← The David Greene Show
The David Greene Show
Real Talk Realtor with Jordan Moorhead - Selling Houses in a Crashing Market | Episode 68
00:53:07
Loading summary
Transcript51 lines
- [00:00]
David Green
Welcome to Real Talk Real Estate, the show where we cover how to build wealth in real estate with no fluff, no BS and no sales pitches. I'm David Green and I've been doing this for over 10 years. I've seen the ups, the downs, and everything in between. This is the show where we pull back the curtain and show it to you too. So if you want to build wealth through real estate or you just love learning about it, you found your home. What's going on, everyone? Welcome to Real Talk Real Estate. I'm David Green and this is Real Talk Realtor, the show by Realtors for Realtors to help you grow your business as a real estate agent. I'm joined today by Jordan Moorhead, an old friend of mine. We met in gobundance and he was a bigger pockets guy. I was a bigger pockets guy. We kind of rubbed elbows a little bit in that space and now he's selling homes. I believe you're with Keller Williams, is that right, Jordan?
- [00:45]
Jordan Moorhead
Yeah, still with KW here in Austin.
- [00:47]
David Green
As am I in California. And so we had that in common and we were talking the other day about what's going on with the Austin market. Now, if you've been following me on YouTube live at the David Green show, you know I've been doing a lot of videos about the state of the market, probably not being as solid as how it's often portrayed in most real estate podcasts. So we're going to talk today about what's going on, boots on the ground from somebody in the market who buys real estate there for himself and who represents buyers and sellers as well. So, Jordan, anything I missed on your intro that we should include there?
- [01:17]
Jordan Moorhead
No, I wouldn't say so. I actually started. I know we met in Gobundance through Bigger Pockets, Keller Williams. I can't remember specifically exactly where we met. I actually started as a real estate investor before I started working as an agent, started investing in 2016, started working as an agent in 2017, started a team in 2019 and just love the business, you know, I love the business of real estate. I personally love real estate. I try to own as much as I can and I like helping other people figure it out and do what they need to do to make real estate a reality for them.
- [01:55]
David Green
Yeah. Now we will do our best to make sure that Jordan's contact information gets put in the show notes. We're also going to reveal it at the end of the show. So you guys can reach out to Jordan or you can reach out to me and I can make an intro for you. All right, Jordan, let's start with what happened in. Austin was one of the hottest markets in the entire country. Everybody was talking about Austin. Joe Rogan moved there. It became the jiu jitsu mecca of the world. Tech companies were going there, so steakhouses were going there. Gary Keller himself is from Austin. Explain to me how Austin became such a prominent city in the country just a couple years ago.
- [02:31]
Jordan Moorhead
Yeah, and you know that that's part of the story. So I know that that's the part of the story everybody knows because it gained a lot of notoriety in 2020. It was a really popular place to move during the pandemic. We had explosive growth during the pandemic, but we've had extraordinary growth for, let's say, the decade before that. You know, they call Austin the Silicon Hills. There's been tech companies moving here for a long time. Dell. Michael Dell founded Dell in UT Austin in his dorm room. Dell's a big tech company. There's a bunch of their tech companies have been here for a while. Intel's one of Intel's offices, right across the highway from my Keller Williams office. There's just lots of tech here, and there's lots of government. So we're also the capital of Texas. You notice there's government here, there's tech now there's a lot of manufacturing. We get a lot of tourism, too. So there's a lot of great reasons to come to Austin. But like you said, it just took off and it went nuts in 2020. It got supercharged by really low rates, got supercharged by people wanting to get out of certain areas during the pandemic and moved to Austin, which, frankly, at the time was affordable and with those extraordinarily low rates, was really affordable. So you could move from California, move to Austin, buy a house for $400,000 in a decent area that was 2500 square feet. People loved it, and they ate it up. And as you mentioned, prices went up meteorically. So we were, oh, man, like, 20 appreciation. Some years it was nuts. And we've. We've come down about the same since. So we. 2020 was when our mad run up started. 2022 was when the decline started. So May 2022, when they started raising rates, prices started to go down in Austin. So we've got. We have an interesting conundrum in Texas. We don't have any state income taxes, which is awesome, but we have high property taxes. So when people are looking to buy property, they're like, wow, this $500,000 property. It's everything I'd ever want. But oh wait, property taxes are $10,000 on this deal. And that, that makes the payment tough for a lot of people, you know, so they've got ten thousand dollar property taxes. They had up to 8% rates in the last couple years. Now we're down closer to seven. It's just really made affordability tough. And then Austin did something really, really well when it came to building affordable housing. They just let people build. Imagine that you let people build and they'll build our way into affordability, which is exactly what they did in Austin. Apartments popped up everywhere. Hundreds and hundreds and thousands of units popped up everywhere. And we have an oversupply of rental housing. So, so now what's happened is people say, hey, it's cheaper rent than to buy, like half as much to rent as it is to buy. I can go rent this brand new apartment. I have a, I talked to a guy recently, he got 10 weeks free, he got a $500 gift card on a 15 month lease on a brand new apartment. And it's a phenomenal rent. So two bedroom, two bath, eleven hundred dollars a month, amazing rent. You know, like that's not in downtown Austin. That's just right on the edge in Round Rock. Great area to be in. Great school districts. So Austin's in a really weird place. Rents are cheap right now. There's an abundance of supply on rents. Housing is, we have an abundance of supply on the housing side. Taxes are high, interest rates are high. It's made payments difficult. So it's made buying real estate difficult. We've been in the, call it four to six month range of inventory for the last year or so and prices have continued to come down. I, I keep saying, and I'm just not even going to say it, I keep saying I think we're flattened out and then I get proven wrong. So where things gonna go in the next year? I have no idea where things gonna go in the next 10 years. Austin's a great place to be. You're buying a house and you're holding on to it for 10 years. I'm confident and I just bought this house, I'm sitting in it about a year and a half ago. I'm confident it's a good place to be.
- [07:02]
David Green
All right, so in your mind, Austin sort of receiving a bit of a correction because it was so hot for the last couple of years that things had to turn around. And when they do, prices drop off of their highs. That appears to us like we're having a crash, but it might just be resetting to where they should be.
- [07:19]
Jordan Moorhead
Yeah, I. Yeah, I think we've more reset it to where we should be, but at the same time, and I was just doing a market update video before we jumped on here, David, we had a couple thousand homes for sale in early 2022. Call it 3,000 homes for sale, 4,000 homes for sale, and almost all of them were selling every month. So we were under a month inventory for a while. Now we have 3,000 sold, 14,500 on the market.
- [07:51]
David Green
That's, I mean, one of the things that when I would teach agents, like how to price homes, or let's say you're an investor and you're trying to figure out if you want to flip in this market, I'd run a CMA compared to market analysis. I want to look at all the actives, pendings and solds that are comparable properties. And what I wanted to see was not a lot of houses active at the time top, a large number pending underneath them, and then a lot of houses that had been sold previously. So it looked like a pyramid. That was a healthy market. If I was trying to sell a house, which, if you're going to flip it, you're thinking about your exit. If you're looking to buy, it's easier if that pyramid is inverted. There's tons of inventory. You can lowball sellers, you can come in aggressive with offers, they're more likely to take it. The problem is it's very hard to get out of the market. And so investors would frequently get duped into buying into markets where it was easy to get in because nobody wanted to buy the house to get out of it. So they'd go to some area no one had heard of and be like, oh man, they're actually accepting offers over here. Like, yeah, there's a reason, man. Nobody wants to buy there. Like, the key is you find the inverted pyramid like you're describing in Austin, and you do it with the belief that it's going to flip the other way around, that you get in when it's a little bit easier, you pay a very good price, but you have the belief that long term that correction is going to fix itself and you're going to go back to a healthier market where you have less houses that are for sale than you have that are pending. That's really, if you can just look at those two numbers, what do I have for sale and what I have under contract, you can get a very good idea for how healthy the market is. It sounds like what you're saying right now is there's a lot more for sale than there is pending. Right?
- [09:31]
Jordan Moorhead
There's a ton for. So I was. Funny, I was comping a house earlier for a flipper. There's a ton active, there's a few pending, and there's a few close. Like, let's call it. And these aren't exact numbers. Let's call it. There's 10 active, there's one pending, and there's two closed. So that's what it looks like right now, you know, whereas in 2022, there is one active or two active, there was a couple pending, and there was a bunch closed. Right now in the last six months in Austin, there's just barely anything closed.
- [10:07]
David Green
Well, let's talk about a little bit your production, and then let's get into what's going on in Austin. So, like, this year, how many houses have you sold and how many have you sold the previous couple years?
- [10:16]
Jordan Moorhead
Okay, so. Yeah, that's a great question. I love that question, actually. So this year we're at 27 homes. Soldiers. That's a much lower number than the last couple years. So 2023, believe it or not, was actually a phenomenal year for us. We sold 97 homes in a year. So every quarter, we were selling roughly 25 homes. It's almost the end of June, and we've exceeded that a little bit, but we've exceeded first quarter 2023 and 2/4 of 2025. The market's just a lot slower and it's. It's harder as an agent right now you have to put in three times the work to get the same amount of work done. And that's frustrating as an agent because you're out there sitting, is this ever going to get better? I'm working so hard to get anything sold. I truly believe if you can survive in these next couple years as an agent, hopefully not that long, you're going to show up and the market's going to be great and you're going to have all this experience and you're going to look like you just. You've got all the battle wounds and are the best guy out there to help them. But it's tough when you're not printing money. And it's easy to say, well, I want to go do something easier. I love this market, personally. I know it's hard. I know it's challenging. I'm not making as much money as I was. But that's fine because I know I'm going to be here when everybody else isn't. I'm still buying investment properties in this market. I'm using this time where I don't have as much going on to do other things that are going to improve and make my business better. When the market does get better.
- [11:55]
David Green
Yeah, that's something that we would typically have done seasonally on the David Green team. During the winter and the spring months, you're like, just stay alive. You're trying to hang on to this crazy motorcycle that's going so fast. And then during the winter months is when I would improve the processes. What are we doing with the database? Where have we. Where did things fall between the cracks? Where do we need more training? How do we need to get our staff on board with what they need to be doing? Because you get a little bit of a break. I think we're sort of seeing that right now, not seasonally, but cyclically. We just. The economy is slower right now. My personal opinion on that, which is always subjective, is it's because when rates go up, it doesn't necessarily push prices down like we're told. It more slows down how often money changes hands from one person to the next. So if you have a higher rate, you don't want to buy another car, you're less likely to buy a house, you don't want to go build up credit card debt if you can help it. You just don't spend as much money when rates are low, you're like, yeah, I'll buy the car. The payments, way less. I'll buy a house, the price is way less. So money changes hands more frequently, which is really good. If you work in an industry where you only get paid if a transaction happens, which is us, we only get paid when someone buys a house or sells a house. Same for all the title and escrow officers and loan officers, the home warranty folks, the home inspectors, the photographers, everybody that's involved in this, they kind of just sit around with not much to do when houses aren't selling. And it's a. It's a tough part of sales because you're going to be in feast or famine. What's a way that you've learned to accept that if you take a job as a real estate agent, you will never have stability. You will either be, I'm so busy, I'm letting everyone down and I can't keep up, or I'm so worried I don't know how I'm going to make my next mortgage payment because I'm not selling as many houses.
- [13:36]
Jordan Moorhead
Well, I'm going to answer that in two different ways. So my dad told me when I got started he was a real estate agent for about, he's been an agent for 20 years or so. He's semi retired now. But when I got started he'd been in it for 10 plus years. He said when the, when essentially when the sun shines, make hey, you know, get out there and work as hard as you can when you're able to because there's sometimes when you're not going to be able to and I've learned over time you need to have discipline around that too. You know I, I don't answer the phone always after eight. Somebody calls me at nine o' clock at night, you're probably not going to get an answer but I'm going to call you back at 8 o' clock in the morning. So you have to have guidelines around how you're going to work and when you're going to work so you don't get burnt out but you need to work when you're able to work. Now when it comes to making your mortgage payments, when you're just printing money in those great seasons, don't let your lifestyle get ahead of you. Save a lot of that money and invest in cash flowing real estate. And then when the market is not doing so well, you're not going to be the one struggling or suffering because you've got good cash flow coming in still and you're able to sit there and tighten up your systems and figure out how you're going to make it work better the next time the market gets great. So I think there's seasons like you said, there's quite literally seasons throughout the year that are going to be good or some that are going to be great and some are going to be slower. You know, you get around the holidays, that's the time to take a vacation. But in real estate too you got to work hard when you're able to make a lot of money and you have to use that money wisely so you end up at a good spot when you're not making a ton.
- [15:13]
David Green
That's a solid point. I think it's so easy, we call it lifestyle creep. When you're making money it becomes very easy to spend money. So you're really busy, you're like yeah, I can spend a hundred bucks on that new CRM. What's the big deal? It's only a hundred bucks like I'm getting. Every house I sell is 6 to $7,000. That's nothing. And I can get the extended Zoom account, and I can pay for the premium picture package. And it just never ends. There's always another company that's hustling realtors and saying, if only one transaction happens, it will pay for what you just did here. And the next thing you know, you buy 10 of these things, and you don't necessarily, like, go broke when you're doing that. The problem is when the spigot turns off and you're not selling houses, but you're making all these payments on stuff that you became dependent on, and now you're like, oh, how do we go back from the CRM to a different one? This is what we're used to. And the CRM we were using was like, $1,200 a month. And I had all these agents on it. Right. And so it was, not only do you have to get rid of the thing, but now all your team needs to get retrained on a cheaper thing, or you got to get retrained on a cheaper thing. You got to go to your broker and say, hey, show me how to do this. Because your broker switched, and your broker's like, man, there's no time for that. We're trying to keep the lights on. It really is a tough business to be in because you as a human, your emotions sort of have to shift along with how well you're doing and how well you're not doing, which is very similar to what your clients go through. They're very emotional. You take a listing, you got sellers that have pie in the sky hopes. They're greedy. They want to get as much as they can, and then it doesn't go well, and they become fearful, and they become. They're yelling at you. Same with buyers. Is there any tricks that you've learned along the way? You can share for what you've done to manage your internal stuff state that's constantly going back and forth from fear and greed, as well as that happening in your clients.
- [17:00]
Jordan Moorhead
Yeah, absolutely. And I think for me, so much of it's just having discipline and having a routine. No matter how my day is going, I just do the same things. And you could say that's boring, but I get up at the same time, I go to the gym, I do the same things. I go to the office at the same time. I do my legion at the same time. So there are ups and downs. Absolutely. And as an agent, I would say the most important thing I've done to get past those highs and lows is having Good administrative help because you start to create a little bit of a barrier between you, even if it's just answering the phone and passing it on to you. That helps my emotional state so much. I. I wouldn't say I'm the most emotional person, but having a barrier of somebody else is answering the phone first and then passing the call along to me if it needs to get to me or they're stopping. Nine, ten of those calls that I don't need to take helps me so much that I'm able to do really well as an agent, but I'm also able to do all sorts of other cool stuff like go buy real estate and, you know, have a good life. So I've been working as an agent now since 2017, full time. Those first. Let's call it three so years I hustle. I was working 70, 80 hours a week. I would say anymore. I probably work 40 to 50 hours a week and I do more production than I ever have. But it's just having a good team and having good discipline. David, I know you know Pasha, I was. I heard Pasha on a podcast yesterday. He. Or recording a podcast yesterday. He does his work between 10 and 4, and he says, I get all the work done I need to get done. I think the reason agents get burnt out, and I'm saying this from personal experience, so I'm not being derogatory towards anybody, but the reason I got burnt out in the past was I was just all over the place. I would get up at 8, I would work till 8 or 9, and I was just burnt out at the end of the day. But I had no systems, I had no process, I had no discipline and I had no schedule. So now I get up at 5:30, I go to the gym. I'm starting working around 8, 8:30, but I'm done doing the majority of my work by noon most days. And then I'm just responding to things or catching up or working on projects or, you know, whatever. It's a listing appointment, whatever I need to do in the afternoon. But my morning is so regimented that I get again, like 90 of the stuff done. I need to get done before noon every day. And I'm not stressed out.
- [19:40]
David Green
Do you think the agents who, let's put work in air quotes, they work 12 hours a day, are doing that because they're lacking clarity on what needs to be done. So they're just trying to make up for that with sheer volume.
- [19:55]
Jordan Moorhead
So I'll speak for myself. I think part of it is that clarity on what needs to be done. So you're just doing so many different things but I think you're also just lacking the discipline on doing what you need to do. So I know for myself I was always good at reaching out and doing lead gen but I was doing it sporadically. I would do Legion for a little while, maybe 15, 20 minutes. Then I would answer emails and I might scroll on social media. Then I'd do something else. I was just all over the place. Now I'm much better at following my time blocks and doing what I need to do in those periods of time and it sounds incredibly boring and restrictive but it's actually so freeing for me is I know, hey, I'm going to go in and I'm going to do lead gen from 10 to noon and then I'm done doing Legion for the day and I'm going to get the amount of lead gen I need to get done during the week. Done. So on my team we, we strive to make 50 contacts every week. So 50 contacts or two appointments are our measures and I'm getting my 50 contacts and two appointments. No problem doing my lead gen from 10 to noon and it's not stressful. I'm not having to stretch to do it and yeah, I'm still doing all that stuff and don't have any problem doing it, get all the business I want from it and feel good about it at the end of the day.
- [21:15]
David Green
Let's talk about what your time blocks are. Can you share like a rough idea of what your schedule looks like?
- [21:21]
Jordan Moorhead
Sure, I'll pull it up here right now, but rough, rough ideas in the morning. You know, I'll make some posts or I'll so tomorrow morning I'm checking in with the team from 7 to 8 on their goals. We talk about our goals. We check in on our goals every week, both in our team meeting and then I personally check in with everybody into the week. I call for every since I'm still buying rental properties. Every morning at 8:30 I'm making a call to some sort of broker, wholesaler, owner, at least one there. We have a meeting from 9:30 to 10. I'll have some stuff from 9 to 9:30. I usually catch up on email, respond to anybody there. I try not to be stuck in email. I think that sucked away a lot of my time in the past too because you get stuck just responding to emails and before you know it, two hours a day, three hours a day, you've just responded to emails. That's not productive work in my opinion. Then tend to do it on making calls in the afternoons, just random other follow ups. We're under contract on a mobile home park right now, so I'm pretty busy with that in the afternoons. But, you know, my time block is pretty consistent throughout the weeks.
- [22:42]
David Green
All right, when you talk about legion from 10 to 12, is that mostly phone calls for you?
- [22:46]
Jordan Moorhead
Most, almost all these phone calls. Once I'm done with phone calls, I'll do stuff like go get on social media and reach out to people, post on things I know we've talked about. Bigger pockets. I've been on bigger pockets since 2014. I've actually gotten a ton of business off of bigger pockets just by being useful to other people on bigger pockets. So getting on the forums, answering questions, just being useful, it's never trying to sell anything.
- [23:17]
David Green
Well, that's what people want. They don't want someone who keeps saying, hey, I'm here when you want to buy, I'm here when you want to buy. We want someone who says, I'm useful to you. And then when we want to buy, we want to make the choice who we're going to go to.
- [23:28]
Jordan Moorhead
Sure.
- [23:28]
David Green
And I think agents make this mistake, which is very easy to make as a reflection of how humans live their lives normally. If you're a person who goes through life and you're, let's say you're particularly attractive, you're used to everybody caring what you want. If you go to a bar, someone wants to get you a drink. If you go out, somebody wants to get you food. If you're sad, everybody wants to give you empathy. Well, then you get your real estate license and you think it's going to work the same way. Hey, I'm open for business. I'm here when you want to buy or sell. And then none of those people care. Right. And it's the same way if you're the funny guy in school or if you were the best athlete, you have a lot of confidence and you're used to everybody kissing your butt. You're not in your sport, in this world, it's a completely different thing. And I think you just gave some really good advice on the agent that's struggling to get that call. Or maybe that keeps. They were talking to someone and they used a different realtor. It's so easy just to get angry or criticize the person who did it or say people suck. The problem is you're one of those people. We all are. Right? We all suck. We all look at things like what we want and not what we Want to give. And there's an element of faith, I think, that comes into the space where you have to believe. Like what you just said. I'm here to be useful. I'm here to help. I trust if I do that, people will come back to me. Was that a difficult approach for you to adapt? Was there fear? Like, if I just go give people free advice, they're never going to come back?
- [24:53]
Jordan Moorhead
You know, honestly, it wasn't too much. I think you described a couple different personality types, and I'm none of those. I was kind of the nerd in school growing up, and. And I just always. I did well by being there, being helpful to other people, and always as a real estate agent, just being helpful and showing up and expecting nothing in return. I've gotten a lot in return. So my first year in real estate, I was rookie of the year in our brokerage, and I almost made rookie of the year in the region. And all I did was get on bigger pockets and answer questions. I didn't have a lot of experience at that point in time. I think I owned two investment properties, but I had eight units, and I had more than a lot of people on there, and I was just being useful. People showed up. I did terrible at following up with those people, too. So now I have better systems and processes. But, yeah, I've just. I've never taken it personally. If you don't want to work with me, I like to ask, if I don't get a listing, I want to know, well, why did you choose that other person? You know, I just want to know, because I can use all that to make myself better. I know I'm going to be around, and I'm going to be around for a long time. So if I can keep getting just a little bit better every year, I'm going to be in a great spot, long run. And I'm using a lot of this money that I make to buy real estate. So in the long run, it's going to work out great for me. It's not just a short career to make a bunch of money and go buy a nice car. You know, I'm. I'm here to help, and that's. That's why I'm in it.
- [26:29]
David Green
When I got the position as host of the BiggerPockets podcast, I was not expecting that. I was not a podcaster. I was very shy, and it was a hard. It's like a hard thing to train for. You can't go hire someone and say, teach me how to be a podcaster. It's different than speaking on stage. It's different than, like, most forms of communication. And I really wanted to do a good job, especially because Brandon had put me there and kind of his reputation was on the line, and I was determined not to let him down. So I would listen to a lot of other podcasts and I'd hear how the podcasters were, and I try to, like, echo their style. So Chael Sonnen, he's a former UFC fighter, amazing communicator. He just tells stories. You could listen to this guy forever. He's so good. I would listen to him all the time. Henry Gracie, another guy, incredible communicator, jiu jitsu guy in Southern California. And I got a lot better at articulating thought and being interesting, but they were people that mostly just hogged the mic. It was like their show and they talked the whole time. And so I was subconsciously adapting these techniques of ball hogs. And I was the co host. I was like, color commentary. I was supposed to come in and make a couple points, highlight what Brandon said, make him look good, make sure we copied. Hey, that guest just made a good point. Let's, let's. This is how this would apply. Realistically investing and then get out of the way and let Brandon lead the show. And I would just go on way too long winded tirades. And maybe 20% of people loved it, and 80% of people were like, dude, he talks too long. He made his point. He needs to get off. And I'm here telling the story, right? So I would read the comments on YouTube that were just freaking mean. I mean, they were just, like, really harsh about the way that I was talking. And my initial response, like everyone's, was to be defensive, like, well, look at you. You suck even worse. Or, well, how come if you know so much, you're not in this position? All these things protect our ego. But I realized pretty quick, if I just adapt to every single form of criticism they give that I think is legit, I'll just get a little bit better every show. Just like you just said, right? If you just constantly ask someone, why didn't you pick me? Why'd you pick them and get a little bit better based on their feedback that you win, you benefit, you become the better. In my case, podcast host, but for someone else's case, it's, you get the next listing. It's your ego that is not your amigo. We are. We spend a lot of time protecting how something makes us feel rather than pursuing becoming good at something. And I wanted to have you on the show because you're someone who's a really good realtor. I trust you with people. I would send people your way that want to buy a house. Was that something that you had, a mentor that kind of taught you how to think this way or how to do things? How did you learn to become just an overall good real estate agent?
- [29:14]
Jordan Moorhead
Well, I think it helped when. So again, my father's been a realtor for 20 something years now, and I've always seen him work hard and really go out of his way to do everything he can the right way for his clients. And he goes much further than I think you should as a realtor. I mean, he's been in people's properties, painting and installing new lights and everything he needs to do to get the property sold. So I've always seen him just go out of his way to get it done. And I remember when he got started in real estate, it was 06 and it was, it was good for a year or so there, but he's brand new. And then the market got really bad. I want to say 2011. I remember he would sit there and make calls for three or four hours a day and just do anything he needed to do to make it happen. Then he turned it into a really good career after a while. So I saw somebody struggle through a really hard market and my father in the beginning. But I also, you know, I got a lot of advice from him. I had a mentor at KW who lost everything in 08. He was a great guy. He was always working hard. He was the last person in the office every night. It was the team leader at kw. I met a bunch of awesome people, like, honestly, at meetups that ended up being really successful real estate investors and taught me that game. But I didn't need the money starting out, I had another business. I think that worked out really well because I wasn't. I never had any sort of strong need to close a deal. And by the time I got my business going, I was crushing it and was able to leave my other business and keep going with real estate. And I didn't need to, I didn't need anything to happen. I never got into real estate ready and something happened. I know they talk about, hey, have six months set aside when you get started. I think a good, good way to get good at real estate is get in it with a desire to learn and desire to help people. And after a while of really working hard, you'll be great and get a lot of business. But if you need business right off the bat, I think it's a really hard part to be a hard place to be.
- [31:27]
David Green
That's a great point. You want to be in the position where you aren't desperate to. Where you're going to give someone bad advice or pressure them into something bad.
- [31:35]
Jordan Moorhead
They were bonus checks for me for the first, like, year, year and a half, I just got a bonus check every time I closed a deal. And it was just money I threw in the bank to invest with.
- [31:44]
David Green
I have an unpopular opinion. People don't like it when I say it. But especially with what we see happening with AI combined with a downturning economy, I think we have too many people in the space, Just too many licensed agents that don't know what they're doing. They all rushed in here when the market was great, and they were like, I don't want a 9 to 5. I don't want to be a slave for someone. I want freedom. And like you said, it takes a long time before people get good at doing it. So we just have too many cooks in the kitchen and not enough food to be prepared. I think one of the ways that you adapt and set yourself apart is you learn how to do more than only sell houses. I think too many agents identify themselves as, I am a real estate agent. I am a buyer's agent. This is my job. If you are. If you have a huge database and you're really busy and it's you, and you're keeping up with stuff all day, and you get to hone in on what you do best, hell yeah, praise the Lord, do that. That is maybe 3% of the people that I come across, the vast majority of them, they are struggling. They're any client that comes their way, they can't be picky. They gotta say yes. Their problems are like, this guy's looked at 90 houses and hasn't written an offer. What do I do? Right? And we can give the agent all kinds of practical advice for what to do there. The reality is, the buyer probably doesn't want to buy that bad. The buyer's having fun looking at houses. And you're a tour guide, right? What you probably should do is fire them, but you can't because you got nobody else to work with. So I had this epiphany when talking to someone about it where I realized, if you're. If you're picky about the job you do. I'm a buyer's agent. You cannot be picky about who you do the job for you got to take whatever comes your way. If you are not picky about the job you do and you just see yourself as real estate professional, which is what I'm getting at, I think that's a healthier approach. You manage properties, you work with buyers, you work with sellers. You have a connection of, like, a network of people that you can connect people to when they need their maintenance done on their house, or they need their air conditioning vent work changed out, or they need a roof estimate. If you can figure out a way to also get. Like, if you're good at photography, you also shoot homes. Okay, well, you didn't get the listing, but you're really good with a camera, so the listing agent hires you to take the pictures and you got something. I always looked at myself like, I have the right to collect a commission if I'm a licensed person. That does not mean that is my job. I don't just stop my learning at I know how to fill out a form, I know how to write an offer, I know how to complete a transaction, and then I'm done. I was always like, I want to know what an appraiser's doing. I want to understand what the loan officer is doing. Right? Because all these pieces kind of impacted my success. If they screwed it up, it hurt me. So I wanted to learn what a transaction coordinator does. Well, if you get good enough at this, which everyone can if they're committed to it, you could be a transaction coordinator for other agents and close your own deals and make some extra money. You could eventually start a transaction coordination business where you're hiring people to oversee it. There are a lot of options open to real estate agents who have an open mind. Not everyone's going to be good at everything, but we all know the things that we kind of succeed at or we thrive in, but we limit ourselves with this identity that we put on. Like, this is the only thing I do. Something I think that makes you a better agent than other people is you. You don't see yourself as an agent. You see yourself as like a real estate investor who has a license. You help buyers and sellers. You also buy property. Tell me where you think opportunity lies right now in Austin, Texas. If someone came to you and they said, hey, Jordan, I want to buy in Austin. What should I buy, where should I buy, and what should I expect?
- [35:21]
Jordan Moorhead
So I'm going to give two different answers, too. And I think it just depends on the person.
- [35:24]
David Green
So.
- [35:25]
Jordan Moorhead
So I was actually talking to our friend Diego Corzo yesterday, and Diego and His team are selling a ton of new build properties. New builds are great deals right now. If you want a new construction property, you want a turnkey ready move in house. That's the best deal on the block. Rather than going a turnkey ready move in house, it's a resale home and it's been remodeled or is in good shape. Go buy a new build cause they're going to give you a phenomenal price, they're going to buy down your interest rate into the fours, they're going to give you all these credits for closing costs, they're going to pay for the title policy, they're going to give you years long warranties. It's the best game in town. It's amazing what you can get in a lot of these new build communities because they have the inventory and their only job is to sell it. It's not a homeowner with house that wants to sell, but could rent or wants to sell but it's still living in it, could just keep living in it. They have to sell that property and they're selling them for great deals with all sorts of amazing benefits. On the other hand, if you're somebody that's a little scrappy and wants to fix up a home, it's a great time to do it because there's very few buyers out there right now that don't want that perfect home that's moving ready. It's in that perfect block. I mean, buyers are so picky right now. You can take such advantage of that. If you're somebody that's looking to buy a fixer upper, I think that's the next best place you can be if you want a new build property. Phenomenal, amazing deals on new build properties right now. But if you want to fix something up, whether it be a duplex or single family home, you're going to get a great deal on that right now because there's just so few buyers out there for those.
- [37:13]
David Green
So what's like a, give me a hypothetical situation. How old would the house be? What would it need done to it? What purchase price can you get it for? What would the rents be and what do you think it may be worth in a couple years when inventory in Austin returns to some form of equilibrium?
- [37:29]
Jordan Moorhead
Okay. Yeah. So the average, the, the median sales price right now is 450,000. So we're seeing homes as low as the low three hundreds that need work and it's not always crazy amounts of work. So as far as age goes, you have a couple different tiers of Stuff that was built in Austin, there's a 60s and 70s, but there's not a lot of it. There's a lot built in the 80s and early 90s. Usually those are pretty solid homes. They need, you know, cosmetic updates done to them. You might spend, you might do paint, might do trim, doors, maybe kitchens and bathrooms. You don't have to do all that work right away. And then you've got some of the homes built in the early 2000s that just need some light updating. So not crazy rehabs on Moza stuff because it's relatively newer in the scheme of homes. I started off my career Minneapolis St. Paul, where everything was built in 1900. So the work these things need done is not crazy. But you get in the 80s you probably got to do some bigger rehabs, like full rehabs to the homes. Early 2000s, just like cosmetic work. So you buy something for 300 low 300s in a good area of Austin and let's say you put 50 grand in it, 50, 60 grand in it, make it nice. I would say you're gonna have no problem. 550, 600 in the next couple years once interest rates go back down a little bit, once the market kind of gets back into an equilibrium. But you're going to have to be a little adventurous because right now, again, everybody's looking for that perfect house to move into. If they're going to buy, they're going to get what they want. But if you buy something cheaper and you're going to have to lowball too, we're seeing stuff get anywhere from 10 to 30% off. I had an agent on my team recently, got one for 24% off. If you really want to get adventurous, buy in those areas where they're building all those new builds. Because those guys are really suffering trying to sell resale homes there. Because you've got this resale home right next door to this brand new home that's buying the interest rate down to the forest. It's already a great price, it's perfect, it's moving ready. You've got this 20 year old home, you're in trouble. So go buy those. Look at places like Buda and Kyle, just south of Austin. You can steal resale homes right now.
- [40:01]
David Green
There instead of maybe the investor looking for it. If they go to an agent and say help me find what it would be the best deal available. What should agents be targeting? Do you have some strategies for agents that are trying to find the best fixer upper out there for their clients?
- [40:16]
Jordan Moorhead
So fixer upper And I hate to keep answering it two different ways. Fixer upper is if you're going to look to flip it, you need to focus on decent area, not a busy street. Again, because you have to remember the buyers are super, super picky right now. So find something that's in a good area that needs some work that you can, you know, put a little bit of money into and sell for a profit. You know, the, the typical flipper. But you're going to have to make a bunch of offers and you're going to find that right person that just needs to sell this home. Maybe they inherited it, maybe they have to to move. But when you're somebody that's looking for a to fix Rupert, they're going to live in for a while, find where you want to be, be patient, and just make a lot of offers. I mean, I, I don't think that there's any magic bullet to it necessarily. You just have to remember that a lot of people that are selling right now really need to sell because it's not a phenomenal market to sell in and take advantage of that. And as an agent, you have to coach your client. Hey, I know the market's not great, but most people aren't going to take 20, 30% off on their home. We need to look at the comps in the neighborhood just because we want to offer less. Maybe the house is already priced well and we don't want to offer so much less or we don't want to be super sticky that we want 20% off. What if 15% off was still a great deal?
- [41:43]
David Green
You have me thinking that this may need to be a book like how to find deals on the mls because no one would have bought that book in the last 10 years because there were no, I wouldn't say there's no deals, but they were so hard to find that you, it was more like, how do you get the deal under contract, period? Because it's going to be worth so much more in the future now that we have the opportunity to find opportunity in mls, there may be something there. I can add a few things to what you said. The first would be write offers without the intention of being accepted. So what I do when I'm looking to buy, and I think that, like, I'm looking for a soft market, I'm looking for a deal that, like, the seller wants to get rid of. Like you just said, I don't want you to just. I don't want to write an offer that you accept on the first go. I just Wrote it too high. I look at an offer in those markets like it's a jab. I'm not going to knock you out. I just want to see how you respond to my jab. You're listed at 800. I write an offer at 700. I'm looking to see if you counter me at 715. That's very different than if you counter me at 795. If I'm at 800 and I write. If you're at 800, I write at 700. You counter at 795. You don't really want to sell that house. I'm probably not going to put a lot of effort there. I'm not going to tell my agent. I'm going to tell my agent to say, hey, totally understand. If anything changes, let us know. If you counter me at 715, you want that house sold you to want, you probably would have took an offer at 690. It's bad for you, right? So now I know I want to very respectfully get you even lower than the 715. Right. I'm like, okay, how about 705 with 20,000 in closing costs? It's, like, even better to me than it would have been the first time. Cause now I know, like, I saw how you responded to my job. So that's one thing. Like, write a lot of offers, but don't accept. Don't, like, do a full analysis of a property every single time. Or make your agent do that. When you have no idea how many of these people want to sell. Maybe 10% of them. 5 to 10% are going to give you that. Ooh, right. So that's one thing to think about. Your first offer is a jab. It's not a knockout. Another little trick that I learned when looking at houses on the mls. Most of us pull up the pictures and we click the little arrow on the right and we start scrolling through them. And what do we get? We get the front of the house. We get another angle the front of the house. We get the driveway. We get the garage door. We get the front lawn. You go through five pictures of the front of the house. Then you get the entryway, then you get the dining room, then you get the kitchen, and you get this walkthrough of a whole property, Right? I would click left. Because when I click left, what I'm seeing is, do you have a stunning backyard that nobody else noticed that probably is not included in your purchase price or your appraised value? Because appraisers don't look at backyards and be like, wow, it's a huge lot, and they have an amazing pool or something that a buyer would want. But it's not making its way into the arv. It's not measurable square feet. And also, even more importantly, do you have square footage that could be converted? This is where I find the really big basement that has electrical and foundation work and plumbing run to it. But I'm looking at a bunch of, like, exposed drywall and framing, right? That's. That's like a freaking gold nugget, right? I could buy a house at 1200 square feet that I could add a thousand square feet to. And it's mostly just throw up some drywall and some insulation and some flooring and, like, paint it, and I don't have to build it from the ground up. There's big value there, but you only find that if you click left. So I just stopped clicking right. I click left, and it's like, okay, boring house, but cookie cutter track home. I can see most of what I. There's not gonna be a whole lot of surprises in this thing. The price they're asking is the only thing I need to know. And then I could lowball from there. So there are, like, techniques that you can pick up looking for deals. And as an agent, I would also set up, like, a search where I looked in the confidential remarks for phrases like mother in law, granny unit in law unit, because I was more likely to find square footage that wasn't included in the appraised value if I looked for those keywords. A lot of realtors just grab what's in the tax assessor's office, and that's what they throw up. And there's been a huge addition added to a house that never got included.
- [45:45]
Jordan Moorhead
And then, you know, I supplemented two of the best deals I bought off the MLS just to add to one or two pictures. So those are gonna be awesome opportunities too. They weren't near. In. Near as a bad shape as you would have thought they would have been, but there's only two pictures. There's one on the front, like you said, one of the front of the house and one on the front of the house from a different angle. Then I walked in the house. I said, this isn't so bad, but I got a great deal on it because nobody on the. Nobody looking at it could tell that it wasn't in bad shape. They just thought it would, you know, it's just not very good here. It's, you know, two pictures Must be wrecked inside. I think you, you can get great. And I, I hate to disparage agents, but you can get great deals from agents that don't know what they're doing and list properties horribly. It's a skill to list properties. We have a dedicated listing coordinator on my team that does it. That's all she does. She knows that really well. And I think people underestimate how important it is to properly input something into the mls. So when you do it wrong, that's how you get good deals. You have to be on the lookout for that.
- [46:51]
David Green
Like you said, they're really good. Point. When you hire 1% agents to sell your house and you think you won, most sellers have no idea how much money they lose on they leave on the table. It's disgusting. If they actually knew like what me as a buyer can do to that 1% agent that takes cell phone pictures and throws them up and they don't get a lot of attention and they don't include the best features of the house or you gotta sift through nine ugly photos to get to the first part. That was nice. Where most people lose interest way before that, it's, it's a shame, but there will always be that greedy person that makes that mistake. All right, Jordan, let me ask you last question here. What's the future of Austin real estate look like? What do you think is going to happen before it returns to a market with appreciation?
- [47:37]
Jordan Moorhead
It's a great question. And I'll start off by saying I have no idea when that's going to happen, but I think for at least for the foreseeable future, it's going to be very slow. We're going to see a small amount of transactions. We're going to see a high amount of inventory. It's going to be a heavy buyer's market at least until sometime next year. So again, kind of our problem is the supply of housing is so great and it's getting, getting filled, but it's not getting filled as quickly as it was once. A lot of these apartments get filled up and rents start to go up. People start to second, second guess renting. I think, you know, when rents get back to more of the normal trend for Austin, I think people are going to start to say, okay, well, maybe interest rates have gone down a little bit. And I'm thinking about buying a home now. I've gotten this great rent for a year or two, but for the time being, it's really going to be a buyer's market and people just need to get comfortable with those 7% interest rates. As long as you can make the payment make sense for you and you're not going to sell that property anytime soon. It's a great time to buy a property. If you're going to buy a property and not do much work to it, you might need to move in a year or two. Don't buy that property. That's a bad idea. You need to buy something that you have a five plus year horizon on and you're probably going to do really well on it. But if you buy something and you have a year two horizon on it and you're not going to fully remodel it or you're not, you didn't just get a great deal, you're going to turn around and sell. I would just highly caution against doing that. So I, I think the next at least year or so is going to be slower. I think. I hope rates go down here in the next year plus year or two and I think we'll be in a great spot again. We have a lot of people moving here still. I know there's a mix news out there that Austin is losing population. There's. It's tricky because the city of Austin technically lost like 1500 people last year. But the cities around Austin, like Round Rock, Georgetown, Leander, Kyle Buda all gained population in a big way. Dripping Springs, growing like crazy. Like all these areas on the outskirts of Austin are growing like crazy. People are moving out of Austin, but they're not moving too far out of Austin, if you know what I'm saying.
- [50:04]
David Green
Okay.
- [50:04]
Jordan Moorhead
And that's. That tricks people because they see the article, oh, Austin's losing population. Like, yes, technically, but the metro's gaining still in a pretty good way.
- [50:15]
David Green
And a lot of it is overbuilding with apartment complexes, not necessarily residential housing. Would you agree?
- [50:21]
Jordan Moorhead
Yeah, there's much more overbuilding with apartment complexes. But again, you get in those outskirts, you get into the Kyle Buda leander. The further out you get, we've just got land and people are taking advantage of it and building neighborhoods.
- [50:37]
David Green
You have a lot of land. I mean, I'm from California where it's either houses stacked on top of each other or farmland and that's it. And then I go to Texas, I'm like, it's just everywhere. There's so much of it, it is so big. So there's definitely, I mean, even when we talk about like places being overbuilt, there's so much of the earth that we never put property on that. Like we could put houses that I don't think we'll ever need. That's a solid point. All right, Jordan, I appreciate your time today and your candidness in sharing some of your struggles and what's working for you and how you're overcoming today's market to last for the long run. If people want to reach out to you, where can they find you?
- [51:14]
Jordan Moorhead
I think best thing to do is shoot me a text or reach out to me on Instagram. I'm at Jordan underscore Morehead on Instagram. Morehead is M O O R H E a D. People misspelled a lot. But you could text me 512-888-9122. I'm sure we'll have that in the show notes here, too.
- [51:34]
David Green
And if you're shy and you don't want to talk to Jordan, you could talk to me. I'm here for you. I have this soothing voice, this, this, this smooth, white, silky, bald head. Reach out to me. Put you in touch with Jordan myself. Also remember, if you are looking to get a loan to buy real estate, I'm here for you. We can finance all kinds of real estate. During the recording of this show, I got three notifications on my computer. People asking me about fix and flip loans. Yes, we do them at the one brokerage. So if you're a real estate agent and you're looking for a really good lender that will take care of your clients and make you look like a rock star. You if you work with investors or if you are one also, please reach out to me. Davidgreen24.com There's a chat feature. You can go on there and you can get ahold of me directly. You can also go to davidgreen24.comaskask and ask your question to be on the David Green show, in which I will have Jordan on with me soon, taking questions from you real estate investors and answering them to share the knowledge for all to hear. Thanks for joining me today, Jordan. I'll reach out to you later about scheduling and time to have you on seeing Green and we'll do this again sometime.
- [52:37]
Jordan Moorhead
All right? Thanks, David. I really appreciate it. And you have a great day.
- [52:40]
David Green
Take care, bro.