What's really happening to Phoenix rents??

Hello everyone, welcome to my live market update this week. Thank you for joining me. I actually have a guest this week. Hi, Jason. How are you? Hey, doing great. How about you? Doing great. Thank you. I wanted to have Jason on. We actually connected because he kind of geeks out over real estate stuff, but he does work in the industry too. And so Jason actually works for a commercial real estate investment company. And it is multifamily, like 100 to 300 units. Correct me if I'm wrong, but I think that's right. And he works with investors, kind of taking them through the process and keeping them updated on the market. So he does a lot of multifamily and rental type of investments and that kind of thing. Has a good perspective on all of that. And as you guys know, I focus more on resale and new construction, not as much on the rental side. So as I've shared some stuff in the past about rents and whatnot, we connected and I thought a lot of his knowledge would be super helpful to fill in some of the gaps on things I've talked about in the past. So welcome, Jason. Thanks for joining me today. Yeah, thanks for having me. I'm excited to be here. Yeah. Well, we were chatting kind of offline a little bit about the rent versus buy situation right now. And I shared this in a video a few, I don't know, it might've been a couple months ago, but realtor.com had published an article saying that in all 50 of the major metros now, renting is more affordable than buying. And that's the first time that's happened in quite a while. And so I was looking at the numbers for Phoenix Metro recently, and I wanted to share that. By the way, guys, this is live obviously. So if you're watching live and you want to drop a comment or a question, we're happy to answer those. So keep that in mind. But in 2020, okay, the median home price in the Phoenix Metro area was 290,000. That feels like, I don't know. That's a different world. Yes. Yes. A land far, far away. So your mortgage with that at interest rates that were like 3.6 or somewhere in there was like 1650 a month. But if you were, or I'm sorry, that was 1550 a month with your mortgage. But if you were to rent, you would spend like 1650 to 1700. That was the median rental rate at that time. So obviously from an investment standpoint, you could buy a single family home, stick a tenant in there and probably cashflow. No longer the case and hasn't been for a little while. So today the median home price in Phoenix is 450. And at 450 with rates where they are today, you're like $3,100 a month for a mortgage, yet you could rent something for 2,100. So like $1,000 a month difference. That's insane. Yeah. They're not close anymore in Phoenix. No. And so it brings up a point that you had mentioned where it's like a lot of people had the option to sell, like if they couldn't sell their home, they were like, oh, I'll just rent it out instead. But if you bought in the last few years, you can't, I mean, that math doesn't really make sense anymore. Does it? No, no, it doesn't make even close to making sense. Even if you were to put 40 or 50% down on some homes, you're still not cash flowing positive. So for people that are doing 5% down, 20% down, which is more typical for first-time home buyers, if you're looking to just rent that house out because you're not happy with the sale price that you would get, the math just is not mapping at this point. Yeah. And I hate that for my clients because sometimes we're looking at the sales price and it's like, if you bought in the last few years, the sales price isn't really great at this point in time, right? You're either breaking even if you're lucky. I've had three of those conversations in the last two weeks where people are like, I just kind of want to break even. But then when you add in fees and everything else, you're actually potentially losing money. So it's like, okay, well, let's look at the option of renting it out. But that landscape is just not that pretty either. Yeah. So what has happened with rents? Why are we seeing the rental market going down and not increasing with home prices? Yeah. So what's happening there, multifamily is actually impacting single family here. So in 2020, 2021, 2022, anybody that was in Phoenix at that time probably remembers rents going way up. We're talking like double digits one of the years. And at the same time, money was really cheap. You could get really low interest rates. So the same thing that was driving people to buy more homes because of the added affordability, because of the rates. And ultimately all that demand drove up home prices. It also was driving a lot of new development. So rents were going way up. Money was cheap. It was the perfect environment to be a developer. So what happened is too many people had the same idea in a lot of apartments. A lot of permits were pulled in 2020, 2021, and 2022. But the delivery on those apartments, it takes about two to four years to actually deliver those units and then to lease them up. So you think about having a 300 unit apartment. It takes a while to go from zero people in that building to 300 renters. So what has happened at the same time is immigration tightened. So we've had all these headwinds that have happened since then. Rates have gone up. The immigration has slowed down. And there are a lot of other factors that actually come from rates going up. And those factors, it's called a cap rate. What it does is it will drive down the value of commercial properties, even if the rents are still all the same. So what happened is we had the perfect environment to build these new properties. And because all that new supply was coming on in this huge supply wave that was peaking in 2024, it actually lowered rents. So the rents had gone down because the vacancy had gone up. I don't know if you remember the feeling, Caitlin, but people couldn't get into a house and they couldn't get into an apartment in 2021, 2022. It's totally different now. The occupancy has gone down because of all these new units and the vacancy has gone up. So what's happening is all these brand new apartments, they're really nice. They're all what we call class A. They're offering concessions. You might see a month free, two months free, or slashing your rents. So what that's doing is it's taking people that would rent the existing stock and it's pulling them up into this class A. But what it's also competing with is the homes that you could rent out. Now the rent on those homes, even though the homes have gotten way more expensive, the payment has gone up, the rent has gone down because of all those class A nice apartments that are offering concessions. That makes sense. Clayton says, I remember around April 2021, everyone I knew who was renting in Scottsdale, their rent either went up by 500 at an apartment building or they had a landlord who decided to sell. He also says a lot of apartment buildings are now having giant leasing now signs offering a lot. Yeah. I see that often too, Clayton. And it sounds like that's accurate, right, Jason? Yeah. Oh, absolutely. Yeah. Four to eight weeks. That is like standard right now to offer those kinds of concessions. Now, just like Caitlin talks about in pretty much every market update, Phoenix is not one market. It's a bunch of sub-markets. And even within sub-markets, just an apartment being on a certain corner, they have way better occupancy than an apartment a couple blocks away. So it's really hyper-local, but yeah, those four to eight weeks free is very, very common right now. Yep. Yep. So, hey, if you're thinking about renting, take advantage. You got the opportunity. This is the multifamily permits. And so you know a lot more about this than I do, but like you can just see from the numbers, the increase, like you're talking about all the permits pulled in 22, 23, then kind of leveled off. And this year at 3,300, we're halfway through the year. I mean, it doesn't seem like we're going to be on pace with what we've done in the past. So is that, are they just kind of stopping multifamily right now because they're not getting the demand? Yes. Okay. So it made tons of sense to develop as much as you possibly could get approved for essentially in 2020, 2021. So now the interest rates have gone way up. So it's harder to borrow as somebody that is putting up these new projects, but it's at the same time that rent and occupancy are going down. So it's harder for them to be profitable even at the same price. So it costs more to build all, by the way, we haven't even said the word inflation at this point. So all the materials are more expensive than they were in 2020, 2021. So really everything is going against the builders now to build new apartments. So what's going to happen is it's going to create a normalizing because now they can't really build much. It doesn't make sense to build much. So the building will taper and now the absorption or the amount of new renters going into those apartments, the absorption is starting to turn positive. Meaning that more apartments are being leased than being brought to market. Yeah. Well, Hey, similar to the resale market and new construction, like it's just a supply and demand thing where we don't have the demand we used to and the supply increased over time and the sellers are feeling that they have to reduce prices, which I think is where we're seeing the same thing. That absorption, we're starting to see just a little bit more of a leveling out in the market. Another comment here, I live near TSMC, Dove Valley, they're building apartments everywhere. My current apartment offered me a lot of incentives to stay. Everybody's offering two to three months plus cheaper rent. Yeah. And I would imagine there's a lot of that development that's taking place around TSMC too. So that supply has got to increase in that area quite a bit. Yeah. The development going on around TSMC is unbelievable, by the way, for, for anybody that's passed it on route 17 and you see how far out into the desert it is, that's all getting filled in. That's all going to be like a city within a city there. Yeah. I know there's so much going on there. It's kind of insane. And it'll be interesting to see how, how it pans out. Question for you outside of the rental space, but like for, for an investor who's thinking, let's say like mom and pop, single family investor. I talk with a lot of folks that are kind of in that situation. Do you like the TSMC area for buying a single family home for the purpose of an investment and having renters or, you know, what, what areas do you like for something like that? This is just me personally. This is totally opinion. Yeah. I think unless you can flip something that makes sense or you're in an ultra, ultra premium area, which also requires a flip, it's just a different kind of, you know, $15 million flip that you're going to do in a premier area like Arcadia. But outside of Arcadia and paradise Valley and, and, you know, doing those massive, massive, you know, take out an old $3 million property and build a $10 million house on it outside of that. I just, I can't find anything that makes a lot of sense to buy single family and to rent out. Now I do think this is just my thesis. I'm giving you a lot of opinion here, but my thesis on this is you don't get free lunch. So if you're a renter, I think you enjoy the time of the lower rents right now, but being a homeowner long-term, I think is going to make sense because as these single family homes exchange hands, you know, somebody that bought this house in 2013 for $210,000, they can rent it out to you for 2100. But when somebody else buys that house eventually for $560,000 and their mortgage on it is $3,500, that rent's going to get totally repriced when enough people buy those houses because they will sell eventually. So I do think, you know, I'm a homeowner because I think that it's a good long-term investment. I could have saved money by being a renter instead of a homeowner in the short-term, but I do think in the long-term, the rents are going to catch the home prices as far as, you know, that monthly cost and we're going to turn back, you know, closer to equilibrium, I think. And it's always like that. I think, you know, it's very hard to time the market appropriately, no matter what you're trying to do and you're on one end or the other. You're selling high or you're selling low or you're buying high or you're buying low, right? And if you have to sell something to buy, then you're on, you know, you take your turn on each end of the spectrum and try to minimize any loss as much as possible. So I think that's just kind of the way it goes. And the same with, like you said, you can rent now, but you're not gaining any equity for the future, you know, and I think there's benefits. I think renting makes sense for some people and, you know, particular situations and lifestyle. And I think owning makes sense for others and different parts of your life that you're in too. So I'll never say don't rent, but I think it just depends, you know, on your long-term goals as well. Yeah. I just think, you know, people that are forecasting out 10 years and just say, well, I could just put the down payment into the S&P 500 and it'll outrun this because, you know, rent costs this and house costs this. They're not forecasting in that huge jump in rent that really could happen. So being a homeowner puts you in control a little bit more. But what I would do, and actually I do this in practice and it's why I am in the space within real estate that I'm in, is I think buying a single family home for yourself is awesome for a bunch of reasons, but right now commercial real estate is pretty depressed. Like homes have been moving slowly, but just to give everybody an idea of values, apartment buildings in Phoenix have gone down about 30 to 40% since the peak in 2022, which is absolutely massive. Yeah. Yeah. That's a huge difference. Huge difference than what we're seeing in, you know, residential. Wow. That's crazy. I didn't realize it was that big of a... So they're really hurting out there right now. Yeah. They're hurting. And, you know, there are people that... Anybody that remembers 2008 and what that felt like for the individual single family home market, that's honestly about how bad it's been for commercial real estate, whether it's office, industrial, you know, that's a little different, but, you know, there there's still been some slumps there. Even self-storage, multifamily, almost all of commercial is down very, very significantly. And the fact that rents have been down for multifamily for almost three years in a row now, during the great recession in 08, they were only down one year and they recovered the year after that. So it's been three years in a row of negative rents. Wow. And I think that's a really great point of how today's environment is different than 2008, because people like to draw a lot of parallels and there can be some things that might be like the beginning stages of 2008, but the overall environment is so much different. So not saying that there couldn't be some sort of a, you know, a dip. I don't think there would be a crash like 2008, but not saying that everything is, you know, rainbows and butterflies forever. However, like the fundamentals are very different now. So if something did change, it's not going to be for the same reasons. Yeah. And the thing to bring up about single family and how that's so different than 08 is the amount of money that people have in their equity, like their equity positions in the homes, they're so much more secure. And that's why all the people that have been sitting on the sidelines are so frustrated because it feels like the homes have run up so much in price and the rates have gotten so much worse. The prices have to fall, but really because those homeowners are sitting in a good equity position, it insulates the market to a certain extent from those big drops just because there aren't as many forced sales. Exactly. Equity positions. And then a bit of the, the like lock-in effect of like the, if you don't have to move your rate and you have a low rate, like it's very hard to give that up. You don't really, unless there's some other reason to force you, you have equity and you have a great payment and you're just not going to get that if you move. Yeah. I was just telling somebody yesterday, man, I wish I could get my interest rate back from when I bought a house in Tucson in 2021. I would die to have that rate back. Gosh, I know. It feels like a long ago time when I was looking at, you know, looking at the payment or the, I was calculating the payment for like a home in 2020. Right. And I'm looking at like the history of rates. I'm like, oh man, 3.67, that just seems crazy. And, you know, at the time I remember it was like, I think it's going to go lower. I'm going to wait until it goes lower, which is just even wilder to think about. Clayton says, I see a lot of well-off people still renting in Arizona because they come from cities like New York or San Diego and they're used to renting. And that's true too. Like it is, it's different, a different like culture here where a lot of people don't rent, but in other areas, well, I mean, we do have a lot of renters, but you know, it's not like a New York or San Diego or something where there is a pretty big rental market there. Talking about like migration trends, because that obviously impacts a lot of this too. There is, I want to share my screen here a second. So there, I was looking at this article, I think this was from January. So it's a little bit dated, but I think the stats are probably pretty similar. But actually in 2025, it says 50% of U-Haul's one-way moves came into Arizona while 49.7% of them moved out, which is, I mean, we're pretty much, you know, losing someone for every time we gain someone here, which is very different because like 2021, 2022, I can't remember the exact stat, but we had, it was a crazy amount of people coming every single day, like in the thousands, like net new migration. And so that's impacted us as well because we, again, aren't seeing the demand and that's both on the, you know, purchasing side and the renting side. Yeah. And the other factor is international migration. It's tightened up so much that we don't have, you know, perfect numbers on it, but there are over 2 million documented cases of deportations, including self deportations. So if you think about the, you know, in the Southwest is where you're going to have the highest concentration. So just from deportations alone, that's a couple million people that, you know, a lot of them were likely renting and that changes the dynamics, but then the amount of immigration has greatly slowed coming into the U S it's been very tight. So there are a lot of international home buyers and renters that, that we would have expected to be in Arizona at this point. And, you know, the last year and a half, we just haven't had that same flow. That's a good point too. I didn't even think about that. So do you think that rents are going to continue to go down significantly? Like what do you kind of see from here? I think rents could go down the remainder of 2026 a bit last year was sharply negative. Phoenix was down, I believe 4%. You know, numbers stats have a funny way of like, you know, it could be represented a little bit differently by one business or another, but everybody's stats are between 4% and 5% lower rent last year, which is a huge drop. So in that's, you know, like I was mentioning, we're on year three of price declines. So we're in the middle of year three right now. So we will probably end slightly negative in 2026, but the building, the delivered units in 2027 will be significantly lower and same with 2028. So that incoming supply is going much lower. So the absorption of that new supply from renters, it should be very positive over the next couple of years. So I'm thinking into 2027, we probably should have rent increases and probably won't look back. I'm assuming we're going to start going positive and stay positive as the trend from there. That's interesting. How do you think that's going to impact the overall like residential real estate market, like for sales and that kind of thing, if rents, you know, kind of increase or go flat from there, you think that's going to shoot some demand back over to, you know, to buyers? Yeah, I think if the home market stays kind of stagnant and flat feeling like it is right now, I think there's going to come a point where if rents go up and rentals get more competitive again, I think that that's going to push people back into the housing market. Now we need rates to cooperate, which I don't know when that's going to happen. The war in Iran really set that back. We were, I mean, I was like, fingers crossed rates are going to be great. And we got into that war and it really messed that up. So I do think that some of the renter demand is going to flow back over into housing just because it's going to make more sense right now. If you're looking for a one year plan, not your long year, not your like long-term plan, it actually, it looks a little bit crazy to buy a house over rent. Now, if you're looking out five years, 10 years, you want to be parked somewhere. I think buying is great, but if you're just looking at your expenses the next year, that chasm's big. I think next year that chasm shrinks and then it'll continue to shrink. Yeah. Yeah. I think that that makes sense. What about like location wise, like where are the best deals for rentals right now? Is it similar to buying where you are in some of the more like outskirt cities where you see that versus like in the middle of, you know, Phoenix and Scottsdale and that kind of thing? Yeah, it is. It's a really similar story to the actual single family homes because there are certain areas where a couple brand new buildings were put in an area. So now they're all competing with each other and it lowers rent for that whole area. You can imagine, you know, you have a, an apartment from the nineties. It's kept up pretty nice, but now you have this brand new apartment going in next to another brand new apartment. There are 800 units between the two of them. They have brand new pools, workout facilities, everything. And then they match your rents. That's the kind of thing that's happening. So that's why it's hyper local and you have to keep really strong demand and you have to not have as many of those properties going up right next to you to have those rents stay a little bit more stable. That's my long way of saying it really is hyper local. Yeah. Yep. No, that makes sense. I think that's just real estate in general. You know, it varies so much. Where would you suggest, and you may not have an answer to this, so I'm putting you on the spot, but like where would be a good place to invest outside of Phoenix if you want to be a mom and pop, you know, single family home owner and with a renter, like are there areas of the country where this makes a little bit more sense that haven't been as affected? Yeah, absolutely. So what's really funny about this is I thought growing up in this place, it would never be the story, but Northeast Ohio is a great place to buy rentals. Okay. And I mentioned the idea of flipping before. If you maybe partner with a flipper or something like that, you can get something at a good cost because it's been flipped to be a rental. I mean, we're talking about a place that you can buy a house in a safe neighborhood, three bed, two bath. And by the way, don't anybody hate me for saying this, but you can buy it for like $140,000 in a safe home. And the rent isn't that much lower than Phoenix because what's happened, it's the total opposite. So because you can buy that $140,000 house, and let's say it costs 400, 450,000 to buy a new house, who's going to buy a new house for 450 when you could buy a really nice house for 250. So there's been like no construction there for decades. So because of that, that's created a shortage. So there's a shortage of housing and there's a shortage of rentals there. Now, economically, it hasn't been doing anything exciting in a while. There is a little bit of hope that there are larger businesses that could come to the area. But as it stands right now, you could buy that $140,000 house, rent it out for 1,400, 1,500 a month. Where in Phoenix, you buy a $500,000 house and you rent it out for $2,500 a month. It's totally different economics. And the way there, you could buy a house for 60,000, you could put 20,000 into it, and you could rent it out for 1,200 a month. So there are other markets like that in the Midwest, but Northeast Ohio would be my number one spot for cashflow. Interesting. And is there enough rental demand there then, then you wouldn't have a problem renting it out? Yeah, my hometown, it has 10,000 people in it and it has zero rentals listed right now. You know, there are the more urban parts that have more rentals, but they're not as nice. Like as far as like safety perspective, they're not terrible, but from a safety perspective, but you can buy those houses for 40 or 50,000. And that's where there are a lot more rentals available. But in the places with the nicer school districts, there are almost zero rentals available. And that's why you can command pretty good prices, even though the prices of the homes are relatively low. Wow. Okay. Well, that's your tip, everybody, Northeastern Ohio. I should find some real estate partners there and be like, hey, incoming, you're going to get some interest. Yeah. I'm being honest with you here. If somebody wanted to talk about that, I can talk about it. I know the area very well. And I actually lend to flippers in the area. That's how I have so much insight into it is that kind of like, you know, one of my side businesses that I do with a partner. Very nice. Well, I did link your info in the description. So if anyone wants to reach out to Jason directly, he also has his own YouTube channel too. So you should give him a follow there and subscribe to his stuff if this is interesting to you. My brother has done a I think Arkansas. I want to say I'd have to ask him again. But yeah, similar economics there, it sounds like in what he's done. But also he's done the flip side. He's flipped a house as well there and then rented. So I think it's sometimes hard though, if you don't know the markets, right, you have the advantage of being born and raised there, you know, kind of what goes on. He's had a business partner there that has some ground level insight. So if you've got someone like that, then, you know, there's plenty of other places to look than Phoenix when it comes to investing. Right. Very interesting. Very interesting. Do you have any investment properties yourself? Yeah, I do. So I have moved all over the place and I sold a lot of properties. So, you know, I've lived in Pittsburgh, had a few there, had some in Tucson, and I currently have some in Ohio. I regret selling any of them because they were at much, you know, much better prices pre pandemic other than the Ohio ones. Those are new. So so I actually switched over when it stopped making sense buying local single family homes. That's when I went into multifamily. So that's why I do what I do right now. And so the method that I started buying these investments is called a syndication. So basically allows you to buy into like a portion of apartment buildings. So those 100 to 300 unit apartment buildings that you mentioned at the beginning, you buy just a portion of it as an investment. So then the company, the syndicator will manage the property, manage the investment for you. So you're strictly a passive investor in it. So I kind of have my money spread around into those different things. I would like to pick up more rentals and I plan to pick up more in Ohio. And, you know, they're all they're all managed by somebody else there because I'm absolutely not doing property management remotely. And I'm way too busy doing what I do here to do that remote property management. Yeah. Yeah. Well, that's that's really interesting. If someone wants to do that method, that's something that you would help with. Yeah, absolutely. Yeah. So, you know, whether they want to talk about, you know, what the Midwest looks like and how you could potentially profit there or you want to talk about real estate syndications. I am a very transparent, objective person. Like I'll tell you what I think. I'll tell you what risks are, all that kind of stuff. I just genuinely love the whole space. I love talking about it. So, yeah, sincerely, if you want to talk about it, you can put some time on my calendar and I'd love to chat. And by the way, I see Hannah David 2111 there asked which place in Ohio did I mention? The area is the Mahoning Valley. So Youngstown and the surrounding towns. Good tip, Jason. Good tip. What do you think? I know we touched briefly on flipping. What do you think about flipping in the Phoenix area? I get that question often and I've said, you know, unless you know what you're doing, I don't know if now is the right time to like test it. However, I know that like flippers are making a lot of money in this market right now. I've seen the stats. So is it, you know, is it a time to like test your hand at it or is it like we probably, if you know what you're doing, you can make it work? Oh, man. So part of it is the properties are pretty expensive here. There's really nothing bite size. You know, the floor is so expensive on the property. Now, something that's interesting that someone that I work with, they're also a and their family flips mobile homes. So that is something that, you know, that could be a little bit more bite size. That could be attainable, something that you don't lose your own house over. Otherwise, like I'm not going to speak for other people, but I personally wouldn't feel comfortable flipping in this market. I don't know enough about the sub markets when it comes to, you know, the houses that you can get, get enough margin. I just haven't been able to find those, but I haven't been doing direct mailers. I haven't been doing meta ads. I haven't actually tried to source those. So, you know, when it comes to finding something that's, you know, 40% or 50% of it's after repair value, I haven't put the work in to be able to find anything like So for me personally, I'm not going to take that risk. I do think it will be pretty hard with the cost of money. Hard money's expensive. Bank money is expensive. You know, unless you're somebody that can do it cash, I just, I can't confidently say that I would do it. Yeah. Yeah. I agree. I think the challenge too is if you don't have good contractors or you don't have those relationships where you can trust that the work is going to get done well. I mean, buyers are sniffing out every single issue with a house these days before they put in an offer and you're on a timeline when you're flipping, you don't have all the time in the world to wait for it to sell. And when the median days on market is already, you know, 40, 50, whatever, depending on your area, you only have so much margin, you know, you got to price it right to get some traction, but you can't undercut yourself. So you've got a really hard bottom line there. And if your product is just not up to snuff, like buyers are so over flips there. They got flipped out in the early 2020s, I think. And they, they hate it and they can see it from a mile away. And so most buyers are like, ah, um, or they're, they're concerned that the work wasn't done well, or they're concerned that there was a renter in there that, um, you know, has worn everything down. It just gives their spidey senses go up and they're like, ah, I think this was a flip. And they, they get very picky. And then your options are to basically reduce your price or put more money into it to make it not look like a flip. Um, so I think you just, you really have to be careful with that. Um, and you know, there's different ways to force appreciation, but sometimes that gets a little goofy. You add a bedroom in a weird place or whatever, like, again, buyers have no tolerance for things that aren't like near perfect right now. And the longer you're on market waiting for that right person to come along the, you know, the, the more money you're losing and not getting that back. So I think that's really one of the tricky parts about flipping in this market is like, you've got to appeal to the buyers and it has to look like it was like a custom remodel, not a flipper came in here and, you know, threw some paint on the wall and new countertops. Yeah. Yeah. Caitlin. So what do you think when you walk in somewhere and it has, um, it has gray laminate floor, the transitions are not done perfectly. So then you have transition strips on all of that. And then they didn't know what to do with the molding on the floor. So they just put caulking really thick in that. Like what are your buyers think about situations like that? Yeah, they get real quiet and I already know what's going through their mind at that point. So, um, but then they're usually asking about the history on that one. Like when was this last purchase? What, what does the seller, why is the seller not living here? I'm like, yeah, yeah, you know, it's the flip. Um, so yeah, you can kind of see it from a mile away. Um, unfortunately I've seen some weird stuff though. I probably, one of my least favorite things is when people, uh, do the Arizona rooms, like they take a patio and enclose it to make it an Arizona room. And then they somehow add like, or they add like a wall unit AC and they're like, yeah, it's a five bedroom house. And I'm like, absolutely not because the floor is sloped out here because it used to be the patio. So like this can't, this can't work. Can I ask you a question about, about buyers? So my wife and I, you know, right now we're in a ranch and there's this bigger house in our neighborhood that it's sitting, it's this two story. It's 500 square feet bigger than our house. And we look at it and we just go, man, it's the difference between a ranch and a two story that big in this market. It, it is. Um, so a couple of things, you know, everyone has their preferences. Um, a ranch tends to sell better single story just because the heat in Arizona, second story gets really hot. Uh, and also from an appraisal standpoint, an appraiser gives a two story, uh, will usually value that less than a single story, um, just because of the cost of construction. Um, so, you know, there, there's usually a price difference. I never, if I'm doing comps for people, I never compare a single story to two story, even if the square footage and bedroom count is the same because an appraiser is going to value them differently. Um, so it, you know, that's one thing. Um, like I said, people have preferences, but have you gone to the house yet? Have you gone to like an open house or anything there? Yeah, I did check it out because like I said, it's, it's right in my neighborhood. Yeah. Yeah. Yeah. What's going on. It's sitting there. There've been price drops and everything. So I'm up with a little thesis, but I have no idea if it's actually true. And I was curious, uh, what you would think about this, but it seems like the two story houses that sell well are really big two story houses. And if it's like under 2,500 square feet, especially under 2000 square feet, it seems like they really have to drop the price a lot on those two story houses. That's interesting. Um, that's interesting. I, I think that you're probably right because there's no, it's very hard to have a larger house. That's a ranch house in a newer neighborhood because the lot sizes just aren't that big. Like it's, it's a little bit harder in a standard neighborhood. Right. So then you have to build up to get 3,500 square feet or something. Um, when the lot sizes are, are, you know, 8,000, 7,000. So, um, I, I get, I think that could make sense that that's the reason why those sell better because that you're actually getting more square footage versus who wants a two story if it's like 2000 square feet, because you could put that all on a single level. Yeah. I don't know. I don't know. I also have had two story homes that are very big take forever to sell because it's kind of like they're just so big and, and they're a two story. And so, you know, I, I don't know a lot of preference out there. It's hard to say. Yeah. Yeah. I just wanted to ask you because you, you have a lot more opinions that, you know, people are actually talking with you about it versus me just talking to myself as I look at it. Yeah. Well, I think the, uh, observing in the market and like, especially your neighborhood gives you, you know, some good perspective on, on what's actually going on. Um, so, so that's interesting. Um, well, I think we've covered a lot of ground, um, especially on like the rental front. Are there any, is there anything else you want to share or like hot tips that you've got, if anyone's interested in, um, you know, the investment side of, of real estate right now? Yeah. I think it's worth looking into on the investment side. Um, you know, looking at different markets, you nailed it with having to have trusted contacts there. You have to know that they're actually good. Um, that's important. And then, yeah, the, the other thing that I would say is, is kind of interesting. That's real estate related is there are funds where you can be, you know, they do lending to flippers or, you know, investors, and you can invest into a fund. So, you know, there are some things that you can do while you're just waiting out this period where buying a single family home as a rental, doesn't make sense. And honestly, it drove me to figure out a lot of other ways to make money because my game plan was just, Hey, I'm going to pick up nice houses in nice neighborhoods where I don't mind having those tenants and it just doesn't work. So my game plan, I had to completely switch game plans and go down a bunch of other roads. Well, it sounds like you found a few things that have worked. So, uh, so that's awesome. If you guys want to connect with Jason, check the description. I've got more, uh, all of his info in there. Um, check out his YouTube channel where he's sharing info on all of this stuff every week. And, um, I appreciate y'all joining live and throwing in some comments. It's always great to engage with everyone. And I'm thinking about doing some more live streams in the future. So it'll be nice to see you all there, but thanks so much, Jason. I appreciate your time and coming on today. Yeah, I appreciate you having me. This is a lot of fun. Yeah. All right. Bye everyone.