Amazon Could Be The Housing Black Swan Event NO ONE Is Looking at

[00:00:02] Welcome to the Real Estate Strategies podcast, where we host in-depth conversations on everything real estate with the industry's biggest movers and shakers. I'm your host, Ken McElroy, joined by my co-host, Danielle. Let's get right into this episode.

[00:00:17] Welcome to The Ken McElroy Show. I'm your host, Danielle, here with Ken. What's up? So today we're going to be talking about Amazon getting into the single family home market. And this could be a black swan event that people are unprepared for.

[00:00:31] I know. This is a big one, actually. This is very interesting because Wall Street's been involved in this for a while. But now, of course, this is just one more, you know,

[00:00:42] I mean, this is a I don't know exactly what's going to happen next, but these big companies. Exactly. You know, so essentially Jeff Bezos has invested in a real estate platform called Arrived Homes, and he's thrown a lot of money into this into this platform.

[00:01:00] So this is this is just one more way for the transfer of wealth. That's exactly what this is. This is this is Wall Street buying up Main Street. You know, this is this, you know,

[00:01:14] this has already begun, as we know, from 2008 kind of woke woke up the sleeping giant, I think, you know, when all the banks started taking back all that real estate. And then what was happening is the big boys were putting together funds. I'm talking about

[00:01:29] Wall Street. And they were buying up all the distressed real estate, you know, during that period of time, during that last period of time. And I think they they were buying this stuff at

[00:01:38] 50 cents, 40 cents on the dollar. And they did very well financially on the on the on the real estate market. So this is a transfer of wealth. That's exactly how this should be looked at. Well, it's interesting, too. So if Arrived Homes, basically they let essentially anybody invest with

[00:01:55] them with a minimum investment of one hundred dollars. So it's like crowdfunding point. But but in a way, it could be good because it allows the average person to invest in real estate,

[00:02:06] maybe if they don't have the money to actually buy a property. I completely disagree. Why do you think that? Well, there are so many factors when you put one hundred dollars with a company, whether it's a oil company, a gas company, a water company, a home building company,

[00:02:25] you don't know exactly what they're doing. And just because they're Amazon doesn't mean that they're going to do it. Well, I would be I would not do this. I mean, this is a this is an online distribution company. That's what they are. They're not real estate people

[00:02:42] now that I'm sure they're finding the best real estate people they can to, you know, to figure this out. But, you know, you always got to fall back on experience. And, you know,

[00:02:54] just because the elephant in the room has money doesn't mean that you should be investing with them. Well, they say they have a whole team that's vetting the property. I know. But but for and, you know, they're managing. So they essentially are doing something similar to MC

[00:03:11] companies, except they're working with just regular investors of the family home market. Yeah, I guess, you know, if if we if I was to create a division of distribution, you know, then I could also raise a fund for that. Right. You know, like, you know, I'm not

[00:03:27] I'm not saying that they can't find those folks and put that together. But I'm saying in the beginning, you know, it's I would be careful. First of all, you know, why would you want to

[00:03:38] be buying today? You know, you know, you got to take a look at that. Right. And, you know, I think that because of we're in a pretty short supply of housing as far as listing, and if we're talking about single family, it's just primarily what we're talking about.

[00:03:55] They're seeing what everyone else is saying. You know, they're the reason you do something like this is if you see the future real estate go up. I mean, that's right. Yeah. OK. They're

[00:04:08] not going to do this in 2008, you know, unless they're buying a big discount from a bank, let's say. Right. But this is this is not you're not going to get wealthy putting 100 bucks with

[00:04:22] Amazon. Right. That that's kind of the point. You know, I know we got to discuss this. We've got to talk about it. But this is this is precisely what's happening to the real estate market and

[00:04:36] driving prices up. Like we just talked about this, you know, when you've got big groups like this going in and competing against, you know, what would normally be somebody that wants to

[00:04:48] move into a home. You know, you now have a lot more demand on, you know, a pool. Right. The pool is the pool. Right. What is ever in the pool is in the pool. And so, you know, it used to be

[00:05:02] mostly homeowners. You know, let's just say when we were growing up. Yeah. OK. Then there was a sprinkling of investors and then the investor base got bigger and now Airbnb got introduced. And then the Wall Street group started really getting involved, you know, call it 2008, 9, 10, 11,

[00:05:19] as they were buying these big pools of funds from the banks. So now Wall Street's involved. And this is just this is just one more chapter. And I don't think it's good. It's not going to be good for home

[00:05:31] prices. It's not going to be good for affordability. Well, that's why we kind of call it the Black Swan event. Right. Because if companies like Amazon get involved into the housing market, you know,

[00:05:43] they don't necessarily care what they're paying for a house, like maybe a small investor would and certainly a homeowner would. So that drives prices up. And then, you know, first time home buyers are then competing with Amazon to buy a property. That's my point. So this is like

[00:06:02] you guys know we've had Chris Martin said on he wrote the book Peak Prosperity and I'm going to show you this graph here. So I want you to stay with me here real quick. So at the base is gold

[00:06:14] or it could be water, it could be silver, it could be timber. It doesn't really matter. But this would be what you would call, you know, you know, God's money, right? Whatever it is, natural resources.

[00:06:27] All right. Then the second level would be the gold mine. You can invest in the gold mine. Now you can invest like Barrick out of Canada. They've got 16 mines in 13 countries. You can

[00:06:39] invest in there and their stock price right now, let's say 17, 18 bucks. The gold coin is around 2050, 2060 I think spot was. And then you can also go all the way up at the top to the gold stock.

[00:06:54] Okay. So essentially you go from the gold in the ground to the gold mine, to the gold stock. It's essentially a derivative of gold. So the higher up the chain you are, the riskier it's going to be.

[00:07:07] And this is the same with everything, all natural resources. There's nothing wrong with this model, but you need to understand what it is. So at the top are your stocks, that's your, you know,

[00:07:19] your mutual funds of course, or a group of those. And then you got your ETFs or electronic trading funds. That's all at the top. It's the most risky spot to be. It's the least control, even though

[00:07:33] you might think it's the most, it's not. And it's also the one that goes down first. And if you want to get wealthy, it's here. So this, when I read this article, I know this isn't Amazon, but you're

[00:07:50] talking about the top here. You know, you got the people that own homes and then you got the companies that are aggregating them and then they roll that into the stock. It's the same thing. So, you know, you're taking money. This is a transfer of wealth.

[00:08:04] So Amazon basically is also looking to get into the single family market. So Amazon gives you a couple options. You can invest in a specific home, you can invest in a fund that's multiple

[00:08:16] homes, and they're also looking to get in the short-term market. And this doesn't just affect home buyers because you're looking like, oh, well I'm a renter or whatever. Well right now, you know, there's small landlords and small landlords are the bulk of landlords in the US,

[00:08:32] especially on the single family home market. Small landlords like me, I undercharge rent. I don't always, you know, raise it on my tenant if I really like them because for me having a

[00:08:42] vacancy is a pain in the ass. But when you start getting into corporate renting, it's all about the market, the numbers, and they don't really care if you leave. So this isn't good for renters either because basically corporate America is going to start dictating rents. And then small

[00:08:58] landlords like me, if corporate America is raising rents, then I'm going to raise my rents. And, you know, you're going to basically be in a system. Yeah. And I'll tell you what guys,

[00:09:09] like for those of you that are for this, I will tell you this, well, this is going to be a ways out. But after these big groups come into real estate, they're now going to be lobbying

[00:09:23] on behalf of the real estate owner. I just want you to know this. Like, so they're going to be lobbying against rent control. They're going to be for all of you who said, this is great. I can

[00:09:35] get in for a hundred. Just understand what this means right now. The federal legislation, state legislation has a lot of, um, they have a lot of ways that they can pull levers on these small

[00:09:45] landlords and they do. And, and, but once this, now this is getting into, you know, call it wall street. Um, it's going to get very different. This is going to be very interesting to see what

[00:09:58] happens here. And, and, um, you know, it's been going on. It's, this is very interesting. Well, and I wanted to look at, um, arrived homes, you know, which is invested in by Amazon. I wanted

[00:10:12] to look at their website and kind of see, you know, their selling points and why they're maybe investing in real estate. And, and if you look on their website, it states that, you know,

[00:10:21] profits in real estate have surpassed golds, bonds and stocks, but with stocks, it's not by a lot. So real estate was 9.8 stocks was 9.6 bonds was 6.9 and gold was 5%. So stocks and real estate are

[00:10:35] very similar, but I think people are looking to diversify. And I think that that's a big deal to people right now. And they, and they mentioned on their website that historically returns in the stock market do not correlate with real estate. So you're basically in two completely separate

[00:10:52] asset classes that, you know, if one goes down, maybe the other one goes up. You're not all in one thing. And they also mentioned what we talk a lot about on the show, which is a hard asset is

[00:11:04] a hedge against inflation. And I thought that was interesting. They mentioned that because I think everybody knows that we're going to have mass inflation over the next X amount of years. And

[00:11:16] they're aware that this is going to be a great hedge against that to own these hard assets and arrived homes as a whole, because they're also partially the investor is aware of that as

[00:11:26] they're buying these homes as well. All right. Well, so I'm going to hold this back up again. All right. So, all right. If I own a gold coin, it's a hard asset. I throw it in my pocket.

[00:11:38] I get on a plane, I go to Europe, I pull it out and I go to the bank and I get euros. Okay. So now is it an investment? I wouldn't say as much as a, as a hedge against currency,

[00:11:52] but that's a different story. The next piece is a company that extracts it and there's a tremendous amount of expenses and all that kind of stuff. It could be private, it could be public.

[00:12:02] And this, and this company, I think was called Barrick out of Canada, public, you know, publicly traded. And then, um, you know, they create a stock obviously above that and this gets all

[00:12:15] sliced up. There's a GLD stock and there's, you know, there's different kinds of stocks that you can get. But if you look, if you Google, are there more ETF stocks than gold? Are there more ETF gold

[00:12:27] stocks than actually physical gold? And the answer is yes. So everything's a derivative. So if I take an orange, um, and it comes off a tree, uh, again, I cut it in half and I squeeze

[00:12:39] it. That's a derivative of the orange. That's all this is. These are just derivatives of what is real, real assets are the ones real people own. They're not paper. So you want to be careful of

[00:12:54] owning anything you can print. You can't print a house. You can print a stock for a house. This is the point. So, you know, it is a way to get into real estate. I understand,

[00:13:06] but does it cashflow? Do you get tax advantages? All those kinds of things. The answer's no. You know, the, you know, is it going to really move the needle for you financially? Is it going

[00:13:15] to make you wealthier? The answer's no. Is it going to make Amazon wealthier? The answer's yes. Well, and I, um, also wanted to point out, I looked up a New York Times article and it says the billionaire tech entrepreneur, Amazon, isn't the only one betting

[00:13:34] on the U S becoming a nation of renters. Last November, JP Morgan Chase and Company announced its joint venture to acquire and develop 1 billion worth of single family rental communities and Met Life Investment Management estimated that institutions owned some 700,000 single family

[00:13:53] rentals in 2022 and expects that number to reach 7.6 million by 2030. Guys, you're not putting the genie back in the bottle here. Yeah. The lawmakers can try, but. It's done. So, you know, this is so far along already as you guys already know this, like one

[00:14:11] of the, one of the things that we've been talking about, I've been saying, we're going to have a renter nation. Um, you know, I saw these guys come in and, you know, they're probably in before,

[00:14:20] but Oh, eight, nine, 10, 11, they started buying these things directly from the bank. Now that was a good thing because the banks had a lot of toxic debt and they ended up buying those. They ended

[00:14:32] up doing really, really, really well with those. Okay. Those are all emerging. So this is the, this is a black Swan event, but it's not Amazon. It's it's, it's main street getting gobbled up by

[00:14:43] wall street, the single family homes. And you know, you're now going to be imagined that imagine you now being, you're moving to somewhere with your family and you're competing against Jeff Bezos. That's a fact that's where this is headed. You're literally, and by the way, you might need

[00:15:04] financing. I can assure you, Bezos does not. So, you know, there's a lot going on here and I know I don't want to simplify it, but this is a big deal. And, um, these institutions, they're going

[00:15:17] to be taken over the residential market. We, you know, it's, it's going to be, this will be normal at some point, probably for your kids. Kids would be my guess. You know, this, this, they basically

[00:15:30] taken one of the last bastions of, you know, investments that, that the, you know, the common person could own have. And, um, you know, is it, um, you know, one day you will own nothing, right? This is all part of it.

[00:15:43] Dave King said you own nothing and be happy. That's where we're headed. So, you know, we can bitch, but the reality is, is, um, it's happening. There's not a lot you can do with it. So, you know, I thought when, when the Fed started printing

[00:15:58] money, you know, I looked at Kiyosaki and I go, Hey, let's just be the Fed. Like what's the Fed doing? You know, they're putting the country in massive debt. So let's get in debt because, you

[00:16:10] know, uh, with inflation, um, that will be paid off by cheaper dollars later. So, uh, so this is an opportunity for you guys to jump into this real estate market. And, um, because I guarantee you

[00:16:26] there's no, we're going to, we have a huge shortage coming. Um, as you guys all know, we're already in a shortage and, um, I think it's, you know, you just watch some of my prior videos, 3 million, 4 million, 5 million, 6 million, even 7 million, the low income housing

[00:16:40] coalition said 7.5. So we're at a shortage. So Nemo said most people want to own their home because it's the main tool for the average person to build wealth. What if that's no longer the

[00:16:52] case? That's a scary thought. That's exactly, it's a really, really insightful point. This is it. I don't know about you guys. Think about the home you grew up in. Think about what it's worth. Okay.

[00:17:03] Why is it worth that? It's because of inflation mostly. So you, my parents, your parents, probably a lot of listeners, parents, the majority, these people are working their butts off, right? Putting their money in pensions and, you know, which is another, you know, taking from

[00:17:28] main street then transfer wealth to wall street. That's all a pension is. That's what a 401k is. That's what a retirement plan is. It's, you know, man, putting your money to somebody else for them

[00:17:38] to manage it. That's exactly what this is. Most people are sitting on real estate as their primary source of income. It certainly was the case with my mom. You guys know I talk about her a lot,

[00:17:51] you know, um, the home I grew up in, she still owns and, um, it is by far the only thing she's got left. And, um, I don't know if you guys are all in the same situation, but I know a lot of

[00:18:06] America is as well. So this is a very interesting time. And this is something to watch. And like we said last week, there's two bills that were just proposed to Congress. One makes it so a single

[00:18:17] person or entity can't own more than 74 single family homes or else you have to pay 10 grand per home. So you w you wouldn't want to do that. And the second bill is making, getting corporate

[00:18:27] America out of the, uh, single family home market. So let's just see if these Congress people in the Senate are going to actually vote this through. Ken and I don't think so. We think that

[00:18:39] it's just a prop for an election year to say, look, we care, but we're not going to do anything about it. Well, you got to look at where most of that money comes from for the elections.

[00:18:49] Right. I mean, at the end of the day, you know, where's your bread buttered? And so it'll be interesting to see whether or not those bills pass. You are near one-liners. Where

[00:19:00] was your bread butter? We got to get a shirt for that one. So we're going to hop into our questions, our KenPro Inner Circle questions. If you guys want to join, just go to KenMcElroy.com forward

[00:19:13] slash join dash now. We answer your questions every week by email or over YouTube. So let's jump into the first one and those of the YouTube audience, feel free to ask some questions. I'll

[00:19:24] try to get to a couple. Uh, Tim says I'm a real estate developer in Oregon and I'm interested in developing cottage houses on a small piece of property. I believe this could be set up as a

[00:19:35] condominium development, but my experience has been in conventional development with lots of public streets and utilities. Uh, I'm looking for a developer or bootcamp mentoring company to understand the kind of development. Do you know a place? No, I don't, not in Oregon. And of course

[00:19:50] we don't really provide, you know, classes and stuff for that. But the, the, you know, the one thing I would say is, uh, I've done this by the way, I've actually done it in Oregon, believe it or not.

[00:20:02] Um, it's, it's not that easy to put together a condominium plan on something. It does take time. It's mostly money and time. Uh, but you're going to still have the public streets and all that,

[00:20:13] the curbs and all that kind of stuff. You got to plug into the city or county or whatever it is. So you're going to have all those costs. Um, by were you, um, and the other thing is I would just

[00:20:23] be careful. Um, you know, the numbers can often be better for selling something off as a condo. Nothing wrong with that. Uh, but at the end, this has been my experience, at least in my thirties,

[00:20:35] you, you sell them off piece by piece and then you own nothing. You've just made a lot of money, paid a lot of tax. Uh, you do avoid the Oregon, uh, rent control laws, however, you know, and,

[00:20:47] but, um, you know, just, just, just understand why you're doing it. It's basically one big flip if you're selling them off as condos. Um, also a condo lending, um, is, um, you, you might want

[00:21:01] to look into that cause that's a little bit different. Uh, you know, you've got a common area and you've got people, you basically don't have control or you have to set all that up.

[00:21:10] Um, and, uh, you have to put money away for it. So think of, um, the roof's going to need a redone in 10 years, the parking lots, the paint and all that stuff. Those are called reserves. Um, the,

[00:21:21] they're part of the HOA, uh, but there it's a reserve piece. Uh, there'll be reserve studies and everything. So it's expensive to do that as opposed to just a normal, um, you know, say long

[00:21:32] term rental. Um, and by the way, you don't have to do it at the same time. So you could build it as an apartment. I've done this and you can put a condo, um, plat on it later in, um, in other

[00:21:45] countries it's called strata. They call it strata, um, horizontal regime, whatever. It's just a legal term, but, um, you don't have to do it right away. So you can build it as a four plex, eight plex,

[00:21:56] 16, 20, whatever. And you can do that later and get it set up later. But each member, each one has its own tax parcel. So there's a lot to it. It's mostly legal. Um, and, um, but I don't know

[00:22:08] anybody. You just have to find somebody local. I don't know anybody in Oregon. Sorry. Um, our next question comes from Hector. He said, Ken, I'm considering doing an eight unit apartment complex

[00:22:19] and a prime location. Initial cash on cash is 5%, but it can rise to 13% with CapEx and rental rate increases. Is it wise to invest despite the low, lower initial return given the potential for the

[00:22:32] higher returns later? So what's confusing is, um, that it's a 5%, but it's a development and then there's a value add. So that's the confusing part. Typically value adds are something that's existing.

[00:22:46] No, I think it is. Oh, it is. Sorry. Yeah. It's an eight unit apartment complex in a prime location. Buying. Oh, I'm sorry. Okay. Got it. Got it. Got it. Got it. Um, well obviously if you can hit 5%

[00:22:58] cash on cash day one, I think that's pretty good even in today's interest rate environments, if the numbers are accurate. So make sure they are. That's been my experience is that, um, we're getting deals, uh, across our desk every day and, uh, they're manufactured, you know,

[00:23:15] they say, oh, these are the rents and these are expenses and typically they're not. So that just make sure you have that nailed. And if it is a true value add, that's good. The other

[00:23:24] thing that you might have or you will have if rates go down, like the, like everybody's saying next year, even if it's a little bit 50 basis point 75 one, whatever it is, um, you're, you

[00:23:35] can always do a, do a cash out refinance after you do the value add. So not a bad strategy to buy it, go in, start raising rents, get all that stuff in order. And then as rates go down,

[00:23:48] if they do go down, then you can go back to the bank and do a cash out refi. Just make sure you pay attention to your prepayment penalty on the existing loan. So, um, but, um, it sounds good.

[00:24:01] Yep. Um, I wanted to grab a YouTube question here. So Ken is asking Ken, I currently own properties in New York city, completely over-regulated here. What state would you say has the best income, uh, investment opportunities today?

[00:24:16] So, uh, the, you know, a state is a big thing. So, um, you know, you gotta look to where people are going. If you look the last two years, you know, Texas, Florida, North, both North Carolina's

[00:24:28] a Tennessee have been, uh, where the people are going. And of course, real estate is a people business, uh, you know, no renters, no rent. So, uh, however, if you look at the Midwest

[00:24:42] and there's been steady rent growth, uh, steady. So, you know, and I think what's happening is people are, are looking for affordability. Obviously it's not as sexy, you know, you, but, but, uh, if you're looking for cashflow right out of the gate, you're going to find that, um,

[00:25:01] some of the Midwest cities are actually doing quite well, especially with work from home and people have options and all that kind of stuff. I think at the end of the day, people, um, want to,

[00:25:11] um, um, have that space. Uh, the other thing you're going to want to watch is if, if you're buying is the, the, the, the policies that corporate policies are starting to pop up.

[00:25:22] So you're starting to see things that, you know, are gonna hinder rent growth and property taxes are starting to go up and utility prices are starting to go up. Insurance prices are starting

[00:25:34] to go up. So you want to look for that too. So for example, like we, we're pretty heavy in Texas and, um, Texas insurance rates, I was just there yesterday, it was like eight, eight, nine, 10

[00:25:49] degrees. You know, last year we had a big freeze during this time. You know, there are insurance claims in Texas. Um, so you have that, uh, insurances in Texas went way up. So did property taxes.

[00:26:00] Property taxes are really high there. So a lot of people are moving there, but you got to start looking at that operating expense stuff as well. Yeah, absolutely. And you know, um,

[00:26:11] MC invests a lot in Texas, Arizona. We do. And each city's different. I mean, we're in Austin, Fort Worth and we're in Dallas, you know, we're in Houston, you know, we're, we're in a lot of

[00:26:21] the big cities. And, and I think that, um, um, you know, each one's a little bit different. Property taxes are different. Uh, insurance isn't that much different, but, uh, but down in the

[00:26:32] Gulf area of Houston, I got hit with a hurricane once, a hurricane Ike, I think it was. So it's going back a bit. Uh, I lost a hundred and some units out of a 300 year building. Literally.

[00:26:42] I didn't realize there's tornadoes in a hurricane. Like you got this hurricane and then you got these tornadoes coming out like that. Okay. So then you got wind and obviously the microbursts,

[00:26:52] but then you also have the water. There's all kinds of, it was a mess. Um, but, um, luckily no one was killed. So our next question comes from our Kenpro Inner Circle member.

[00:27:04] Matt is asking, I'm looking at a 1980s product with 26 units and I'm wondering what type of discount I should be using to project rents in my Performa when comparing rents to a brand new construction product? Ah, good question. So eighties is very different. You have, um,

[00:27:21] I bought a lot of property in the eighties. I think you have lower ceilings, uh, maybe non-sprinklered I don't know. It was around the time where they started making some of that more mandatory.

[00:27:32] You have some ADA or American disability issues. So it's not, you can't really compare eighties product brand new product number one. So, um, the way to value a property is the rents minus

[00:27:44] the expenses. That's it. So, and then if there's potential inside of the rent role, then that's something that you bake in, not, you don't give that obviously. Um, that's, that's, that's how

[00:27:55] you sell it to your investors. If you, if there are any, so for example, if the rents are a thousand and they're supposed to be 1500, then that's something that you keep in your back pocket.

[00:28:06] You put it in your business plan and you show your investors say, here's the market sports 1500 and we're going to buy it at a thousand. And, um, that's your value add, you know, but, uh,

[00:28:17] if there is new construction in the area that can be good, but I can assure you, you're not gonna be able to compete with it. What you want to do though, and what you might do

[00:28:27] is you want to take a look and see where their rents are. Cause if they're at 1500 or 1600, 1700, then your market is going to shift down a little bit because the new product is going to

[00:28:37] kill the eighties product all day long. And so all you can expect is just to hover up underneath it. Um, the best that you can, um, and be the best that you can in that particular market. And,

[00:28:49] and I think it's a good spot to be because people are going to be facing affordability problems here, uh, this year and next and the next, in my opinion, based on what I see happening. So, um,

[00:29:02] it's not always the best strategy to, to take everything you have and, and polish it up the best you can and try to charge the most you can, especially if it's a longterm hold. Now they're wrong with having affordable market rate stuff that cash flows,

[00:29:17] because you can always do it later. You know, we did this on a property we have in San Antonio and we're like, you know, we call them classics. You know, we've owned the property 15 years,

[00:29:27] I think I'm like, let's just keep it as is. Let's just really maintain these nicely and, and, and keep them affordable. Um, as everyone else kind of bangs it out over the new, new construction. Yep. Cause people will transfer when prices or incomes get tighter.

[00:29:43] I've seen it. Yeah. Like, you know, everybody wants to gravitate toward the new stuff. Don't get me wrong. They do. But then at some point they're like, and I could say 500 or 600 a month, you know, just by moving to something else. And, uh, and they do.

[00:29:58] Yep. I wanted to touch on Nemo's question. So the great question, he said, Ken, do you see his mom and pop landlord surviving? I think within a generation or two, we'll be gone

[00:30:06] with step up basis. I don't see myself keeping my parents' properties or my children keeping mine. I hate to say that, but it's possible. You know, it's just going to depend. Yeah. Wall street is coming in and um, you know, they've done it with every industry,

[00:30:20] you know, they're just coming after real estate now. Yep. Um, it's possible, but I still think that, uh, you know, they're there first of all, the laws, the tax advantages and the cashflow and all that kind of stuff is awesome. It's going to be a long, slow,

[00:30:38] painful thousand cut type thing, you know? Um, and uh, if the country goes that way, let's go to another country. Yeah. You know, like it's, it's going to be fine. You know, there's always going to be, if we are truly heading to a renter nation,

[00:30:53] there's nothing wrong with the private sector standing up and taking advantage of that too. And, um, you know, so it's going to be a, it's going to be a battle, you know, it's a thousand small guys and one, one giant, you know, David and Goliath. Let's go.

[00:31:09] So Josh from YouTube is asking how was your weekend in Dallas? What did you learn and what were the main takeaways? Oh, good, good. That was good. So we had a mastermind, um, called the collective. So this was awesome. So it was five partners. We had George Gammon,

[00:31:25] who you guys know, uh, Jason Hartman. We have, uh, Robert Helms of the real estate guys and Russell Gray and myself. And we have a small group that, um, it's like behind the scenes access, you know,

[00:31:38] small, like when I say smaller, it's probably 50 people. Um, and, uh, we meet quarterly and we just put all our issues on the table and discuss them. It's really, really good. So we did that for a

[00:31:47] couple of days and that rolled right into a goal seminar with my two boys. So there's 200 people, real estate guys put on a goal seminar and it was, it's really impactful. You know, like my,

[00:31:59] I have a 23 year old son, maybe he's watching, so I gotta be careful. Um, I'm just kidding. Um, you know, and, and my oldest son, they were there and setting their goals for the year. You know,

[00:32:10] they all have different dreams, different things. And I can be honest and say that it's a confusing time for young people, you know, trying to figure out what they want to be. They're getting squeezed

[00:32:20] by inflation. Um, you know, they're working, um, and some, you know, they're just trying to figure out their path. So that was fun being there with them. And, um, I think they told me a little bit,

[00:32:32] not a ton, but it was fun. Uh, so setting goals and then also talking big picture. So we did a, did some seminars. It was fun to, um, uh, just see everybody's different perspective.

[00:32:44] And then of course the members, of course, my gosh, they're incredible. We have people that are really slaying it across the country. Uh, it's really, really, really fun to, to, to hang out with a bunch of people that are really moving the needle.

[00:32:58] Yeah, absolutely. And I was told that you sponsored 20 kids for next year. Oh yeah. To go, uh. Forgot to tell you. Yeah. What's up with that? What did you do?

[00:33:09] Oh, well, I was sitting in the room and there was about maybe a dozen kids in there. Like when I say kids, I'm saying like, say 18 to 25 with their parents mostly. And, um, and I saw them in

[00:33:24] there just jotting stuff down and, you know, they're all pumped right about, you know, cause it just thought provoking two days you can imagine. And my son leaned over to me and he said,

[00:33:33] Hey, I, um, you know, would we really be great next year if we can bring one of his friends? And I was like, you know, really hit me. Like it just hit me like, cause there's no way that kid

[00:33:43] can afford it. No way his parents could afford it. Cause it's like 10 grand or something, right? It's not that much. It's a thousand, a thousand bucks per kid. Um, and I was like,

[00:33:53] wouldn't it be cool if, um, if I, if I could sponsor 20 kids. So I, I wrote him a check for 20 grand, um, at the end. And, and then what they did is they said, as they turned it into a match

[00:34:08] thing, they said, Hey, listen, Ken's going to match up to 20 grand. So I think, uh, 40, we got, we sponsored 40 kids next year, me and obviously other people that were there. And I just, I think

[00:34:19] I just was, here's what I said. I said my, uh, and I meant this, my kids are in that room with a bunch of adults that are running businesses. They're smart. They're, they're setting their goals. Some

[00:34:33] with their kids, some with not. I would trust my kids with any of those folks at any side conversations. And the room itself was an incredible room of people. And I said, I would

[00:34:44] trust my kid to be in any conversation with these kids. And so, uh, I felt like next year, if I could do my little piece and we had, you know, let's say 40, 40 other kids in that room, you

[00:34:56] know, maybe, um, we could, we could talk to them about things like this. Cause I, it doesn't feel like they're getting the messages, you know, um, on how to get move, move the needle forward

[00:35:08] personally in, in the school system. So this would be a great way. So that was just my little dent. Awesome. Yeah. Wow. Well, thank you guys for listening and we'll see you next week.

[00:35:19] So you guys, thank you for listening to this episode of the real estate strategies podcast. If you liked what you heard, please give us a five star review on iTunes and let us know what you thought of today's episode. Thank you. And we'll see you next week.