Florida's Crash Has Begun - The Rest of the U.S. IS NEXT

I've never seen such an inventory explosion with so little interest in what's there. Migration coming into Florida is down about 75 to 80 percent. People are not coming to Florida. High cost of insurance, taxes, assessments. People are worried about what's going on with these condo buildings and associations, these homeowners associations that are 200, 300 percent up. People are pausing and a lot of people who are here now are actually leaving because they can't afford the increases. They're just fed up with it. And the thing is too, the culture's changed in Florida. The culture of the people changed. You know, Florida, it's not really family oriented anymore. People can't spend 70 percent of their income on a home. They should be spending 30 to 40 percent. And until either rates come down or prices come down, you know, that's the glut we're in. It just seems that they're being forced out. The average people, husband, wife, have a job, two kids. By the time they pay for their home, pay for their automobile, pay for their insurance, pay for their taxes. It's like there's nothing left. It's like everywhere else in the country. People couldn't afford it when the rates were down. Over the last 20 years, we've watched mortgage rates drop. That's not practical. The 50 year running average for mortgage rates is 7.7 percent. Sellers need to wake up. My story, and I'm sticking to it, is this has to crash because it's not sustainable. Phil Simonetta, welcome back to the show. Good to see you, Todd. Always good to see you, my friend. You know, every time we get together and talk about the Florida housing market, it's like fireworks. You know what I mean? Some people are like, yeah, you guys don't know what you're talking about. And but anyway, man, it's always a pleasure to see you. And I'm excited to talk about what's going on. There's a lot in the news in Florida. I can't wait to cover it with you. But for those that don't know who you are, just kind of let them know. Give them the 50,000 foot overview. Yeah. As Todd said, my name's Philip Simonetta. I'm the broker owner of Pure21 Realty. And I also own the Florida Real Estate School by Pure21 Realty. We're licensed here in Florida, North Carolina, Tennessee. And we're expanding actually into New Jersey and Pennsylvania. I'm in the process of doing that. A family owned brokerage, myself and my son, Aiden. He's also a broker and instructor with me. And we have 10 agents here. We serve the entire state of Florida from our headquarters in Jacksonville. So what's happening, man? Last time we spoke, prices were crashing. What's going on? Inventory was exploding. Is that still happening? It's increasing. What's happening is the buyers are down. Migration coming into Florida is down about 75% to 80%. People are not coming to Florida. A lot of things are the reason for that. High cost of insurance, taxes, assessments. People are worried about what's going on with these condo buildings. And associations, these homeowners associations that are 200, 300% up. People are pausing. And a lot of people who are here now are actually leaving because they can't afford the increases. So you have a lot of people going to Tennessee, North Carolina, South Carolina, moving back up north due to job calls. They're being pulled back to work. So it's really interesting because the Florida market is completely opposite of the New Jersey, Pennsylvania market. You put a house on the market in Jersey, there's five offers and it's over asking. Florida, the average time is four to six months now on the market. I have four closings this week coming up. And all those properties have been on the market for over four months. One was over six months. But in general, it's down. I mean, the buyers, the calls from the buyers, the buyers agents. I'm also seeing a lot of agents. The agents are in bad places. They're not working. They're just running around the buyer side. And just the incompetencies. We talked about them before. Different problems with contracts. I have a deal right now closing on Thursday. The buyer agent disappeared. The title company can't get a hold of them. They just disappear. There's no communication. It's hard to say. And there's a lot of that. A lot of these deals are falling apart because of there's just bad, bad negotiations and bad contracts. And just people are getting jammed up like that. I mean, obviously it's spring. So you find that alarming. You're talking about sales, inventories rising. And how many houses would you say have hit the market in the last seven days? Last seven days in the Stellar MLS, it was about 15,000 houses hit in the market and about 16,000 to 17,000 price reductions in that same MLS. And sales are down. So do you find that disturbing that it's the spring market, traditionally the best time of year for a seller to get the highest dollar for their house? Yeah. I mean, the Florida market, it's something I've never seen. We've talked about this before. I've never seen such an inventory explosion with so little interest in what's there. And I've been in real estate here for what, 15 years. I've never seen a glut of properties coming on the market and just no interest. It's very, very surreal. It's like a surreal situation. And buyers and sellers are starting to realize it. Sellers are starting to realize it. The bulk of the houses that are coming on the market, are they occupied or do you find where they are out of state owners and they're sitting vacant? Yeah. A lot of them are investment properties that the people are getting out of. I'd say about 50% of the people I'm dealing with are investors who had properties. They're either tenant occupied and they don't want to renew leases and sell them or they're vacant because the tenants are recently out and they just, the insurance costs going up, the association costs going up. It's not a valuable investment. About 50% of it is that. And then I'd say about another 20, 30% are people who are just getting out of Florida. They're leaving. They just can't afford the costs. I want to pull up this article from neradarealestate.com. And this is a new article as of the 12th of May. 24 housing markets could see home price drop by early 2026. I mean, maybe they're late to the party. I don't know. We're already seeing, you're explaining price drops. I've interviewed housing analysts that are saying that Florida is leading the country in price drops. They say that 24 Florida housing markets could see home prices drop by early 2026. And it says that Florida's red hot housing market might finally be cooling down after years of breakneck speed. And if you've been watching from the sidelines, wondering if things will ever change, listen closely. There's more homes on the market. I know you and I have talked about this before off camera here. And you said that you didn't know where they were coming up with these numbers because they're low. This article claims that single family homes in March of 25 were up a healthy 10.8% compared to March of 2024. You said that that is way off. Yeah, I don't see that. And not in any of the markets I'm in. I'm in most of the major markets in Florida. I mean, it's just the numbers don't, they're not accurate. Well, it also says here that with more homes being listed, the total number of homes for sale, active inventory is up for single family. There was a five and a half month supply in March of 25 for condos and townhouses. It was even higher at 10.1 months supply of balanced markets, five to six months. We know that from being in this industry. Where do you see this going? Do you think that we're going to be flipped completely to a buyer's market? Yeah. I mean, if you look at Fort Lauderdale, Fort Lauderdale is the highest month's inventory in history, in recorded history. There's more, it's like 10 point something months. It's never been that high. And that's one of the hottest markets in Florida, right? Fort Lauderdale, South Florida. I mean, that's one of the hottest, a Hollywood area, Lauderdale by the sea, that area. It's really interesting though, Todd, because you're going to see pockets where something goes on the market and it's sold or because there's a certain element of people, certain buildings, certain communities, but other things are sitting. If you look year over year on the typical condo, it's down almost 40 to 60%, depending on where you are, year over year sales and volume. Volume is down tremendously. It's just the numbers don't lie. The numbers are the numbers and it just seems to be getting worse and there's just no accuracy being reported on it. You know, the numbers are the numbers. No one's looking at it. Well, a lot of it's backward looking data. I mean, they're quoting things from March, but just let's check this out. Why the cool down? This is still the same article peeling back the layers. They say that inventory is bouncing back, mortgage rate mayhem, the affordability wall, the elephant in the room, insurance costs, buyer fatigue, a general dip in sales. What's the real elephant in the room, Phil? It's all of it. I mean, people are just fed up with the cost. They can't afford it, man. You know, insurance costs going from $2,500 a year to $6,000, you know, for a $400,000 house. You know, it's just, it's impractical. Your taxes, your insurance. I mean, it's just, people are working to keep their home. You know, when you're 60, 70% of your income is going to maintain your home. You know, a lot of it's time to go, right? A lot of people going to Tennessee, North Carolina, South Carolina, the beach, you know, Myrtle beach. I have a bunch of clients moving up that way. They're just fed up with it. And the thing is too, the culture's changed in Florida. The culture of the people changed. You know, Florida, it's not really family oriented anymore. I mean, you'll see, I think I just read an article yesterday that the rate, the birth, the debt rate, death, death rate in Florida is officially flipped. It used to be 2.1 people born for everyone who passes away. It's actually 0.9 for every birth for everyone who passes away in Florida, the state of Florida in general. So when you have the birth rate change, that's like a, that's like a natural. Like the client of birth right now, what, what, what does that do? That affects schools that affect like schools are going to be, have less students, right? It affects the workforce. There's a lot of factors there that, that, that affects. And if you look at that, I mean, it's, it's, that's, that's, I mean, I don't know nationwide, but for the state of Florida to have, you know, a declining birth rate compared to a death rate is really something. And if that keeps progressing, that's only going to get worse too. And a lot of people in that culture, you know, I was reading that same article and they were saying, you know, in certain cities in Florida, you know, maybe 30, 40% of the homes have children in them. And the balance doesn't, you know, 50, 60, 70% of homes don't have children. Like in Tampa, I think one of the places was Tampa where it's like a 25% rate of children in homes compared to homes without children. There aren't families here. You know, there's a lot of that adjusting and, and they're cutting the schools. Like there's articles now about, you know, cutting school budgets and cutting classes and cutting teachers. There's, there's a lot of that going on. The culture has changed. Yeah. Well, I mean, I believe you with that, but as someone that doesn't live in Florida, who's never lived in Florida, I always think of Florida as a state for retirees and snowbirds. I mean, I think of Florida as Disney vacations, hitting the beach tourism. You know, I'm not really thinking about Florida as a place to raise a family or raise kids. I mean, the jobs are suppressed. The incomes are suppressed. I think, uh, they have tried over the years to bring medical city to, uh, maybe it's called medical park or medical city, whatever it is, Orlando, that area. Um, obviously you have a lot of retirees. You need to take care of them. So you need to step up the, uh, the medical industry. The problem is, is that if the nurses and the doctors can't afford to live, I mean, you're selling to, uh, foreign investors that are parking their money in Florida because they want to be on the beach. You have rich and poor and, and they're doing a great job of separating everything else. At least that's from, that's from an outsiders. Uh, I love it. It's the pockets you're, you're right. There's pockets. Are you talking to beach Fort Lauderdale? You know, Hollywood, South Florida, sunny Isles. It's all that you start going inland, Davie Parkland. Now that's what you're talking about. Your family's Coral Gables, right? You're talking about your families and your good schools, but there's pockets. You're absolutely right. But it, it just seems that they're being forced out. The average people, husband, wife, have a job, two kids. By the time they pay for their home, pay for their automobile, pay for their insurance, pay for their taxes. It's like, there's nothing left. And they just like everywhere else in the country. Well, that's, that's, that's, that's, that's sad. It's getting that. Yeah. That's everywhere. I mean, it's, it's crazy, but well, what do you think the elephant in the room is? Obviously insurance is going up. Cost of living has gone up. Groceries have gone up, you know, taxes, property taxes have gone up. Home repair costs have gone up. What's the elephant in the room? Why is it that we can't afford houses in America? And why is it that buyers are tapped out saying, I'm not buying your overpriced house. You need to drop your price. It's the affordability. People can't spend 70% of their income on a home. They should be spending 40, 30, 40%. And until either rates come down or prices come down, you know, that's, that's the glut we're in. People couldn't afford it. People couldn't afford it when the rates were down. I know it's, it's, it's four times worse. Look at the payments. I mean, people, listen, people always will stretch themselves for something they want. Just like when you go to a car dealership, you buy a car. Next thing you know, your payment is $60 higher because you wanted to power windows in the moon roof, right? And they sell you on the emotion. The thing is that emotion has, I believe with all the things going on in the world, COVID, all this stuff, a lot of emotion has come out of people and a lot of, a lot of transactions. If you notice when I'm, I'm dealing with buyers and things on deals and sellers too, there's a lot less interaction. There's a lot of, a lot less emotion involved. It's more transactional. I see that in my daily transactions. I don't know if you pay attention to that, but it's either, you know, there's no, no emotional tie to it. Like it's either they can do it or they can't. And here's the number and that's it. You know, there's no, well, let's see if we can do this or do that. It's really, the emotion has been drained out of people when it comes to real estate purchases. From my experiences. This article goes on to say, is, is it a crash or correction? What do you think? You think it's a crash or correction that's coming? Well, the bottom line is if you look at the COVID, I think it's a little bit of both because if you've seen the increase from 18 COVID, you know, if you look at the history of and then, and then you see it shot up and now coming back down that, that baseline of where housing was is really the, the, the average growth of where it should have been like 17, 18, before, before you got hit in 19, 20, 21. And you see, it's coming back down. It's like, it's like there's a little spike in there. I truly believe it's going to come back down to where it's always been. You know, the cost of the housing has changed though. The building of the housing has changed. It's just the people's equity has grown and they don't want to give it away. They feel like they're entitled to this equity. That was this big blurb with, with the supply demand, with the COVID moving with the, with the, the influx of people, different areas of the country. But at the end of the day, we go back to what we talked about before. People can afford that payment. And now, if you look at that medium, medium home price all the way up, so you're climbing, you know, at a base level and then you drop it and you're climbing, but look at that shoot up there. Look at like from night 19, where it got a little crazy with COVID and you see, I'll just shot up there. I truly believe it's going to, it's going to linger and you got a correction coming back down to where it left off. And I'd say 20, maybe 21. I don't see how that it's, it's inflation that that's inflationary. That what caused that was all the free money, all the COVID money, people not having to pay their mortgage for, for a year and a half or two years, you know, but they wasted that money. Nobody saved that. They just blew it, you know, and, and, and they blew it on houses. They blew it on, you know, Oh, Hey, we're getting all this free money. They can do this. And that, I believe that that's really what pushed that up. And the sellers took it, right. Somebody's going to pay you money for the house. You're going to take it. You know, it was, they're saying, they're saying a crash, a crash is a rapid, steep and often unexpected drop in home prices, usually across the board, driven by a panic and severe economic issues like the subprime mortgage crisis. A correction is more moderate decline in asset prices, often after a period of strong gains. Think of it as the market letting off a bit of steam or returning to more, um, to more substantial levels, right? Well, what I'm saying is just like, we just looked at that. It was a reverse crash, right? Panic. All that caused that, that 20 from 2020 to 2022, that client there panic caused that it's a, it's a reverse crash. So what's, what's going to happen? You can't let steam off. You're going to have the same panics coming. People can't afford anything. You know, it's going to, it's going to turn back into that crash and come back down to its normal levels. And you know, what's interesting to me, you know, what's interesting to me, this turbulence right here kind of resembles this term. If you look at this V right here, kind of resembles this V right here and a little bit of a spike. And then obviously we start going down. And the interesting thing about this chart is there has, even with this. So far, I would say we're in a housing market correction because we're starting to see prices sort of like balanced out. What this is showing is that people can't afford the higher prices. So the bulk of the sales, the median sales are dropping, and this is happening both in new homes and existing homes. We're watching builders make these corrections. But the interesting thing is we've never seen that kind of volatility in the housing market prior. And this goes back to the early 1960s, but we really haven't seen this kind of volatility since World War II. And what we're really looking at, a lot of people talk about the unaffordability or the stagflation of the 1970s where interest rates actually hit over 18%. 30-year fixed rate mortgage rates hit 18 point some percent. Even back then, we see none of this price volatility that we've experienced since the great financial crisis where we saw a major dip. And now we're looking at the same thing. Back then, Todd, back then there was no smoke and mirrors. There was no, there was no, you know, it was, it was black and white houses were a lot, lot less expensive. There was no inflation, like the way it is now. What I want you to look at, very similar to between 06 and 10, right? But look, that reverse crash from the panic, look, look on there from 20 to 23, take that out. And where would you be? Take out from 20 to 23, just remove that and put it together. What's it doing? That's a correction. Without that, without that steep increase, it's a correction. Now that, that was a panic that made it jump up. It's going to come back down to where it would have been. It's going to go back to that 2020 level. It has to, because that's all inflated panic. Well, that would be a more than a 50% price drop. And it happened before it happened. Look at these cities, like in Cape Coral and these areas over there, there were houses that were 380, 400, that's over 175,000, you know, in 2009, 2010, it happened in places. You could have bought a condo in a, over in like water Hill in those areas for like $45,000. They were giving cars away with them. Remember they're giving smart cars away in the condos. If you bought one. The BMWs. Yeah. It was a BMW, smart cars and BMWs, but, but there's, listen, the value of the house is what somebody is willing to pay for it. That's it. And when people are tired of paying for it, it's going to come down when people just hold it or guns, it's going to happen. Tell me about what's happening to the contracts that are accepted. I'm, I'm speaking with agents and brokerage brokers all across the country. And they're saying, and we're seeing it here where a large percentage of the contracts, houses are going under contract and then they fall through and they're back to market. Are you experiencing that? Yeah, absolutely. Just the numbers I was telling you about with stellar MLS 6,500 deals closed in the last seven days, 2,700 fell apart. And that's about average, about a third of them are falling apart. And that's because of either financing, like something's not right in the financing or numbers aren't working out. Insurance is too high. You know, they're, they're, they're putting the contract together. And then during their inspection period, they're finding out, Hey, the insurance is this much, the taxes are going to be this much and that. And they're like, Whoa, Whoa, hold on. Or a lot of these houses are in disrepair. People are not maintaining the houses and they think they're going to get top dollar. You know, you go into these houses, they need, they need an AC, they need a roof, they need a water heater. And the people, I just had one that we put under contract. The chimney was leaking and the chimney insert had, it had a fireplace in it and it had to all be replaced. It was a $13,000 job and they didn't, they didn't want to budge. You know, they, they, they were, we were at, they were at 650. We put the contract at 600, you know, knowing that it needed an AC and some things. And, um, and that was it. You know, that, that, that's kind of what happened. And, and we just couldn't go anymore. There was no more room. And that deal fell apart. That was a personal deal that I was working on. And they'll probably end up getting, at the end of the day, they'll probably get 550, 575 for the house, but they just wouldn't, they wouldn't budge. And it's, the house was vacant. Nobody lived in it. The lady moved out and lived somewhere else. And it was a pretty substantial home, beautiful home. But it was just, it needed to work. It was a nice. What you're describing right there is a prime example that the sellers were able to get away with anything that they want. I mean, when it was happening, when we had that boom, that pandemic boom, things were, they were able to sell their house with broken things, deferred maintenance, end of life, mechanical heating and air systems, roofs that needed to be replaced. That's all over. That is finished. So now these sellers have to wake up to the fact that if a buyer wants a home inspection as a contingency to their contract and their house has been sitting on the market, they got nada. They don't have any interest. They've had no showings in the last month on the, certainly even in the last week. And now they get an interested buyer. They put a contract offer in, and then all of a sudden they get a home inspection and the seller doesn't want to fix something. The deal is going to fall apart. And I tell buyers a lot of times, look, take your shot. I mean, ask for everything. The safety items have to be disclosed. So if you tell, if you're my listing agent, I'm the buyer's agent, and I tell, give you the report and tell you, Hey, Phil, this fireplace is going to burn this house down to the ground unless it's fixed. You have to tell the next buyer that it needs a fireplace, correct? Absolutely. And I'm seeing every deal I'm closing on these four deals. I'm closing. Well, three of them, one's a short sale. Three of them, all seller concession, all requested some kind of seller concession, you know, credit towards closing costs, credit towards something, everyone. And you're seeing a lot of that too. Requests for, you know, X amount, X amount, you know, and that's it. But there's a limit to that, unless you're paying cash, there's a limit to that. So a 6% seller concession might not mean squat, you know, on something that is a major repair. You got $400,000 house. Oh, absolutely. You need a roof. You got 30, $40,000 on a roof, right? I mean, it's just what it is. And the thing is, you know, the sellers, they know, they know it needs it. And they're still battling that, you know. Sellers need to wake up. They need to get to the program. They need to figure that they missed the boat. Yeah. Listen, if they bought the house before 17, beginning of 18, if they bought it before then, they have plenty of equity. If they bought it from 18 to now, they're in trouble. It doesn't mean they want to do anything about it though. It doesn't mean they want to drop the price. It doesn't mean they want to fix things. And you know what I say to them? Then live here. We talk about price drops and housing correction, whatever you want to call it, crash correction. Prices are coming down. You just said there's, we might be looking at a situation of pre-2020 home prices. A lot of people are in denial. We can look at this chart. We can see it's coming down. It's just, you know, just looking at that, we can see it's coming down. It's not going up like it was. So we know something's happening. The key element here is they're saying, well, if mortgage rates come down, that, let me tell you something. You can look at, here we go. This is, as of yesterday, mortgage rates jumped to two-week highs after US-China trade talks. Everybody thinks, well, now that the tariffs, you know, we're figuring it out. You know, Trump, we have an agreement with China for 90 days. Things are going to improve. The economy, the stock market booms. Mortgage rates boom too. They go up, not down. So they boom for investors investing in mortgage rates because they get to make more money. And we're looking at, a lot of people are saying, we could just look at this chart right here, right? And what we're looking at, we could just take this out to a max. Here's where people are in denial as well, because a lot of people are like, well, mortgage rates are going to go back down. The reason why we're in this mess in the first place, we talk about the elephant in the room, I was asking you about that earlier, is not, in my opinion, all of the above. This is the elephant in the room. The Federal Reserve manipulated rates. The bond prices predicate the mortgage rates. And because of all the rate manipulation, we watched 10-year treasury bonds drop to all-time lows. Fed was buying mortgage-backed securities and enabled this mess to happen, where we dropped 2.74% for purchases. I can honestly say that I saw people that had 2.74% mortgages. I've heard people that have said that they've gotten rates lower than that. I haven't personally seen it. But 2.74% for a 30-year fixed-rate mortgage, that allowed the home prices to skyrocket. We should have never allowed this. Since over the last 20 years, we've watched mortgage rates drop. That's not practical. The average 50-year running average for mortgage rates is 7.7%. I mean, look at the chart. Look where it was. It went up in the 80s, came back down. But look at it. If you take that, look how it decreased for 20 years. Look where it is. Where did it jump back up to? Where it should be. Back to the average rate. The average rate, 6%, 6%, 7%, right? That's the average rate. That's where rates should be. So you see mortgage rates coming down? I don't. If they do, it's just smoke and mirrors. It's not real. It's just manipulated, just like the stock market's manipulated, right? I don't think it matters. I think if they drop mortgage rates, I think if mortgage rates drop to 5.5%, if buyers start behaving the way that they did before... Seller's going to take the money. I don't see it happening. Let's just say that the seller that wants $600,000 for their house that they haven't done anything to in 20 years, if mortgage rates drop and they are able to get a contract somewhere close to their $600,000, the buyers, if they don't get home inspections and ask for $50,000 in repairs or that these sellers don't have to dump a lot of money into their home to sell it, I will be completely shocked. I'm blown away people did it. I would never buy a house. I mean, I would never buy anything like that where I can't believe buyers did it. We've inspections took it as is. I can't believe the lenders didn't. Like the lenders let it happen. They're on the line for the money. You know what I mean? But they were more protected than anything. It was the parents that rolled over and wrote their kids a check for $100,000 to buy an overpriced house. That was the new comp. The lenders are taking the money. You got to remember something. If people put down less than 20% of their initial mortgage, they're getting mortgage insurance to cover the lender. Then you have the government bailing the lenders out and the banks out. There's no risk for them. Of course, they're going to lend the money. That's all the manipulation. What happened was we have parents that own houses that allowed their kids 30%. Look at it. We've got two classes of buyers. We had the parents of the 33% to 34% first-time buyers that were helping them out, thinking they were doing a great job by giving them a lift up in life, giving them a $50,000, $100,000 gift to overpay for the house. Then you had the investors who weren't playing with their money. They were playing with everybody else's money, like Zillow Offers, Open Door, all of these other... You can look at their story as written in the headlines where the millions and billions of dollars that they lost for their investors. You had two-thirds of the buyers that had zero common sense. You had to do all that money that was lost, Todd, was all inflated free money. It was all money that was just inflated and free. They didn't care. Like these investors, and it's hedge fund money. It's somebody's pension. They don't care. They're making money on the transaction. They don't care. They're making money on the transaction. They don't care about the... That's the sad part. My story, and I'm sticking to it, is this has to crash because it's not sustainable. It's not sustainable. Mom and dad, first of all, in any kind of... If they're not in the magnificent seven stocks... I was talking to a buddy of mine. He was like, yeah, I invested in... Made a lot of money. I bought 600 or 700. I forget what he said, but it was a lot shares of Nvidia way back when. He's made a ton of money in that. You start looking at it, you go, okay, parents are now realizing that they may not have enough money themselves to retire or pay for their healthcare. That's what a lot of them are doing. They were giving the future inheritance. They were giving it to them now. That's what they were doing. They're not realizing they're giving them that inheritance now, and they're blowing it away on smoke and mirrors that numbers aren't even real. It's wealth being drained from people. It really is. Hey, think about this. Now, your kid can't afford the new roof and it's $40,000. Now, what do you do? You're going to give them a new roof. What about when the insurance went to $8,000 from 2,500? The bank will take it fast, man. Tell me what's happening in Florida with consumers. What are you seeing? What's their behavior? Are people still going out to eat? Are the restaurants and bars packed? Airbnbs are dead. Nobody's... Disney, I have a couple for sale for a client right in Davenport, right outside Champions Gate, where you go into Disney there, nothing. Disney is Airbnb's most popular rental area, dead. Disney's down. I mean, big, big money. I mean, there's just no attendance. People aren't paying it. You see articles, $1,400 for five days for something this or that, and people are writing how upset they are, not happy with the service, and you never heard that before. I mean, Disney was like another planet, right? I mean, you went there and the service was like, boom, white glove. Everything is degraded. That's like what I was saying, emotion. People's emotions have depleted. Everything's cut and dry now. There's a lot less emotion in people's daily activities. It's just a society thing. There's a society change. And I tell you, you're right about a crash, Todd. That blip from 20 to 23, it's going to come out. It's going to come back down, just like the interest rates did. Interest rates went down for 20 years and boom, what did they do? They shot up right to that average. Listen, you don't got to be a scientist to figure that out. It's human nature. It's patterns. It's going to happen. I don't care if you're a PhD, whatever. Half of them got it because, I don't know, they paid the right person or they hang out in the right class for 10 years. You know what I mean? A lot of that stuff, you got to talk about reality. Remove all the smoke and mirrors and all the bullshit, and you look at reality. You look at patterns. You look at people's activities, and that's what's going to bring you back to reality. It's got to happen. These days, something's got to happen. Accountability is coming back, and that's the thing. There was no accountability. You couldn't pay your mortgage. Oh, we'll give you a forbearance, but we're going to raise your rate from two and a half to six and put it on the back, and their payment went up. You know how many people are in that position right now? They did these forbearances. They're coming due in the next two, three months, and their payment went up because their rate was doubled. The bank, it was a scam. They had 3%. The bank says, okay, we'll give you a forbearance. We'll put it all on the back. Don't pay for a year. Then your rate's going to be 6.875, and what did they do? They signed it. I have one right now. I'm listing. I'm actually filling the listing paperwork. I had the interview last night on Zoom. It's a $599,000 house down in St. Augustine. We're listing at 569 because I went over the numbers on the market. It was 599 three months ago. 569 is where it is, where the comps are. I'm taking it at 569. We already agreed. I'm literally sending it out for signatures. Photographer's going. It's going to go on the market. It's insane. The whole package of everything that's going on, it has to happen. You say tourism is down in Florida. Nobody's going to Disney, staying in Airbnbs. They can't afford it. The customer service has gone down. What about the locals? Are they going out and spending all their money on overpriced dinners? Or what's the restaurant scene like? Listen, if you're in Fort Lauderdale, there's an element of people who are going to spend, I mean, there's bars opening, there's, there's, there's towers being built $4 million, $5 million. Rich Carlton, Porsche, they're all building these buildings. There's a certain element of people that are always going to have money and spend. You know, they're just a certain element of people, right? It's just generational money and things like that. In general. Listen, the average people, they're not going out to eat. Look at McDonald's numbers. Look at Wendy's numbers. Wendy's is almost bankrupt. People can't go out and pay $20 for a Big Mac and a meal. If they wanted to, they, you know, they go get a steak, right? You can go get a steak and cook it at home for $20, you know, like people, all those numbers, just look at retail retails in the, in the, in the tank, people in general, the 80% of people are not spending money. They're just holding dirt, holding even, you know, they're barely paying their bills. Credit card, look at credit card debt. It's higher than it's ever been. I mean, it's reality's reality bankruptcies. They're going like crazy, right? You have huge amounts of bankruptcies. That's coming. Chapter seven is going to be all over the place. You know, what's your opinion of what DeSantis is doing for Floridians? Yeah. I tell you, you're talking about the, the income, the property in general. What do you think? I mean, do you think, uh, you know, you think he's doing a good job? I always liked the guy, you know, when he, when he went against like the whole Trump thing or started running for president, you know, it left a lot of bad taste and then you started seeing his true colors. You know, now his wife had this charity and now they were donating money to the charity. Listen, politicians are all scumbags. I don't care who you are. They're all scumbags. And at the end of the day, you're going to see it come out, right? He, he did all DeSantis is great. Oh, this and that. You know why? Every decision he made was the decision of common sense. But when it started coming to making decisions that really mattered and loyalty and how you treat people, he failed every test. You know, he's a JAG lawyer, whatever Navy, whatever he was. Okay. All that, all that checks the boxes, right? But when you don't have loyalty to people and when you start taking shortcuts and then, you know, at the end of the timeline, that's when things start to show, right? The facade drops off. I think that's what's happening to him. Reality starting to show. I think the guy is genuinely a good guy, you know, but the facade's gone to me. I, I mean, I don't trust any of them, honestly. You know, when you vote, you vote for who you rather rob you. That's, you know, what you do. Well, before we show this article, because I want to get your opinion on that, I want to talk a little bit about DeSantis being in the news and it hitting sort of like a nationwide nerve where he's saying that he would like to eliminate property taxes. And that's a big deal because a lot of people feel like they're being jacked in this department, right? You buy a house, you pay a transfer, maybe transfer recordation tax. Now you're paying, you've never really owned it. And if you were a retiree in any state and you worked hard to pay off your mortgage, 30 years later, you raised your kids. You now are on, you weren't fortunate enough. You spent all your money raising your kids and buying your house and la da da. And now all of a sudden you have no money. You're on a fixed income and which is a huge percentage of retirees. I mean, it's crazy how people don't plan for retiring. And now your property values have quadrupled or 10 X since you bought it, looking at today's prices, and now you're getting whacked with property taxes every single year. And a lot of cases of property taxes more than your social security check a month. And you have DeSantis is saying, you know what, we should eliminate property taxes for homesteaders, people that are living in their home, not some New Yorker that decided that it would be a great idea to own a piece of property in Florida, but they live in New York. So he's saying, you know what, but for people that are homestead exempt, you know, taxing, they have that credit. They live in their home. They're Floridians by definition. He wants to eliminate the property taxes. At least that's my interpretation of what he would like to do from reading things. But he came out with this crazy thing. And we'll talk about this tax bill that just passed. Florida House passed this $5 billion tax reduction plan. It's record-breaking. It's historic. It's permanent. It's immediate, but it doesn't directly talk about eliminating property taxes. But what DeSantis said, well, first of all, this article says that he opposed, and I'm sure you know as a Floridian, says that while it was mostly partisan vote and support, the bill faces opposition from Governor Ron DeSantis, who has pushed for elimination of property taxes and $1,000 homeowner rebate, which I think he's saying, hey, look, if you're a Floridian, you live here, we're going to give you a $1,000 rebate. And a lot of Floridians that I've spoken with are like, that is a slap in the face. Absolutely. Yeah. Your insurance went up 8,000, but you're going to give me that. So here's the thing with this, from my understanding of it, they're talking about eliminating property taxes for everybody, investors, everybody, but they're talking about raising the sales tax to 13% from seven. It'll be the second highest in the country. Now, what are they doing? They're just taking the burden off homeowners and putting it on everybody and making it smaller because there's more sales, right? Now, what would make sense is if you live in the property and you're homesteaded, no property taxes. If you're retired, 65 over, no property taxes. If you're an investor and it's an investment property, multi-unit, whatever, commercial, you still have taxes. If they did that and they raised the sales tax to 9%, it would do the same thing. So investors and businesses still pay property tax, raise the sales tax to nine from seven, which that's small, right? 2% more when you buy a car, when you buy something at the grocery store, not the grocery store because no tax, but when you buy an iPhone or whatever, a little bit more tax, right? 2%. Okay. On everybody. Now you eliminate property taxes and you're pulling in the same money. Common sense, right? That makes sense. But politicians, you know, right? People aren't getting paid when you do common sense, right? That's how that works. But, but, but this whole thing with the property taxes would save so many people because look at Tennessee, Tennessee, I believe when you're 65, you have no property tax. There's no, like, like there's certain states that when you're, when you're retired, your property tax goes away. Now, Florida, there's how many people here that are, that are retired. I mean, it's hard. A lot would go away. But if you took it away for those people and the people who are homesteaded and just charge those businesses and those investors property tax, and then I'm telling you 9% sales tax, it would, it would solve it. Well, they're going the opposite direction. I know they are because they're getting paid from the lobbyists. It says this bill would lower Florida's sales tax rate by 0.75% to 5.2, 5.25%. The bill would reduce all other sales tax rates by the same amount. Commercial rent. You got sales tax on rent. Yeah, they, they lowered it. It was 7%. They lowered it to four and a half out. I think, I can't. You pay your rent and 7% tax on your property. It gets added to your rent payment. Yep. So if you rent something for, for 1500 a month, you get percent added onto that for only commercial though, only commercial, not residential when it's commercial leases. Yep. Wow. Electricity from 4.35% to 3.6%. New mobile home purchases from 3% to 2.25% and coin operated amusement, amusement machines. That's all the, that's all the slot machines and vending and gambling machines and stuff. They're going to drop that 0.75%. But where are they going to pull this money from? Where are they going to get it from? Well, here, most of the criticism on the floor. Good question, Phil. tax known as the hotel bed tax. They're not even here. Nobody's coming. Florida law authorizes counties to levy five separate tourist development taxes for specified purposes. All of which generally related to the tourism industry. Yeah. When you rent a hotel room, there's a tax, there's extra taxes, things like that. When you rent cars and things like that. So they want to bump that, I guess. Yeah. But there's less people coming here. The migration is down 80% people. Disney's empty, man. This is giving like passes away for like nothing to Florida residents. You used to be able to pay one flat fee and go to Disney as much as you want. If you lived in Florida, they reduced it to like nothing just to get people in there. Tell me about real estate agents. You have a school, a real estate, uh, is your, uh, enrollment down. Enrollments down. But what I am getting, the enrollment I'm getting is loan officers and lawyers, lawyers, getting their licenses. So they can charge on transactions and not refer them out. Loan officers, the mortgage banker association, um, basically recommended for every loan officer to get their mortgage license in Florida. You could be an agent and a loan officer on the same deal with respite disclosures. And speaking of that, I have a deal closing Thursday to 15th. The agent is the agent and she's also the loan officer. She's been missing in action for like a week. My title company just messaged me. Now I was just on the phone with them. They can't get ahold of them. The underwriter, nobody like, like we already extended it from May 2nd to May 15th. The girl's like in left field. Like, I don't understand how you can be, I have no respite disclosures. Like nothing was sent to me, notifying the seller that she was representing both. Well, the broker could step up and close the deal. Well, that's what I'm, that's, that's what we're doing now. Like I already have the title company reaching out there, reach out to the underwriter. I don't have the access to them. And as soon as we get done filming here, I'm going to actually jump on the phone. I have the seller that's wondering what's going on. We saw the seller signed May 1st. You know, the seller's in New York. Property was an investment property. It's empty. It's over here in Jacksonville. Tenant just got out. We just sold it. And that's it. I mean, they don't close this time. We're keeping the deposit. And, and basically I'm just telling them, you know, you want to, you want to extend it again. It's a $10,000 additional deposit and non-refundable. And either that or they're going to lose their deposit. You know, do you, do you think people are going to wise up to the fact that, um, one of the ways that they can make more money or save more money in a transaction is to try and eliminate real estate agents? Yeah. I mean, I, I see it can go that direction. The problem I'm seeing Todd is people just don't know how to do it, you know? And if they knew how to do it, if you can educate people how to navigate a transaction and have an attorney on their side, review everything, I don't see why they couldn't eliminate real estate agents. Right. I mean, there's a lot that a good broker brings to the table. And when I say broker, I mean, a broker, not an agent, right? Cause agents, you know, in Florida, it's a 63 hour course. I teach it. I teach the course. I certify them. And then they go to the state, take their license and boom, they're a licensed agent. Right. And once they're a licensed agent, two years, they don't have to close a deal. If they, if they just got their license and had an active with a broker for two years, never closed a deal, they can get the broker license and open a brokerage. That's just the way it works. So it just blows my mind. But anyway, the agents, if they have the right training, how a deal gets done, a lot of them are out there faking it till they make it. And it's sad. It's so sad. And that's why so many fail. Brokers have to take responsibility. States have to have accountability for brokers. Just like this girl, she disappeared. She's not answering emails, calls, texts, disappeared. She's an agent and loan officer. How does that happen? Like, how does, like, don't you have any, any, like, how do you wake up in a morning and just not, just not answer people that it's a transaction, there's money involved. It's a legal contract. Like, how do you do that? How are you qualified to do that? There has to be something put in place for accountability and, and, and if you don't hold yourself accountable and to the law, there has to be ramifications. And the problem is there's just no ramifications. There's no accountability for people who just do whatever they want. You file a complaint, nothing happens. You know, they let people off. They don't, they give them warning slap on the wrist. But when you're talking about somebody like a transaction, you're talking about somebody's finances, you're talking like, if this deal doesn't close, this house been off the market for three weeks now, it's been off the market for three weeks, right? What happens? The seller gets to keep part of the deposit and we got to put it back on the market and a market like we're in today, you know, so what happens now, if this could have been avoided two weeks ago, if something was wrong, you address it. Then you don't drag it out. You know, if there's a problem, you address it that second. And then you find a solution. That's, that's what I do. Transparency. There's no accountability. There's no, I don't want to say ethics, but it's like, it's like a game to these people. Like it's not a game. This is a serious business. And I think a lot of that has been due to the influx of people coming in, getting in the business and then just, you know, fly by night, run at this one. And we talked about it before where brokers, the agents became their clients, not the clients, right? The agents became their, became their business, right? Getting fees and building the brokers with a thousand agents and things like that. Instead of the customer and a seller being there, being their client, you know, and something, something that the industry is under attack, NAR, lawsuits, but the, the quality of the industry is that has degraded and a good broker Todd is priceless. Now, if you have one of these agents and pink shoes dancing around on tick clock, right? Doing whatever. And they're just riding along and getting a commission like, like this girl that's disappeared, right? She's going to get a commission on both sides. If this deal closes, I don't even know what's happening, you know, because there's no communication. There's so much of that out there and they just fake it to, they make it, there's got to be some kind of accountability, maybe a broker, you know, make a, make, you know, like when you're an appraiser, right? If you're going to be an appraiser, you have to be an apprentice under appraiser, right? You have to write so many appraisals and an appraiser signs off on it, right? Like if you're going to be an appraiser, why not? When agents get into the business, have to work two, three, four deals with the broker as a co-agent until they close two, three, four deals and make that a lot, make that a, a, a, a, a, a mandatory thing. But the business has always been the wild west. And it's always going to be until you have some kind of oversight and conformity. And that's my dilemma. Like as a broker, I have agents, right? You have agents. The dilemma I have all the time is what am I doing? Why do I have this headache? I consider sometimes just be done with agents, broker, my own deals. And that's it because everything becomes triple work. You know, doing deals, getting deals done. You tell them how to do things. They don't want to do them. They want to do them. They're like, it gets to the point where, you know, is it worth having agents or can I just go do 10, 15, 20 deals a month on my own? Like I'm doing, I don't need to have people take my time away from what I do. Unless they're competent. It's just the industry has to change from the foundation up. And I just don't see how it's going to happen because there's no leadership. You know, NAR's over here, you know, protecting themselves legally making settlements and we're over here, you know, you know, it's, it's, you have the same dilemmas I'm sure, you know, when you're dealing with, with agents and responsibilities, it's hard. One of the things that you said that I don't agree with is you said this business is hard selling real estate's hard. It's not hard. It's very easy. I think, I think buyers and sellers can 100% do it on their own. I don't think they need us at all. I think that, you know, I think that we're over complicating this business and it's because what you said is that no one has pulled the curtain back on this industry. And that's the reason why. And they're stuck with bad agents. They're overpaying for services. The agents doing very little in the bulk of the transaction. In my opinion, I mean, I've just seen it happen for the last five years. I agree. And the thing is you're, you're absolutely right. You're absolutely right. And it's not, it's not, it's a simple business. It's not easy because when it comes to the contract and concessions and negotiation and title, and there's a lot of things that's got to be dotted dot the I's and cross the T's right. Disclosures, right. Seller disclosure, things like that. If you don't have somebody who's aware of that, let's say you're trying to sell your house and you don't disclose the proper things and there was a leak and you didn't tell them and they come back and try to sue you five years later, three years later. Right. If a seller understands that and like they would have to understand that and make sure all the disclosures in place, make sure the addendums are proper, make sure the additional comments are proper. They have to understand it anyway. They have to under, they're either going to hope that an agent tells them about that or they can read a fact sheet on it that says that you should call the, you know, the department of labor and license department of licensing and labor or whatever your state calls it. You should find out what is the, what are the minimum forms, form requirements for transferring real estate from one, from a seller to a buyer. These things are not rocket science. And telling somebody that the roof leaks that you have knowledge of it is something that would take 10 minutes to learn. In fact, you just did it in 30 seconds. You're absolutely right. And if you had a package, you're absolutely right. If you had a packet of everything you needed and a lawyer oversaw and finalized a contract with you, you don't even need a lawyer, get a lawyer approval for 500 bucks just to make sure. But you don't even need that. You don't need it. No, but you want to protect yourself. Yeah. A good broker is priceless. They're going to save you more money than you're paying them. A good broker, a good broker. But how many good brokers are there? And that's a fact, you know, that's the truth. All right, my friend. Well, it's always a pleasure chatting with you. You know, I think we're going to see a lot of things changing in this industry over the next several years. And, uh, you know, we'll, we'll see. You sound like you're frustrated with agents and, um, you know, it's just what I'm saying is that the fact of the matter is that the public is frustrated with our industry at large and we keep messing with it. Things are expensive and I believe that consumers are going to wise up and figure a way to do a lot of this themselves. But it's always a pleasure, my friend. Yep. It's always good to be here, man. We'll talk soon. Yep. See you there. Thanks so much for watching. If you liked the video, you can let us know by smashing that thumbs up. And if you haven't already subscribed to our channel, please consider doing so now. Hit that alert bell. You'll know every time we upload content just like this. Keep those comments and questions coming. And one of the biggest compliments you can do for us all here at Saks Realty is to share our channel and this video with your family and friends. This will help us to continue to build this amazing online community with viewers just like yourself. See you next time. Saks Realty, Maryland broker number 607720. Office number 443-318-4514. Equal housing opportunity.