Real Estate Show - March Lender Updates

Real Estate Show - March Lender Updates

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[00:00:00] Alice Lema: Well, good morning, Southern Oregon. And welcome back to the real estate show. Alice Lema, I'm a broker here in beautiful Southern Oregon with John L. Scott real estate. So glad to have you back for the show today. And we do have a great show Guy Giles of mutual of Omaha mortgage is our in-house lender.

[00:00:18] He's a sponsor of the show and he's coming back for his monthly update and it's going to be a doozy because we have all these things happening in the world. We have all the chaos, we have all the terror and then we have for inflation. I don't know if any of you folks saw the gas prices. I think they have officially doubled in the last year or so.

[00:00:38] That's having an impact on our Southern Oregon housing. And you might be asking yourself, what is the national state of things and the world's state of things have to do with housing and Southern Oregon? Well, let me tell you what I'm hearing from the people that are buying and selling right now in our area, especially the buyer.

[00:00:58] They have the jitters. We have some number of them that just pulled out of the market. They're not going to buy, they're going to take a wait and see because they're nervous. And it's not just first time home buyers it's people that were buying a bigger home. We call that the move up buyer. We have people that were downsizing. They still seem to be trying to do that. Because downsizing is a different life event than upsizing. Up sizers frequently can wait. Downsizers frequently, cannot, or don't want to. The first time home buyer pool, you know, the interest rates going up kind of took a lot of them out of the market.

[00:01:37] But I don't know if you heard the news. Some, some people are saying the federal reserve bank might pull back from all those interest rate increases or they might slow it down or the interest rate. Increases might be smaller. So that just creates a lot of uncertainty in the housing market. And in Southern Oregon, we have had such a high demand.

[00:01:59] I feel the seller's reaction. They're showing numbers are going down. The frequency of those showings are going down and some of their offers are a little less and softer than they were even a month or two ago. So if you're experiencing that in your selling, try to do something to your property, spruce it up, make it a little more desirable.

[00:02:21] Think about your price. Think about your marketing. Talk to your agent. And maybe have a new strategy for the next few weeks until hopefully the world events calm down. If you're buying, a lot of us, think if you have a property that you can afford, it makes your life better. Especially if you're renting, that's probably still a good idea, but you gotta be able to sleep at night.

[00:02:40] Okay. So with all that in mind, we're going to be talking to Guy Giles of mutual of Omaha mortgage, one of our sponsors about what he thinks that you should do during these tumultuous times. Okay. So we're gonna have Guy. Well, good morning again, everybody. Welcome back to the real estate show. Alice Lema here, broker John L. Scott and beautiful Southern Oregon with our in-house lender. First of the month, guy Giles mutual of Omaha mortgage comes back to talk to us. Boy, do we have a lot to talk about this week, don't we.

[00:03:12] Guy Giles: Just a little bit, and it's crazy by the time the show, you know, I mean we're here and then on Saturday, and then by the time it replays on Sunday, everything will change.

[00:03:22] Alice Lema: It could be, it could be, but boy, we've had a lot of volatility what's going on in the mortgage world.

[00:03:27] Guy Giles: Well, where we're that's about every other hour also right now, basically. You know, I mean, people invest at least from a rate standpoint, people invest in either, Hey, I want to make a buck real quick in the stock market real quick, meaning, you know, in the next couple of years. Or I'm a little worried about everything and I'm gonna invest in something that's a little bit more long-term. We fit into it a little bit more long-term category.

[00:03:53] And normally, you know, basically a war with Russia, you know, somebody invading Ukraine would, involve a huge flight to safety. And, and it has in, in little glimpses, but the stock market is, has still stayed up. And, and I mean, it does allude, you know, a few of us, I think, with, with the fed coming in, you know, they are going to raise, raise rates.

[00:04:20] I mean, I think they pretty much confirmed that and they kind of have to do something. They don't really have a lot left in their, in their chamber for you know, for the inflation that that's happening right now. But really on our end, it's just, it's a wait and see every day, whether it's farm numbers, whatever everybody's just kind of on pins and needles .

[00:04:40] At the moment, we've had a little bit of relief. You know, I think the average for a 30 year loan is, is a little over 4% right now. I've been locking in people in the, you know, the high threes right now. So so they're still really good historically, but as, as far as what's going on, that's a day to day, moment to moment thing right now. And you know, just, just, just everything in Ukraine is, is kind of, I don't know, it does have a lot of bearing on, on what we're, we're looking at, but we have not seen a big direction either way, as far as our rates go beginning in November.

[00:05:17] Alice Lema: It's surprising though. Because this is a really big deal and a lot of us did not think that this invasion was actually going to happen. And then if it happened, we didn't think it was actually gonna get legs. So. You know, are your, how are your, your buyers doing Guy, the people that are out there trying to write offers and close escrows? How are they feeling about all this?

[00:05:40] Guy Giles: Well, I, I think it's it's still hard to find a house. I mean, I mean, really a lot of these conversations wouldn't even be happening if they could find a house at the moment. But a lot of my conversations are kind of going should I buy right now? Or are we going to end up in some kind of a recession there's going to be a deal? And my answer to that, I think, I think Brad, well we had him on the radio, not that long ago. I, I think he, he kind of answered that.

[00:06:06] I mean, even in, you know, what's going on in Phoenix and Talen, where they, they burned down 3,500 houses, Rebuilding of the number might have changed right now, but last month it was only a hundred, less than a hundred houses were back up and running. So I think the demand around here stays up. So I was actually telling a guy this morning, you know, it just look, and if you find that right house, go in with a strong offer and do what you can to get it. Because I really don't see prices going down. You know, I do see a recession. There's there's no doubt in my mind. Anyway, what happens?

[00:06:41] It's a, it's the same chain of events that happens every time we get inflation, then the fed raises rates, fed raises rates. We get an inverted yield curve, inverted yield curve. It is a prelude to a recession. So it's going to happen. It kind of has to, everything's just been on a terror and meaning the stock market, just every investment, everything has been so hot for so long. It has to, it has to cool down.

[00:07:07] I mean, it's just unaffordable for, for a lot of the country right now. So that's what I see happening. I don't really see the house prices going down. I don't, I don't think that they're going to go up at the same rate that they were before. You know, last year was pretty, was pretty crazy, but I'm sure you're probably seeing a lot of the same.

[00:07:26] Alice Lema: Well, and you know, it's interesting, these questions people have about, should I buy something now? Or should I wait? What they're really asking, I think is, are the prices going to go down enough that there's going to be a smaller payment? I'm going to pay less, but what they're doing is they're attempting to time the market.

[00:07:47] I don't know that that's a good idea even for experts. You know, expert investors in this kind of volatility.

[00:07:55] Guy Giles: If Zillow and some of these online ones are the, are the, you know, the professionals then you're you're right. Nobody has any idea. I think between Zillow and I don't even remember which other one they've lost money.

[00:08:07] Alice Lema: It was Open Door. It was a monumental amount of money.

[00:08:10] Guy Giles: It was, it was billion dollars between both of them, you know, trying to speculate in these markets. And, and it just goes to show that all the money in the world and all the data in the world really can't predict what's going to happen. You know, it's just, people are going to need a place to live.

[00:08:28] And I, I think you're, you're, you know, you hit the nail on the head when you, when you just say, I, I don't see things going down. I, I really don't. So I don't know, just, just get in the market, get with you, get with your real estate agent, call Alice and have her, you know, doing a search for you right now. And if that house doesn't come up, then that's fine. But you, you at least are seeing all the new stuff that's coming out every day.

[00:08:56] For sure. For sure. You know, and I've had a lot of people get in contract. And been looking for quite a while lately also that maybe some of the sellers are getting a little paranoid about something going on.

[00:09:07] Alice Lema: Oh, I can tell you absolutely. I'm talking to sellers in huge numbers the last 10 days, lots and lots of phone calls from sellers, worried, wanting to move, waited too long.

[00:09:22] Guy Giles: Yeah. And I mean, if you're going to move, I mean, for me, I've thought about selling my, you know, one of my rentals and I think I'm just hanging on because I don't, I don't see the marketnecessarily going down in the rental market is going to be there. But if you're going to sell and move up or do something, I don't think you've completely missed the boat at all.

[00:09:43] I just, I just, you know, the, the one unknown factor is will we see some more listings in spring? Like we normally do as well, especially with the restrictions, you know, getting lifted now on the masks. I believe that's the 11th that, that we're supposed to be done with masks in the state. And in my opinion, people are going to start feeling comfortable to move around.

[00:10:05] And I mean, I've been moving but I, I really do think that a lot of them are going to start feeling comfortable to go out and do different, do different things. And you might see a lot of movement. A lot of movement might come to this valley again also, you know, who knows.

[00:10:20] Alice Lema: Well, and it's all relative. You know, some of the locals are, are moving out of the area, just like some of the Californians are and going, you know, they have their places they're going where they feel it's better than where they are. But Southern Oregon still has a really high relocation rate where people are coming here because this is better than where they are. So it's all about your perspective.

[00:10:45] Guy Giles: I've been traveling this year, even though I haven't really planned to, I mean, I've been as far as Maine and as far south as is Miami.

[00:10:54] Alice Lema: Oh, you mean you're you're getting on airplanes?

[00:10:58] Guy Giles: I never stopped. I told them I'd play COVID for a minute. And I haven't played Covid for a very long time. I've been enjoying life. You know, the only thing I did different was I kind of moved up into the woods and spent more time in the woods when the thing first started happening. But but no, I've, I've been traveling and as much as something looks really good, this place really is the perfect environment. I mean, you know, yeah. We have some screwy politics. Thankfully, those guys self quarantine up north, but, but really, I mean, gosh, you got the woods, you got the ocean, you have the lakes, you have. You know, you have weather that's good. You got snow if you want it.

[00:11:35] Alice Lema: And international airport.

[00:11:38] Guy Giles: That doesn't go anywhere internationally. I still don't know.

[00:11:40] Alice Lema: But it's the runway, right? We're called international because the runways were reinforced to carry the big jets.

[00:11:48] Guy Giles: I'll tell you what flying in from Miami last week we had televisions on the seats behind us. Now, I don't think I've ever seen that coming in to Medford.

[00:11:56] Alice Lema: Wow. That's pretty downtown, huh? Yeah. It's because we have the international status. It's the smallest international airport. Maybe we should find out.

[00:12:06] Guy Giles: You know what, and that's another thing for people moving here. I mean, honestly, the flights if I'm not in, you know, at night I literally have you know, flights coming in two or three of them after midnight that I see landing there in the airport.

[00:12:20] And yeah, I mean, it's, it's, it's crazy. I, I don't have to get up at 4:00 AM to get on a flight, sometimes the connecting ones, but it feels to me like there are a lot more flights. And we're not limited like, we were just a couple of a couple of years ago.

[00:12:35] Alice Lema: Yeah. So the desirability of our valley, I think has magnified during the COVID because people just went online and kind of Google weather patterns and hospital access and outdoor access. And, you know, they just kind of like typing stuff in and all of a sudden we started showing up on these. So I'm thinking, and this is just by me that our relocation rate is not only going to be steady. I think it's going to go up.

[00:13:04] But we do have kind of a significant, what they're calling migration, the locals, you know, there are, there are some number of locals that are leaving and they're going to other mostly out-of-state, but other parts of Oregon, Eastern, Oregon. The coast, a lot of people moving to the coast because of the fires.

[00:13:24] Guy Giles: Yeah. I think, you know, short-term memory stuff, you know, I kind of forget every year, you know, that, that we've been dealing with that quite a bit over the last few years. I don't know. I'm still hopeful that that will put together a few years with, without a big fire. And I don't know, even, even when we have them, there's so much in the year here, that's, that's nice. Even on the bad fire years that, you know, I mean, I'm not necessarily running around, you know, other than maybe the lake when it's a hundred plus degrees outside anyway, so. You know, it's, I would think this place will be attractive and people will, will move here no matter what. And hopefully some of the, the kids will stay just so we don't lose the whole culture.

[00:14:11] Alice Lema: Yeah. The family, the family, young people moving up. So if the desirability is still there and we still have people moving in, then that still creates some friction on the housing inventory available.

[00:14:28] Guy Giles: Yeah. Yeah. I, I don't know what fixes that right off the bat. You know what I mean? We're what at a 3,400 house deficit over and over in the Phoenix, Talent area right now. Just, just to break even from where we were before. I didget a phone call, literally right before I got on here from a guy wanting to build over there in Phoenix.

[00:14:49] You know, it's happening kind of, kind of slow, but, you know, I think we just gotta be, gotta be a little bit patient because the inventory for the houses to sell just, just isn't there right now. But I don't know, I'm hopeful that a lot of people will start listening.

[00:15:06] Alice Lema: I think so, gosh, you know, with all the phone calls and information and appointments that so many of the real estate agents are getting right now from sellers, that backlog of sellers from the shutdown I'm thinking is finally coming on the market right now. The Ukrainian thing, you know, kind of makes people nervous.

[00:15:26] Guy Giles: So, yeah, I don't think Russia has aspirations any further than that. Not to get super political, but I'm hopeful that we're not a political show, I equally hate all politicians, just for the record.

[00:15:44] Alice Lema: Well, Guy Giles, we're going to have to stop you right there. Cause we have to take a quick break. We're talking to Guy Giles mutual of Omaha mortgage. I'm Alice Lema, broker John L. Scott. We just need two quick minutes. We'll be right back with another update from Mutual of Omaha mortgage. Do not go away.

[00:16:02] Well, welcome back to the real estate show folks. I'm Alice Lema, broker John L. Scott here in Southern Oregon. And what a great time to be talking to Guy Giles, our in-house lender mutual of Omaha mortgage. Just been a really intense couple of weeks. And Guy, I wanted to kind of go back to last month. You know, we've had such intensity and all of the markets in the last you know, couple of weeks because of what's going on overseas, but can you take us back to kind of where we were 30 days ago and what we were expecting to happen, and then what has happened since then? Interest rates, inventory, that kind of thing that .

[00:16:40] Guy Giles: I, I don't, I'm not surprised, but that was actually that that's actually a really good question because everything did, did shift a lot. And I hadn't, I hadn't really thought about that, but it, but it's true. We were thinking something completely different 30 days ago then than what we're thinking right now. Back then, it was just, Hey, we're going to, we've got inflation. It's bad. They're going to keep raising rates.

[00:17:02] And, you know, eventually it'll, it'll cool off enough and everything just kind of gets back to normal. But, but this whole thing, you know, I mean, there was even talk in this last week about the fed, not raising rates. Because yeah. And I, and I think they, they will, they, they really have to, you know, there's there's numbers coming out every day, every minute.

[00:17:28] And do you know, there there's some jobs I want, feds job is not one of those. They you know, they've, ,they painted themselves in a corner over years and years and years. And at this point they, they just have a couple of things that they can do. And I do believe that we will see a rate increase. I don't know if it will be a quarter or a half, what, what it'll happen, but, but instead of having five rate increases this year or four or whatever everybody was promising. You know, maybe we're only looking at a couple. What, what has changed is, you know, we might be looking, you know, I think the only thing that keeps inflation as high as it is right now is supply chains, which now all of a sudden we're, we're in an oil situation again, because we're, we're still continuing to buy oil from Russia.

[00:18:21] You know, why in the world, we are not energy independent at this point is, is another it is another thing, but the reality is we're still getting our fuel from overseas. And so every time something happens like this around the world where we're at the mercy of it. So the, the way I see this whole thing going down is they raise rates.

[00:18:44] Thin that yield curve. You know, I, I talk about this so much. I don't even remember if I've mentioned it in the last hour, because other than the radio show, I know I've talked about it two or three times, they will create a recession. And once that happens, rates will lower. Yeah, it happens every time.

[00:19:02] So I anticipate towards the end of the year, we could, we could see some very, very low rates again, believe it or not, they could even touch. Yeah. And I'm just some guy in Medford that, you know, we'll be out mucking stalls later, where I rate, you know, as far as this thing goes, but, but you have to take these things to their conclusions.

[00:19:23] There's there's. The economy has to kind of kind of cool down, you know, we're just coming off this, this weird hangover with everybody getting free money. Now people are going to have to start paying back some of the loans they took, so people are gonna have to start paying their mortgages. Realities is going to set in and I, and I believe in my heart of hearts that later on in the year, we will have some, some lower rates.

[00:19:47] Again, it's going to be a wild ride over the next couple of months, whatever lender you're working with, make sure he, or she just has an eye for this stuff. Cause I got, I have my list of locks. I wouldn't turn it to where anybody can see it, but literally it's sitting right here next to me every day and I'm watching and I know what I'm supposed to lock who and at what rate, and I just watched these things all day long.

[00:20:10] I probably, I sleep better at night if I was one that just locked you instantly. And sometimes I do. And I've been doing that actually a lot more lately than I used to, but there's some people in some constructions that you know that we're four or five months out still before their house is done. Some of them I'm locking, if that's a little bit more comfortable.

[00:20:29] And it it's a such a day by day thing, but overall I think rates could tick up a tiny bit more or kind of stay where they are. And then I really do believe that they go down. So when you hear the fed raised rates, don't think that automatically your mortgage rates going to go up, those are baked in months ahead of a fed hike. So, and it doesn't, it's not a direct result of that. It'll affect your credit cards, your home equity lines of credit, things like that, car loans, but it doesn't affect directly your mortgage rate. You know, it is an overall sign of inflation and you know, where things are going.

[00:21:07] So, you know, they do tend to kind of trend together, but. But the fed raising rates is not going to have a dramatic impact on mortgage rates with when that happens.

[00:21:18] Alice Lema: Well, and I think you hit it on the head and let's talk more about the lock. Not everybody in our listening audience knows what that means. And then what is it? And how long can you go?

[00:21:28] Guy Giles: Yeah, well, typically a lock is 30 to 45 days. Just meaning, you know, you get in escrow and that's just kind of, we base it on how long, how long your contract is in and the way we're working this now though, is, I mean, literally I can lock you up to a year. You, you pay a fee up front for that. And you know, we can go over that on a case by case basis, if you want to call me. But what does that do for you? Exactly. Well, it's it buffers you from, from rates going up? If it's something that you're afraid of.

[00:22:01] So like I've mentioned a little while ago with the construction people, you know, you might be building a Hayden home or a Mahar or whoever your favorite builder is, and you're seven, eight months out before, before that's ready to go. So if you, if you start talking loans or trying to think about it in the past, you know, 60, 90 days is about how long you could lock. But we're, we're trying to accommodate some, some people and just make sure that they're, you know, I mean, that's a long time not to sleep if you're worried about your rate.

[00:22:31] So if you're, if it's something that's really concerning and you want to do it, we can lock up to a year. So your rate is buffered from it going up. You because you pay a little bit of a fee for it. You know, it actually, the, the, the nice thing is if it goes down though, you can still float down. So it's a little bit of the best of both worlds .

[00:22:51] Alice Lema: And if it goes down, you get the lower rate. How does that work?

[00:22:57] Guy Giles: Well if it goes down, if it goes, gosh, you know, it, it gets really deep into, and it's not too technical, but I tend to confuse people just talking about something simple. So I have a feeling that if I, if I dug into it, they would just have to call you and get the details.

[00:23:15] Yes. Yeah. I mean, it, it, it, yeah. I mean, honestly it would be the best bet, but I mean, it, cause it goes down in between the pricing in between the eighth of a percent in a rate. So, so there, there, there's just a lot more detailed.

[00:23:30] Alice Lema: I just didn't even know that it was even on the buffet of choices. So that's really cool.

[00:23:38] Guy Giles: We're looking at a few different things like, like lock, lock, and shop where you can lock up to 90 days before you even have a house picked out. So yeah, yeah. Yeah. There's a few different options.

[00:23:49] Alice Lema: You can get prequalified with mutual of Omaha mortgage and not have a house.

[00:23:57] Guy Giles: And, and, and yes, you could lock and be, and be buffered. So, yeah, that's, that's one that I can, I can get some more information on. I mean, I should have probably talked about this stuff a little bit more, but I really felt that, that the inflation part wasn't going to last forever for, for a bunch of different reasons. You know yeah. Does there's this oil thing cause inflation, you know, with trucking with, with everything, but put the policies and again, I'll have to kind of refrain from, from getting political here.

[00:24:32] I don't see any policies that are huge growth ones for this country that are being proposed right now. It was just kind of like in the state of union, we're just going to cure cancer. No explanation on how that's going to happen. And yeah, that did happen this week. But, but anyway, I really think that that the economy is not going to be so hot that we have to worry about inflation forever.

[00:24:55] Alice Lema: I guess so what I'm hearing you say is that that the production and prosperity will be going a little bit backwards and that is the opposite of inflation.

[00:25:08] Guy Giles: Well, yeah, and I mean, if, if, you know, if, if people keep their word and they raised the minimum wage, you know, all that stuff sounds great on the surface. You know if, if they really want to do something to help low income people do some things to get rid of some of the regulation to be able to build a cheaper house for them.

[00:25:26] Alice Lema: Yeah, like Brad Bennington was saying when, cause he's a head of the local association of builders, it was over $150,000 per house.

[00:25:36] Guy Giles: For a $400,000 house. I think you said that it was 40%. That would be $140,000 of that is just some type of regulatory issue that you're doing. That should be the way they're paying for a house.

[00:25:49] Not, not, not that. I mean, we're not going to fix, fix the federal government, but, but if people really truly want to do it, you know, like I said, it sounds good raising the minimum wage up, but then whoever hired you now is going to have to charge more for that. And in the long run, you really didn't gain anything at all.

[00:26:06] It's just about being able to conduct business, hire more people and and the competition just goes up for those jobs, because if somebody else is going to offer you and your good, minimum wages. I don't know how we got off on this. It's not meant to be a career.

[00:26:24] Alice Lema: So all affects housing and how much people pay for housing. And, you know, even if you're not doing new construction, the supply chain and the labor shortage is affecting our local housing market, just because it's really hard to finish an escrow now. If you just need some minor repair done so that you can move forward with the transaction or if you want to get your house ready and you need it painted something like that, it's just really, really difficult.

[00:26:52] Guy Giles: Yeah. That's, that's kind of to say the least, I literally am in the house that I'm in right now because I couldn't get a contractor to remodel my house. This was four years ago before everything really got crazy and I ended up just buying a different one.

[00:27:06] Alice Lema: Well, you know, that's an interesting comment because I wonder if the labor market and the supply chain don't loosen up, at least in our area enough, I wonder if the buyers will just be forced to be more picky. And that, you know, we will be blaming it on them. So I know the buyers are so picky, but I'm wondering if they can't even get a house, you know, that they can buy that's financeable because the sellers can't do the repairs.

[00:27:32] Guy Giles: Yeah. And Freddie Mac came out with, with a program where you can do some repairs and you can do some things. And again, that would be, it gets off into a whole bunch of different things,.

[00:27:41] Alice Lema: Is that like a little bit of a rehabilitation or repair.

[00:27:46] Guy Giles: Yeah. So, I mean, and then you close just like a regular loan and then a repairs happen after. So it's not like. It's not like it all has to happen, you know? And now you're looking at, you know, somebody putting a ton of money into an escrow account, you know?

[00:27:59] So there are some options for those kinds of things, but I'm just really not seeing that program utilized a lot right now.

[00:28:06] Alice Lema: So I don't know. We should, yeah bring that up to the front a little bit. Cause there's a lot of homes that are older in Southern Oregon that could benefit.

[00:28:14] Guy Giles: I'll definitely have, have some, some hard facts about that, or at least try to break it down into some good bullet points for our next radio show and have that ready.

[00:28:24] Alice Lema: Well, and then you just have to find somebody to do the work.

[00:28:30] Guy Giles: It's a really good time to get into construction.

[00:28:34] Alice Lema: It really is. This is a good time to sell your house. If it doesn't need major repair and it's a good time to be a construction worker. Oh my gosh.

[00:28:43] Guy Giles: Absolutely. It's and it's still a good place to live and it's still a great, great country. So even though, you know, some things aren't going exactly, like we want it to, we're not building bomb shelters, like they were in the sixties.

[00:28:55] Alice Lema: Yeah. And what I'm hearing you saying is you think it might be short-lived. So we've got to take a quick break, Guy Giles, mutual of Omaha mortgage. We'll be right back after a word from our sponsors. Do not go away.

[00:29:07] Well, welcome back to the real estate show folks. Alice Lema here, broker John L. Scott in wonderful Southern Oregon talking to Guy Giles mutual Omaha mortgage, like to give a quick shout out to our other sponsors, the Rogue Valley Association of Realtors, and John L. Scott Medford, Ashland. Thank you so much for supporting the show.

[00:29:27] This show will be broadcast again on Sunday, tomorrow at 6:00 PM. So now that we have that out of the way, let's get back to this juicy conversation we're having about the side effects of what's going on overseas, inflation, whether the feds are going to raise the right rates or not. And the labor shortage in Southern Oregon, it all affects our housing market. It really, really does.

[00:29:50] Guy Giles: Yeah, I want to turn the tables just for a second. When you mentioned John L. Scott, I remember when you guys first got big. And it was all about the online, you know, you guys had the best online and, but, but you guys have stayed. You, you see places and it seems like a little flash in the pan and then they're gone. You guys have probably stayed number one for a long, long time.

[00:30:13] Alice Lema: We're just kind of a regional company. We're not nationwide. We're just in the Northwest and Northern California. And I think like any business over time, you have to pivot, you have to redo things. You have to be nimble enough to react to what's going on in the world so that you can stay competitive. And I think John L. Scott has done a good job of that.

[00:30:37] Guy Giles: I think so too. And I literally just thought of that right when you were doing it. You guys came up and then you guys, just, you guys, and it's been years and years and years now. And you guys just attract all the best agents.

[00:30:51] Alice Lema: Any agency that's on the planet right now is doing a good job of that themselves, because I think real estate is a volatile industry, especially with all the changes coming. So yeah, but John L. Scott is kind of a anomaly that way since we're just a regional regional company, but any of the agencies that are in business now have had to make the same changes we did for sure.

[00:31:17] Guy Giles: Now that's that's cool. Anyway, so I guess to get back to this you always ask me kind of what, I'm, what I'm seeing.

[00:31:26] Alice Lema: What are you hearing from your people?

[00:31:28] Guy Giles: It's it's been weird. Something I haven't really had people talking about in a long, long time, and that's people are wanting to refinance to consolidate debt. And all really. Yeah. And I'm not a huge proponent of that. I would love to see you just, you know, get out of debt without redoing your house.

[00:31:47] But gosh, I had a call earlier today actually two days ago that I, that I finally followed up with today or the week we got them in, you know, going. Are still at a five and a half percent from years and years and years ago. We're actually gonna, yeah, we're actually gonna consolidate what they have, do a shorter term for them.

[00:32:06] So they're not dragging the thing out. Their payments going to be roughly even, and they're not going to have dollars in debt. So It's definitely not a one size fits all. Like you call the online person and that's their only job is to sell you on you just save$30 a month, even though now you just went into debt for, you know, an extra 25 years.

[00:32:25] But if you call, you know, we can strategize. And sometimes it's not the best idea, it's not to do something like that, but I've actually had a few instances lately. And that's even before the fed starts raising rates where it really does make sense for people to consolidate debt. And like I said, the, the, the old times of it has to be a 30 year loan or just a 15 year loan, we have a lot of variations right in between, where we can just kind of keep you on track to pay your house off when you did. And I can say it's just really fitting the goals of a couple of people.

[00:33:00] Alice Lema: I really liked what you said about keeping the payment about the same, because you know, you and I are older people, we're about the same age. We went through this whole inflation fiasco back in the seventies and you know, it was pretty rough on families. It was rough on business owners. There was a lot of unemployment, I think that's different than this time, but it was still a hardship for so many. And when you're consolidating debt and living off of credit cards, you know, sometimes you have to do that, but it's certainly not a good practice and not something to do long-term.

[00:33:35] Guy Giles: No, no, no. I it's pretty much the worst thing that you could do is, you know, stealing from Peter to pay Paul. And in, and in a lot of ways, doing a refinance, you know, that's a quick band-aid, but, but just getting your, getting, spending under control and, and, you know, I mean, it's just freeing, I guess, is the way to put it.

[00:33:57] I've I've lived my life years ago. I was never taught proper, proper handling of money and I didn't have debt. Then after I got married and had kids realize that they're expensive, I did that for a little while. And it was not, it was not a fun place to be, I think right now is a good time to not, you know, go over, extend yourself on cars and boats.

[00:34:21] Alice Lema: And, you know, with all the volatilityit's like, doesn't that make people stop. You would think that would make them stop spending money.

[00:34:28] Guy Giles: You, you would, as long as the fed or somebody, doesn't just kind of step in with it with a quick little, you know, placebo for a little while or, and I don't know the right word for it, but, but it feels like there's always some kind of an easy button for, for people to press to, to do it.

[00:34:46] But, but really, if you can just kind of, I don't like Dave Ramsey says, you know, you know, live like no one else right now. So you could live like, no one else tomorrow. I'm not saying don't enjoy life, but you know, just, just, just kinda keep an eye on these things. And if you can avoid me as far as doing a refinance, put yourself out of debt and do it that way absolutely. It's, it's a good way, especially with inflation, like you're talking about like they had from seventies and they've got all the way into people were bragging about a 18% mortgage, the eighties.

[00:35:20] Alice Lema: I remember that I was there. It's crazy. So what about student debt? Do you still see a lot of buyers coming to you to get pre-qualified and they have student debt that's causing problems with their prequalification.

[00:35:34] Guy Giles: It's when you say that, because it's been an issue for years and years and years, I've actually had a lot of kids coming in lately that have decided to do some sort of a trade school, do some sort of a thing where, where they don't, they don't want to go do that four year degree because it's really not going to serve them in what they want to do.

[00:35:52] So even though it has been a huge, huge piece of everything I've dealt with for years and years, Lately, it has not been an issue at all. And I don't think somethings necessarily changed. It's just weird luck of the draw,.

[00:36:04] Alice Lema: But is this like a new batch of younger buyers?

[00:36:09] Guy Giles: Those are the ones I'm seeing that they're not wanting to go into debt. I have you know, a couple in the last two weeks that we're going to go out of state, go to college, do the whole thing, like was traditionally supposed to happen. And they actually looked up the schools and said, I really don't want to be indoctrinated and I can get indoctrinated locally, just fine and not go into debt.

[00:36:30] So I believe it or not. I'm seeing a lot of really responsible young kids that I'm just blown away every time one of them walks through my door. And it's, it's, it's something, of a mind shift of do you know, you don't have to go get in a huge amount of debt to, to, to make a living in this country.

[00:36:51] And maybe it's better just as a specialized thing, like welding or construction or doing something. And there's no shame in hard work, whatever you do. And I'll tell you what those guys are making a whole lot more money than the ones with writing degree that would only serve them if they became a professor someplace.

[00:37:08] Alice Lema: Not that there's anything wrong, cause we need all kinds. No, absolutely. But if you're young and you are trying to buy a house, it helps if you don't have student debt. I was just curious if that was some of what was being paid off through some of these refi's.

[00:37:26] No, I don't know that I've ever really done that. Again, I'm not a proponent of just, Hey, let's refi. You let's, you know, let's just keep, keep doing this thing because it is anyway, it's, it's on a case by case basis every time. So it's best just to come in and talk. I'm more of a mortgage planner than some guy trying to make a buck doing a loan.

[00:37:47] Well, Guy Giles, you're always a breath of fresh air. Love your information. Love your insight. Guy Giles mutual of Omaha mortgage. We're out of time. So check on us next week. Have a beautiful Southern Oregon weekend.

[00:37:58] Bye.