#7 The impact of COVID-19 in the rental market (3 possible scenarios) and how I'm planning to invest going forward and why

0:03You started in the suburbs of Chicago and then you transition about was it three three years ago three years ago yeah yeah so you're down in Indianapolis now across the border like a lot of us I'm in Northwest Indiana so but you've had the experience of working in both Metro areas which I think gives you a leg up and helps you to understand real estate even at a deeper level so what if you you're very obviously tied into the market what what have you noticed over the last month with covid like what are you seeing now as a result of this and kind of I guess we'll get into what changes you're making after that but yeah so I'll I'll first just talk about my results and then what else I'm

0:51Seeing in the market so last month was still a really good month for listings for me I listed eight properties which ties what I did in January I closed I think 14 last month it was an awesome closing month because of the work I did January and February the pending sales were down quite a bit so it seemed like my listings the the buyer activity dropped off significantly so the conversations I was having with sellers is just that properties are still selling because I'm checking the metrics every single day in our Market there's properties being listed sold and closed every single day every single week so the numberers never zero

1:40Which is always a good thing however it might take a little bit longer for us to find that buyer because there's less of those buyers out there so I would say overall there's been about a 50% reduction in new listings on the market and new pending sales so but they've been at the same proportion so it's not that there's been a significantly less number of listings actually selling it's been at the same ratio but just at a slower Pace see so we're we're still at like all-time low inventory levels in the market so buyers don't have a whole lot of options to choose from so

2:29I've been telling buyers it's a great time to get out there because you don't have as much competition and sellers that are on the fence they also don't have as much competition with other listings so just depending on how you look at things it could be a good opportunity for either party however I think the the real ramifications of this shutdown are yet to be seen in in the months to follow so yeah that's good insight my sister-in-law who's also a agent Bridget she's a agent in the suburbs of Chicago and she she said that there's a significant difference at least for her listings between the price points she said everything basically I think it was 200,000 and above is just Frozen

3:18And 200,000 and Below It's seems like it's still flying off the shelf people are still buying it is that the case down in Indianapolis as well for sure for sure just because if you think about it if you're under 200,000 it's most likely a firsttime buyer the majority of the market so these people have leases coming due they're they're not tied with their equity in a home that they need to sell still so those people are still going to buy no matter what because of their situation with renting we we did sell a property last week that was 375,000 and we found that needle and a Hast stack buyer but I'd agree probably you know under 250 or under 300,000 you're

4:06Going to have a better time selling quicker than above that price I I actually had a million $20,000 deal Kirby that closed a few weeks ago and the day before closing the lender pulled the buyers funding oh because their Bank decided they're not going to do jumbo loans I've heard across a lot of banks are not doing jumbo loans right now yeah so so mostly I I think there's there's two banks that are still doing jumbo Chase and Wells Fargo and they've significantly increase the standards for credit score and down payment requirements to get those jumbo loans so luckily for us we were on the

4:54Listing side the buyer came up with a milon 120,000 to come to the table with cash sitting around yeah just had within 24 hours and we were slav to close it but our seller would have had a fit if yeah you know their their whole life is in a moving truck and the morning of closing that deal died so knock on would we haven't had very many deals fall apart because of job loss or changes in financial situation but I think across the board there's a lot of people hurting I think the latest unemployment numbers is there's been 22 million people over the last four weeks unemployed filed

5:43For unemployment so yeah that's insane that that specific metric is going to be the greatest indicator of how we come out of this because that that unemployment is going to affect a lot of people and their ability to to buy homes