The Science of Flipping - Renting vs Buying Real Estate In 2022

Episode Date: January 28, 2022

The #1 training and coaching system to launch, grow, and scale your investing business! 𝐋𝐞𝐚𝐫𝐧 𝐌𝐨𝐫𝐞: http://www.thescienceofflipping.com In this episode of The Science of Flipping, Justin Colby shares the Best Tips to Buy or Rent a Home in 2022. Is it possible to leverage your crypto portfolio to buy a home? Justin Colby share his advice to not liquidate your crypto to invest in buying real estate. How do you get a mortgage with Cryptocurrency? By using Milo. Instead of selling your crypto for a down payment to qualify for a mortgage, a crypto mortgage lets you leverage your crypto to invest in real estate. #CryptoRealEstate #Rentingvsbuyingahome #Getamortgagewithcrypto Become a 𝐓𝐒𝐎𝐅 𝐈𝐍𝐒𝐈𝐃𝐄𝐑 and get access to exclusive training and resources: https://insider.thescienceofflipping.com 𝐈𝐍𝐒𝐈𝐃𝐄𝐑𝐒 𝐆𝐄𝐓 𝐅𝐑𝐄𝐄 𝐀𝐂𝐂𝐄𝐒𝐒 𝐓𝐎: ✔️ Science of Flipping Academy   ✔️ All the systems and software I use in my business ✔️ All the tools you need to run your business  ✔️ All my Scripts, Contracts, Spreadsheets ✔️ Special Discounts ✔️ And Much More... 𝐇𝐚𝐯𝐞 𝐚 𝐪𝐮𝐞𝐬𝐭𝐢𝐨𝐧? Get immediately connected with a team member on messenger: http://split.to/tsof-messenger 𝐁𝐞𝐬𝐭 𝐑𝐞𝐬𝐨𝐮𝐫𝐜𝐞𝐬 𝐅𝐨𝐫 𝐖𝐡𝐨𝐥𝐞𝐬𝐚𝐥𝐞𝐫𝐬 ✅ 𝐁𝐞𝐬𝐭 𝐑𝐞𝐚𝐥 𝐄𝐬𝐭𝐚𝐭𝐞 𝐒𝐨𝐟𝐭𝐰𝐚𝐫𝐞: http://bit.ly/tsofsoftware ✅ 𝐁𝐞𝐬𝐭 𝐃𝐫𝐢𝐯𝐢𝐧𝐠 𝐟𝐨𝐫 𝐃𝐨𝐥𝐥𝐚𝐫𝐬 𝐀𝐩𝐩: http://bit.ly/tsofd4d ✅ 𝐁𝐞𝐬𝐭 𝐒𝐤𝐢𝐩 𝐓𝐫𝐚𝐜𝐢𝐧𝐠 𝐒𝐞𝐫𝐯𝐢𝐜𝐞: http://bit.ly/tsofskiptrace ✅ 𝐁𝐞𝐬𝐭 𝐓𝐞𝐱𝐭 𝐁𝐥𝐚𝐬𝐭𝐢𝐧𝐠: http://bit.ly/tsoftext ✅ 𝐁𝐞𝐬𝐭 𝐃𝐢𝐫𝐞𝐜𝐭 𝐌𝐚𝐢𝐥 𝐒𝐞𝐫𝐯𝐢𝐜𝐞:: http://bit.ly/tsofmail ✅ 𝐁𝐞𝐬𝐭 𝐃𝐚𝐭𝐚 𝐏𝐫𝐨𝐯𝐢𝐝𝐞𝐫: http://bit.ly/tsofdata 𝑾𝒉𝒂𝒕 𝒕𝒉𝒆 𝑷𝒓𝒐𝒔 𝑯𝒂𝒗𝒆 𝑻𝒐 𝑺𝒂𝒚 𝑨𝒃𝒐𝒖𝒕 𝑱𝒖𝒔𝒕𝒊𝒏: “Justin is one of the best trainers in this space. He really gives everything to his tribe.” – Brent Daniels (TTP) “Justin’s ability to connect with people and help them understand what he is teaching, is unparallelled” – Kent Clothier (REWW) “We have been in the trenches flipping homes in Phoenix for over a decade, he is one of the best to do it.” – Sean Terry (Flip2Freedom) 𝐀𝐛𝐨𝐮𝐭 𝐉𝐮𝐬𝐭𝐢𝐧: Justin Colby is the founder of The Science of Flipping Podcast and The Science of Flipping Coaching Program and is an active Real Estate investor having flipped over 1500 homes in multiple markets across the U.S. Justin runs an 8-figure real estate wholesaling business that closes 20+ deals each month in multiple markets across the U.S and has helped 1000s of clients learn how to become successful real estate investors. Justin subscribes to the philosophy of "Wholesaling To Wealth" and is the foundation of his coaching program which teaches you how to get started wholesaling or streamline and scale an existing wholesaling business as well as build long term wealth through wholesaling, flipping, and building a rental portfolio. Subscribe To Justin Colby: http://youtube.com/justincolby View All My Videos: https://www.youtube.com/c/JustinColby...

There's blood in the water now, boys and girls. The real estate market is definitely changing real time as we know it. I think most people are well aware that the Fed is increasing interest rates. Well, how does that affect everyone? I'm going to go in a little further here, but I can tell you it's now at 3.5% or so. And the Fed is talking about how it's going to continue to raise the interest rates throughout the year. And you throw in the fact of inflation and the fact that homes have had a double digit

price gain over the last year. You sprinkle on some good old inflation and you have a double-digit home price gains over the last year or so, and it is becoming that much more difficult for most people to be able to buy a home. First American Title actually says that it is roughly 21% more difficult to buy home now than it was just one year ago. This and much more on this episode of the Science Flipping Podcast. There are some cool things I want to talk about. I want to give some thought-provoking ideas for you guys as I am not as doom and gloom as a lot of these reports are going to talk about because I love real estate and I continue to buy rentals for this one reason, which is people are going to need a place to live and rents are

going up. So here's one little savior that a lot of people aren't talking about is there is going to be a push to buy right now. The reason being is most buyers are thinking, well, if the Fed is going to be raising rates, we need to jump in now to get our interest rate as low as possible. So while refinances are down, the Mortgage Bankers Association actually is reporting that mortgage applications are actually up 8% this week. Again, this doesn't really shock me because, you know, if you really think about how the human psyche works, they want a good deal when the deal is good.

And, you know, over the last quite some time, several years or so, the mortgage interest rate has been three or below sub threes. Well, most people were taking that for granted. And now we're having a reckoning and people are thinking, wow, I should have jumped on this a while ago. Let me get going and see what we can do. This is a classic case of FOMO. Last year is, you know, ah, you know, home prices are going to go down. Let me wait. And now all of a sudden they realize they're not. Home prices are continuing to increase and so are interest rates. So that FOMO didn't pay off for those that were waiting around for the market to crash. And now they're trying to jump in, taking advantage of still an increasingly low interest rate. I mean, 3.5% relative to back in 08 or 07 when I bought

my first home, I had a 6% interest rate. And many of you listening to this episode or watching it on YouTube, I'm sure you've had interest rates way higher than six. So FOMO is really kicking in here. Now, as I just mentioned, rents are going up too. Housing right now is just very interesting, right? We are definitely in a space that I don't think we've kind of seen as not only are the interest rates going up, appreciation is going up, and rents are going up. Living at this point, again, inflation, shocker, is just becoming more and more expensive. According to Redfin, rent rates have gone up over 14%. According to Redfin, rents have actually gone up over 14% just in the month of December, which is the highest increase in over two years.

Now, they also report that across the nation, the average rent rate is just under $1,800. For many people, that's going to make renting very, very difficult, which brings us back to if they're going to be spending that much money on rents, should they be buying a home? As I've reported earlier on other YouTube videos and other podcasts, renting a home might be more expensive in roughly 58% of the states than buying a home. Now that has to do with price points, right? Given certain price points that obviously the higher price points that kind of sways a little bit more, but you know, 58% of the country, it is likely cheaper to buy a home than to pay rents. Now here's the really exciting news. As most of you guys know,

cryptocurrency and real estate are two of my loves when it comes to investing. I love to invest in real estate. It is my number one love. It is my main thoroughbred horse, but crypto is creeping up. Now, here's the cool part. Now, the reports are saying that roughly 12% of home buyers now are liquidating some part of their cryptocurrency portfolio to buy a home. I myself liquidated a part of my cryptocurrency portfolio to buy my home in Miami. So I'm very familiar with this practice. In fact, the lender actually had some troubles trying to get it all through because it is a newer practice, obviously a lot more common now. Now the reports of 12% of homebuyers liquidating a portfolio is up a ton relative to roughly only 5% of that pre-pandemic.

Now, here is the super, super cool part that I want you to get fired up about. There is actually a company called Milo that is now allowing you to leverage against your cryptocurrency portfolio, and they will give you a loan for your home. Now, I don't know a whole lot about this yet, but I am going to be doing a deep dive because as someone who literally did liquidate some of my portfolio to buy my home, I would have absolutely rather not liquidate any of it, leverage the portfolio, and then get a loan to buy this home, and I keep intact my portfolio of crypto. That would have been ideal for me. However, this program was not around, but it is super, super cool. Now, this really brings my two worlds together. I've talked a lot about the metaverse recently, which isn't a part of this, but interests me. But I've always been very

interested in crypto and how the two worlds of real estate and crypto are going to merge. Here's the thing. Many people talk about how crypto is an inflation hedge. Well, very difficult for crypto to be an inflation hedge when it tanks about 50% in roughly a week. Now, some might say, well, yeah, look what the real estate market did back in 08 and 09. It did a very similar thing. That is true, but it was a performing asset if you held rentals, right? So you are actually still making revenue as the value of it sank. So there's two different viewpoints here. What I really love is crypto now is getting in the space of actual planet earth real estate and not just the metaverse. So all in all, there's a lot of interesting takeaways right here from

this episode of the science of flipping. First of all, if you have not yet given me a five-star review on iTunes, please do that. I would greatly appreciate it. Also, if you haven't subscribed to my YouTube channel, make sure to get over there. Just go look me up, Justin Colby, or you can youtube.com forward slash Justin Colby, subscribe to that channel. The most interesting takeaway is this whole crypto play. There's already a really long line of applicants who would like to try to leverage their existing cryptos so they can go buy a home. That is an absolute game changer. So many people have been waiting on the sidelines, waiting to buy a home because they think the pricing of homes are going to correct. Now, a lot of people were pointing to the interest rates going up, which we spoke

about earlier, as one of the main reasons for this price correction in real estate. However, it's not happening. You know what else is not happening? There's also no big foreclosure tsunami coming. The data is saying that because of the Fed and the lenders where they are trying to make sure and correct as much as they can so that doesn't happen. In fact, there was a decrease of roughly 8% of foreclosures in December. All in all, guys, I'm very bullish on the real estate market. If you're still going to sit on the sidelines, you're absolutely silly. I have a rule. Follow the money. The money are hedge funds. The hedge funds are buying at an all-time fast rate right now. Why is that? Because they realize

that the best protection against inflation is always going to be real estate. Now you layer in this crypto play and the game is over. Prices are going to continue to go up at an all-time high rate. Now again, I don't know all the facts about this crypto play with Milo or Milo, whatever the company's name is. But listen, if people are able to leverage their crypto and not have to sell it off, people are going to be buying real estate at an all-time fast rate. And what does that mean? Supply and demand. And what does that mean? There'll be little to no supply. Demand will be incredibly high. Pricing is going to continue to increase. Real estate, real estate, real estate will always be the play.

There's a lot more news that I want to get to in further episodes. I appreciate you guys. Hopefully this was thought-provoking at the very least. And again, if you have not given a five-star review on iTunes or subscribed to my YouTube channel, make sure to do so. And I'll talk to you guys on the next episode of the science of flipping peace.