Posted on: March 01, 2022
WI 897 | Money In Real Estate

 

Step right in because today, we’re here to maximize leads!
In making a better source for the leads you have, you’ll be in a much better place. Putting your money on the line can be a little tricky, but with the right game plan, you’ll move forward in no time. But the question lies with are you just going to wait for the market to crash, or are you here to listen and mitigate a better strategy?

Here’s Chris Craddock to answer and send you the latest updates on how you should monetize your leads the best way possible.

Reality Check – Is it Too Late to Make Money in Real Estate

Episode Transcription

I am so excited to be here with you. If you are like most investors, you are reading this because you want to go from doing well to crushing it. Maybe you are in a place where you are saying, “I am ready to start going big.” If that is you, this show is going to be directly speaking to you. I am here to help you take your business to the next level, maximize every lead that you have, and make the most out of the things that you are already doing. Instead of paying for new marketing and lead sources if you are able to make better use of the sources you have, you are going to be in a much better place.

With that said, what I want to talk about is a question I get regularly, “What’s going to happen in the market?” I get people telling me all the time, “I’m going to get into real estate, start investing into real estate, start doing real estate stuff, become an agent and do all these different things when the market crashes.” The big question there is, “When is the market going to crash?” That’s what I want to talk about. I had a debate. I’m not on Clubhouse all that often but every once in a while, I jump on.

I was on Clubhouse and this very smart lady’s whole thing was, “The market is going to crash.” I started listening to it. I was curious about what she was saying. I’m like, “Why is it going to crash?” She’s like, “We are in that part of the cycle.” I’m like, “That’s not how crashes happen. It doesn’t crash because it’s time to crash. That’s not it.” Economic factors cause something. Everything in this world is cause and effect. Things don’t happen spontaneously. There’s always a cause. There’s a primary mover on it.

What happened in the ’90s with the market crash is there was a lot of stuff with the S&L or the saving and loans, which you don’t often hear anymore because they have gone out of business. There were issues with that where people were getting loans they shouldn’t have been getting. The same thing happened in the 2000s. McDonald’s workers were making minimum wage buying $2 million mansions. They were living large on MTV-style crib houses on minimum wage and all of that. They had no cash. People were getting loans when they should not be getting.

Now is always a good time.

What’s happening is there’s extra cash in the market. If you look at people’s bank accounts, people are cash-heavy. There’s more discretionary cash than any of the other times that we were having crashes. That’s one. Number two is people are not getting loans they should not qualify. We see over and over again people who do qualify and can buy million-dollar houses in cash are not qualifying for loans because it doesn’t fit the Freddie Mac and Fannie Mae guidelines. If you are not familiar with that, they are the people that buy all of the loans that people get.

If you buy a house, you will get a loan through a company. Freddie Mac and Fannie Mae will buy the loans with the guidelines for what loans are able to be sold and all of that. The bottom line is these companies are not allowing people that don’t have cash and the ability to qualify and don’t fit in their box. It is hard for entrepreneurs, which we will talk about. How do you make sure that you are not paying the government too much money in taxes but also being able to afford or qualify to get loans?

If you have very little taxable income, you don’t pay taxes but you don’t qualify for loans. How do you play that game in a way? I never recommend cheating. Those are things that entrepreneurs are always wrestling with. How do you qualify for these? I shared this before but I want to share briefly why I do not believe that we are ready for a crash anytime in the near future. Number one, homeowners have more money. They are not strapped. People are able to make their payments. Many people came out of forbearance earlier in 2022 or 2021.

The government essentially mandated that people didn’t have to pay the mortgage for a little while. If people were strapped for cash, they could have stayed in the program. It was something like 92% of people got out of the program, showing that they were not strapped for cash. People had money to do it. Second, builders are playing catch up. They have only been building about a million houses a year for years ever since the last crash when we need about five million houses a year. Only about 20% of the houses were being built that needed to be built for a number of reasons.

WI 897 | Money In Real Estate

Money In Real Estate: Inflation makes everything more expensive over time and dollars become less valuable.

 

One, they were in shell shock, too. A lot of them went out of business. Three banks were less likely to loan to builders. There were all these reasons but now, the builders are trying to catch up. We all know that when there’s less of something, it costs more. Go to a football or NFL game. You will see that. It’s because you don’t have a lot of options where you can buy beer that you are paying $20 for a beer. If you had a ton of different options, then you could buy beer cheaper. The same thing is true with houses. When you have fewer options, it costs more for it.

A bottle of water at a grocery store is $0.50. For a bottle of water in the middle of the desert, if you are drowning, you give everything you have to stay alive. That’s the piece there why costs are going up. Next is inflation. What the government is saying is first, it’s 6.8%. Now, it’s almost 8% inflation. Honestly, I don’t even believe those numbers. Inflation is the debasing of money. According to the government’s numbers, it’s 7%. If you have $1, its purchasing power is only worth $0.93 after what happened, which means the value of the dollar is going down because of inflation.

That’s why you look back and see when our parents or grandparents were saying that they bought school lunches when they were in school for $0.35, $0.10 or $0.05. A McDonald’s burger was $0.05. Inflation makes everything more expensive over time. When we have an expanded inflation rate, what happens is the dollars become less valuable. What everybody who’s smart does is they don’t sit on a ton of cash. They put their money into hard assets like gold, silver, and real estate. Even cryptocurrency doesn’t get debased at this point, which is why a lot of people are putting their money there.

We could go a lot deeper into this. Real estate is the best bet against inflation. Houses are so much more expensive every year. If you have the same interest rate and your dollar is worth less, it’s important for us to realize that the dollar is losing value like a melting ice cube. Houses are going up in value. Real estate is a good place to get into. With all that said, I wanted to give the background behind what the real question is. “Is now a good time to get into real estate? Should I wait until the market crashes to get into real estate and go all in?”

Maybe I’m doing business in real estate but I’m not all in. I’m afraid to go big because I don’t want to put all my money into real estate and the crash is coming. Here’s the question. “Should I wait or go all in now?” Here’s the deal. Now is a good time. It’s always a good time now. It is a great time to get into real estate because I have people that said years ago, the market was going to crash. They didn’t get in and buy any rentals. One of my friends was going to buy a $900,000 personal residence.

Everything in this world is based on cause and effect. Things don’t just happen spontaneously.

He called me in 2021 and said, “Chris, I’m looking at housing prices in the same house that I wanted to buy in 2021 for $900,000. It’s worth $1,050,000. My waiting cost me $150,000, didn’t it?” I said, “It did.” That’s the whole thing where we need to realize that the market is going up. It’s a good place to put our money. Now is always a good time because we are learning, growing, and getting better at what we are doing now so that we can take our skills into any market.

When the market crashes, here’s the best thing that happens for investors. Everybody that needs to work on their house and everybody whose house is not in pristine condition has to give it away because it’s called a buyer’s market. If you put it on the MLS, nobody is going to buy a house if it’s not pristine. It needs to be incredible. In a seller’s market, which is what we are in when the market is strong, you can put dog crap on the MLS and it will get multiple offers. It is one of those things where you can put anything up on the MLS and get multiple offers.

A lot of people are making a lot of money here because the market is going up. Maybe you are not buying at a great price but a big wave makes everybody a better swimmer. That’s where we are. Everybody is winning because of this. Don’t use that as your business strategy, hoping that the market is going to go up because at some point, it won’t and you are going to get in trouble for that. The market is going up. It is a good time to be in because we do have a little bit if you work to buy right.

If all of a sudden you realize you didn’t buy right, the market is in your favor. It will correct in a way that helps you win. Here’s the other side. To anybody that has read much that I have shared, I was in ministry for a long time. I remember studying a guy named Rick Warren who wrote the book The Purpose Driven Life. It was the number one bestseller for a long time. If you are feeling lost, it’s a great book to check out. One of the things about Rick Warren is when he started his church, he was looking for a place that fit well.

He wanted to build his organization in a place that was a good fit according to the numbers. He went to Orange County, California, which was a good place where it fit the demographic that he felt would lend itself to growing a fast organization. I do believe in massive imperfect action. That has served me well time and time again. I also think that looking at numbers, trying, and making sure that we are making wise decisions about where we put our money and how we invest is important.

WI 897 | Money In Real Estate

Money In Real Estate: Anybody who’s smart won’t sit on a ton of cash. They put their money into hard assets, gold, silver, real estate, even cryptocurrency.

 

That’s why no matter where you are in the process, looking at some of these great organizations, classes, and programs, especially the ones that Wholesaling Inc is offering, can help you do what Rick Warren did. Look at the numbers and say, “How can I compress decades of learning into days?” How can I take all of these demographics and numbers and say, “I don’t want to spend tens and hundreds of thousands of dollars to learn the best strategies and techniques?”

“I can get into real estate and go big, whether it’s learning to do my first deal or go from doing a deal 1 month to doing 10 deals a month. I can learn from people that are further along.” That’s why I personally have a lot of coaches that I pay to bring into my life because I want them to help me. I pay for it because it’s worth my time. Our goal is to do 700 transactions in 2022. If I’m going to do 700 transactions, that’s up by almost 10% growth from where we were in 2021.

If I’m going to do that, it is worth paying somebody to help me not figure it out for myself. Even though I can, it will take me a longer time. What are the practical steps? Now is the best time to get into real estate. Even though the market may crash at some point, I don’t believe that it is coming anytime soon. There are a couple of different groups of people that read this. There are the people that are brand new saying, “I want to do my first deal.” If you are doing no deals, here is the first way to do it. It’s massive imperfect action. The best way to do it is an activity in skill. Start moving.

If you want to spend all your time doing research, listening to podcasts, and not doing any action, you are never going to grow. Learning is a hobby for you. It’s not a job. You will be running a nonprofit. Frankly, we don’t get into real estate to run a nonprofit. We get into real estate to make money. That’s the deal. It’s important for you to start doing the right things but also get the right mentors and coaches, look for the program that is right for you and jump into one of these programs.

If you spend all your time doing research and not doing any action, you are never going to grow.

Number two, maybe you are doing a handful of deals a year. I was talking to somebody who was asking me some questions on my Instagram. I will answer anybody’s questions on Instagram, @Craddrock. Send me any messages that you want. I’m happy to answer your questions. She has done a bunch of deals but it seems like she’s not able to go to that next level where she’s able to scale her business. That’s where you start looking at some of these other ways and mediums that will bring in more leads and allow you to scale.

If you are making more than $100,000 a year, it doesn’t take a lot to get there if you follow the advice of some of these great folks. If you are making more than $100,000 a year, you need to have an assistant because if you don’t hire an assistant, you are the assistant. A lot of people say, “I’m going to hire a cold caller, salesperson, and acquisitions manager.” What you need to do is hire the person that can dot all the I’s and cross all the T’s because let’s be honest. I know you and entrepreneurs.

All of you are very similar to me. I believe there’s the outlier here and there but most of you hate paperwork. You can hire somebody for $20 an hour to do all your paperwork, administrative stuff, and all the things that will sap you of energy. I did it. Some of you are not like that but most of you are. The paperwork and the admin work will sap you of energy. If you hire somebody else to do it, then you are able to function on all cylinders and run hard and fast. The best way to grow is to be able to do the things that you are good at.

You should be selling, stealing from our friend Brent Daniels and talking to people to get stuff done. That’s where you start. You can hire cold callers and other people to bring in leads and deals after the fact. Start by getting an assistant. The last thing is if you are bringing in leads, you’ve got to be able to monetize all of these leads. Monetize every single one of them because you have already paid for the leads. You need to make the most money that you can from the lead.

WI 897 | Money In Real Estate

Money In Real Estate: Real estate is the best bet against inflation.

 

Instead of letting some other real estate agent or investor that’s paying some stupid amount for it way more than they should be paying for it make money or get the deal, you can control the deal with the REI Revive Program where you work with the agent to make sure that you are monetizing every dead lead. With that said, those are the real keys to leveling up to scaling, whether you are doing no deals, some deals, and to a massive amount of deals. That is the whole key there.

Honestly, one of the things that I have found is that brings us a lot of joy when we are able to become a better version of ourselves. That’s what we are doing with our business. We are helping it become a better version of itself. With that said, if there’s anything I can do for you, your business, and your company, go to my webpage, ChrisCraddock.com. Hit the Apply button, either I or somebody from our team will give you a call, look at your business and say, “This is a place where we can help you make more money, level up your business, and therefore, level up your life and get to where you want to be.”

I want to serve and help you with anything I can do. Reach out to me at my Instagram page, @Craddrock. It’s an old and cheesy high school nickname. That’s the deal there. Feel free to reach out. I will reply and help you. I’m excited about helping people. I want to see you win, go out and live uncommonly. Let’s kick butt and take names. Do the things you need to do in 2022 and you are going to look back and smile to yourself saying, “I cannot believe the life I have built over the last few months.” Let’s go run. See you.

 

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About Chris Craddock

WI 886 | : Leveling Up - 3 Steps To Changing Your Financial Temperature To Achieve A nationally certified Life Coach in Leadership and top 20 in all of Keller Williams Realty International, Chris Craddock is the host of the Uncommon Real Estate Podcast, a Realtor, and entrepreneur who runs multiple successful businesses in the Washington DC Metro area (and Richmond, VA). Chris and his companies consistently bring in over 5 Million in revenue year after year. His team, The Redux Group, sold just over $160 million in volume in 2020. Chris has been married for 20 years and is the proud father to six beautiful children.

 

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