Comments by "Jeffrey Deuitch" (@jeffreydeuitch2146) on "Michael Bordenaro" channel.

  1. You dont need subprime to have foreclosures. Once value drops way below loan balance, many will lose interest in making payments and ride out for couple years until foreclosed. Taxes do not drop proportional to value drop and insurance rates are high and generally dont drop unless petitioned so hold costs remain high. If income or employment drop, the decision gets made. Cash buyers bail to recoup as much as possible. It's so obvious and rooted in history.
    19
  2. Not to mention the cost of replacement of batteries when they fail. One popular model is about $16,000 to replace the batteries. Some who bought a used EV have learned this absolutely the hard way!
    11
  3. Great video as always. Watched a couple of vintage episodes of Miami Vice this past weekend. Your videos are reminiscent of those episodes and you really do resemble Don Johnson as Crockett. You need to do a collab with someone who looks like Tubbs. That would be surreal and plug in some background music from Jan Hammer! Retro.
    9
  4. People would be shocked if they would realize how much of first few years payments go to nearly all interest and how little applies to principal. When you refinance, as Michael states, you are back to beginning of the amortization schedule and hence much higher proportion going to interest once again. The results in extremely high rate of interest if house sells in first few years. The things people dont understand!
    9
  5. Yes, but HOAs also put rules that for many seem draconian. If you are not compatible with LOTS of rules, don't by into an association. Want to plant a fruit tree? Well, proposed at one meeting then take some months prior to get "approvals" it's a double edged sword and can slice your own living preferences. Many learn this the hard way.
    8
  6. Yes, but the balance is made by the 800k value of the lot.
    7
  7. Good luck with the refinance deal if values should drop. Great to bring up the refinance hazards and hope viewers will recognize the Captain Obvious moment. Glad you are helping people to understand the hazards.
    7
  8. Another 3 months and the YOY will be compared to last June and everybody will wonder how this read can be so high. Strange so many do not understand very basic math. Will be large if prices stay stable for next 3 months. If there are price reductions between now and then the negative YOY will be much larger. Not a difficult concept to grasp. Will hit mainstream media pretty hard and may trigger sentiment change but remains to be seen.
    7
  9. Imagine if genuine unemployment increases occur. There appears to be a rapidly tightening noose out there. Really feel for the young folks starting out. Have a son who is starting grad school in July. Finance major. I hope he will be able to consider home ownership at a reasonable young age. A big downturn will be the only salvation for a whole genetation of young people.
    6
  10. To buy at the court house steps, figuratively speaking of course, better have lots of assumptions for repairs in your bid. Also best be aware if the foreclosing property is a second position holder or other liens. Back to 06 or early 07, early foreclosures sold at very high prices. Falling knife just like buying at open market too early in the downturn. Yes, concrete in toilets and sinks occurred as well as removed appliances, stolen condensers, well pumps, removed granite tops, boxing matches with drywall, and other sabotages were common and repairs can be xexpensive. Be careful
    6
  11. When you buy into any kind of association you need to know all the rules and obligations. They can be numerous.
    6
  12. For all the MLS searches I am doing, I am definitely seeing a rising proportion of active listing to pendings. This a definite evolving trend in Sarasota Manatee county area. Naturally this corresponds to rise in the monthly housing supply metric. I do not recall seeing this at same time last year. Also many "flips" for break even which means loss after closing costs. I do not think that this is a blip. Also DOMs appear to be rising on average.
    5
  13.  @hvaball150  yes, and more keys get turned in if value and equity drop.
    4
  14. When early YOY references start to show negative, they will fall back the Case Shiller which lags 2 months from closing which means about 3 months from contract date and hence when the agreement in price was made. Once CS shows negative, the narrative will shift and masses will take notice. Until then, people will be fed Soma.
    4
  15. Resellers will have a difficult time competing with this if they bought in last couple years. This will begin a process in motion.
    4
  16. In fairness, would need to see if there was a major renovation in that 1.4m house after the 800k purchase. But yes, I absolutely would recommend to wait. History is a pretty good teacher.
    4
  17. Not really familiar with the Miami market, but many of those flips in my area include a significant renovation. Was that the case with with the You Tuber's property? The gain may not be as high % as it appears. Renovation costs can be quite substantial. Great work as always
    4
  18. Foreclosure activity should pick up which will lead to increased inventory. That particular inventory is held by motivated sellers. That needs to be factored into anyone's prediction for future outlook. Cash buyers will likely predominate at lowered price since the higher rates will exclude those needing financing
    4
  19. A current low interest rate on someone's mortgage is one thing. A falling knife is another.
    4
  20. History has an echo. The "reduced appreciation but no price decline" was a very persistent mantra in 2005. Same as in last year. Saw the similar wreakage in late 80s. Led to complete destruction of the Savings and Loan industry which was the largest source of mortgages previously.
    4
  21. A great reset would indeed be painful in the short term but a salvation for the younger generation who are very challenged for economic life in general but especially for any hope of home ownership or affordable rent. Things are way out of proportion. A reversion to the mean is long over due but over history has seen to be true. If you are diligent, you will be preparing now for future events. I am for sure. History is a great teacher.
    4
  22. Downside of rising values is the rise in taxes and insurance. Can be burden. For homestead, Florida has Save Our Homes Act and tax exemption probability, but does not apply to other properties and not in the owners control. Since tax assessments are figured by mass appraisal algorithm once per year, the higher tax rate can persist even in rapidly falling market. The roll back rate used to insure that municipal budgets are met can result in stable tax bills even if assessments drop, which can take owners quote by surprise. These are some of the I'll feeling side affects springing from a big real estate run up.
    4
  23. Looks like an Ylang Ylang tree. It the flower Chanel #5 is made from. Grows in tropical climates.
    3
  24. Insurance premium increases could be partially offset if construction costs go out and result in lowered replacement cost. If this happens the contract your agent and have a new replacement cost estimate. If still high, can be contested by getting an estimate from a builder or construction estimator. In a homeowner's policy, there is an assumption that personal property has a value of 50% of the structure value. This may be true in some cases, but would guess it is not true in most. The base rate for personal property coverage tends to be higher than that for the structure which exasperated total premium changed. Talk to your agent to determine what cranks can be turned to minimize premiums. I have done this many times and its easier than you might guess. Lender may call the shots however so would need to check with them as well. Sometimes HOAs can also specify.
    3
  25. Last I looked, the government backed NFIP only covered residential structures to 250k and had somewhat limited things covered. Overage would need to covered by very expensive private insurance. No NFIP in COBRA zones. Buyers need to be aware before offering on property.
    3
  26. Data is data until the run for the exits commences. Seen this dance before. Yes, willing buyers, especially if cash, will gain significant leverage and will apply it.
    3
  27. Keyword indeed is "yet". Holding costs mount with time until reality sets in.
    3
  28. Thanks for the lending lesson. Very inrormative.
    3
  29. Flood risk happens in waterfront or proximate areas which tend to be higher desirable areas. No contradiction with that.
    3
  30. He is partially right in his recession definition but he is looking at where the puck is and not where it may head.
    3
  31. The legislative measures you describe are really not bad in principal. There were similar in the 06 to 2010 period. The market eventually took care of itself. Perhaps it just an indication of where we are on the curve. Not draconian like what blue states are doing. Will be interesting to see if Floida shift to negative net migration like what happened in last go around. Seems unlikely, but was also incomprehensible in last go around. As far as encouraging developers to build low cost housing, the cost of construction makes this unlikley to be offset by tax credits.
    3
  32. No question you will see those Case Schiller 12 month figures change radically in next several months. References data that is about 3 months old and compares to 12 months previous. Already dropped from about 21% to most recent read of 15 handle in past 4 reads. This is for the nationwide figure. If it did not lag, the figure would likely lower for the current read. In another 6 months reads, we could see negative. Then CNBC and other mainstream media will be reporting and confidence will really shift.
    3
  33. Hey Michael. How do you think the new Citizens insolvency danger announcement may affect sentiment to housing?
    3
  34. Despite the "different this time" narrative, it is amazing how similar the chain of events is unfolding.
    3
  35. Under save our homes, assessment has go be reduced when market value decreases. However the roll up provision allows for increase of millage in order to make the budget. Ultimately, taxes are indexed to municipal budgets and not to property values. During the last big downturn many were infuriated when their taxes did not reduce proportionate to the market value drops. Since municipalities tend to spend a lot of money during boom times I imagine that the same will occur if another big recession hits. You are correct in that many people do not know how this works.
    3
  36. The cure for high prices is high prices. Takes some time however. History has shown this in past and may in future. Can't bet on anything, but trajectory is changing. Big question is what is future trajectory? It's not about what assets you buy but the timing under which you own them. Therefore look at history, see where we are on the cycle, and see how others capitalized in the past.
    3
  37. If you are buying an 80 year old home, you should have inspections from engineers and by the individual trades. I.e. electrical, roofers, plumbers etc. It is out of league for most general purpose home inspectors.
    3
  38. Those who insist on remote work in defiance of the company's mandate may very well be higher on the layoff list if/when the big downturn occurs. Not really great to be biting the hand that feeds you. Can bet derivatives on mortgages and other instruments are being issued, subprime or not. Strongly recommend watching the PBS Frontline documentary series "Money, Power & Wallstreet. Is a very detailed account of the economic and political events from 2004 to 2008 which culminated in the GFC. Was much more than just unwise domestic mortgage lending. Had influences outside USA borders and derivatives collapsed rapidly. Mortgages obviously were part and possibly the trigger. Can watch that documentary on YouTube. Very enlightening.
    3
  39. Taxes in Florida for main residence protected by Saves Our Homes Act. Does not apply to second homes, land, or commercial property.
    3
  40. Quite the pickle for remote workers.
    3
  41. Great to see great time with dad. I miss my dad every day. Enjoy!
    3
  42. Love your videos but have to point one thing out. Not all HOAs have private road. If it is a gated development then it will have private roads but many are not gated and have public roads and hence road maintenance is performed by the municipality. Just a technicality and don't mean to seem nit picking but just mentioned for factual accuracy.
    3
  43. My son attended an investmentxseminar with me recently and we got to talk with a. Brokerage company exec. He is about to graduate with a finance degree so was asking employment questions. He wants to work in an office/team environment. The exec said he was rare and they are finding ot hard to hire for positions requiring office attendance. When economy really slows I think those with desire to be in office will have advantage. Those who bought houses far away from work with Hope's of being remote workers may face hard decisions as Michael said. They are easy layoff targets.
    3
  44. Glad you are doing ok in Miami. I am in Sarasota county and we were original ground zero. Feel for Steve Daria since the eyewall is coming ashore in his area, Ft Myers, as I write this. It pretty intimidating here right now and his area might be seeing double the wind speed we are.
    2
  45. Here in Sarasota Brad area yes listing are increasing but additionally pending seem to be falling. Differences of course from neighborhood to neighborhood as well as price ranges but seeing this more and more commonly.
    2
  46. More than homestead tax exemptions, she was beneficiary of save our homes act which also pertains only to homestead. Perhaps that was what your referring to.
    2
  47. They should bring back Miami Vice and Michael would be the new "Crocket" resembles Don Johnson enough to be the son following in Sonny's footsteps. Those of us who remember that series would be all in. "Tale of The Goat" was my favorite episode with the bad guy "Legba"
    2
  48. It has been documented that kickbacks from Eukraune to politicians were made from previous rounds of funding. Some via FTX. Both parties likely involved and both houses.
    2
  49. Keep in mind too that after 60 days vacant, a HO policy will not cover. A replacement policy Carrie's a much higher premium. Therefore the leverage against the owner grows substantially.
    2
  50. All those things combined with the potential for a general RE downturn. It's getting concerning.
    2
  51. Josh not being objective in his recommendation. Also, atleast in our area, a high proportion of our 1M+ sales are for cash. Either way, it may be wise to wait this out for awhile.
    2
  52. Noticed similar recently when just trying to see what current rates are. Every web site I clicked on had a mortgage application link. Gave me the same feeling Michael is describing.
    2
  53. The competition in the next couple years may very well be amongst the sellers rather than buyers. A similar "standoff" occured in our area in 2006.
    2
  54. If rents collapse, investors will hibernate.
    2
  55. yes, I would offer a bit low considering what may happen over next several months. Beware the falling knife.
    2
  56. Once the velocity of money through the economy slows you will see changes.
    2
  57. Condo buyout would work unless recession and downward RE market evolves. Then the higher new HOA fees create a tightening noise. I sense this is going on in many asset classes. I can imagine large impound lots with dozens of 80 to 90k pickup trucks. Recessions are like a massive reset buttons. The bull walks up the step but the bears jump out the windows. Would not be the first time.
    2
  58. Until people just say no to buying stuff at ridiculous prices, it will go on. The consumer controls this. Shop at Aldi. Even Walmart has gone greed, not green. There are options.
    2
  59. As far as those items affecting young people's decisions on home buying, the real big one is the layoff stats. Stretching to get the dream home is often done without consideration of employment stability and long term income projection. That is a very hard lesson to learn especially if sandwiched by an underwater property. Worked with many of these back in 09 to 10 period. It is sad and shocking.
    2
  60. One of the first things you learn in studying water intusion issues is that protrusions in roofing is the highest hazard causes. This was one of the first things I thought about when rooftop solar started hitting the market. Imagine how they complicate re roofing projects. I personally would never do them.
    2
  61. Remember there was very high appreciation from Jan to about june to August 2022. YOY not telling an accurate picture. Much data comes from MLS and much of new construction is not on MLS. Even the turvis tumbler factory store here near Venice has a "up to 50% off" 4 day sale going on now. Truly a sign of economic times!
    2
  62. Prices already too high. Any inflation will tighten the noose. If housing goes, everything goes and the reset button gets pushed with massive demand destruction for everything. Price reductions will prevail and then the fear of, and reality will be deflation. The cure for high prices is high prices. If real estate can go down in price, other things can as well.
    2
  63. The proposed rent control issue could accelerate downward market value and prices given that increasing rent anticipation is a large part of investor thesis.
    2
  64. What the article is ignoring is the potential that prices could drop to such a level where fear sets in and the flood gates open causing a race to much lower prices. Wonder if "snowballing" will become a buzz term this year.
    2
  65. Most inventory data appears to be based on MLS/IDX listings. A very large % of new construction is NOT MLS listed. Hence inventory is under reported.
    2
  66. He was the top dog on TV during the heyday of that series. Remember it well and have the entire DVD collection. The remake movie with Jamie Fox was pretty good too.
    2
  67.  @jimshoe402  the sound and music really set the atmosphere. The episodes are still good to watch and have the feel.
    2
  68.  @MichaelBordenaro  yep, and the villain would be an international drug lord laundering money by financing real estate investors in Miami.
    2
  69. shoe  omg
    2
  70. I entered RE services during, as NIck referenced, the early 90's. What he is referring to is the S&L Crisis. Was very similar to the GFC. Strange no one remembers this, perhaps too young. Completely decimated the S&L industry and its deposit insurer, the FSLIC. Taken over by the subsidiary of the FDIC known as the RTC. Was personally involved with liquidating assets from failed banks and S&Ls around the country. Trust me, it was huge.
    2
  71. The storm is approaching the FT Myers area on the west coast. It's already north of miami and on other coast. Miami is pretty much out of danger for anything significant and Michael is aware. They could still get some significant rain and other effects, but nothing like being near the eyewall.
    2
  72. Something to know about taxes is that they are NOT flexibly tied to value. They are tied to municipal budgets. If property values fall dramatically, the rate of taxation can increase so dollars are sufficient to cover these budgets. These are called "roll backs". Call your local tax collectors office to see how it works in your area. The value down=taxes down assumption is not valid. Budgets have to reduce to allow your taxes to reduce.
    2
  73. At the State College level, tuition in Florida is about 200 per credit hour with the average load of about 12 hours per semester which is $4800 per semester. Other than dorms, student housing is about $750 to $850 per month plus utilities. This adds another $3,200 +/- per semester quadruple occupancy.. In Floida you have Bright Futures scholarships if the student did reasonably well in HS and continues good grades in college. Pays for basic tuition but not additional program costs. Does not pay for housing. We seem to come around for all of us that housing is a big problem and student loans get way out of whack with this figured in
    1
  74. Some folks think there is environmental reasons for EVs. However they need to assess what fuel and carbon usage was used to generate the electricity. If nuclear then OK but then comes down to cost of power. Renewables just don't produce enough power for grid scale.
    1
  75. Spot on. Narratives get fully exploited.
    1
  76. Wait until June for the YOY data. Then we will be one year from the peak. There will be some shock and awe. It is obvious although there may be some narrative engineering in attempt to prevent panic.
    1
  77. Definitely not an HOA person. I am an avid gardener but, I do feel that if you buy into an association you have agreed to give e control to others. Buyer beware and don't complain later. Know what you are getting into.
    1
  78. Bo jangles dirty rice is the best and they have been around for a long long time.
    1
  79. Where I live in Sarasota County it is amazing how often I see 60 to 80k pick up trucks in from of little 2/1 houses with carports. A few years ago the likely occupants would have had beater cars and a bunch of people living there splitting rent. Not sure what to conclude but one possibility is poor financial choices on the part of many to live the dream believing that construction or related services will go on forever. Been through last 2 recessions and not pretty when it comes. Seems in overdrive this time around. Noose tightening?
    1
  80. Mattamy has a large presence in Florida as well as being one of Canada's largest builders.
    1
  81. Many reason why volume increased. may be result of seller capitulation and price drop combined with slight rate drop.
    1
  82. That or a cash out refi.
    1
  83. Some of the professions you reference have license requirements which necessitate education requirements. To be an appraiser now has some education requirements.
    1
  84. Absolutely brilliant energy policy. Pay to get people to get rid of gas appliances in favor of electric which will require power plants to up the gas burning to provide more electricity to power all the new electric ranges that replaced the gas ones. Is there ever an end to the stupidity! Yes, gas powers most power generating facilities. Dont like gas plants, then go with coal or oil. Germany has learned similar lesson when the shut down nuclear. Now they are burning more coal than ever and have higher emissions. Oops, the $500B wind/solar experiment didn't work out to well.
    1
  85. Decent analysis but need to break down electricity cost to price per mile traveled.
    1
  86. Remember also with new home construction that every vacant lot in modern developments represents inventory despite there not being a permit on these.
    1
  87. I think the wise look for where the puck is going rather than where it is. When recessions arrive, they tend to come as a surprise. Then drastic changes in habits occur. Otherwise tends to be business and spending as usual.
    1
  88. In my recent MLS searches I have noticed that active listing are dwarfing pending sales. A fundamental change appears to be evolving. If this progresses then some wholesale changes in the industry will occur and the NAR issues will become irrelevant. Have been through the last 2 big downturns and history may be repeating. All current narratives may become passe soon.
    1
  89. Understand the point, but when you allow the govt to supercede a free market, you might create a Frankensteins monster since it could spiral rapidly and no established boundaries. Ok with the Homepath system, but not the broad market. What would be the endpoint of such authority? Truly scary.
    1
  90. Keep the glasses, makes you look right out of Miami Vice.
    1
  91. Agree with most of what is said, however if market starts declining then many of the dynamics you describe will be different. This includes comps. In declining market, lenders will start to look at list prices of available properties. Many do not know that appraisals contain not only data for closed sales but also typically will have 2 or more listing or pending comps with pending being preferred. This requirement came in the last downturn where asking price on listings became more indicative of security for a loan. So much that people do not know about.
    1
  92. The gap is because price is capitalized to income. This is why prices go down quickly once rents drop, especially if organic price appreciation stagnates or drops. It's a perfect storm when that happens.
    1
  93. I do services related to new construction closing diligence. Am on 3 to 6 or more construction sites each week. I am stunned to see how many truck heaven f150s and RAMs used by contractors. Many of these trucks are in the 80k+ range. Market clearly starting to moderate and would imagine that many of these trucks will show up on lots soon after repossession. Trades have been good for last few years but is changing and that debt will come home to roost
    1
  94. Time to bring in consultants from Saudi and other mideast countries to show us how to address theft issues.
    1
  95. Not only should your investment analysis include those you mentioned, but also a buffer for the possibility that rents can drop, especially if the economy turns down and unemployment increases.
    1
  96. The silent ripoff is the replacement cost estimate. The rate is multiplied by the replacement cost to create the premium. There is no regulation on cost estimates. Works just like tax bill in that regard. In 2012, Citizens got into big trouble for excessive RCV estimates. You can google this if you wish to research. This is the component you need to fear going forward. Furthermore the base rate for personal property coverage is higher than real estate and in a HO policy, personal property is assumed to possess a large portion of the structure value. Usually 25 or 50% of the structure value. So if your structure has 300k in RCV, then you can be paying for $150k of personal property coverage but some classes of valuables are only covered up to 5k. Talk to your agent for details.
    1
  97. Your listing and pendings analysis is right on the money here in Sarasota Bradenton area.
    1
  98. Hope you guys faired OK. Here in the Sarasota area, Nicole was a mild wind and rain maker. Definitely did not need anything resembling another Ian type event. Was strangely cold when it came.
    1
  99. You last sentence says it all. Recency bias is a powerful thing and tends to outweigh history. This bias, of course, leads to the belief that what has happened recently will continue. It works in both directions and is prevalent in all investment types.
    1
  100. It is as though governments are deliberately trying to send us into recession in order to hit the reset button and drive everything thing down. All this with extreme fallout ofcourse. Automotive podcasts are revealing significant changes in that industry as well. Another brick in the wall to quote pink floyd. Shades of 2006?
    1
  101. Since when are home inspectors expected to be cost estimators? Doesn't make sense. Really stupid if the inspector volunteered a roof estimate and should have declined if asked by the agent or buyer. Very dumb unless he/she was also an experienced roofing estimator, but probably not.
    1
  102. I would wonder what the developer of the site with the dig is asking to be paid for the site. There is plenty of greed on all sides to go around. There is always more to these stories than meets the eye.
    1
  103. If they had a previous homestead in Florida, then through portability, they can carry forward the save our homes benefits will carry to the new home up to the assessed value of the previous house.
    1
  104. The fake borrower's credentials very much in play during the last housing boom 2005+/-. Not a new thing and not limited to Canada. Happened right here in the US as well.
    1
  105. Citizens had a mandate several years ago to begin depopulating and it worked for awhile. Those new regulations could negative impacts but the question is: how will they enforce? Not sure how many policy holders they have, but that will be a monumental task..
    1
  106. The ghost of hurricane Andrew is alive and well in the memories of insurance providers. Was quite the event.
    1
  107. Watch out for when our Gov't defaults on treasury bonds under "emergency circumstances" they took GM out at the expense of shareholders, so think they would not screw over bond holders?
    1
  108. The unthinkable only is, until it happens. When it does, it is up front and center in our thinking. In 2010, the RE prices in 2005 we hard to fathom. In early 2022, RE prices in 2010 were impossible to fathom. So what is the next step?
    1
  109. You can easily obtain a mortgage amortization schedule on the web. Yes, it is shocking to see how it works and the early years are dominantly interest. The proportion changes constantly through the loan period. May not be such a good move to refinance if you are well into a loan. If you refinance in the first few years, then may not be bad idea. However if value of property has dropped, it may not be possible without adding cash.
    1