Real Estate News Radio with Rowena Patton

Exploring Emerging Trends and Opportunities in the Syracuse Real Estate Market with Guest Expert Chip Hodgkins

December 16, 2023 Rowena Patton
Real Estate News Radio with Rowena Patton
Exploring Emerging Trends and Opportunities in the Syracuse Real Estate Market with Guest Expert Chip Hodgkins
Show Notes Transcript Chapter Markers

See more at www.AssistedLivingCPO.com

Looking for valuable insights into emerging trends and lucrative opportunities in the real estate market? Our guest expert, Chip Hodgkins, joins us to dissect the dynamic housing scene in Syracuse, New York. With Micron's major relocation sparking a surge of jobs and potential growth, we delve into why Syracuse might just be the next hot investment spot. On the flip side, we also get real about the hurdles retirees face due to high state taxes, and what this means for future housing decisions.

Switching gears, our conversation navigates the vital link between assisted living and real estate, exploring how the market is shaping buyer preferences and the importance of quick turnovers in assisted living facilities. With a nod to the changing demographics of antique store customers, we also introduce the ingenious services of the cash CPO team who are transforming homes for a quick sale. 

Finally, strap in as we journey into the adventurous world of real estate investing and house flipping. Learn how strategic renovations can significantly boost property value and generate benefits for sellers such as rapid sales and reduced stress. We delve into the advantages of using a certified pre-owned (CPO) program in real estate transactions and how it can attract more buyers and potentially command a higher price. Join us for this packed episode as we explore these fascinating facets of the real estate market with Chip Hodgkins.

Speaker 1:

This is the Plain English Real Estate Show with your host, rowena Patton, a show that focuses on the real estate market in terms you can easily understand. Call Rowena now. The number is 240 9962 or 1-800-570-9962. Now here's the English girl in the mountains, the agent that I would trust, rowena Patton.

Speaker 2:

Good morning and welcome to the show. It's going to be a great one today because we have Chip Hodgkins. I'm so excited, chip. You may or may not remember all of you that. Let me just go live here on YouTube. So we've got it on YouTube too. Chip joined us during COVID, which was so awful, all awful, yeah it was awful, it was bad, it was bad, except that I have two words in the English language that I mix up. You remember what they are. No, it was awful Awesome.

Speaker 1:

Yeah, I do it all the time I'm like wait wait.

Speaker 2:

no, it wasn't awful, it was awesome.

Speaker 1:

You've got that in my head.

Speaker 2:

I know right, yes, it's a little crazy. So, yeah, that's pretty exciting. So Chip was on with us, I think, almost every week all the way through it, and that was what 12, 16 weeks that we couldn't come into the studio and we had to pre-record it. And we were recording them all on Zoom and Chip, along with many of my other colleagues in RATE, came on and kept us going, which was freaking awesome.

Speaker 3:

I recorded you guys from my home oh my gosh and we shipped it over here and put it on the radio.

Speaker 2:

It's so funny doing a live show that thousands of people are listening to all over the country and internationally often, I know, because we get all the tracking data that here we are, with you being able to do it from home and people being able to join on Zoom, and somehow we kept it going. We did, yeah, and I guess COVID isn't as much of a problem now.

Speaker 1:

I hope so.

Speaker 2:

Strangely. Yeah, let's keep it going. Can we have Chip join us? He's ready. Chip, how are you?

Speaker 3:

Awesome, outstanding, better than you deserve.

Speaker 2:

Better than I deserve. I stole that from Dave Ramsey. It's so nice to have you on. I don't know if you heard that intro there, but I was just talking about how you were so kind to join us through COVID, and some of our other rate COVID colleagues jumped on with us as well. Mr Ben and Big Friday night.

Speaker 3:

We had a blast. You know what. We were such a positive. We were focusing on the positive conversation rather than the woes me, woes me. There's so many opportunities for us to complain and bury our heads in the sand, and what's funny is the people that you brought on that we were always talking with. They always had an optimistic mindset and it was really fun. It helped me. Yes, absolutely, because I was like oh good, I got all the like-minded people that are optimistic about life, so that was a good thing that you did. Thank you for putting that together.

Speaker 2:

It was like we were mentors to each other through it and we produced a radio show at the same time that we aired. It was just a wonderful time. I've got them all on YouTube. Actually, I look back at them sometimes and say, wow, did we really go through this? Obviously, it was a very strange time for real estate. We don't expect that now, but nobody knew what was going on. One moment we were necessary, one moment we weren't. Were you allowed to go into houses, Chip?

Speaker 3:

Only if no one else was in the house and I had to be gloved and masked and booted, and then we would corax our way in and we would corax wipe our way out. It's amazing to think of now, isn't it?

Speaker 2:

So introduce yourself, chip, and I know you've got a big team. You've got about 11 agents up there. Introduce yourself and just tell us about your market for a second, because you've got one of the few hot markets in the country.

Speaker 3:

We really do. There just is not enough inventory, so every house that we list sells pretty quickly.

Speaker 2:

Well, tell people where you are, because they didn't know where you are yet.

Speaker 3:

I'm in Syracuse, New York, home of the Syracuse Orangeman. We have a huge business opportunity that's coming into Syracuse, and so there's investors coming in looking to buy up properties lower end properties and then some people that are looking to buy bigger properties.

Speaker 2:

Talk about the business opportunity because we have a lot of people coming from New York to the mountains. Usually, what happens is all about half the time, not usually. People move from New York, they move down to Florida and then they land back here, and we've even got a term for it because it's so common In fact, I'm one of them. We call it halfbacks. So we have a lot of New Yorkers listening to you today. So talk about the business opportunities there, the companies that are coming in.

Speaker 3:

So Micron, the largest memory chip manufacturer in the world, is moving to Syracuse. They're going to bring about 50,000 new jobs to the Syracuse market. And whenever something like that happens to a market, for example, fedex has to triple its workforce in Syracuse, and when Micron moves, so does their supply chain. So applied materials is moving to Syracuse, tokyo Electric is moving to Syracuse, so DHL, which really doesn't have a big presence in Syracuse, it has to have 150 employees in Syracuse. So each one of these little pieces of their supply chain has to move to Syracuse, and so we're looking at about 100,000 new jobs in the Syracuse area.

Speaker 2:

That's amazing, and how affordable is your housing, because a lot of those people will need more affordable housing. What's your average price point there, chip?

Speaker 3:

The average price point is $247,000. That's amazing. That's all in the multiple-use service, the MLS, so you can find a $60,000 house. We have people that are coming in Syracuse and buying 10 houses, trying to buy every house. They can under $100,000. So they'll buy the average house. They. Someone comes in, they buy $70,000 average house price and they buy 10,000, $700,000. And then they put $5,000 to $15,000 into them and then you can rent them out for it's all profit, it's all cash flow positive.

Speaker 2:

Yeah, that's amazing.

Speaker 3:

Do you think that's why so?

Speaker 2:

many companies are moving in because people can actually afford to live there, because so many areas in the country now. So when I got into real estate back in 2007, our average price point here for everybody listening, that's local $176,000. So less than yours, chip, back in 2007. And you go, oh yeah, but wages have gone up and but not really not with inflation and everything else they might have gone up a little bit, but we've gone from $476,000 to, depending where you are in the mountains, more like 450 to 500. That's a massive jump, obviously. So when you, chip, have got houses on average at 247 or even less, people can actually afford to move there. So if you're looking for a job, or looking for a medium level job, if you like, or something you're trained in, and maybe you're in the New York area, maybe you're not, but you can sell your $700,000 house or you know, there's modest houses now here for $600,000, right, randy?

Speaker 1:

That's right.

Speaker 2:

I mean it's when I say modest, like for micro countertops, old cabinets from the 70s. You can sell that house that you bought, that you may own nothing on, or own $50,000 on for $700,000,. Move to Syracuse, and what kind of house can you buy for 247, Chip?

Speaker 3:

That would surface countertops either granite or quartz. Four bedroom, two and a half bath.

Speaker 1:

Wow.

Speaker 3:

In the top school district about 2,100 square. So here's an example.

Speaker 1:

Wow.

Speaker 3:

I just did a flip, a flip for $310,000. So you know, in a flip everything's been done right. Yes, so you have new appliances. It doesn't have washer and dryer, but other than that, everything's new for $310,000 in the number one school district. So for $240,000, you can get less than that, but it's still. You know, I moved into it.

Speaker 2:

Yeah, you might only need two bedrooms. Maybe you retired, maybe the kids are already at college, you know, maybe you don't need all that space. There's a lot of people who are right sizing now and realizing we don't need these big, giant houses. Obviously, if you've still got the babies at home and you know you want rooms for your kids, that sounds like a great option.

Speaker 3:

One important thing is that in Syracuse in the year 2020, the average house sold in the MLS in the multiple listing service was $168,000. Wow and in three years we went up $80,000 to $247,000.

Speaker 2:

Yeah, so it's going to change right, but obviously, as those changes come into place, as they do all over the country, less and less people are able to afford those houses, even at that price point, Because I remember doing this in 2007 here and there was still a lot of people that couldn't afford that, especially with today's inflation rates and everything else. So you just became.

Speaker 3:

What's scary for a couple of people is that they all of a sudden they might not be able to afford to live in their house, yes, and so they've got to sell their house. Taxes go up. As market value goes up, taxes go up. All of a sudden people are being kind of taxed out of their property, so they've got to sell the properties. But that's a huge opportunity for the people who are coming into the area yes. Because they're able to buy a much lower price home than what they're used to.

Speaker 2:

Well, a lot of New Yorkers retire here, retire in warmer areas. You know, we're in the mountains and we're south, so we've got a nice temperate climate. We are expecting a little snow over the weekend, but in the mountains you might expect it and then it doesn't happen all the time because we're in the mountains but we don't really get snowed in. We might once a year or something, but so you've got the best of all worlds. You've got the climate changes every quarter. People who come from the north and move down to Florida are like oh, we're tired of not having the seasons. So what concerns me about your market and where the opportunity comes in there is for people who are thinking about retiring, maybe going into continuing care, what most people know as assisted living. Continuing care is when you sell your home for $200, $300, $500 a million, you take your money and you rent a place in continuing care. Continuing care, there is no care at the beginning. You can go and choose to eat meals in the cafeteria once or twice a week or every day or whatever you want, and then there are different levels, you know, and then it's somewhat assisted into full memory or nursing care at the end. There are different levels in those facilities and a lot of people in their 70s and 80s get on a list for that. And I should say Chip, who I've known for a very long time and you know, did all those shows in COVID. You can find those. You can look up his name, chip Hulkins, on YouTube and all kinds of things will pop up, including those COVID shows. Or me, rowena Patten same thing for the COVID shows. So a lot of people. Chip just joined the Cash CPO program. Cash CPO also works for we have assisted living CPO, we have divorce CPO, builder CPO. We've gone through a lot of those on different shows. But I wanna talk a little bit about the people who are retiring in your market, chip, because I'm guessing. Well, I know your taxes is super high. They're some of the highest in the country, correct?

Speaker 3:

New York State is the number two worst state to retire or die in.

Speaker 2:

Wow, what's the number one? California?

Speaker 3:

Because California.

Speaker 2:

How did I guess it's number one? Worst state to.

Speaker 3:

And they fight each other for number one.

Speaker 2:

Wow, so somebody who owns, let's say, $200,000, $300,000 house in your market and that's a nice house, isn't it? And, you know, maybe they bought it in. So let's say they're 70. Now let's say they bought it when they were 40, so they've been in it for 30 years. So now it's a let's say it's a 1980s home, and I'm making this up as I go along, obviously.

Speaker 3:

I'm just working up on that. So they probably bought. If their houses were $300,000, they probably bought it for $60,000.

Speaker 2:

They probably have no mortgage, correct Exactly, and what kind of taxes are they paying on that $300,000 house, just roughly I mean? Obviously it depends on the district and the county and everything else About 3.6% every year.

Speaker 3:

Paying about 10 to $11,000 a year.

Speaker 2:

Wow, and that's a $300,000 house. So a $600,000 house, you paying 20 to 22,000 a year. Okay, so now we're talking about people on a fixed income who are retired. They don't have any mortgage and, depending on what price point the house is at the average price point, let's say they're paying 10 or 11,000. So they're paying basically $1,000 a month out of their fixed income, which may be only $25 or $3,500 or less than that even.

Speaker 3:

Well, here's the biggest part of that there is zero return on that $1,000 a month.

Speaker 1:

Right, zero return. You're paying your tax.

Speaker 3:

If it's a mortgage, you're at least getting a return because you get an appreciation.

Speaker 2:

Right right.

Speaker 3:

Or you're getting tax benefits for paying the interest. Well, the other thing you just pay your taxes Right.

Speaker 2:

And the other thing there is because you haven't had that massive increase in prices, which is probably why one of the key reasons, I would imagine that companies are moving there in the first place because people can afford to buy the house. So, even though they've got these big taxes, if you're buying a house anywhere else, especially in, I mean, obviously you're outside of New York, you're not in the boonies somewhere. So most markets you're talking about average for $500,000. Now, Now you can have a family by that four bedroom house for $250,000, $300,000, two or $300,000 less. You can afford to pay those taxes. You're still working, Everything's great. But let's talk about that retiring couple. It would really suck to have to find that income before you pay for your groceries and which are so much more expensive now, pay for your gas or anything else. So you can see why they're retiring out of California or out of Syracuse, plus the fact they're older and you know you're not 19, either chip, like me, I think, or about the same age. It's nice to have a little bit of warmth in the winter, isn't it?

Speaker 3:

Are your knees getting a bit?

Speaker 2:

creaky yet Chip.

Speaker 3:

We're probably the only two people I know that don't go south. We go to ski countries so we can get a couple of extra weeks of skiing in Cool. Everybody else goes to Florida and doesn't do.

Speaker 2:

You're right. So what do you think will happen in? I'm thinking of our age right now. How about in five years time? Will you still be skiing?

Speaker 3:

I will be.

Speaker 1:

Ten years.

Speaker 3:

My wife and I still will be, but we're the anomaly In 10 years I'll still be skiing.

Speaker 2:

I love you. It's awesome.

Speaker 3:

Yeah, I grew up ski racing, so I was part of our blood.

Speaker 2:

I did not know that.

Speaker 3:

Yeah yeah. My wife is a race coach and our kids all were racers, and so the main thing is we will go south. Yeah eventually We'll go south. For a month or so we won't move south.

Speaker 2:

Yeah, no, I hate you. We won't relocate south.

Speaker 3:

So if you go to Florida, half the population of Syracuse is down in North Carolina, South Carolina, Georgia and Florida Correct.

Speaker 2:

Not only that, when they go to Florida. So the reason they move here instead of Georgia or South Carolina or other areas in North Carolina, even Hendersonville is about three degrees warmer than the Asheville area or higher in Western North Carolina because we're in the mountains, right. So what tends to happen is when they go to Florida first, which many New Yorkers go to Florida first. I used to live in Florida and you're right, like it's full of New Yorkers. So many of them just get tired of not having any seasons and move back here. In fact, I've got some very good friends, erick and Eve, who I helped. They're New Yorkers. They moved down to Bakerish Home and I helped them buy a house here about three or four or five years ago because they want to get back to the seasons, but they don't want the heat of Florida, but they don't want to go back to the cold of New York or the big taxes. So they're just a little bit older than us. So sorry, even Erick if you're listening, I love you dearly called you out there. So they're awesome, awesome people. I love them to death, my best friends, really. So let's go back to the people who are in the 70s and thinking about gosh, my knees are getting a bit creaky, I could really use some warm weather. My heart person, my breathing person, is telling me I could really use some warmer weather. And they're moving out and they're thinking about assisted living so, or going into continuing care, so that, should one of them pass. This is often what happens. You know, herbie is there. Sorry, randa, you guys don't live as long as us, you know, and we know that it's often the ladies that get left on their own, sometimes the men, but often the ladies get left on their own and the husband, especially from that generation, is all about getting set up and prepared for taking care of his wife and his family. You know they don't want their kids to have to take care of them, and the husband often says, hey, let's get on the list now for continuing care and take that onus off our kids. Same thing if you think about long-term care insurance. Many people are getting that because they don't want their kids to have to take care of it. So they're on a list and you have a lot of assisted living there, don't you Chip?

Speaker 3:

We need more.

Speaker 2:

I'm sure you need more.

Speaker 3:

We need more and it's multi-stage. We were talking about that earlier.

Speaker 2:

Yes.

Speaker 3:

It's multi-stage, you know, as you come in you just need a place to live and some socialization and maybe someone to watch some of your meds and then you grow into or you progress into more consistent care.

Speaker 2:

Yes, and it's there. So generally you don't have to leave your place and so you know it starts off with basically renting a unit and you're right social activities and food as and when you want it, but you don't have to buy into their food plan. You put a bunch of money down generally and you go on a list, often for years in the better ones. You're on that list for years and then they call you and basically assisted living is all about vacancies. It's like running a hotel and they can't have vacancy rates. You know somebody moves into the next level of continuing care or sadly passes, and now they've got a unit open. It's like vacancy. Sorry, that sounds very blunt, but that's how they work it and they want to fill that spot as quickly as possible. So they call Jimmy and Sally and say, hey, good news, your spots come up after three and a half years and now they need to sell their home. They're in the 70s. What does that house look like? Generally, chip I mean some people in the 70s, in fact my in-laws their house is absolutely spectacular.

Speaker 1:

The.

Speaker 3:

Max in-laws better than to death. You know the house is spectacular. A lot of times it has to do with the socioeconomic class that they're in. Typically the doctors, lawyers, businessmen or business women tend to have more updated kitchen and everything. The other people that are a little bit lower than that. The houses need more updates. Here's what today's buyer doesn't want. Anything that looks after smells like their parents' house, or definitely not like their grandparents' house. And I would tell you probably 50 to 70% of the houses we deal with look after smell like their parents' house, and so those houses need some work.

Speaker 2:

Yeah, absolutely, and that's I would say. You know I'm talking about our market here. Obviously I'm sort of interested in yours. But what I've found over the years in talking about this is almost all markets operate the same, just at different levels of the curve, if you like. So I have to take that I want you to repeat that Looks, acts or smells like their grandparents' house. Is that what you said?

Speaker 3:

Yeah, today's buyers do not want anything that looks, acts or smells like their parents or their grandparents' house.

Speaker 2:

And hasn't that always been the case?

Speaker 3:

That's a cross. That's always the case. That's always been the case. I just say it differently.

Speaker 2:

Yeah, no, I think it's always, always been the case. So you know, in other words, it's an interesting one when you know your parents go hey, you know, I inherited this from my parents or my grandparents when they came over from Germany or whatever. You know, this piece of furniture or it might be a piece of furniture that is, quite frankly, not a valuable piece of furniture at all there's laminated pine but you know, they inherited it from their mom. And now we're saying to their kids Randy's smiling here, the producer. And now we're saying to the kids I know you're going to want this one day. And the kids are just rolling their eyes.

Speaker 3:

So you know, you and I both said that it's kind of always been that way. But I'm going to tell you it's more so If you go to the antique stores. The people that go to antique stores used to be in their 40s.

Speaker 2:

Yeah.

Speaker 3:

The. It's growing, it's going up in age. It's like now it's in the 50s or 60s. The 20s and 30 year old people are not going to, they're not looking for those antiques anymore. But what are they doing? So are they going?

Speaker 2:

to IKEA and buying cheap stuff that is just disposable, Like what are they doing? Sorry, IKEA, I love you, but you know, obviously those things aren't designed like antiques are designed normally. You've got to be careful we don't really see by IKEA here.

Speaker 3:

We love you IKEA, we're seeing IKEA, we're seeing Pottery. Barn we're seeing. So it can be. You know that cottage kind of vibe with with the trinkets everywhere and the wallpaper. You walk into that house and people will print it. Even though that house is available and it's priced right, they'll go to the house next door that has more modern furniture and it doesn't have any doilies in it, you know, but the doilies that used to be on the arms of the couches and underneath Gosh the doilies People would put a doily underneath a. They put a doily underneath a lamp because they don't want the lamp to scratch the table. But the lamp's never going to move, so it's never going to scratch the table. So get rid of the doily.

Speaker 2:

And you know, the funny thing is that the doily is all brown and colder around the edges and when you eventually take them out they crumble because they're so old, or you wash them and gosh. I had a the most beautiful linen tablecloth with lace all the way around the end and I absolutely loved it and it was an antique piece from great-grandma or something, and eventually it just crumbled in the wash. I mean, that's what happens, right, it disintegrated. Yeah Well, something ate it, I don't know. Anyway, so the point is that many of these homes, when people are moving on, need a little bit of work. Now, I don't want you to think that the assisted living CPO is about homes that need work. It isn't and it's based on cash CPO. The cash CPO team goes in. You get 70% up to 70% within 12 days. The cash CPO team goes in, up front's the money for you, takes that wallpaper off, removes the doily's, allows you to move in to and it's. Let's step back a second here, chip, because it's very hard when you've been on a list for two or three years. It's heartbreaking actually. And you're so excited and you call the kids and you're like, yay, we've got a place. Oh, we've got to sell the house Now, even if you're in a hot market like Chip's, which, honestly, there are very few around the country now. Most markets crested in the third quarter of 2022. Anchorage, alaska, is another one, but there are very few hot markets where houses sell in the day very few and even the hot ones tend to be calling off a little bit. So even in a hot market like Chip's where it sells the next day, how long does it take to close Chip? 30 to 60 days or 45 days on average?

Speaker 3:

60 to 60 days to close.

Speaker 2:

Okay, so that is not fast enough to get your money out To go into assisted living. They want their money now. Well, they go on to the next person. You know it's like, really, it's all about vacancy in assisted living. So think about if you went to a hotel and said I don't get my paycheck until Monday, are they going to check you in on Friday? No, that room's going to go to somebody else. Sadly, that's what happens with these lists. So this is a way, even if you're on a list. So here we are, an older couple, we're on a list and we're starting to think you know we ever going to? Is it ever going to come up? Oh my gosh, honey, we've got to get the house ready and pack up our trinkets and everything else and you start doing a little bit. It's just like when you're moving you start doing a little bit here and there. It takes you a very long time to get through it all and then suddenly it comes up and everyone's in a panic and, like Chip is saying, people these days, even though it's low inventory and there's not much out there, most people don't have the vision to look past anything that looks, acts and smells like your grandparents house. They just don't. They can't see through it. So the way this program works, assistedlivingcpocom, is that that couple will get their money in 12 days. Now what I want if you've got parents, or you are the parents or the grandparents that are in this situation, that are on a list I want you to get your offer now. Here's why it's just something to put in your back pocket, assistedlivingcpocom Get your offer now. Will we need to update it in a month or three months or six months when your offer comes up? Absolutely, but the difference is we've got everything we need ready to go so that when you get that call and you need to move in, we can get that offering really fast and they'll normally give you a couple of weeks' grace. In that couple of weeks' grace, we can get you 60, 70, 75% out. This isn't your grandparents' cash offer. Two-thirds of our sellers get more than they would with a traditional listing, but a traditional fashion listing. That's where you have to have showings. You have to have a lockbox on your door. People are coming in, people worry about you. Know you've got to get your pets out. You've got to get yourself out, especially when you're older or you've got kids or pets or anything else, that's a royal pain in the butt.

Speaker 3:

So can I answer up for a second. Yeah, of course I think, the biggest for me. The reason why I joined CPO Cache CPO is because the biggest concern I have isn't getting them the most amount of money, although that obviously is a big concern the stress that you watch these older people. They are making one of the worst decisions of their lives. We know we're moving out of our home, that we've grazed all of our kids into the last stage. That is a very hard decision for them to make, the stress that goes with that. Now, honey, they just called us. We got to move in in 30 days. We don't have that money.

Speaker 2:

Oh my God, what do, we do, I don't want to miss this opportunity. Yeah.

Speaker 3:

Let's just throw it on the market and hope that we get anything.

Speaker 2:

Yes.

Speaker 3:

They can be taken advantage of so easily.

Speaker 2:

Yes, and people do take advantage of them all the time.

Speaker 3:

Oh my God. And so this gives them that comfort and it takes all that stress away. The emotions obviously they still have, but it takes the stress away.

Speaker 2:

And they don't have to go through showings. And you know, the other thing is one of the key indicators I'm sure you know this chip for somebody going into continuing care is one of them gets sick, one of them breaks a hip or gets, you know, has some kind of worse illness going on or some chronic, you know, copd, or some chronic illness going on, where eventually, quite frankly, the kids sit down and have an intervention or their friends do. It's often the kids, like we can't keep flying back from San Francisco to be here in North Carolina or Raleigh or wherever it is they're coming in from. Every time mom or dad in their 70s or 80s has a tumble or, you know, is in the hospital or you know, you name it. We obviously we tend to get more illness and that's usually the trigger. So now you're moving and prepping for moving. One of you is doing it because the other one's sick and that's not fair. It may be that a little, you know, sonility is coming in. Maybe a bit of memory loss is coming in with one of the partners. I doubt with that. Recently with a couple actually, where she'd been dealing with her husband I've known them for many years. She'd been dealing with her husband, who had early onset or not really early on, said he was in his 70s but he'd had early onset Alzheimer's. And now he was wandering up and down the street in the middle of the night and she was getting heart problems and, as I researched, this bore. That's often the case. So the men get sick, the women take care of them not always but you can be the other way around the women take care of them and they get sick because of all the stress that's on them all the time. And now you're looking at moving into assisted living because your kids are like we can't deal with this anymore and it's not fair on you, mom, or it's not fair on you, dad, taking care of the other person and put all that stress on top of all the doilies and the wallpaper. And you know your house smelling like your grandparents, and even grandparents remember what their grandparents house smelled like, although it might have been better in those days because it was all log fires and you know who knows, it was probably just the same. So how stressful is that? You know, usually one of you is either having memory loss or and now, one person, sometimes they've lost a partner and they'll go into this as well to keep them social. You know so how stressful is this. And this allows them to get money out in 12 days, a big cash advance. That cash advance because they normally own the places outright. Or even if they've got a 50% mortgage on it or reverse mortgage, we can do that too Pay off the mortgage, have enough money to put down on a better programming, continuing care and get rid of all the stress, like you say, chuck. And what do you think we would go in? I mean, you know just from an investor's perspective. So the ugly houses crew or the investor crews normally go in and they'll offer you maybe 60% as a cash offer. Hours is 90 to 120%. Two thirds of our sellers get more than with an old fashioned listing where you have to have showings and go through all that malarkey. So what would we do to the house of this, this average house that you're describing? Chip to make it worth more? And is there a house next door in your market that's worth a hundred or two hundred thousand dollars more? That's been remodeled?

Speaker 3:

Yes, that is usually the case. So what you're doing is you're bringing the house up to today's standards, which really is paint and flooring yeah, walls, ceilings and flooring. You're either putting LBT down or you're putting new carpet down. Sometimes you just clean in the carpet.

Speaker 2:

Yes, deep clean.

Speaker 3:

You're. Usually you don't have to go through and redo all the countertops, but you can. You can update the countertops, you can update the cabinets, really inexpensively.

Speaker 2:

Yes.

Speaker 3:

But you need the pros to come in, and so what we'll do is we'll bring in a bunch of pros. We'll have it done in about forty eight to seven days. Seven days you'll have a house ready for the market later.

Speaker 2:

And the sellers don't have to pay for any of this. There's no stress involved. Within 12 days that big cash advance is out. They can choose, but they don't have to move out in 12 days because that stresses a lot of people out as well. Like we can't pack up. You know, I offer often at this stage I offer for somebody to come in and pack up, but they tend to be moving out of a bigger house into a small unit so they want to go through everything and their kids can't make it down until Christmas or the new year or you know, the spring or whatever, to go through the stuff. They can choose to stay for up to 90 days, even when they don't own it and they've got their money out, which is really cool. You know that the 70% out.

Speaker 3:

So I literally have this going on right now. The kids all live in California, mother lives in Syracuse to get accepted into the Nottingham in Syracuse the best one in Syracuse. I've got a state salesperson coming. I mean she's going to move out on January 8th and we're going to have the house ready for the market before February 1st.

Speaker 2:

That is awesome. I love that. I think we should put an assisted living CPO off right on a house. How much? What kind of? Okay, so let's use this. We've not given any names or anything, so let's use this as a real example. If you had to sell the house tomorrow fast, what would you be selling it for? 350? Okay, 350. If you were able to go, go in and make some updates, what would those updates be?

Speaker 3:

Just what I said before floors and paint. I would update the kitchen, I would probably okay.

Speaker 2:

Let's spend 10k on the kitchen. You can put countertops in for five. We can paint the cabinets, put new modern hardware on. Let's put 10k down. Let's do a real life example for everybody listening today 10k in the kitchen. Let's do 15k. Let's do 10k. And how much for the flooring do you think if we put luxury vinyl plank or whatever you need to do with the carpets.

Speaker 3:

Actually, you're going to put carpeting in the bedrooms because of the age. Yes, people are going to walk at the age of the demographic, so they want carpeting in the bedrooms okay, you don't even need LBT. This is luxury vinyl. So you're going to do carpeting there and you're going to probably do a one coat on the hardwood floor throughout the house. So three grand for the carpet.

Speaker 2:

Three grand for the carpet.

Speaker 3:

Three grand and two grand for the hardwood, so a total of five grand so we're at 15 tops, okay.

Speaker 2:

So now we've got a house that's 350 plus 15 is 365. What can you sell that house for when it has those updates? So we've painted the cabinets, put new hardware on new countertops, we've put new carpet in and we've refinished the floors. First off, would your lady even think about doing all of that? Not at all, of course. So let's say we got her that. So if you could sell it for now, let's say we put the offer in at 350 and we're not trying to steal anyone's money here because we're going to sell it for more right, so 350 let's say okay, so let's say 385. Yeah, so that's a $35,000 gain for putting in 15, which sounds about right, and yours is a lower price market. So imagine when you apply that to a 500 or 600,000 or else, which you know Randy and I talked about earlier they could be very, very outdated and of course, people don't want those houses either. So 350 let's run numbers here for a second, if I can do it. 10% of 350 is 35. What's 35 times 7? 5 is a 35, 714, 21 see, if my math is right here for 245. Does that sound about right?

Speaker 3:

That's right.

Speaker 2:

I did that in my head. Aren't you impressed? So that lady is going to get $245,000 now and then we're going to list it at 385. We're going to flip it for her. Basically, her house will sell faster because it's all cleaned up. And, who knows, are you still getting multiple offers, chip?

Speaker 3:

Yes.

Speaker 2:

Well, you may get multiple offers and it may bid up right at that point as well, because now it's a sexy house that's winning the beauty contest, it's got nice, fresh carpets, it smells great, all the furniture is out there and she's going to get we're going to re-list it at 385, sell it. Maybe it's going to bid up. She gets the majority of that profit. That's why two-thirds of sellers get more than with the traditional listing and it doesn't matter if you need anything doing to your house either. First off, even if everybody needs something doing to your house, when we do the inspection report, we're going to find 20, 30, 40, 50 items on the inspection report. And unless you're in a ridiculously hot market like chips, I've never heard of one like chips where you sold how many homes this year already Chip 135, 135 and how many of them had inspections? 8 so around the country. Your parents, buying a house okay, your parents are buying a house, would you tell them it's okay not to have an inspection? Never, why not?

Speaker 3:

Because there's too many things that can be wrong with a house and you don't want to take on that responsibility as the buyer. You want the seller to have that responsibility. However, when you have 13 offers, you know that if you put a home inspection in, you're not going to win it. So buyers in today's market in Syracuse in Syracuse, are taking the responsibility for the home and they're actually looking at the basement and the foundation on their own and the roof on their own and they're judging for themselves rather than getting a home inspection correct.

Speaker 2:

It terrifies me, I'm sorry, really terrifies me. For most people it'll be fine because they'll just fix whatever needs fixing. I understand that. We know the seller has. It's all about supply and demand. The supply is low and the demand is high there, which is, like I say, the only other market I know that's doing this is Anchorage, alaska. Most of our markets were doing a year ago or 18 months ago. Now we all understand this. We're all getting multiple offers. We're not expecting it to go back to that tomorrow. It's a seven to 11 year cycle. This has been going on since 1860. Good old Clemence Eugler. What concerns me, chip, is when life happens to those folks who are taking on those. It's not your issue, this is just what the market is doing. You have to waive your inspection contingency to get the downhouse. Two things here. What's going to happen to those people that bought houses that do have more serious problems in three, four, five years, that get divorced or have a death in the family or have to move back to Arizona to take care of their ailing parents? There's all these things wrong with the house.

Speaker 3:

They're going to need and want a CPO offer.

Speaker 2:

Here's my next question to you those listings that you have, what would happen to the price? How many homes do you get multiple offers on 80% of them? So 80% of your homes get multiple offers. Still, there's a lot of sellers here that would be very happy to do that. I'm seeing a lot of pre-foreclosures right now. We're making cash offers on them every day and this is not a skeezy cash offer where we're offering 70%. We offer full market value. I've had people in tears this week where we've helped them avoid foreclosure. Here's the important one, chip, if 80% of yours are getting multiple offers, how much more do you think you could get for your listings if they paid $300 or $400 for an inspection and it were a CPO listing? Now, sellers don't want to wait. They don't want to spend the $300 or $400 or wait another week. But if we did that and we had a certified pre-owned home to sell, do you think it would sell for more?

Speaker 3:

Yes, because the buyers suddenly that fear of oh my God, I'm buying a house without a home inspection. They still have that fear. I don't know they're not putting it into the contract Now. Whenever you can reduce a fear, prices go up.

Speaker 2:

Absolutely. That's correct, because it's the right thing to do, because you're not kicking a house that all houses need work. I've been doing CPO certified pre-owned since 2007. I was running CPO experts around the country since 2007. That's where the seller pays for the inspection and the appraisal and the home warranty or any one of those three or all of those three, because people pay more for the homes. The idea came from certified pre-owned cars $20,000 cars, $156 point inspection, black book value and a dealership warranty. I'm like why the heck are we selling $200, $500 million homes without this? It made no sense to me. So imagine if those sellers just took a second and actually got it certified. Now cash CPO is the evolution of that. We only launched this in August and it's absolutely taken off. We've got 1,200 agents. Chip, just join. Thank you, chip. I can't wait to get this going with you. 1,200 agents around the country are using this because the cash CPO team up front the money and do all the work. They take care of it all for you. You get your 70%. You move on to whatever you're doing, whether it's a divorce or you need a bigger house, you can make a non-contingent offer. Now You're not saying, oh yeah, I'll buy your house in Florida, but it's contingent on me selling this one. And markets are dropping everywhere else but Syracuse and Anchorage, it seems like, and therefore people there's a fear around of well, I'm not going to take that offer in another state or down the road because they haven't sold the house yet. Imagine if all this were put in place. And that's my dream, chip, and that's my legacy, and that's why I'm so glad that you joined us at Cash CPO, because I think it's just a better way to do real estate, that inspection and having everything in place, the one thing that everybody, I think you forget, because my life is very personal to me. Yes.

Speaker 3:

And there's that thought. But when you look at the demographics out there, the same amount of people tend to get divorced every single year, the same amount of people died, pretty much the same amount of people get born every year, and those are the main reasons why people buy and sell real estate.

Speaker 2:

Yes.

Speaker 3:

Because, you know, marital change or demographic change, like they've got more kids or less kids living in the house. So when you have a divorce, you need to move quickly. Typically, when you have a death, you tend to need to move quickly. When you have a diagnosis, you tend to need to move quickly. So those events, that's what Cash CPO really can allow them to do with a high level of certainty.

Speaker 2:

Yes, right, you know I've also got veterans and more private people terribly interested in this and also people who've expired, so you're probably not seeing many expiring listings. Everyone else in the country were seeing expiring listings. I'm seeing five or ten expired listings a day here now. So a lot of you know that may change over time and the buyers that are coming into your problem check is that many people are going to move into your area from somewhere else because you've got all these jobs going on but they've got to sell their house somewhere else. So, of all the people you've, how many people have you got on your database? 126,000. Oh, good Lord. Okay. So the people looking for jobs that might be moving in what percentage of your database do you think is that? Or do the majority of your people on your database are they local and you're just helping local people move from A to B?

Speaker 3:

No 10% of my database, or 12,000 of my database, is people from outside Syracuse looking to come into Syracuse.

Speaker 2:

So you have 12,000 people looking to come in. So, unless they're moving from Anchorage or indeed Syracuse or maybe two of the markets in the USA that are still holding on, most markets, even if they're going okay, are not what they were 18 months ago. So the person that's moving to Syracuse has to sell their house there. So it's something that you can offer to those 12,000 people you have on your database where you can help them with a cash offer whereby they can get the money in 12 days, make a non-contingent offer on the home in Syracuse. They're all going fast. You know none of your sellers, given the market in Syracuse, are going to take a contingent offer, correct? Why would they Correct?

Speaker 3:

Okay, don't even bother Right.

Speaker 2:

So now you can take that cash offer from Florida or California or wherever they're moving from back over to there because we have cash. We have people who know how to do this all over the country now. So you've got 12,000 people that you can help in different areas in the country move to Syracuse through using this program. So they get the 70%. They move to Syracuse into the new house. They've got a non-contingent offer. They're still waiting for their. So basically, you get 90 to 120% on a cash offer. We can never guarantee it, you know. So your third so you're getting 70%. Your next amount is going to be 20. To do the math, row 20 to 50%, You're going to get of what the listed amount would be because two-thirds of our sellers get more. I'm making it too complicated. Basically, two-thirds of our sellers get more. The point is that couple or the family or individual gets to move to Syracuse in a wonderful new job. They buy a house at half the value that's twice as big and way newer, and now we go in. They've moved all their furniture out. We clean up the floors, we do everything from a deep clean to one of mine right now we're putting a new septic in a new roof on and then your house is most likely going to sell for more money, and even if it doesn't and you get 90% or 95%, which would be very rare on this program the average in the country that we were getting lists to sell price, and just explain that for a minute. You know when you list your house, most people go, oh, we have to list it for a bit more because we know we're only going to get 90%. That was five years ago. The last five years, or the last four years at least, people have been getting 110% of list price right Chip on average To any way. You are obviously Well yeah, yes, that's great. Well, that's just dropped to 95% and the cash GPO offer is 90% to 120%. So I'd take the leap of faith and I wouldn't go through those showings. I mean personally I wouldn't. I'm not just trying to sell this, I just think it's a better program. That's why I've been doing certified pre-owned since 2007. I think it's better I don't care what your market is to go ahead. Get you at the very least get your home inspected. You're going to make more money. It takes so much of the hassle away.

Speaker 3:

It makes total sense.

Speaker 2:

It's a no brainer, right, chip? Yes, but now you can get your money, move to Syracuse or move wherever you're moving on and you're basically protected. We go in. Maybe you move everything out. You think my house is great. You move everything out. We do the inspection. The cash GPO team up fronts the money for the inspection up fronts, the money for the appraisal. And the appraisals are coming in nice and high because the funding partner makes their money. They make a percentage of your sale. They don't want it to come in low. So they're not trying to buy your house cheap like most investors. They're trying to get it for as little as possible so they can make as much as possible. That's not what this is. It's so different. By the time you move your stuff up, you've scratched some of the floors up the smolder. You walk around the house and you're like, oh, it smells a little bit. We need to do a deep clean on the fridge and the stove. And gosh, I don't remember the walls being this dinged. When everything's out, you can see it and oh my gosh, the carpet left a sun stain on the or a doggy pee stain on the nice hardwood floors. We go in and we clean it all up, you're going to be able to compete against new homes. That's the other difference. That's what certified pre-owners always don't, because when you're a buyer, you go in and it's all shiny and beautiful. Now it compares to a new home. You go into a new built home.

Speaker 3:

Who benefits the most from this?

Speaker 2:

The seller. Two thirds of them get more money than with an old fashioned traditional listing, and they get money faster. How amazing is that I know.

Speaker 3:

It doesn't get any better than that. Are you excited? It really doesn't. I mean, I know that it sounds like I'm a salesman. Yeah, taking that statement.

Speaker 2:

Me too.

Speaker 3:

But they get the house updated, they get money faster and they're going to get between 90 to 120% of the list price. I mean, why would you not do it?

Speaker 2:

Right? Actually, that's what people keep saying to me. Why wouldn't we do this? You know we started off. We could also make offers on your house, if it's listed, by the way. The problem is the listing agents often don't understand the program, so we have a lot of end sellers or expired sellers, fisbos sellers, people in foreclosure contacting us directly, and then they go to their friendly agent and they're well. We haven't seen this before. Chip, you've been in the real estate business a long time. How many times have you heard that? You know this isn't the way we do it here.

Speaker 3:

All right, we don't do it that way here.

Speaker 2:

Yeah, we don't do it that way here. Well, guys, real estate is changing. You know, this is the evolution of real estate and, trust me, chip is the number one in his market and he's in a very hot market. I've been doing this a long time here. We've got 1200 agents all over the country. Many of them in California are actually doing this because it makes sense. It makes sense for everybody. It's not because we make more as agents. It actually takes us more work to do this, but it just makes sense. You just have to understand how it works. All right, chip, close us up. We've got a few seconds left.

Speaker 3:

Well, thank you so much. This is exciting for us. We're new to this. Our whole team is getting ready for it. And we're just really excited about it. We can't wait to benefit our clients as well as our phones. It's wonderful. It'll help more houses sell. It'll help more houses hit the market and that's our biggest problem we just don't have the inventory. This will help our whole Syracuse market.

Speaker 2:

Yes, and it will clean up the houses that are there. They'll have an inspection report, they'll have an appraisal. They'll get cleaned up so you don't have that big sludge of houses in three to five years time that need cleaning up, chip. Thank you so much. That was wonderful, chip Harcoons. So here's the thing. If you want to get ahold of Chip, you can give us a call 828-333-4483. We'll see you on the radio next week.

Speaker 1:

This has been the Plain English Real Estate Show with Rowena Patton. Visit Rowena and post your questions at radioashvillecom or call her at 828-210-1648.

Real Estate Market and Business Opportunities
Retirement and Assisted Living Options
Preparing for Assisted Living
Investment Strategies for Increasing Home Value
Cash CPO
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