The #1 Home Selling Opportunity in St. George Real Estate Market Right Now (St. George Real Estate Morning Drive Radio Show, 8.9.18)
-Jeremy Larkin, Host of the St. George Real Estate Morning Drive.
On today’s show host Jeremy Larkin and co-host Jesse Poll of The Larkin Group are in the KDXU studio with Mike McGary to talk about the client who will most benefit from today’s real estate climate!
Jeremy: …one hundred percent accurate. You remember Willard Scott, do you not, out there? Mike, you know Willard Scott.
Mike: I know Willard Scott.
Jeremy: He so pre-dated Al Roker. See, when I was a kid, he was the Today Show guy. Right?
Jeremy: He was the guy.
Mike: I was not even a kid when that happened.
Jeremy: Well, there you go. You know what? That is fair enough. That is absolutely fair enough. The reason this is in my scrapbook is because I was obsessed with the weather. But it has been so crappy and hot, I know I am being negative, I am sorry, that I stopped looking. So here is the guy that had a comic strip in his childhood scrapbook about how much he loves the weather. I just stopped looking. I just started, look, it feels miserable out there. That is kind of how it feels. We talked about the five stages of grief, and folks, we are right at that point, right at that point that I talked about where it is August. And the funny part is there will start to be a delusion that comes over us this month that it is going to cool down soon. Right? But the reality is it is going to be over 100 in September also.
Jesse: I have not hit that delusion yet.
Jeremy: So sorry.
Jesse: I just know that it is going to be hot for a while longer.
Jeremy: Sorry. Folks, tell us what you think about the heat if you are watching us on Facebook Live. Good morning to everybody. You can see us at Facebook.com/JeremyLarkin. Tell us what you think about it. I want to do a little shout out to my, so just in case you folks do not even know who we are and what we do. I am Jeremy Larkin. I am host of the St. George Real Estate Morning Drive. I have Jesse Poll in here. Jesse is a business partner. He is our Client Concierge and he is our do-it-all guy. He is really good actually, man, serious. He is really good on the radio and he came in here and started doing all my camera work, and we added him in here. I think that the glory very easily, well, the glory is very easily given to me because I am this guy who is in the community. Right? So people say we see your videos. Man, you are everywhere. But the reality is Jesse, three people very specifically, Jesse Poll, who is with me in studio, who is our Client Concierge, make this happen at The Larkin Group. The reason that we sold 1,300 homes, that means served 1,300 families, and we are going to talk about today the emotion that underlies every real estate transaction as well as where market values are and we are going to ask you if you might be shocked that in this amazing market that over a third of homes are not selling. We are going to cover this all. Jesse Poll, Client Concierge and kind of does what we call inside sales, Kala Evans, an amazing woman who stepped in and stood in and took over really our operation recently in kind of an unexpected way. Thank you so much. She does so many dynamic things and brings so much light and positivity. And Taylor Lemmon. Taylor is brand new, and these are the people that make our office actually run. It is not sales people. We go out and bring the animals back from the wild. But then what happens with the animal? Right, I know everybody says that is such a terrible analogy. Sorry, Robert. Too bad for you. Actually Robert is in an appointment with the Herds. Met with them this morning. They are selling their home. But Taylor Lemmon is brand new and joined us seven days ago today.
Jesse: Yep, she has not ran away yet. So this is good.
Jeremy: No, no, and it has been wild. It has been wild. Forrest Green is saying good morning. Oh Jesse, you saw it.
Jesse: I used to work with Forrest.
Jeremy: Oh, he is so awesome.
Jesse: He is a cool guy. He lives up in Idaho now.
Jeremy: Perhaps we should run a support group. Jessica says about the heat. Yes, we should. With lots of air conditioning. So those three individuals, I just wanted to let them know how much I appreciate them. The really cool part is that Taylor is so new she does not know how to challenge me yet, but Jesse and Kala –
Jesse: She will learn.
Jeremy: Yeah, they challenge me daily. As a matter of fact, daily. Maybe even this morning. They challenge me to run our business better and more effectively and show up and lead with love and help our clients. Robert was meeting with the Herd family, and I think there is a kind of an interesting conversation. Do you know any background on what they are trying to do?
Jeremy: Okay. So you know the scenario.
Jeremy: They live in one home but tell people the rest of the story because this is, by the way, we are about to tell you who the number one, who the best client for this current market is. If you would like to know if you qualify.
Jesse: They built a smaller home a few years ago, and this home that they were talking about, they have actually had a great renter in it for two years. Imagine if you are a landlord having a renter come in and say no, I do not want just a year lease. I want a three-year lease.
Jeremy: I want to tie this thing up.
Jesse: So they did a two-year lease and it is almost up. They are trying to figure out do we wait another year or do we sell this now? Because what is interesting is he is actually in the construction, a vendor of the construction industry, so he just sees what is going on and what feels like such a crazy, hot market is pretty scary. And he is wanting to have a real conversation around that. So that is what we are doing today. Do we dare wait another year?
Jeremy: Right. And how does he specifically benefit versus someone who wants to sell a home and then buy another one?
Jesse: Well, he just gets to take advantage of a great selling market.
Jeremy: He just takes the money and runs.
Jesse: He does not have to worry about, and actually he took advantage of the great building market a couple years ago.
Jesse: It is a great scenario to be in, I think.
Jeremy: Well –
Jesse: It is a Cadillac problem.
Jeremy: It is a Cadillac problem.
Jesse: I always say that.
Jeremy: It is a Cadillac problem, and it is a Cadillac problem because like Jesse is saying here, I want to sell my home, and so you have a scenario if you want to sell your home and you need to buy another, you get wrapped up into this challenge in this market which I am going to sell my home for a lot of money and then I am going to have to pay a lot of money.
Jeremy: Now, while that stresses people out it is actually not the problem they think it is because the equity in their home is going to offset it, and interest rates are so low. But it feels like a problem to sellers. Right?
Jesse: Well it is like any other problem. If you do not sit down and really have a high-minded discussion around it, about facts, all you have got is your thoughts, feelings, and emotions, and they are running around in your head, and until you really get them around factual data, and actually talking one-on-one with somebody, there is nothing but fear or delusion that can happen. I think.
Jeremy: And this means coming in and sitting down and talking with somebody who can give you some guidance. So I actually stepped into the meeting on the way to the radio show and chatted with them. I asked a few questions. What would benefit you from keeping the home, by keeping the home? Would you want to sell the home? One of the things that will often happen is the seller will say well maybe we will hold on for a year. Maybe it will be better next year. The challenge is you do not know that.
Jeremy: And we know for a fact, almost a fact, that interest rates have risen, first of all, and will be higher, and what will happen is, I want you to think about that freefall feeling. You go on a roller coaster and you go up and you go up, and then there is this kind of weightless feeling that happens at the top and the next thing you know your stomach is dropping and you are going down the other side. Real estate market shifts will happen this way. It will be crazy. It will be busy. It will be so like it is now, and then we will hit that weightless feeling and it is completely, it is unnoticeable to the naked eye. It is unnoticeable to the typical consumer who is not selling real estate, and quite frankly, most real estate agents will not even notice that that has happened, and then the market has shifted. And now it is going down the other side.
Jeremy: But only it is not a rush.
Jesse: It is not. If you are paying attention, you can see it coming.
Jeremy: This family that we talked about – that is like the best client world for this market. There are a lot of people that need to sell a home or want to sell a home and a buy a home. But if you are an investor sitting on real estate right now, I have to say, I have to say it is very likely you have $100,000 equity in your home. I would wait, if I am an investor, I would say okay, I have got this home that I paid $220,000 for. Okay. I paid $200,000 for it ten years ago. Well, now it is worth 300 for sure, right? We can assume a third for sure in ten years. It is worth $300,000, and my tenant paid part of my mortgage down, so I owe 180 or less. I owe 160 to 180. It is worth 300, and my dream was to be a real estate investor and keep this home forever. But I started thinking I am clearing $275 a month net profit. Yes, they are paying the mortgage down. Yes, right? But I am clearing $275 net profit every month building this nest egg. What if I sold it and took $120,000, sat on it, put it in a CD, put it in a mattress? Right? Did something different?
Jesse: Well, okay.
Jeremy: This is the benefit for some many investors who may look back and go dang it, I wonder if. I wonder if. I was kind of rolling the dice. I just kept pulling on that lever at the casino. I ran that thing up to $200, and then I could not resist, and I ran it back down to $100. I am so mad at myself. I hate that feeling.
Jesse: Possibly, but I think that before they go and make that decision, I think that they really have to look at all of the, not facts because we cannot know facts for the future, but we can definitely run some what-if scenarios. Because for the guy that is maybe going to sell and hold onto $120,000 for two years, and has to get a loan again, that might not make sense even if the prices are lower. And he is going to have to pay, it is more than just can I get the highest price right now? I think that is just a whole plethora of conversations that should be had before he does that.
Jeremy: That is a valid point. Valid point. Jesse, talk to us about this situation. Chantry Abbot commented on Facebook Live. Guys, check it out. Facebook.com/JeremyLarkin. He said that does shock me, and what he is referring to the fact that 37% of the homes on the market are not selling.
Jeremy: I want to interject this and get some feedback from you. We run all these ads on the radio. And we have done this for years. And people know that we are endorsed by some of these local guys. We started realizing that people got the sense that every single home was selling so hey, you know all your easy exit listing or you will cancel the listing if we are not happy? All that stuff. It does not really seem that valuable anymore because everything is selling anyway. Really?
Jeremy: Because 37 out of 100 homes that are hitting the market, when we say they are not selling, it means their listing period is expiring, meaning they are spending six months on the market typically and it did not sell. And then they are having to revisit new agent, new price, new something, and then they may be selling later.
Jesse: Right. Or we decided to stay. We cannot get what we want. Right.
Jeremy: What do you make of that, man? You have got some interesting data right there.
Jesse: Well, it has actually been that way for a while. You want to see a hot market? You should go up to the Wasatch Front. Because the reality is the Wasatch Front includes Ogden, Salt Lake, Park City, and Utah County, and we have more homes active for sale than they do in that whole area. That is a hot market. So are we in a strong market? Sure.
Jeremy: Sure is.
Jesse: But we are not seeing thirty and forty offers. I have not experienced that.
Jeremy: No, we are not seeing –
Jesse: We might see ten.
Jeremy: We have had a handful of ten.
Jesse: Yeah, we have had a handful of ten. So it is not necessarily as hot as we think it is.
Jesse: When you have a market that 37% of homes are not selling, although it is still, 63% is still a good number, right? But the reason I started looking at that number right now is because around the industry, we are starting to feel a difference.
Jeremy: We are feeling a difference.
Jesse: In fact, the seller we are meeting with this morning said the last time he felt this difference it ended up really bad.
Jeremy: I remember that.
Jesse: I started talking about this number and man, I think people are going to think I am crazy, but we want to be ahead of this when we start to see it. Actually, the owner of Keller Williams Utah talks about this. Matt Greene. He will talk about you can see a market shift coming a year in advance if you are paying attention. So I am just starting to pay attention because I do not want to get, I do not want us to get caught in the dark.
Jesse: I was going to say with my pants down, but that is not very good.
Jeremy: It is such a PG show that we are trying to run here.
Jesse: Right. Right.
Jeremy: And the issue is –
Jesse: Oh, I did say it. Sorry.
Jeremy: The issue with that kind of a shift is that you go from knowing that you can get with a good agent and the right marketing. We said 37% are not selling.
Jeremy: You are in a market right now where you should certifiably, with the right strategy, be able to get the most money out of a home that we have seen anyone get out of a home in a decade. Home values through April were up an average of $110,000 since 2013 in Washington County. $110,000 on average. That means all individual homes. Now, of course, that is an average of $100,000 one-bedroom condos and $2 million luxury properties in Entrada. But $110,000 on average values were up through April. As far as we know, maybe they have been up a smidge more. It is August now, right?
Jesse: They keep going up. In fact, last month, they went up. The average sales price for Washington County went up another $3,000 in thirty days.
Jeremy: Yes. Yes.
Jesse: So now it is $350,279.
Jeremy: Yep. This merry-go-round is spinning and at some point, the music is going to run out and you will have to hop off your horsey and that will have been exciting for everybody involved. That is just the nature of real estate. If you are out there thinking about selling a property, I would be in conversation right now trying to develop a strategy about whether that is going to happen. Whether you want to do that right now, what the benefit of doing that right now is, is there a benefit for holding on for another year?
Jeremy: Or two years or three years? And there could be benefits. Sometimes it is not about benefits; it is just about the actual fact, life factors that you are dealing with just will not allow for it.
Jesse: And let’s touch on that. What scenarios would be beneficial versus not beneficial? And I am going to give you what I am thinking. So if you have got a $200,000 home, it may be a lot more beneficial if you can to hold on for a year. If you are thinking of oh man, I would like to, but should I? If you have got a $500,000 home, I do not know that I would make that good decision because as the market starts to shift, it will trickle down through the price points.
Jeremy: Yeah, the highest price points will be hurt fastest.
Jesse: First. Right?
Jeremy: For our listeners out here, if you have got property over 400 and certainly over 500, you will be hurt first when the market shirts.
Jeremy: It is just absolutely a fact.
Jesse: And we are not really seeing it. In Santa Clara, which we were just talking about yesterday. You have got between four and five hundred thousand, 5.5 months of inventory. That is the highest we have except for in the million-dollar range in all of the county.
Jeremy: Why do you think there has been an increase, and inventory just means number of homes for sale.
Jeremy: Why do you think there has been an increase in Santa Clara? I have a theory.
Jesse: I am not really sure. Probably because Ivins is just right next door, and everybody is going there.
Jeremy: I think that is possible. I also think that Little Valley has become so popular.
Jesse: It has. Definitely.
Jeremy: I can tell you that Castle Rock is a really neat subdivision off Snow Canyon Parkway. We have team members that have lived there, and we just watched Castle Rock completely turn itself over and go from being a family neighborhood to a retirement neighborhood over the last five years.
Jeremy: As one after another after another homeowner sold the property, they followed all their friends and they moved southeast all the way across the county to Little Valley. Isn’t that amazing?
Jeremy: Little Valley has single-handedly, if you go out there and drive above the old airport and look out, it is just a sea of rooftops.
Jesse: That is true.
Jeremy: It is pretty crazy. Jesse, we were talking about something earlier, and I just referenced it really quick. It is about the issue that is the issue beneath someone buying and selling a home. This is where we come in. This is what our job is, is to help folks. So anytime someone is making a purchase or a sale of a property, it is very easy to say well so-and-so is selling their home. So-and-so is buying a home. So-and-so is selling a home and buying a home. But it has been quite remarkable to look at the amount of really difficult life changes that people are going through. First of all, it does not have to be difficult and stressful. So we are working with a client in Green Springs, amazing people, the Jenkins. The Jenkins are moving to be with family. It sounds wonderful, right? They are also in their 70’s, and they just have the opportunity to pack up an entire 2,891 square foot home, walk away from their neighborhood, their neighbors, their friends, the comfort of this area. They have family who need them across the state in the Midwest. They will drive across there. They bought a home, and they are going to start over. It is a good move, but there is an entire emotional under-layment that is going for them, which means they have to prep the home for sale. They have to unpack the whole entire house, prep the home for sale, coordinate showings, which we will handle when they are gone. We are helping them coordinate carpet cleaning, window cleaning, final cleaning, any touch-ups, any repairs. And then they will go through the real estate negotiation process. So they will move away but then it will not go away. The problem quite yet.
Jeremy: They will negotiate contracts and they may not get any offers, or they may get offers that they do not like or statistically speaking, we kick butt and then hits fast. The Jenkins are doing that. We have a couple of clients who are coming through our doors right now who are in the middle of divorce. Very complicated.
Jesse: A couple of them actually.Coeur d’Alene, Idaho
Jeremy: Yeah, a couple of them who are in the middle of a divorce who are selling and finding homes. We have people come through who are having new, who are having babies, and it is really exciting. Oh, we are having a baby. We get to grow our house except for we are completely freaked about how we are going to possibly afford a home because we are excited to welcome the new one into the world, and by the way, mom is pregnant and really struggling with some biological emotions and challenges that come with being pregnant like being miserable physically. Dad is trying to continue doing what he is doing, and the kids are uncertain and there are boxes and there are showings. People are getting married. We have people getting married, and that is an exciting time. They are also broke as church mice and they are brand new, and they are finding out what it is going to be like to be a homeowner, and that is exciting. And what I am saying is there is an emotional foundation that rests underneath the purchase and sale of any real estate holding. That even includes an investor, but investors, typically, it is a lot more of a logical, economic, it is a money decision. Right?
Jeremy: But there can still be some emotions there because the identity of what they thought they were going to do, which was be an investor a long time, is changing. And when we go through life changes, sometimes our whole identity is upset. As you are out there listening to the show today, and you are buying and you are selling real estate, or maybe you have family who are buying and selling real estate, people say what do you guys do that is such a, you do a great job, what do you do differently? I think it is understanding that that is an issue for folks. Right? There is only so much we can do to help someone buy or sell real estate. Average sales price in the county as we wrap up right now, Jesse.
Jeremy: Which is the highest city of all of the kind of general cities.
Jesse: Actually, Ivins –
Jeremy: Ivins. What is our average price?
Jeremy: Average sales price of home in Ivins right now 419. What about Hurricane Valley?
Jesse: Hurricane Valley, $297,900.
Jeremy: So 297 for the average sales price of a home in Hurricane Valley and 419 in Ivins. Folks 37%, as we are wrapping up today, of the listings on the market are not selling, which means the home is in shambles or they overpriced it or the agent did not do a great job. I want people to visit if they are interested our Instant Offers page, and if you are thinking about selling and you do not have the time, the energy, the money to deal with a lot of cleanup, you might want our investment group to make an instant offer on our program. Mike will give you a website right now and you guys can click on that Instant Offers link.
Jesse: All right. Thanks, guys.
Jeremy: Thanks guys.