KGCI: Real Estate on Air - Building a Strong Lead Gen Foundation with your CRM Jeremy Collins

Episode Date: June 11, 2025

Hey, it's Bill Gross. Welcome to my weekly real estate market update. You know, in business, we're held accountable for results. When I sell a property, if I don't do a good job, the someone might fire me if I don't sell the property, or they may not harm me to sell the next property. And that's common in business that we oftentimes benefit or are penalized based on the quality of service and of the results we create for our customers. In sports, famously, when teams lose, the coaches get fired.

the coaches get fired, the management gets fired. It's a results-oriented business, but one place where there's no results focus is in government. And lately, one of the tactics of government is to blame everything they do wrong on something that can't be controlled, but it's a boogeyman they're going to focus on. So for example, this week we're talking about how our government, and particularly the banking system, is blaming their failures on climate change. But before we get into that, let's take a look at the real estate market and where we are. And we can talk about what's been going on the market

and then we'll take a look at the issue of the week. So in an economy, there's two factors that drive the prices. There's buyers and sellers of supply and demand. On the buyer side, on the demand side, it's really driven by interest rates. And this week rates came down a little bit again, about a quarter percent to close the week at 7.15%. If you look at the chart,

it's the range of where it's really been for the last six months, about the range of maybe over the last year or so, and certainly in a range to continue to have buyers show great interest in buying properties. So the interest rates say they were volatile last week. This week was a little more, I would say, subdued and quiet. And as a result, we end up with the numbers that we have today. Now, on the demand side would be measured by the amount of properties for sale or inventory. And here we take a look at the inventory.

You can see that this year is above last. year by about 10%. We had 516,000 homes for sale this week and about 460 a year ago. But last year was only higher than the three pandemic years. The pre-pandemic years, we had way more inventory for sale, about 50% more in some cases. And so we still have historically low inventory. As long as that is true. Prices can't go down. They might flatten out or they make up by 1 or 2 or 3% while the rest economy

inflates at 8% or more, but they can't go down. So we're not likely to have a real estate crash, but real estate will be squeezed for the next period of time. I think it's a fair assessment to take a look at it. Now, the real estate market is very localized, and so what's true in one area like Los Angeles made up between nationally. Here in Los Angeles, the market continues to be a slight seller's market. Altaxas Research, a great research firm that I look at.

They rank our market at 42 again, about the range we've been. for months. And so we continue to be in the sellers market, but it's a slight seller's market compared to a year ago, two years ago, where it was a intense seller's market. We still get multiple offers, but not as many competitive offers as we did maybe a year ago. And overall, home prices are continuing to go up, though I would say clearly at a slower rate than they have in the past. Okay. So let's take a look at the news and see what's going on. One of the constant themes if you follow my podcast is I feel like the news, is always giving misinformation.

CBNC, CNBC, continues to try to hypnotize. I think it's readers with bad information. This week, their article was, if Americans won't lower interest rates, they're going to have to do it themselves. So this is an article. It's just hysterical to me when you look at what are they recommending people to do who want to get ahead in life?

And they're saying, you have credit card debt. Two things you should do is call your lender and beg them to lower your rates. well that's not very becoming. Second, you might consider shopping for other credit cards and get 0% credit card debt. And of course, they have a handy tool that advertisers on the website. How convenient. They're basically saying use our advertiser. What's the problem of that?

Well, how about telling people maybe if your problem is too much debt payment, how about paying off your debt? How about paying off all your debt? How about not using debt at all, only using it as a lot. a payment system for money you have. How about live within your means? How about live less than your means and save the extra and invest and buy real estate and other investments to become wealthy? No, that's not a CMPC.

All they're going to talk about is how you can get in more credit card debt buying stuff you don't need that they advertise on their website and then shop for better credit card debt using their advertisers and find yourself choked in a never-ending world of credit card debt and other loans. but really what they should be telling people is live within your means, save money, don't buy a car you can't afford to pay cash for, and then once you have more money put away, you can use either savings or passive income to buy the nicer things in life.

But they're never going to save that because it's not consistent with their business model. Next, speaking of companies that have, I think, misleading information for their customers, Business Insider, one of the leading sources of bad information has an article this week, Home sellers are facing a summer from hell. A summer from hell. What's the summer from hell? So they say the age of insane bidding awards and desperate dealmaking is coming to an end. Presumably because sellers won't get 10 offers on property as they'll get five or four.

That's the summer of hell according to business insiders. Well, okay, so let's break that down. First off, is that really? a summer from hell? No. I mean, the worst thing in your life should be, you're a seller, instead of 10 offers, you get two or three offers. Really, there's a lot of worse things in life than that. Second of all, I would say that, well, there are always the glass is half full kind of source, because what's bad for sellers is good for who? Who is it that's trying to, I'll give you hit, buy the property the seller is experiencing hell with.

The buyer, if the seller is having a summer from hell because there's not enough demand, might that mean that buyers have a better chance to buy property? Might have buyers instead of being one of ten offers, be one of two or three offers? And that'd be a good thing for them. So you can see how, A, it's not that bad, but B, how between buyers and sellers, it's a glass half full, glass half empty mentality. And I think that business insiders are always going to take the buyer, the glass, is half empty in order to make people upset.

It just seems to be their premise as keeping people aggravated and they'll buy stuff on your website. Speaking of aggravated, there was a couple that was upset this week to find out that L.A. is too lenient on crime. Welcome to the party. This is a family in Planet de Raine was very upset because their home was burglarized and the perpetrators were arrested

and booked and let out. Is this news to them? This is KTELA 5 reporting the news. Is this news to them? Don't they know we've been doing this now for years that we don't really hold criminals in Los Angeles? We just process them and let them out. And to the point where not only do we not have enough crime,

we actually import more crime because we're sanctuary city. We invite people from around the world. We don't check the criminal records here. They can come across the border illegally without the records checked, and that they do commit a crime in the city of LA and state of California,

we purposely do not report them to immigration to have them deported. We purposely keep the criminals in our city. So this is not a, I don't think it's a news story, even though it's on the news. I don't think this is a

something to complain about if you're in Los Angeles. I mean, I don't like it and I live here. But I accept it. This is the policy of the Seattle, we are a city that caters to criminals. We have only made our laws more accommodated criminals

consistently over the last three or four or five years. We've elected prosecutors who promise to make their lives better. And as a result, more people leave California who own houses than come here and buy houses. That's just what's going on. Now, I know that sometimes I sound negative, but I do want to point out occasionally there are some good articles on the internet and here's one by Kiplinger i think this is worth the

read for everybody who's listening to this and i put the hyperlink into the in my email version of this 13 smart estate planning moves this is some really good stuff i you know i used to do an article like this once a week and send it to my client database i stopped doing that because i only found bad articles more often than new good articles a good valuable information but this is one that I think everyone of my clients would benefit from, if not to use these techniques to be able to share them with their clients, if you're an attorney or accountant or a real estate agent. Great checklist. A couple of the points just off the bat.

Rethinking IRA investing strategy, some really good stuff based on how the law changed in 2019. Sneaking in a Roth conversion. Complicated. You might want to get a wealth manager to help you with that, but definitely worth looking into. I'll leverage the annual gift exclusion, particularly have money to give to kids the next generation, as well as your lifetime gift exemption early, paying medical or education expenses directly. So again, these are, some days are very detailed, but I would say overall, oh, you know what, I didn't share the article like this, did I?

Let's put that in there. And this is from Kiplinger. This is great stuff. This is the best article I've read on helping people achieve financial needs. dependence in in a couple years. So Hatsop to Kipplinger and 13 smart estate planning moves. Definitely a good read for everybody, whether you're in the business or not. Okay, homelessness.

So if you follow, I have another podcast called Real Estate Ripoffs, and I call the homelessness is really a new industry. And so let's do a quick flashback. Our governor, back he was lieutenant governor after being the mayor of San Francisco, promised us 16 years ago to end homelessness in the decade. Here he is, looking young and dapper, great hair, great clothes, great tan, great smile, getting more people in the housing. And this was in 2008.

He launched a 10-year plan to eliminate housing in the state of California. I'm sorry, homelessness. He was going to eliminate homelessness in the state of California in 10 years. 16 years later, $24 billion later, let me ask you, has it got better or worse where you live? You know, where I live, it's gotten worse. Where I live, it's just, it just seems everywhere now there's another place where people are adding homeless encampments. In fact, just this week, I drive south on Robertson Boulevard to get to the 10 freeway. And there almost always has been off and on, large encampment on the west side.

and east side of Robertson at the Freeway Underpass, just a short walk from Hamilton High where high school kids have to walk by drugs and prostitutes and crime and the filth every day in the way to school. And so we again got it removed, and I was excited. Yes, they finally got rid of it. But as I drove under the freeway, I noticed they just moved it down one street to Ellis Avenue.

The poor business there is just overwhelmed with this huge encampment of tents and filth and drugs and prostitutes, the whole thing is just a mess. So really in LA, we just were good at moving it around and somehow we count that as moving people out of homelessness, but in reality, it obviously, it is obvious. It's just getting worse. Well, it's getting so bad now that the homelessness now is starting to explode in, of all places, Orange County.

And I found this article fascinating. This is from, again, KTLA News, one of the few news sources in Los Angeles, saying that the Orange County homeless population has skyrocketed. Hmm, interesting. I wonder if there's any clues test as to where. And one of the things I noticed when I look at the numbers,

first off, they point out half of them are drug related. Don't say that out loud in Los Angeles, because they'll call you a liar. But it's gone up 37% since 2022. One of the things that's fascinating if you look at the numbers is 80% of the homelessness is in two cities in Orange County. Santa Ana and I have the two largest cities. cities. But these tend to be cities that tolerate homelessness. This is kind of like Los Angeles.

The larger cities in America have made homelessness in their industry. And so of all of Orange County, where those two cities represent less than 20 percent of the population, those two cities have 80 percent of the homelessness. And you might say, well, that's their choice to make. But the truth is, the criminals who live in tents on the streets of Anaheim will drive too nice neighborhoods to do the robbery. So again, the homeless population getting worse in Orange County is not just an Orange County problem. It's a sign, I think, of things getting worse overall. And we're just losing control of it. It's now moving to areas that were never really affected by it before. Signed historical this week about Warren Buffett. Now, Warren Buffett has really

had, I think, of all people in the world, the best press is a very wealthy guy. And so obviously he can buy press and he comes across as an oh shucks kind of guy and this week he was forced to defend real estate commissions which i think is very defendable saying the commission structures worked out very well welcome the party war and we've been under attack for years now he owns berkshire hathaway real estate company back when they bought it that was the selling point as to why you should join the company but really he's not been in front of that company like most of his companies is not really involved other than in this case his name, the name of the company of Berkshire Hathaway.

But what's fascinating to me is that he is now speaking up, why? Because the industry is threatened with being destroyed. We're under attack because we're entrepreneurs, because we're not government employees, we're not subject to a lot of the control of the government officials. They're seeking to destroy real estate industry, which are made of entrepreneurs. And so even Warren Bubba has to speak up. This is a guy who's so really going to talk about greed. He looks to be a humble guy.

In reality, he's one of the richest man in the world. And at the end of his life, he basically has just turned over all his money to Bill Gates to donate for him. Meaning he has nothing, apparently, that he thinks is a value in the world. He has no principles or values, no church, no organizations that he values other than Bill Gates. Bill Gates is a man who famously is divorced because he kept the mistress, his visits, to Jeffrey Epstein's Island. He famously's been involved in really forcing lockdowns, forcing masking.

And so that's Warren Buffett has worked his whole life to leave his legacy to be Bill Gates, which is very, very sad, I think. But anyhow, at least he's come to the party to defend real estate agents, and I welcome him that party. Well deserved it's a good fight. Let's see, under corporate news, Zillow continues,

I think their destruction of the middle class with an article, they put out this week, talk about the amount of money it takes to live in Los Angeles. If you're going to rent in Los Angeles, going to Zillow, and live comfortably, that's the headline.

And this is a report of their news in, again, KTLA-5 has been a great source of information this week. So the average Los Angeles Angelino to rent an average property and live comfortably, note those words, needs to make $117,000 a year. Now,

that's for a rent, with the average rent is just under $3,000, $29.20, which is $36,000 a year or so in rent, which might require about $50,000 a year pre-tax income. But as fascinating is what would you do with the rest of the money, meaning living comfortably, if you're renting a property and spending $3,000 a month, it seems to me you should be living uncomfortably.

You should be saving money for the future. you should be not buying Starbucks. You should not be paying a fancy car lease payment. You should not be buying fancy clothes. I know my wife I started out before we bought our first house. We had bed and furniture and a table and chair for eating on. That was it. We live very frugally because we're saving money to buy a house.

But nowadays here's Zillow promoting the concept that renters should buy, should rant expensive rentals and have enough income to live comfortably on those. I think big mistake, and that's part of the problem in our economy, is too much focus on comfort. I think I'm not enough on savings, wealth creation, and service or values. Another interesting article from the Masters of the Universe, Goldman Sachs, one of the companies that really runs the world. They kind of let the cat out of the bag. If you look at this briefing they have, they talked about new homes as a percentage of cells. It's fascinating that new home sales used to be about 17% of home sales overall. And somewhere around 2004, we stopped building homes until it collapsed down to 7% of home sales in 2011.

And it's been climbing back, of course, took a hit during the pandemic period, but basically back towards the historically normal level, but still below at about 16%. Now, one problem is all the homes that didn't get built in that time period from 2004 to 2000 and now, we need to make up and build more houses. But that's against the policies of our political class today. In California, we're not really building many new homes.

We're building apartments. They're all low income and for homeless and for, immigrants, but we're not like building housing for middle America in California at all. That's why people are being forced economically to move to other states. So again, fascinating article, but when Goldman Sachs says it's kind of like putting the stamp of approval that even our government, as stupid as most of them are, are now allowed to talk about that at some level. Okay, so this week we talked to, my headline was about the government diverting our

attention from a scandal, major scandal. the FDIC and the Federal Reserve was in a damning report talked about the toxic workplace environment, the sexual misconduct, lewd behavior, retaliatory administrative practices. This is, you know, in many institutions and particularly in government, underreported. But here it is being reported. And, you know, we have had numerous, you know, resignations and people who've been prosecuted for it. Here's over 5,000 cases. I'm sorry, 500 people, 500 cases at DETC, the reported of misconduct.

So it's a major problem going on at the FDIC, like many agencies. But one thing is that, you know, so what is the Fed really focused on? Well, it's interesting. The banks are being told they're supposed to focus on climate change. Now it's your report saying, hey, banks, let's take a look at our, you know, practices, how we're treating each other, how we treat our employees. is no, let's talk about climate change. And what's fascinating is, again, you might talk about climate change

if you're the EPA or other areas of government, but here you have a case where, and this is the Biden strategy, it's all of government. Everybody in government is supposed to be worried about climate change. And so now the banks are being forced to take a look at what data do they need to collect to make sure they're fighting climate change as if they really are.

We're going to get to that. So that's really what the bank is, that's what they're really doing. Right? The result is our economy is amassed. The result is they have all kinds of sexual misconduct. But what they talk about is climate change. That's what's going on in our federal government. So it's gotten so clear that that is their focus that they tried out Beyonce. Fannie Mae says, Beyonce is right. They actually refer to her. I guess she's a climate change expert. That shows you about the level of science and climate change. They say that the climate change has hit the housing market and homeowners aren't prepared. Oh, no. Oh, no, we're all going to be

affected by climate change. You know, I live in West Los Angeles. I'm inland. The oceans are to have to rise, I don't know, 50 feet, 100 feet, minimum before it be a factor for me. That's millennium, thousands of years from now, at best, at worst, whatever you want to call it. But here you have Fannie Mae's CEO referred to Beyonce. And what's he talking about? Is he talking about helping you make more money? No, is you talking about how to help the housing market? No, Is he talking about stopping the record banking failures we're facing? No, he's worried about climate change. So Beyonce, I just found this fascinating,

she and Jay-Z just bought the largest mansion in the history of California, in Malibu, of all places. Now, they didn't buy one on the beach. Interesting. They bought one on the bluff overlooking the houses on the beach. So they're overlooking billionaires' row, and they bought this $200 million, dollar magnificent estate

overlooking the beach. So don't worry about Beyonce. She's worried about climate change. Their house isn't on the beach. But the question I have for you is about, oops, I lost my spot here. I had this beautiful picture of all the homes in

Malibu. They're on the water. And my question is, who is worrying about those homes? So if you've driven up the Pacific Coast Highway, you've seen, as I have, houses, rows of houses along the You've ever been on the beach in Malibu. You've noticed all those houses right on the water.

You can imagine if the water table went up a certain amount, that it would affect them and be a scary situation. And so the question is, you know, what happens with them? I'm so sorry. There we go. There we go. What about these houses here? Right on the water.

You can imagine if the water table went up five feet, they're wiped out. These are 10, 20, $50 million homes all along here. You know what's fascinating about these is? Number one, most of them can't get insurance without fair plan insurance, which means we as taxpayers are basically underwriting their insurance or their flood insurance. And when they have wildfires of Malibu, again, that's most commonly, the person on the hook for that is very commonly taxpayers with fair plan insurance. And so, but meanwhile, why are the wealthiest people in the world? This is Malibu. The same is true in Florida. The wealthiest people in the East Coast.

buying houses in Florida on the water near Miami, Miami, Boca, Fort Lauderdale, all in the water, all within 10 feet. Are they not worried about climate change? How could that be? They're spending $10, $50 million, and they're not worried about it, but you are I should be. In fact, they're so not worried about it. They casually fly their private jets amongst their mansions.

They might have four or five mansions adding to climate change. But while they're doing that, they're not worried about the rising water. And then they fly to Davos in their private jet and talk about how they're concerned about climate change. I fly back from the Malibu House that's on the water to their Florida house. How can that be? So I recently pulled up some interesting data. I pulled all the mortgages being done in Malibu. And it's sort of by lender.

What's fascinating to me is it's like a hoo-hoo of the normal lenders. There's Bank of America lending on a sales price of $7 million, $2 million, $2 million, $2 million. So they're lending plenty of money in Malibu. Here is Bank of the West. Here's Citibank, lending all kinds of money. Here's Citibank. Here is First Republic Bank. Now they went broke.

They were bought based by J.P. Morgan. Kind of that shell game that bankers play with each other to steal taxpayer money and make millions of themselves. There's Goldman Sachs. They're about climate change. Meanwhile, they're lending money to people on the beach. Here's HSBC. here's J.P. Morgan Chase, Morgan Stanley, PNC Bank.

This is the University Credit Unit for Prepadine University. It's right there. Wells Fargo. All the usual players lend money to those homes on the waterfront, whether it's in Malibu or in Florida on the Keys. They're not worried about with their money. They put their money where they make money, and they put their mouth where they can get their hands in your pocket. And so I think that the move of the federal government to focus on climate change is yet another example.

They much rather talk about climate change, even if it's true, even if the climate is changing, even if it is manmade, even if we should change their policies. The Fed rather talk about that than why inflation is out of control and the average American's life financial is getting worse. But that's their job. And we need to hold them accountable to that. And again, there's a time and a place to talk about climate and the weather and we shouldn't pollute for sure. But at the same time, let's not allow them to use that to distract us from their poor results. So again, and I do this every week and I don't mean to make this a campaign pitch other than I wouldn't be a campaign pitch. How can you make a difference?

I'm not going to complain about this alone. I have a friend who's actually running for elected office. I used to be in elected office, low level. I was in the neighborhood council here in Los Angeles. I've served two different times when I first opened in recently. And now putting my efforts behind the second and current recall pitch of Governor Newsom. Whether it works or not, I think we should send the message that he's most responsible for our state. In my entire lifetime, it's been nothing but declined.

He's profited. We should hold him accountable. Now, if you have a better solution, let me know. Put a note in the comment section or reply to me, text me, email me. I'm all ears on what we can do to make things better. Overall, I live in California. I have a great life. I have grandkids that live nearby.

I love going to, I swim outdoors at the pool. I love the weather here. It's just heartbreaking to see life so hard for so many people. And I am in real estate, obviously to make money, but also help people keep their wealth, increase their wealth, and to make more income. So if I can help any way reach out to me, at Bill Gross Pro, text email as always make today your best day ever