The I Love CVille Show With Jerry Miller! - Scott Morris & Tovah Payne Joined Keith Smith & Jerry Miller Live On "Real Talk With Keith Smith!"

Episode Date: August 28, 2026

Scott Morris, Branch Manager at Envoy Mortgage, and Tovah Payne, Loan Officer at Envoy Mortgage, joined Keith Smith & Jerry Miller live on “Real Talk With Keith Smith” powered by YES Realty Partners and Yonna Smith! “Real Talk” airs every Friday from 10:15 am – 11 am on The I Love CVille Network! “Real Talk With Keith Smith” is presented by El Mariachi Mexican Bar & Grill, Fincham & Associates, Inc., Free Enterprise Forum, Envoy Mortgage, Intrastate Service Co, Mejicali, Tailored Closet, Premier Garage, Budget Blinds and YES Realty Partners.

You guys definitely drove together. I can guarantee you both of them had phone. Oh, that would have been cool. But you had phones stuck in your, you guys were talking. Good Friday morning, guys. My name is Jerry Miller, and thank you kindly for joining us Unreal Talk with Keith Smith. It's a pleasure to connect with you guys through the I Love Seville Network on a show that is eight years strong. Is that right?

This April will be ending our eighth year and beginning our ninth year. So eight and a half years strong, ladies of gentlemen. Assume it I don't get fired. Real talk with Keith Smith. You won't. You do a hell of a job. We talk anything and everything. Well, I was talking about Yonah.

Real estate. Life and the pursuit of happiness through prudent financial decision making. Today's panel, I think, embodies that tagline. In fact, that is the tagline of, you know, a lot of ways of real talk. Maybe Keith in real talk will embody that. Scott Morris is here. Tova Payne is here. Keith Smith is our star.

Judah Wickhauer is the Elmer's Glue. We don't get to Victory Lane without Judah Wickhauer. And it's a show that's live on 27 social media and podcasting platforms as we speak. And we encourage you, the viewer and listen to shape the show. So Judah, without further ado, if you could, my friend, go to the studio camera and a foreshot where all of us will be on camera with, I think, just a fantastic panel on a Friday morning. You know, I've been looking forward to this, particularly, you know, we were talking, I guess, before the mics were hot, about each one of us are married to our business partners, right? And we work together. So at some point, we're going to talk about that fun and how that actually works. And is it a good thing? Is it a bad thing? But let's take a few seconds with a few people don't know each one. I'll start with you, Scott. Introduce yourself and then Tover, and then we'll dive right in. I'm Scott Morris. I grew up in Central Virginia.

I've been in the mortgage business for 10 years now. And we've got a blended family. We've got a couple kids. We're multiple states. And we're running. And a couple of motorcycles. I've got to throw that in, right? And soon to be a boat.

And the boat project. We are negotiating a boat side. Okay. Yeah. The never-ending project. It is a never-eating project. I'm Tova Payne. I'm his wife. I'm also the boss.

I run the show. I love it. I love it. I love it. Well, I think that's the short answer to each one of our business relationships is I asked Yona this morning. I said, hey, do you want to come on? She's actually out doing business right now. But she passed on it. So what I want to do is just do a quick kickoff, right?

We're at the end of August, first eight months, right? You know, we do a lot of data on the show. What is the car footprint looking like? And Judah's got about six slides over there to take a look at it. We'll buzz through it pretty quickly. And then maybe you two guys can chime in on what you think. And then we'll kind of move into the important topic of marriage and working together. So, Judith, if you don't mind hit the slide number one, please.

We'll kind of go through this kind of quickly. I put them on my Facebook page, but we're comparing in that slide the first eight months of this year versus 25 versus 26. So it's interesting if you take a look at it at a larger swath as eight-month swath, we're up about 6% in sales, volume in sales, number of sales. and Jerry and I have been doing this like every month now. At the end of the month, we're saying like what's the first four months, three months, five months. That's six months, that's six percent, excuse me, has been holding pretty solid. Sales volume also is increasing because that's a total number of sales transactions that are coming out about five percent on it.

But the median sales price has been flat, in other words, compared 25 to 26. and that's been, every time Jerry and I have been doing this, that has been something a little consistent. The median days on market has gone up. So the market hasn't slowed down from a volume perspective. And a little later, we're going to take a look at August because our conversation you and I had yesterday made me want to look at this a little harder. Like, hmm, what is August looking like?

And then I did a 20-year analysis. was up until 3 o'clock in the morning, taking a look at it. So jump in on slide one. I mean, do you guys, this is what you're seeing out in your marketplace? Yeah, I mean, so the footprint, we've seen some higher year-over-year sales, specific to the August comment, excluding last year the previous five years, August has been one of the bigger months we've had all year. which means that's July contract activity.

Got it. And this year and last year, that's a little softer, but we've seen bigger September's afterwards. So I don't know if that's just like some shift in seasonality with like school year stuff or if there's anything, or if there is, you know, anything specifically driving it. But just year over year, that's what we've seen. So, Toba, want to jump in?

No, I mean, I agree with. that I think but I do I do think I'm a firm believer that the not only schools starting either earlier or some of them are actually starting later like their everything is staggered like I have had friends who have had kids start their school years within weeks of each other so we start at the beginning of August I've had people start the same week of August third fourth so it's like there's no real like uniform schedule for schooling and I think that is really throwing a lot of people off

You know what's interesting is this came up yesterday in a call. We're helping broker a deal in the pool industry. He's a service provider of swimming pools. And because the school season is getting out earlier at the end of the year, and then starting earlier at the end of August, that window is shrunk. Because it's still colder, the water temperature-wise, when they get out. And it's not going, I mean, when we were growing up, we used to go to school in what? week of September. So the season was going through August. August is hot as you know what,

and that was still the season. He's saying this is throwing off his business completely. So maybe there is something to this changing schedule and this is the second year now that Almaro County and Charlottesville City Schools are on the same school schedule. Before they were staggered schedules, the private schools also matched up with the public school schedules as well. So Central Virginia, at Admiral Charlottesville and the private schools, all in the same start and stop schedule now. So we'll jump right to slide seven, if you don't mind. So that's the last one in the stack I gave you. So I took a look at 20 years going back. Now, these are closed deals, right? So you're talking about pipeline. These are deals that, you know, you started in July. But these are just what is July and August looking like in sales going all the way through.

And, you know, generally, August slows down about 70% of versus sales. They're usually a little bit long on market, right? The median home prices kind of staying stable. But what I found the most interesting, and we'll go back and look at a different August slide, this August versus from July to August, there was a huge drop. this July 26 to August 2026 that we'll talk about it in a minute but our conversation yesterday

got my wheels turning going well hold it I'm hearing tempo the last two weeks dropping right I'm hearing you know the school conversation coming into it is doing it there's also a component which I'd love to get your guys read on it

a lot of phone calls we're having because the buyer profile is my age my buyer's taking a time out now take kids to college right or take grandkids to school so it's an interesting it's an interesting hiccup I think this is seasonal being at the last 20 years and I think when we do this show at the end of September we're going to see a 180 going back what do guys think I mean I agree I think that there has, you know, I talked kind of briefly what we were chatted about yesterday is we've seen a softening over the last two or three weeks. And I think it's a seasonality thing that whether it's just a difference in school schedules or kids off to college, whatever it is, that's been going on. And that we typically see a bit of a pop two weeks out from now.

So, Judah, slide six, if you guys wouldn't mind, slide six. So this is July, August. thing I'm talking about. So between, these are just closed deals, right, comparing July to August, right? We were down 34% in Vimal sales. Last year, we had, excuse me, July of this year, there was 294 closing. These are closed deals in the month of July. So far in the month of August, and we do have a couple days left.

We're at 193. That is 101 units less than we were closing. in July, that's roughly 34% off just compared to the last month. Prices are staying flat for the most part. The average is down a little bit, which has been kind of normal, been tracking this month. But that number surprised me. Do you guys surprise? 30%, yeah.

That's a huge number. Slide five. Go ahead. I agree. I mean, I see it in our closing week. We had a great July, and we're probably 30% lighter. in August. We're going to do one more slide and then we'll kind of talk about what this whole needs. Number five if you don't mind real quick. So this is August of last year versus

August of this year. Closed deals, we're down about 13%. So we're roughly 15% below the same volume of sales as we were last year. The only difference is last year the median price was up 11%. So this year numbers are being pretty much on the median stage. staying flat. And you guys are experts. What does this all mean to you guys when you're sitting down talking to a client? I've seen

buyer, but I was on a call yesterday the day before, the day before. Like, with some national leaders and overall application tracking is down.

Especially over the last, especially over the last two of three weeks. I think that I don't know how much it's rate impacted or just an overall consumer sentiment that's driving part of it or just a seasonality shift that we're starting to see. I don't know that there's anything greater to it. We've been in the same rate range for some time so buyers are much more custom to hearing with where we're at. I think that you do have to look at 2008 to 2022 as an anomaly that we may not go back to and

the further we get away from that I think the less rate impact actually exists there's certainly a cost of living burden that everyone is facing I do think that we've probably assuming that we are not going to there there doesn't seem to be anything driving rates back down in the short term we've probably topped out on pricing and we're starting to see that in these numbers because even though with a limited amount of inventory and we may see continued growth in certain sectors Charlottesville and parts of Albemarle County will be driven by a higher income earner that is being put into the area with the thing going on in green was that Pfizer whoever's AstraZeneca the data science center at UVA those are all higher income jobs will be competing for a limited amount of housing in the area so you will see some continued

growth in price there. However, when you move into the more rural parts of the area and state or region in general, you're going to continue to see somewhat of a plateau or softening in prices. If there's not continued population growth there to overtake the existing inventory and rates do not substantially come down, which I don't think that there's some mechanism in place for, you're going to see a softening in value. So you are projecting values to decrease? Nationally. Originally and nationally.

I was playing squash yesterday with a fairly prominent realtor, and he said that we was talking about investment properties that he owned, whether he should unload him or not. And I asked him about appreciation. And this gentleman said that he does not expect value appreciation to be significant over the next two to three years. And he said, I think it's going to be flat what we're going to see in the car footprint.

Zero to six. Micro markets will matter, right? Price points will matter, but it will be between zero, zero to six. And I really love to have Tovers read on this, but I'm going to ask for it a little bit differently. Because you're kind of, I mean, you're on the front end and the back end, but you kind of help people along through the process, right? So you really get granular with your clients. How is the mood, how is the tenor, or deals more harder to get or difficult to get across, is stuff popping up?

Because I want to talk about something that popped up of me yesterday that we're not normally seeing that's making transactions a little bit more difficult. So I can tell you something that has not happened to me is in a personal deal that I've actually been working with these people for two, no, one year, almost two years. Who? The one that bought your land. Oh, gotcha. Yeah, almost two years.

They were building. Totally custom house, great house. The pre-billed appraisal came in higher than what now the finished value appraisal is coming in at. So that's the first, and I think that that is probably going to continue to happen, not where we're going to see that substantial of a drop between two appraisals, but I think that we're not going to see, like it's going to be harder for people to say,

or for sellers to be like, well, this is what I wanted to list my house for, so that's what we're going to go for. And they're not going, if it's not priced right, they're not going to get an appraisal that is going to. Is this buyer, obviously, they're financing it. Yeah, I mean, so it'll still be fine. But have they sold their existing property?

No. Right. So they're waiting for House A to get. get or be to get finished. They have a very unique situation. So I think it would be important. So in the period of time of them building this house, I'm just trying to understand it, in the period of time of your clients building this house, which is, say, what, eight to nine months?

It's been longer than that. Okay, so it's been longer than that. The appraisal at shovel into the ground was higher than here's the keys to your house. But how much longer was that? Because that's an important. Yes. So it was because we had more sales to back what their construction value was than we do now. So for those who may not know the granular of this, talk a little bit how this loan process works, right?

So you're talking about a construction perm, right? Right. Just sort of walk me through that, right? So typically with a construction process, this one is kind of an outlier again. But with that process, you usually have a pre-construction appraisal to kind of give the construction company, or not the construction company, but the person who's handling the construction loan, they'll have an idea of, okay, we are comfortable with lending this amount of money to these people because we know it's going to appraise for this.

So we know that they'll be able to get financing. And then they take that and they lend on that number, and then I do a takeout loan at the end. But then at the end, we still have to make sure that the value still exists. That's usually within a 12-month, six-to-12-month time frame. Usually, the value still exists,

and usually we end up with a higher value. With a uptakes. Right. Yeah. But because of just where the market is right now, because we're not seeing as many sales, because housing or house values are kind of being, staying stagnant right now.

How custom is this? It's completely custom. Yeah. So that, that we need to point that out, right? Yes. We're also not in your $700,000 range. No, yes.

This is that. Yeah, yeah, sure, sure. But the struggle is the comp, and time matters on this, right? You know, if it was more than 12 or 24 months ago when there was, you know, pretty high appreciation, right, it goes into it. But from a path, a normal path is, you know, you do a, construction loan you do an appraisal on a set of plans to your point it usually goes up because stuff is added to it yada yada yada yada this is going down because there's no comps to go against it right

so it's not that the market has dropped that much i think it may be specific to that property the market is slowed down without a doubt but i think it's just important to understand we're talking apples and apples well yes i think it also depends on where your purchase or where it does depends. I don't think it does. It does. It 1,000% depends on what price point you're actually looking to buy at because there are going to be like as I think in our specific area in Culpepper, I do think that the higher you go, the stickier it's going to be because there's not enough houses for sale in that price point. Like we are closer to the lower end. Like we're not Charlottesville. Coal pepper is not Charlottesville. So we're closer to probably

mid-300 to six. That's kind of where you'll have a lot of comparable sales. Anything above that, I think you're going to have more time. Well, below, I still feel like you're probably okay because you've still got some comps that you can support the value. I just put on a resale for the land trust. It's a 350,000 appraised home for 265, and we're having struggles getting people in.

Well, it's a program, right? They have to qualify, right, for all that kind of great stuff. But the struggle is, is the people, and this is a whole thing I'll get off on a tangent on here. The problem is the 80% AMI, right? They don't, you know, at $76,000 for a household or $85,000 for a household, they just can't get the math to math for $265. Which is why we don't do USDA loans anymore. and it's you know it's tangible in some areas like surrounding Huntington west

Virginia where your average price point is still 200 x,000 dollars and you've got a university that's supporting incomes that are average in the mean to where that can earn inside of the county loan limit and still qualify to buy 250,000 dollar house a three two 15700 square foot three to which here is in the four to seven hundred thousand dollar range depending on whether it's in you know a greenbriar neighborhood or you know or coal pepper I think because even though I'm formally off the board the land trust board I got called in to look at a couple of things on it and it's very interesting because people and this is just a to Jerry's point and the conversation he had

the appreciation model is changed right particularly for three or four years. So people that bought land trust homes three or four years ago have double-digit appreciation. People that bought last three or four years, it's pretty flat, right? Isn't there a clause there that prevents them from flipping that appreciation? Like the purpose of the whole project is to keep them in the home.

Like that's why it exists not to let them go in and buy the home and then take advantage of that. Well, let me paint this. Yes. There's a resale form. Let me paint a different perspective, right? I just sat down with you two guys and bought what's the medium price house right now. Let's say it's $505,000, right, according to the data that I just pulled.

I'm buying a house for 505. I'm doing a 10% down. I'm bringing 50 grand to it, blah, blah, blah, blah, blah. I got to be in that house probably right now for about five years in order to start going on the positive side. Is that a fair assessment? Yeah. It's no different with the land trust, right? So if you buy a home and try to sell it in two or three years,

appreciation just isn't going to be your friend. The problem was it was when it was double digit, right? When you made, in two years it jumped 30, 40, 50%, now it's 0 to 6%. So that conversation is really no different. That look, if you're buying a home right now and you are trying to sell it within, say, a five-year period, there's a likelihood you'll break even

or you might have to bring cash to the table. Is that a fair statement? Yeah. Comments are coming in for the panel. This for Tova and Scott, and it's from J.R. Travis, I think that's on your page over there. What percentage of potential buyers are waiting

or expecting an interest rate drop before they make a purchase? I don't know, but if they're holding their breath, they're going to pass out. If that is what is preventing you from moving forward, you are not going to be a homeowner. You will be a perpetual renter for the rest of your life. I mean, I can't say I disagree. Again, I've said it a thousand times on my social media every time I talk to a buyer or really anybody who is like,

I'm waiting for rates to drop. If you're waiting for rates drop, you're going to be waiting for a really long time. Because the only times that we have seen, the rate to the rate to the rate rate, drop in the past, what, would you say, two years, three years? Been for very short periods of time. Short window. And then what happened when that happened? And then we bond by Iran?

He said, let's go, maybe. Well, that's not what I was thinking. But he's not wrong. He's not wrong, he's not wrong, but sales jumped up. Yes, if you look at the, why August of 2025 was probably as high as it was, was because that was a period, a short window. where the rates did start to drop. Well, you're talking about last year.

Last year of 2025. Yeah, 100%. So more people, there was more activity, more people jumped on and they were ready to go because they were able to fit into that window. If you're not ready to go, you're going to end up missing that window. So talk to a fair amount of people. This is our business, right?

I don't think I can get a clear answer from anybody while they don't want to pull the trigger. Everybody seems to be waiting for something. It's because it's expensive. It's exciting. It's expensive. I mean, get a contractor. What's the rate?

I mean, a good credit score, what are we at? Flooding was seven? Six, five to seven. Six, probably after, I haven't seen what's been directly, what's being said right now. We seem to be hanging in there four points on the tenure. So, 6.625, 6.75. in that range. So we're knocking on the door of seven.

And rates and values while they're flattened or softened, they're still extremely expensive. And there's a lot of deferred maintenance out once you're buying. And that's what we're about ready to get into. So I hear you. Then tell me why we're up 6.3% year over year in volume of sales. There's a 6.3% more people have bought in the same eight months from last year to this year. Because last year to the year prior was a little softer, 25 was softer than 24.

I would agree with that. People have digested, I said this earlier, the rate environment. And we are in an area that we've seen continued, and not just in this area, nationally, we have seen part of the inflation that exists outside of the supply dynamic is an income inflation that translates over to actual consumer good purchases. So people are being paid more, whether it feels like it or not, because of the stuff that they're spending the money on, but they're making a little bit more money.

They're in a rate environment they've become accustomed to, and their ability to take action inside of certain windows has become greater. So we're seeing people who are willing to move forward. I think that we go back to what probably looks like a more seasonal real estate version, big spring markets, quieter parts of the year as people digest what's going on around them. We have things in front of us that are going to create more activity year over year. but I think right now Kevin Warsh is speaking at Jackson Hole and he's going to come out and say we haven't done enough to fight inflation. We may see a rate hike.

I think so. I think so. I think so. And we, you know, I don't know how adversely that affects what we do if it happens once. We get into the winter when maybe we put this Iran situation to bed in some format. Back to, we're doing about two-thirds of oil transport that we were doing prior to March 27th. So that's why we haven't seen super high spikes in the oil market itself. There's not a doomsday scenario here.

There's just kind of like this stale. Quick sand. Yeah, like we're not really going anywhere. So we're not growing. I don't want to say stagflation, but there's a, there's a, a consumer sentiment feeling that has an uneasiness that people don't know where things are headed. So with that uneasiness, it makes them more hesitant to act overall. 100%. Well said. So well said. It's consumer fatigue or hangover. And to answer your question,

why we're up 6.3%, population increase for the area is something that needs to be highlighted. were uptick and population, and anyone that's got any kind of positions in stocks and equities is knocking on the door of all-time wealth for their households. So the real answer, in my opinion to that, is to who. Who's buying, who's selling? That's why that's uptick is going. It sure as heck isn't the first-time buyer. It sure as heck isn't somebody in the 20s and the 30s.

There are people in that mix, but to who that are buying is me. right I've got you know we're dropped a little bit in our marketplace we're roughly a third percent of cash we're now hovering somewhere around 25 26 percent so the cash impact is starting to decrease a little bit on it but it's it's the it's the who that is buying and there's just isn't enough so who is selling it who is buying and when you're not seeing this younger Gen Zs and millennials they're out there but they're not buying in the volumes that I was buying at that

age, it's becoming a unique dynamic on it. When the average homebuyer is my age. Say it again now? When your first time homebuyer is in the 40s. 40 years old. And you're someone coming out of

college and unless you're in some sort of a specialty niche you're not getting hired right now. You're saddled with that. Way too much student debt. You know, because well that's because everybody said go out and get into debt and get a college education nobody said go out

and be a plumber well go ahead sure and i mean we've banged on that for you know a hundred years yeah but that's going to continue to be burdensome yeah um so specialize specialize specialize if you're got somebody who's got kids or grandkids who's watching or you know you're unemployed watching the show right now but that's like figure out what he just say but by hearing that by hearing he didn't think that. Specialized, specialize. No, no, no, not that part. The part of the made her laugh. You're unemployed watching the show right now. I mean, he's giving good advice.

He's being very straightforward. He's giving good advice. So I asked, Tova, I asked this question of Scott yesterday, and maybe you can help out a little bit on the backend. When you take a look of all your transactions over a period of time, what is your typical buyer look like? What's their demographic, not race or anything, but their age, right, their income.

Are you seeing in your buyer profile, something similar to what Scott's talking about, the 40 years old? I think in April, that number is going to jump to 42, by the way. I think that number is going to jump up even more when they rerun the numbers from NAR in April. Yeah, I think a lot of the people that we are seeing are not, I mean, I'm trying to think if most of them have been

first-hand homebuyers at that age, or they've been, they were, they owned a home and maybe sold it and have been renting for 10 years. So, so let's talk about that for a second. Mm-hmm. If I do that more than three years, what am I now? You're still a first-time home buyer. I'm a first-time homebuyer. A lot of people don't know that.

I can be, I can be the 10 to age of 60-something years old. I won't fill the, I won't fill the other number in and on it. Rent for three years. Guess what I am? I'm a first-time home buyer. So saying that, there's a lot of people out, that's the reason why I, this 40, year thing is a little goofy for me, right? Because the way they put it into a box, right? So if there's a lot of me's out there, I've sold my house, I'm retired, I put a substantial

amount of money in the bank, I can't find what I want, I'm going to these upper end luxury apartments that are getting built in Lake Monta Charles, Charlottesville, which we have a lot of people up, and I'm sitting tight for a few years. I've got three clients that are literally that. They've sold that, hey, I'm going to rent for a while, I got enough cash put aside, I'm going to wait for the perfect house to come by. But after their third year, they can apply for

first-time home buyer. A lot of people don't know that. And I think that's skewing that 40 years. I would be curious to see if that is what is skewing that number. I'm not sure if it would or if it is or not. I've asked that very question of NAR and they have not returned my texts, emails,

phone calls. Geez, I wonder why. There is between now and the end of 2027, 3,000 that I know of, luxury build to rent units coming on the market. 3,000 between now and the end of 2027. That's an insane amount of build to rent luxury units that are coming on the market. Well, that would fit the inventory demand of putting $5,000, $100,000. plus a year jobs and it will gobble up a big bet bulk of their buyer pool not just their inventory but their purchase ability because of what they're going to be paying given their income

and why can't I qualify or why can't I do this for a home because you're paying 40% of your income into a luxury apartment I thought there for a second that you were trying to like start a riot on the Lake Monticello community pages by saying that more apartments are growing out there Sure, I can do that. More apartments. Where would they go? They're not, not, not. But yeah, so thank you for catching me on that was a slip.

But you guys are not wrong, but look, you know, we're kind of talking about the negative side of things a little bit at this point. Tova, I'd like you kind of bring it back to. I'm curious to see where she's going to go. Bring it a little bit more. more positive, you know, because from a business perspective. If there's positive for their standpoint, it seems the cash, the percentage that are cash deals is going down. Do you want to know, here's something positive.

Young, first-time homebuyers, here's what that blueprint looks like. You are 25 to 28 years old. You are married or in some sort of a relationship with a human being who is. making also $80,000. So you guys have a combined income, however you get there, a little over household of $160,000. You've got $10,000 to $20,000 saved, and you're making a down payment of zero to three and a half, five percent.

What can they buy? And you're buying a $300 to $350,000 home. Somewhere just in the slightly more rural area, you're seeing those properties develop in Lake Monticello again, Twin Lakes and Green, in parts of Coalpepper, in your surrounding areas. And you're going to get in that house and you're going to be there from age 25 to 35 or 28 to 38. And you're going to outgrow it in the size of your family or you guys are going to get divorced and you have to figure out how to sell the house and split the proceeds.

But that gets you in, get you some equity built and get you to the next step. Now, is that for everybody? No, but that's what I think that the most successful youngest people we are seeing, unless you're an individual making $160,000 and looking to execute that same type of plan, that's your blueprint. So, yes. And, and Toba, please jump in. Otherwise, he and I just will do this for another 45 minutes.

I was on the phone. Today's buyer gets that and understands that, because usually if you're making $170,000, you have some edge. You kind of get that. They just don't want to. Right? They just don't want to get into that market because of the belief. I was on the floor. They're so comfortable where they are.

They want to know. I was on the phone yesterday with a cop, Highmore County cop and a nurse. They're making $170,000 a year. They say, help us. We're looking for something. I said, great. Not a problem.

Oh, I want to be walking distance to downtown mall. Right? I want to, you know, their wants were so here that I said, look, I get you, but you're in the 350 range, and we need to look at Lake Monticello and Green County. No, I don't want to do it. I want to be able to walk that. So the point is, is that 170, they're really looking at a $600,000 to $800,000 piece of property is what they're really looking at, and they can't go there at 170. 170 can get them to 600. They won't do it. They won't do it. They will. They will, they will. not do it because they want a yard. They want to picket fence, right? That their wants, their needs are so high that it's going to take that two years to get them down to a realistic. Can you blame, just throw this out there, can you blame a nurse and a police officer for not wanting to live 30-minute drive from the epicenter of employment? Well, he can't and she can't.

Just the mileage alone at $4. I mean, how much did it cost? Did you drive the truck or the car today? The van. Yeah. How much did you drop in gas to come and do the show? It doesn't matter for you guys.

You guys are doing well. Was that three gallons? I mean... I don't know. I don't ever think of gas like that. I just conceivably cannot. Why? Because it would demoralizing?

Because it would be frustrating? It's a business expense. I have to go. It's not a matter of whether I want to go somewhere or what I'm doing. like I'm going, I'm going to pay, you know, I can't adjust, I can't adjust gas prices into my anxiety of life.

So the reason I was late this morning, Yonan and I, whenever we can, always try to drive in, right? So I dropped off Yona at the office because she had some meetings at the office, and then I came in, instead of being here at 10 o'clock, I was here a little bit after 10. That's the reason I was late, but we have been doing, and this is, I'm going to work this into this marriage thing here in a minute, right? We've been doing that, you know, decades, right? We always plan our schedule.

We always try to do it together, mainly because it gives us an opportunity for Mrs. Smith to talk to Mr. Smith and give me my to-do list on the way in. It's a great opportunity to have for coming into Route 53 to have a serious business discussion on what we're doing for the day and so forth. and so awesome. You're smiling. Do you want to jump in? No? No, this is our business meeting right here. Look, the fact that he, what did I say to you when I talked to yesterday about sharing the topic with Tova?

I said she's fine with it. Yeah. How did you do? How do you feel about that? This is our therapy session, by the way. How did we feel about that? I mean, where do you want to go, Keith? I'm an open book.

I know you were an open book. So let's try. What makes the fact that you were married and working together successfully work? What makes that work? That's for you? It doesn't matter. You guys chime in. What makes it work?

I think that structurally, like... Personality is a big key. You cannot. I knew my role. But you guys are not the same people, not the same personalities, right? That's what I'm saying. I knew my role.

My role is one thing. Wouldn't it be boring if you were both the same? I don't know that that would work. That would not work. For us, it was not working in the same office. My wife and I. When we were working in the same office next to each other, close proximity,

that was more challenging. When it was like now with technology and phones and computers, you can work from anywhere. You know, it doesn't have to, necessarily be right there. I feel like we do better in the same, and when we're in the same office. Oh, explain that.

Jero, Yona and I and I and Jerry and Lauren are the same thing. If we are in the same next to each other, because I do things extremely different than Yona does. So I talk to people all day long. It's a lot of what I do. And her being able to hear some of the conversations I have

prevents me from forgetting to put a note to something. So mentally she can clock whatever I am. I said to John Doe down the road versus going, hey, I saw this in John Doe's file. It's like, oh, yeah, yeah, totally. I'm going to tell you that. So it's just like a backup to when we're working and having that. So I have now on my phone an AI app that when I have these conversations,

it translates it into notes and dumps it into a, note file on it so I can go back. Do you notify the recording is happening? No. Just a curiosity. No, I'm not necessarily think I need to. This is more than Virginia. Some states you do.

This is just notes for me. Yeah. For my conversation. And in some states you do notify, have to notify. But Virginia is a one part. One party consent. Yeah. Well, this is not that kind of, if I've been around in politics long

enough that if we're going to be having that kind of conversation, I say, look, we're recording. But these are, I'm having a conversation with the client. I have a real bad case of ADD, right? And I'll forget the conversation. So we go into it. So I don't have Yona to jot notes out. So it's a little tool that works.

So how do you feel about that? I'm still yelling in Spirley, so I just remember things. Pardon? Did you say you're still young and you can remember that? Is that what you said? I said, young. So hold it. You're making in front of the disabled vet over here that's old.

Is that what you're doing? Oh, okay, got it, got it. Well, he's a disabled vet too. Yonah's watching the program. Oh, there you go. She must be done with her meeting. She says, allow space to be creative and respect each other's opinion and learn to listen. Yes.

Man, that's something. Learn to listen. That is, I will say this publicly, that is a 40-year struggle for me, is listening. It is hard. Really, really hard. And I got to tell you, doing the show has helped. me improve that. Maybe not so much. I think he might disagree with that. But listening is so hard to go ahead and do it.

This comments come in for the feed. Has the fall market started yet with kids back in school? I don't think so. I think we're two weeks away from that. I agree to that same date. The only reason I do that is I do a 7,000. days we go week over week market monitor looked as this very moment 92 are on the market and 86 or so it's not just that it is hard to feel like the fall when it's 100 degrees outside people haven't they haven't the football season it just there's a little shift that you're going to get in about two or three weeks and it's going to be mindset it's about it's outside of

just real estate um You'll see just the kind of overall, everything is going to take a little bit of, you know, a turn better, worse, better, whatever in about two to an half weeks. So working together, the biggest struggle Yonan and I have, and we talked about this on the listening side, and it took us a lot of time and a little bit of therapy to go through that, is for me not to want to fix everything, right? as a guy I just want to fix things, right? You know, and sometimes I just need to listen, which is so bleeping hard, right? So that, you know, that has been my biggest struggle. You know what you should do about that, right?

Shut my hearing aids off. No? No, the joke is, like, whatever you're telling me something, and I'm working on fixing your problems instead of hearing you're out. So the response you always give is you know what you should do about that, right? Yeah. And then we've got a whole language barrier thing, right? A cultural and language barrier thing where as a New Yorker, you know, I kind of do things very differently and I'll hear, well, I could do this. Okay, I'm sorry. So that's the biggest compromise. That's the biggest struggle of me wanting to fix it and do it. And maybe I'm getting better, but we shall. How about this comment?

Is there a financing product type or a line of financing that is upticking for Keith for Scott and Tobas business? And I'll add this. Obviously, we're not in a refinance environment here. Is it new construction that's upticking here?

Or is it all pretty much the same? How's the book of business look? We don't do which one of new construction? We do a lot of resale. I don't know that there's any one thing. thing that maybe more non-QM, more bank statement loans, more non- non-for business owners looking for creative solutions, that's probably what we've seen more growth in over the last six months, six to 12 months even, is for people who are

earning, but then they don't maybe show the government all of what they're earning and just coming up with creative ways to help them buy. Now these people are earners. We're finding more success with non-QM on higher income price points than with, say, lower income price points. I don't know. not to shade the lower demographic, but one, that's going to be a continued pain point is for the entry point buyer. I think your entry point buyer is going to continue to look more like that dual income willing to drive a little further as a purchaser, and your more selective options are going to be people who are going to be business owners, some capacity who may not qualify for conventional financing and neither another solution.

Good answer. I want to talk something in and thanks Jerry for getting my brain brain moving. Something that we are seeing and I've got about four people having this conversation on a listing side and I'd love you guys to take a little bit of dive into this is the thought of people recasting loans. Is there something going on on TikTok right now? I swear to God. I have heard the term recast. In the last two weeks,

and I was in my house project that I'm getting closer and closer to being moved into. If your marriage can survive a renovation, you're in good shape. This is round two. This is renovation, too. So, one of the HVAC guys is on the phone with like one of the other HVAC guys.

And I hear from the basement, him like, You know, I was looking at recasting my mortgage, but then it just resets the term. I'm like, that's not how that works. He's like, oh, I forgot. The guy's upstairs. I'm going to talk to the guy. I got a call from a buddy of mine's dad talking about

recasting the mortgage on a property that I think the son owns at like a 2% rate. I'm like why why are you going that's like free money. Yep. Why are we going to like just either overpay it or go go invest it at something that's going to make you seven years. Give me a high five. Appreciate the emotion. This is too.

This is too. I've had people reach out to me in on in messaging. about it. Like, where is all this recast stuff coming from? Got it. So it's in the marketplace. However it's got in the marketplace, it's in the marketplace. So Tova, do me a favor. Tell people what a recast loan. How you, what this is about, please. So a recast loan is basically you are, you're putting a lump sum towards your current

mortgage and you're re-ameterizing the new loan balance. So let's say you've got $300,000 left to the loan. and you come into an inheritance of $200,000, you can put all that $200,000 towards your loan and re-ameterize it for the remaining term and lower your monthly payment. Yeah, that's essentially. So, and it's usually a minor fee, $1,000, something like that.

So why are these four sellers? I know why, because we had the conversation, but why are these four sellers talking to me about, I'm going to put my house on the market, I'm going to sell it. I'm going to go buy something during that sales process because they have the financial ability to do that.

And then when I sell House A, because House A now is taking more than five seconds to sell, I'm going to dump $200,000 or whatever it is into House B and recast it. Why are these sellers thinking like that right now? Because they've got a bad financial advisor. Yeah, yeah, yeah. I mean, why would you recast your loan

when you can take the $250,000 and drop it into index funds at 8%. Most people are not thinking that way. Most people are not thinking that way. They want to think of their monthly expenses. That is what people are like tunnel vision when it comes to what their monthly expenses are. So these two gentlemen, I sure do appreciate it,

but 98%, and I've made that number up, 98% of buyers care about monthly payment. That's what it's all. about how much how much monthly payment it is there's another thing they could do they could take that 500,000 or 200,000 dump it into another thing but they're going to keep that higher interest rate that higher monthly payment and they can go ahead and dump 500 dollars a month at the principal and cut their 30 year mortgage down to 15 right and and and and do it that way return 50,000 dollars and an 8% return and just basically but jerry i love you and you part

and you park it and leave it is 20. But they don't, but the typical, I love you, but the typical buyer. That's why we have a wealth gap. The typical buyer will not think that way. The typical buyer, and these are sophisticated folks, these are not unsophisticated sellers. When you explain that to them, I said, look, I did spreadsheets. I said, look, if you do this, right, but if you take this and do this here, this is what it is, or if you go ahead and go towards your, by one less,

my latte factor, and your years cut back, instead of having a loan for 30 years, you have a loan for 15 years, and look what you save on your interest and all that stuff. It is inevitably, I just don't want that monthly payment. Here's the only way that it makes sense to me. And this is somebody who wants to literally, and I don't want, you know, I'll have these conversations,

but they are, that wants to grind down, every last cent then let's say this person wants to put down 10% on the original because the 10% pricing prices slightly better they want to save this is to say mind you at a $700,000 loan amount for the people who might be doing this this is going to save you three to five thousand dollars if you want to if three to five thousand dollars is the goal in savings here's how you do it put down 10% you get 50 basis points or maybe a little bit better in pricing so at $700,000 loan amount, that's going to be $3,500-ish dollars, and you're going to take whatever

that better rate is at 50-bips better for 10% down, and you close on a loan. And then you take the remaining, say, 15%, and you recast. The reason that I say 15% is because to remove your mortgage insurance inside of the first 36 months with most of these companies, you have to be at a 75% LTV, not an 80% LTV. So you put the 15% down then, get the property probably appraised again, even though you just had that done,

and you have the MI removed, and you saved yourself around $3,500 to $3,500 in total savings, that's what you do. There you go. That makes perfect sense to me. That's the only way I can. Hold on a a second. Let me get this out. Scott,

you're an effing genius. Jerry, you're an FNG genius. I mean, I don't think that. Tova, what do people care about? A level of stress they can handle. They don't care about the numbers. But they're not thinking about that. People do, people who do not handle money do not think about money the same way that we do because they're not in it on a day-to-day basis.

They're not constantly doing the math and comparing the apples to apples. They are thinking, what is my monthly expense? What do I need to do X, Y, and Z, and to live comfortably? They aren't thinking about 10 years down the road. They're literally thinking about what the rent. I respect that, but if someone just did, if someone just did, say you get it. But you recast a lot because you get a lump sum of money. Is that why you would consider recast?

When you're in a level of stress, when you have the anxiety brain on, because buying a home is stressful. Thinking about that and all of your different options, it's stressful. So when you have this on, you're like, what is my least path of resistance? You're not listening to somebody being like, but if you did this, you could do this. They don't care. They want to do what is least path. resistance that makes their nervous system be like all right we're okay we're fine like this is the people business this is not a we're gonna figure out i mean some people think that way

and they're great but most people most of the population is just what do i need to do to make my nervous system go from here to here gotcha so so i done a 400 000 loan comparison right if you're at 400 000 loan at 6.5 percent your p i forget about your t is roughly 25 500 bucks right if you end up putting 200,000 dollars in that and recasting that your monthly payment goes down to 1200 bucks from and what was the 25 to 1200 it gets cut in half and and in so 1300 a month savings so what did it is it 1200 a month say 1200 a month times 12 I got it is 14,400 what was the what was the nut what was the net what was the net 400 it's a 400 What they did over is 200.

So 200, so 14,400, 200,000 times 0.08 is most conservative return ever in index funds. And 2K more. 80% of people's wealth are in their property. Is there? Yeah, I get that.

But hold on a second. Hold on a second. But there's a second version of this. What if they just leave the loan alone, make the monthly payment and dump $200,000 towards principal, right? They're more mortgage then cuts down to eight years, that 30 years dropped down to eight years. Or if there's a third version of it is you recast, you put your 200 and you pay a couple hundred dollars a month and you can cut it down.

The bottom line is the reason this is popular right now and the reason why these four sellers are talking about it because they want to buy, they know that they have come to the understanding these four sellers that they're paying six and a half percent. That's it. They know they're going to do it. The sellers have now recognized 3% is never coming around. Oh, he's doing math. 6% is never going to come around again, right?

So 3% is never going to come around. I mean, we might not see 6% for a while. But this, what I, my takeaway is I got four sellers that want to be in the market. That want to sell. I don't think recasting is in their best interest personally. But if that's what they want to do, our job, and I'm talking to to Toby here, because our job is help to get them there and explain it. But people live at, it's real simple.

It's $2,500 a month versus $1,200 a month. That's as far as their view is ever going to go. And that's not meaning that these people have master's degrees. They are super intelligent. What's the master's degree in? Then that means they have the capability to learn, and they maybe need to be explained a better way. 100% with Scott Adams.

So hey, Tova, one day maybe you and I will do a show. I appreciate his frankness. I'm the same way. We might be, we might be like. This is why he's bad cop and I'm good cop. Over the top, you know, you know. I am always the bad cop, but we're frank. Why do I always have to be the bad cop?

That's the other real marriage problem we've got in business. I'm always the bad cop, but I want to be the good cop. Here's a good question to close with. Let me get this out if you don't mind. Everybody at this table is not wrong. You guys are right, but not many people think that way. And yes, you can educate them. The problem is you've got to get to a point where, okay, this is what this client wants,

and this is what we need to do, and we need to get this client to a place that they're happy, and you have to disclose, you have to let them know, hey, you know, there's other ways to do this and let them make that decision on their own. This one, why don't we close with this one here? Scott referenced earlier in the show. show that there could be a rate hike one and maybe two later in the year. Does Scott envision a market where rates go higher? If so, how much higher? I mean, it depends on how much the market front runs. I think that we potentially get back into a 7% medium 30 or fixed. That seems

like a likely scenario inside of the next six months. I think if that's two rate hikes. I think if it's one, the market's probably already built that in somewhat, and it's not going to affect rates. But I also had to park like a mile away today because the parking garage is closed, and I've got to run. I've got to be somewhere a little bit.

Absolutely. What's up with that? Absolutely. Such as downtown Shultz. Yeah. Two engineers of the four. Two are engineers, two of them are school and our school teachers. Okay.

Okay. Keith Smith, Scott Morris, Tobin, real talk with Keith Smith, their DMs and their emails and our phone numbers are everywhere on the internet. Very easy for us to reach, for you guys to reach anyone here. And we welcome that. I know Scott, Tova and Keith absolutely do. I'm kind of so-so on that. Judah Wickauer is behind the camera and this show is archive where we get your podcasting and social media content.

So long, everybody. Thanks, guys. That was fun. Thank you. So you think could get...