You make $10,000 –

Jeremy:  So what would he do?

Chantry:  — a month, correct?  Wink, wink.  And then all of a sudden, the deal is closed.  You did not have to document anything.  It was insane. There was no common sense, greed, crazy, stupid, whatever you want to call it.  Loans were getting done to people that just should never have gotten the loans.  Period. End of story.  And so, it made everything go out of control, and these people were doing it knowing that they could not afford the house payment. They just thought –

Jeremy:  Right.

Chantry:  They just thought if I do this, I can hang on for a year and then I will sell it and make all this money because my neighbor did that.

Jeremy:  right.  Right.

Chantry: And so let’s do that.  I know I cannot afford a $2500 house payment.  My neighbor just did it, and we can sell it in a year, and we can do it for a year.  Pull it out of our retirement.  That is what was going on.  See people were getting these loans they could never afford.  Ever.

Jeremy:  Not a chance.

Chantry: They never even thought –

Jeremy:  Not a chance.

Chantry: The people did not think they could afford them.  So now the total difference is loans are tough.  Loans are, it is hard to get a loan.  People that get a loan, by the end of it, they are tired of all these rules and giving us pay stub after pay stub and bank statement after bank statement and all this stuff we have to dig into, and absolutely the whole point of it is to make sure the mortgage industry feels like this person can actually afford this house payment.

Jeremy:  Well, right.  You need to make $10,000.  You know it is funny you ask that because I happen to be making $10,000.

Chantry:  Oh, that is weird timing, right?

Jeremy:  Actually, it is 12,000.  Well it is funny you would say that because I just got a text from my boss.  My income was raised.

Chantry:  Yeah, exactly.  Right.

Jeremy: It is like this is incredible. Right?  It is amazing how everybody seemed to have the qualifications during that time to do this. Right?

Chantry:  You did not have to get anything. It was just whatever you said, get a loan.

Jeremy: Well, okay, so the big difference now, that Chantry is saying, we have got Chantry Abbott here with Guild Mortgage here in St. George, we are talking about the great housing slow down.  I love this term.  I think I am going to run with it.   That Bloomberg News has put out of 2018 and we shared, if you just picked up the show, the fact that, and good morning to everybody on Facebook, and good morning to all of our listeners.  Thank you so much for your support.  Talking about the fact that in some of these housing markets it is slowing down.  So we saw massive, they are giving away vacations and crazy incentives and free media rooms and free upgrades and free cabinetry.  And they are giving away, they are reducing prices a hundred to two thousand dollars on these expensive homes by the way. Just to be clear, Chantry, I think people need to understand this.  They are reducing the price of seven to hundred million dollar homes by a hundred thousand dollars.

Chantry:  Right, yeah.  It sounds really –

Jeremy:  These are not $300,000 homes.

Chantry: A $3,000,000 house had $100,000 reduction.

Jeremy: Yeah, so let’s be clear.  However, what Chantry is saying here is that the difference between ten years ago as the housing market kind of catches up to itself, is that people are actually qualifying for the loans, aren’t they?

Chantry:  I have not done a loan since 2008 that was not like extreme documentation of being able to make the payment.  It has happened. People still have stuff happen in their life, and they are going to have short sales or foreclosures or fire sales.  I have to get rid of the house.  For the most part, these people are affording their payment barring a catastrophe, and that was not the case then. So that is where, sure, are we going to have a slowdown? Yeah, we needed it. We needed it.

Jeremy: Yeah.

Chantry:  It was a bummer for homebuyers.  There was not anything for sale. It was a little bit out of control, and I do not even necessarily mean prices were out of control. I just mean there were not enough, you sit down with a buyer and you go here are the two homes that are available. Which one do you want to buy? The seller has all the control in that situation, and that is just not good.

Jeremy:  It is not good at all.  And the sellers are like this is great. So, let’s put this in perspective for our local people. I have a comment.  I have an observation and a question.  Let’s start with the question. The prevailing 30-year interest rate today if I went to get a mortgage is what?

Chantry: About four and three-quarters.

Jeremy:  Okay, so it is four and three-quarters percent to get a home mortgage today, typically. Assuming fair credit and all that stuff, good credit.  Okay.

Chantry:  Somewhere in there 5% —

Jeremy:  Good credit, by the way, we are not talking 800.  Just thinking if you have got 700 –

Chantry:  Four and three-quarters, 5%, whatever.

Jeremy:  Okay.  Yep. What is the average interest rate that people have paid since they started tracking interest rates to borrow money for a home?

Chantry: Great question. So the mortgage industry as we know it, Fannie Mae and FHA, and it has been around since the 1950s we will say.

Jeremy:  Okay.

Chantry:  It is a little over 8% is the average rate over that timeframe to current.  And that is taking in current day when they have been crazy low, which is throwing the average off, right?

Jeremy:  This is crazy.

Chantry:  So the government made interest rates lower than they should have.  Even counting that, the average is still over 8%.

Jeremy:  This is, okay, this is going to be fun.  Typical person comes in your office today and wants to buy a $300,000 home, which is the average home in St. George right now.

Chantry:  Yeah.

Jeremy:  It is actually 330, 340, but I am going to say 300, okay, because I think the average is skewed because of higher –

Chantry:  Yeah.

Jeremy: Really is 300.

Chantry:  Take out the extremes.

Jeremy:  Yeah, the stuff that people are really affording.  If they buy a $300,000 home, your typical client, just no specifics, what is their payment? Like the typical payment?  What is the most average payment you send out of your office?

Chantry:  $15-1800.

Jeremy:  Okay, so let’s call it $1650 a month.  So the average mortgage payment that someone is coming out of Chantry Abbott’s office, Guild Mortgage, when they go in there and they hire them to help them get a loan, it is $1650.  Chant, just for fun, and I am putting you on the spot, if interest rates went from 4 ¾ to 8%. Today we are 4 ¾.  Eight is the historical average.  If they went up by 3 ¼ points, what would that payment 1650 be?  Just as a guess.

Chantry: I will do the math, but I am going to say about $400 a month higher, probably over two grand.  At least probably.

Jeremy:  So we are four –

Chantry:  I am going to do the math.

Jeremy:  He is going to do the math.  He is going to do some math. So let me put this in perspective as he playing around here.  He is actually just making his move on whatever, what is the game that everybody plays?  It is almost like Scrabble that they are playing with their friends.

Chantry:  Oh yeah.  Words –

Jeremy:  Words with Friends.  He just needs to make a move on Words with Friends and he will be back on. If interest rates right now, because we are going to tie this in, because we started the show by saying that the housing market is falling apart in Texas.  I do not know if it is falling apart, but wow, it has kind of shut off overnight.  If you read the article I linked in on Facebook to Bloomberg, you will be fascinated at the way it reads.  If rate were today at the historical average interest rates for you to buy a home, your payment would go up by an average of $400 for the typical homebuyer. From 4 ¾% what is the number?

Chantry:  It is about 500 actually.

Jeremy:  Five hundred.  Okay.  This is even better. Thank you for adding some excitement.

Chantry:  So about a 3% difference on that scenario is almost $500 a month.

Jeremy:  So it is very simple where we are going with this. So the question is what are rates?  4 ¾%. The simple point is that this is absolutely a time that is still a great time to be buying a home.  Now, here is the observation I wanted to make.  We are seeing the For Sale By Owner sign go up everywhere in Washington County –

Chantry:  Right.

Jeremy:  — in the last 30 days.

Chatnry:  It is easy.  Let’s just sell it on our own.  Right.

Jeremy:  Have we noticed historically, gang, that consumers are always six months behind every trend?

Chantry:  Yeah, yeah.

Jeremy:  We are always six months behind.

Chantry:  Yeah.

Jeremy: Now here is the reality –

Chantry:  We all know that guy.  Oh, my buddy made a bunch of money in the stock market.  I am going to hurry and jump in. It is like you missed it.

Jeremy:  Yeah, you missed it.  Right?  So what is going to happen with most of these people selling their home by owner, and I have to be very honest about this, we are needing to reduce the price of most MLS listings right now to get to them in line with what the market is really supporting, and we have talked about this for a month because sellers have been asking more than the market would support.  Values are not really going down.

Chantry:  Yeah.

Jeremy:  Right?  In St. George.  People have simply been asking more than the market will support.

Chantry: Well, what people do and I think this is where you are getting is their house is realistically worth 300, but they think, you know what, I have heard it is crazy.

Jeremy:  I will do it at 325.

Chantry: There is nothing out there.  Maybe we put our house up for sale for 330 and see if we get it.  And if we get it, really cool, let’s sell it.

Jeremy:  You know what?  Let’s just go 600 and see what we get.  Okay, but they are not going that crazy.

Chantry:  Let’s just put it up for sale at 330, 350, and we get that.  Cool, we will sell.

Jeremy:  Right.

Chantry: And that is not what is going to happen now.

Jeremy:  Right. So the For Sale by Owner, where every professionally marketed agent listed is being reduced, most of the For Sale By Owners are not going to have success right now, and it is going to be hard, and that is going to be frustrating.

Chantry:  Every time I do a mortgage and there is a For Sale By Owner, the buyer thinks he is going to get a deal.  There is no real estate commission, so I am going to offer him super low.

Jeremy:  The buyer wants the deal.  So folks, if you want to reach out to Chantry Abbott at Guild Mortgage, 674-1090?

Chantry:  Yes.

Jeremy:  Best number, 674-1090, and Mike will give you our contact information.  Have an amazing week.  Get your Christmas shopping done and check out the article we linked on Facebook about free vacations for realtors in Texas.  No free vacations here that I have seen.

Chantry:  There is one for Mexico, I think.  I do not know when that was.

Jeremy:  Okay.  All right, man.

Mike:  (Indiscernible)

Jeremy:  There is a dude ranch vacation.

Mike:  Dude. All right. You have been listening to St. George Real Estate Morning Drive.  For information, call 275-1690 or find them online, Sold in St. George dot com.

The SINGLE MOST IMPORTANT MESSAGE About The Real Estate Market (St. George Real Estate Morning Drive Radio Show)

 

Click on Facebook Live. to see the entire recorded show from Facebook! Below is the actual S. George Real Estate Morning Drive show, hosted by St. George Real Estate Agent Jeremy Larkin, word for word! Enjoy and please share if you find it valuable! 

Jeremy Larkin and The Larkin Group @ Keller Williams Realty can be reached by calling 435-767-9821, or emailing sales@gostgeorge.com. 

Mike:  KDXU News Time.  It is 8:36 of the news time morning news, and welcome.  Glad to have you with us.  Thursday morning. And of course, that means it is time one again for another edition of the St. George Real Estate Morning Drive with the voice of St. George Real Estate Jeremy Larkin.

Jeremy:  Good morning, ladies and gentlemen, girls, boys, real estate fans.  I can definitely declare that I am going to be stopping at Daylight Donuts on my way by this morning.  I just had that inspiration coming up Bluff Street.

Jesse:  Then you have got to do it then.

Jeremy:  I know.  I realize it may not be the best choice. We will see.  Let’s see how I feel in 24 minutes. We will see how I feel then.  It is a wonderful day.  I have got Jesse Poll, Jesse Poll in studio with me.

Jesse:  J.C.?

Jeremy:  Yeah.

Jesse:  You can call me whatever you want.

Jeremy: Yeah, I have got JC, my good friend, here.  Good morning to all of our lovely listeners and Facebook friends and fans and people.  It is going to be a great day, and part of the reason we know that is if you look outside you can actually see, hair in my eye here, sorry. You can actually see downtown.  I can see all the way. You can see a big old shower coming down the way and some sun rays coming through them.

Jesse:  It is nice.

Jeremy:  It is incredible.  The famed, famed Larkin Group Fall and Dixie photo that has just been going around for forever and ever and ever, we actually have a client. Remember Quuntin and Mori Jensen?  Did you, you did not know them.

Jesse:  I did not know them.

Jeremy:  So they are moving back from Virginia and how I noticed that on Facebook the other day is that they had posted this photo, and if our listeners do not know what this photo is I guess I can throw this into the feed this morning. But it is a picture we had taken in 2009 by Danny Lee.  Danny is a really great professional photographer here in town and did just a ton of work for us for a lot of years. Larry Gardner, a little back story. So this is going to be fun this morning, excuse me, but I am. So Larry is a friend.  I grew up in the neighborhood that he was one of the dads. Right?  So his kids are my friends.

Jesse: Okay.

Jeremy: And then he was my boss. One of my bosses.  He is a City councilman and a really well-known guy, and so he took a photo of this shot.  And the shot is you drive up Airport Hill.  Okay?  What they call it.  Right?  Just to the top, almost to the old airport, which is now where the Cliffside Restaurant is, and he took this photo.  And it was probably 2004 of downtown and it was just in this epic color, and it was right after a rainstorm and everything was clear, and the color was really vibrant.  Well, it was not a professional photo.  It was a good photo, and years later, it was November.  It was good, and we used it in our marketing, but it had some power lines running through it.

Jesse:  Yeah.

Jeremy:  And then years later on a November day, I called Danny and I said what are you doing?  Well, I am in St. George.  I just shot a home, photographed a home.  Well, could you go up to Airport Hill in like 10 minutes?  He said yeah.  He went up to the hill and 15 minutes later we had this photo, and it has been featured on more Facebook pages and yard sale pages.  When I saw the Jensens, now segueing back, I knew they were moving back from Virginia because what photo did they post to say guess what everyone, we are moving back to St. George.

Jesse:  I am going to tell on myself for a second here. I do not even know if you know this, but did you know that I stole that idea before we met?  For my sign.

Jeremy:  No.

Jesse:  I went up to my friend’s house –

Jeremy:  I remember.  I remember.

Jesse: But it was my photo.

Jeremy:  We disapproved. We saw.

Jesse:  I did not even know it was you.

Jeremy: Oh, it was us.

Jesse:  I saw this sign and I am like wow, that is gorgeous.  How could I get one like that? So I went up to my friend’s house with my phone and took it.

Jeremy:  Oh, I remember.  I remember, Jesse.  We knew you before you knew us.

Jesse:  And do you know where those signs are now?

Jeremy:  In the garbage?

Jesse:  No, my sister-in-law painted them. We have this, the next time you come to my house you will see it.  It says the cottage.  This beautiful sign.

Jeremy:  I did not know this.

Jesse:  I have not hung it yet because we were still working on it.

Jeremy: Oh, that is classic.

Jesse:  But she painted them all.  For each, she did one for everybody’s house.

Jeremy: I am glad you came to work for us instead of –

Jesse:  Beautiful.

Jeremy:  — instead of competing.

Jesse: Right.  Competing with the sign. Mine still was not as pretty though because it was reflective, and it is in the details.  Right?

Jeremy:  The devil is in the details.  Hope we have got some friends watching.  Comment and say hello if you are watching this morning and let us know that you are out, and you are listening.  So I want to share with you guys something that is going on.  That is the background. And we will share that.  We will actually throw that photo on the Larkin Group Facebook page this morning.

Jesse: It is a nice photo. It is so nice people try to steal it.

Jeremy:  Yeah, it has been on postcards.  There are some jerks around town that thought they could take our photo.  That is the situation, guys.  It could be worse.  By the way, if you are lamenting that it is cool or not, it is just not early Fall anymore, you could have snow.  And it is snowing all over the place.

Jesse:  And they do have snow in Cedar City. My wife called me last night on her way back from work and said it is snowing.

Jeremy:  Woo, buddy. We do not want that. We do not want that.  Today, we are going to share with you, just so you know, as we get the show rolling, we are going to share with you what I believe is really the most important, single most important message that you can receive in real estate. And when I say most important message, I mean in any market.  And when I say any market, Jesse, what I mean is any city.  Okay?

Jesse:  Right.

Jeremy:  And in any market condition. Right?  Whether the market is going, generally the public understands real estate as the market is either going up or it is going down.

Jesse:  Right.

Jeremy:  That is kind of how that works.  Well, is the market going up or is the market going down? We are going to share with you the single most important message that you could possibly have in real estate.  There is nothing more important to you as a buyer or a seller than this message that we are going to share today.  Okay?  Which is something more than Happy Holidays.  Is that fair enough for you?

Jesse:  Oh, happy days.

Jeremy:  This truly is something that is important.  So I wanted to share something that is kind of fascinating.

Jesse:  That was for Jessica Marron, by the way.  Her and I –

Jeremy:  Good morning, Jessica.

Jesse:  You never know when either of us is going to start singing —

Jeremy:  Yeah.

Jesse:  — or dancing.

Jeremy:  That is exactly right.

Jesse:  She is my kindred spirit.

Jeremy:  I think she is a lot of people’s kindred spirit.  Good morning to her.  Gang, if you are a skier or a snowboarder, Bryant Head Resort, I was just mentioning when the live feed started, and we were just kind of in here getting mic’ed up, Bryant Head is getting some snow. Finally, getting some snow.  They opened last weekend.  I never miss opening day ever.

Jesse: And you did.

Jeremy:  Two weekends ago. I absolutely missed opening day. They opened actually the weekend before Thanksgiving, and then I missed the weekend after. It is looking like I will miss this weekend as well. So this is pretty rarified stuff for me, but it is what it is.  If you go to Bryant Head dot com, it is fun.  They have three live webcams and I watching it right now in studio, panning left and right, and it is dark, and it is overcast still a little bit up there.  Lights are on. It is really cool because the storm has set in up there.  So check that out.  Skiers and snowboarders, we are really only an hour, it is an hour and a half if it were a snowy day and you were taking it easy.  I do not tend to take it very easy when I travel to Bryant Head.  I am usually in a hurry. I call it 75 minutes for sure coming back and usually about 80 going up. So Bryant Head dot com. I hope that everyone has got their skis shined up, grab a stick of Juicy Fruit.  Remember those ads? I do. I remember those ads very, very —

Jesse:  Juice Fruit.

Jeremy:  — yep, very distinctly, and these people were skiing over in Colorado. That was a good time.  All right, let’s talk about real estate, shall we?

Jesse:  Let’s do it.

Jeremy:  Jesse, I had this crazy, last night I was playing around, and I am absolutely not going to mention the homeowner’s name.  But I saw a property that was in Stonecliff that was on the market.  And when I looked at the property, this is kind of interesting. So, this home has been listed one, two, three –

Jesse:  Two, three, four, five, six —

Jeremy:  — four, five, six, seven, eight, nine, ten, eleven, twelve times.

Jesse:  Wow.

Jeremy: So there is a property that has been on the market twelve times, and that is with a variety of real estate agents, starting in 2008, it is now 2018. So for a decade, literally for a decade, and if I count up the days, two, three, four, the home has legitimately been on the market probably 1500 days over the last decade in Stonecliff.  For our listeners out there, if you have not sold a home, this is so mind-boggling if you are the homeowner.  Right?  Because you start to say what is possible, and I see the price started at one point, I am just going to say six.  The price started at $1.6 million, and it has come down a third of that, and down below that, and then it has come back up. Here is the challenge. When we have a market that has appreciated for the last six years but your price has come down a third over the last ten years, this does not make sense.  Right?  So all of the home values in Washington County have gone up an average, an average of about $125,000, 130 since April 2013.  Or just 2013. Maybe it was April. Home values are up $125,000, 130 maybe in Washington County since 2013.  That is the average home.  Home values as a percentage are up 25-30%, maybe even more, maybe even 35% in certain neighborhoods. But here is a home that a really good human being has tried to sell.  A homeowner, and they have actually reduced their price by 30% over the same time period.  Jesse, what does that mean? Because that does not make sense with the market. It means something very simple for us.

Jesse: Well, it just means that they are not, they are trying to get what they want instead of what the market will bring.

Jeremy:  Right.

Jesse:  Because even, I am going to go somewhere you are not even expecting. But even in those price ranges –

Jeremy:  Oh, I do not know.  You are pretty unexpected.

Jesse:  — even over a million dollars, the homes that are selling are selling within, at the highest, 154 days, oh no, 207 days –

Jeremy:  Yeah.

Jesse:  — is the highest days on market. So they are still selling when they sell.

Jeremy:  It is just taking longer.

Jesse:  It takes a little bit longer. Not significantly. Not 1500.

Jeremy:  Yeah, so 1500 days, as we get into this and we are going to share this message.  What we believe is the single most important message about any real estate market for buyers and sellers and would-be buyers and sellers.  But I think this is a great segue for us.  You have someone, as Jesse said, has been trying to ask significantly more than the market will bear.

Jesse:  Right.

Jeremy:  So here is what is going on in the real estate market today before we set this up.  Well, let’s just share it.  You guys ready?  Three, two, one. Real estate markets in every city in the United States of America and probably on the planet are cyclical, and this is the single most important message that you can possibly understand about real estate. It is not is it a good time to buy.  It is not is it a good time to sell.  Should I rent or buy?  Right? Should I purchase an investment property? The single most important message is that real estate markets are cyclical, which means what?

Jesse:  That what goes up must come down.

Jeremy: And?

Jesse: And what goes down must come up or will come up.

Jeremy:  Absolutely.

Jesse:  It is an equilibrium, and in any equilibrium, it has to go up and down to equalize.

Jeremy:  I have a very close friend who two days ago, 48 hours ago, we are not even at 48 right now. I think we are at 35 hours ago. He was like I guess things are just not going to work out in my life, and two hours later, everything changed. In a very positive way, and the way I described it is the clouds parted and the sun broke through.  Go figure, and I said this morning, do you realize that was two days ago? Two days ago, you were everything is going to pieces.

Jesse: That is why we need to keep reminding ourselves that this will pass. This too shall pass.

Jeremy:  Which makes it sounds like we are talking about a bad real estate market.  We are not at all.  This is an amazing real estate market, but we are going to help you understand what is going on in the real estate market. So if we go back ten years, it was 2008. Literally, people thought, people meaning just generally everyone, it seemed like the clouds could never part, and that the real estate market would forever be in freefall and gang, understand that almost all of the major developers in the western United States lost everything.

Jesse:  Yeah.

Jeremy: This was not like –

Jesse:  I was just talking to a roofer last night. Actually, Stout Roofing is going to do my roof, and we were talking about the crash. What they went through and what they have pulled through, it is just amazing.  We are talking about $600,000 of accounts receivable that they could not collect on.

Jeremy:  Are you serious?

Jesse:  And they pulled through that. It gave me goosebumps for a guy to stand in front of me that came through that and now they are getting ready to do my roof and they are going strong.

Jeremy:  Isn’t that amazing?

Jesse: Yeah, it was really cool because how many did not come back.

Jeremy:  Right.  The amazing part is we have projects in Washington County that were 30 to 40 to $50 million value projects that just went belly up.  They went upside down.  Anyone who can remember ten years ago, if you went up to the Ledges, so the Ledges actually came, well it was a little later.  The Ledges came out of the ground.  It was 2007, Parade of Homes 2007 is when the Ledges came online.  This is fun.  The average person does not know this because why would you know this?  You do not do this for a living. But it is 2007, and they have opened at the Parade of Homes, and they had this big, incredible Spanish-style property that many folks do know of.  It was the first big home in the Ledges.  It has a lazy river and an island green in the backyard where you can chip balls onto the green.  It overlooks Snow Canyon, and that thing came on the market.  It was $5 million, by the way.  They had all these tents set up, and the sky was the limit, and they sold all the lots up there to a variety of builders. They came in and these guys thought they could do no wrong, and gals, to be fair. By 2010, you would drive down past the clubhouse, and there was a row of unfinished homes right there.  Probably a dozen homes, framed, some of them had, what do you want to call it?  Paper, what do we call it the paper?  My brain is fried for a minute.  On the outside, getting ready to stucco and they sat for years.

Jesse:  The vapor barriers.

Jeremy:  The vapor barrier.  Years, and years and years.  My uncle came into town from Southern California. He is a developer and he said oh my gosh.  This is bad.  That was, guys, that was eight years ago.  That part. So now go to the Ledges.  Now look around St. George. I am looking behind me at the Bluff Street redevelopment project.  So what we need to understand is that every real estate market is cyclical.  And so, Jesse, what are we starting to see in the market. We are having a lot of real estate agents reach out to us and say what is happening with their listing that they are trying to sell for a client.

Jesse: Well, what is happening is there are a couple of things.  We are seeing a lot of pressure like sellers are having to reduce their prices finally.

Jeremy: There you go.

Jesse:  Buyers are stopping.  They are like no, we are not going to do this anymore.

Jeremy:  Yeah.

Jesse:  You are having to have a strategy to actually sell a home.  What are we going to do?  How are we going to be the best value?

Jeremy:  So very specifically, sellers are having to reduce their price.

Jesse:  They are.

Jeremy:  Does that mean the home values are going down?

Jesse:  Not necessarily.

Jeremy:  Not necessarily.

Jesse:  They do not go down like that.  It is kind of like a train does not stop in 100 feet. It takes a minute.

Jeremy:  It takes a while.

Jesse:  But there is starting to be some pressure.

Jeremy: There is.

Jesse: And it is visible pressure like homes that 30 days ago or 60 days ago would have sold in two days are taking maybe three or four weeks.

Jeremy:  This is absolutely right.  We are seeing a ton of pressure in the $4-500,000 range, and what starts to happen is because real estate markets are cyclical, and the reason this is the most important message is that people will start to panic and the market is so driven by the emotional conditions that people live in that what will happen is you will have a whole bunch of buyers who are frustrated and they are fed up, sick and tired of writing offers on homes and competing with five people.  So they start saying well, maybe I will not write anymore offers.  They are fed up with paying 10% more than the last person paid in the neighborhood. So they say well, maybe we will not pay 10% more than the last person. They are frustrated because interest rates are amazing at five-and-a-quarter percent, but they remember when they were four-and-a-quarter percent.  So they say maybe I just will not borrow money, and I will not buy a home. And what starts to happen is very subtly, slowly, then suddenly, the entire market can change.  And it is changing.

Jesse: What is interesting is that, Guild Mortgage put out an interest rates over the last, I do not know, 40 years, yesterday, it is a picture. But for the last, gosh, 15 years, interest rates have just kept going down.  And we lose track of our memory.  Right?  We do not think well, this is cyclical.  And we do not stop long enough and –

Jeremy:  Excuse me, what were you saying?

Jesse:  It is cyclical.

Jeremy:  You said we lose track of our memory. I was going to see if you were paying attention.  Okay.

Jesse:  But we do not realize that what goes down is going to come back up.  And what is that going to do to us if we do not act now or if we do act now.

Jeremy:  We do forget, and here is what we start to do. We make decisions on buying and selling a home that are based on well, rates went up, maybe I should not buy. Here is the issue gang.  Historically, rates were significantly higher than this.  I remember when I was at 7% on a townhome, and I thought it was the greatest thing ever.

Jesse: Right.

Jeremy:  When it went to 5.8, 6%, I really thought that my wildest dreams had come true.  And then they went to 3%. Well now they are back to five-and-a-quarter percent, and they will go higher.  So there will be people who will look back at this market and go oh my gosh –

Jesse:  I wish I would have.

Jeremy:  — I cannot believe I did not buy a home.  Okay?  We are going to have sellers –

Jesse:  Or make that move.

Jeremy:  Correct. Right? We are going to have sellers who are going to find out that people are reducing prices in their neighborhood, which is going to imply to them and cause this idea that maybe values are going down.  Maybe this is not a good time to sell.

Jesse:  Right.

Jeremy:  Historically, ladies and gentlemen, do you realize that values are literally back where they were at the ’06 peak.  We are actually back there. We are right back where we were. Let me share something with you. Southern Utah Title produces a really great report that we were looking at this morning, Jess, right?

Jesse:  Yep.

Jeremy:  And by the way, you can visit SUTC, S as in Sam not F as in Frank. S as in Sam.  SUTC dot com, Southern Utah Title Company.  Thank you, Mitch, for your help this morning. Southern Utah Title Company, they produce this incredible report called the Good News Report.  Let me share something with folks.  In 2009, there were 474 building permits pulled.

Jesse:  Wow.

Jeremy:  In 2009, 474 building permits.  Do we know how many building permits were pulled so far this year, Jesse?

Jesse:  1,866.

Jeremy:  Projected at how many more?

Jesse: 622.

Jeremy: So we are projected to have 2400 building permits pulled.  That is five times as many building permits as were pulled in 2009.  Okay? And it looked like this.  2005, four years prior, now brace yourselves, folks, and we have talked about this in the show, but I would not expect someone to remember this. 3500.

Jesse: Really?

Jeremy:  We went from 3,500 building permits pulled in 2005.  The low was 474.  Nine times, a nine-time crash.  Nine times fewer.

Jesse: Wow.

Jeremy:  Right? We went from 3,500 building permits in Washington County to 474.  Last year, we pulled 1800, and this year we are at 1800 and the year is not out.

Jesse:  And end at 2400.

Jeremy:  Let me be really clear. This is September. But we are headed to 2400 permits. Is real estate cyclical? Real estate is cyclical.  Is the market crashing because people need to reduce the price? No what it means is, and what we have talked about on the show is pretty much everyone is asking probably 5-10% more than what the market is really going to bare.

Jesse: Yeah.

Jeremy:  (Indiscernible) the sellers.

Jesse: The pricing conversation is a lot different when you are in a really strong sellers’ market than when you are in a buyers’ market or just a balanced market.

Jeremy:  Yeah.

Jesse:  And really, we are just going back towards a balanced market.

Jeremy: Yeah, correct. This is so true.  We are headed back to a healthy, balanced market.

Jesse: Because there is a day when three months was normal to sell a house.

Jeremy:  Correct.

Jesse: Sixty, ninety days. That is normal.  This sell your house in a week is not normal or sustainable.

Jeremy:  It is not.  Right?  We have used this so many times, but it is like when In-and-Out Burger opened over there by Best Buy, it has been a long time now.  There was a line around the building for four days.

Jesse:  That is crazy.

Jeremy:  Well, it is an unsustainable pace. No restaurant has a line around the building for 365 days a year and it lasted about four days and it was done.  And there is a nice line out there now on a busy lunch, but they push them through.

Jesse: Right.

Jeremy:  Here is another thought.  Okay? That was building permits. How about total sales?  In 2009, 3,900 properties sold in Washington County. 3,900 properties.  We are projected this year to have almost 10,000 properties sell in Washington County.  Now this is all sales, and so when we say all sales, and again you can visit S as in Sam, UTC dot com and look at the Good News Report.  All sales means building lots, homes, condos, townhomes, that kind of thing.  Right?  So folks, look, the market is absolutely incredible.  The market is cyclical.  Let me share one last thought with you.  We virtually have no foreclosures in Washington County right now.

Jesse: Wow.

Jeremy:  We are talking about, folks, let me give you some perspective.  We are talking about almost zero, virtually none in Washington County.

Jesse: Out of how many active listings?  1400?

Jeremy:  1500 homes on the market.  Well, how many homes are in the county?  10,000?

Jesse:  Yeah.

Jeremy:  More. I do not know how many.  That is a number we need to get.

Jesse: How many homes are actually built?

Jeremy:  Yeah, yeah, properties.

Jesse: I will work on that.

Jeremy:  Thank you. There are virtually no foreclosures.  Real estate is cyclical.  A decade ago, we know for a fact, I know because I was selling homes that I was handling at one point, the Larkin Group, we were handling over 70 foreclosed or soon-to-be foreclosed properties.

Jesse:  Wow.

Jeremy:  Just us.  Guys, the most important message that you can ever receive about real estate is that it is cyclical.  Markets go up and they go down.  This will be a time that people regret not selling because values are high, and they will have been high, and it is a time that people, this is ironic because it does not always work this way, will have regretted not buying because rates will go up another point.

Jesse:  I think that is a big piece.

Jeremy:  And they will be ticked.  It is a strange and actually amazing time in real estate.  Headed back to a balanced market.

Mike: You are listening to the St. George Real Estate Morning Drive with the voice of St. George Real Estate Jeremy Larkin.  For more detail and information, call 275-1690 or find them online at Sold in St. George dot com.