Market Update: 10-16-23 NAR Lawsuit, Special Loan Programs, & Open House Mastery

Mike Mills (00:00:08) - Greetings, Earthlings, and welcome to the Texas Real Estate and Finance Podcast. I'm your host, Mike Mills, a mortgage banker right here in the Dallas-Fort Worth metroplex. Today, I come to you with the latest edition of your real estate market update for the week of October the 16th. The market updates a recent addition to the podcast episode lineup designed to complement my usual interview format. My primary goal is to keep real estate professionals like you well informed about the ever changing landscape of our industry. I love doing interviews, engaging with each one of my guests, and really diving into their brain and experience to grow my own knowledge base, but they often limit our ability to dive into the week's headline news and relevant stories affecting the world of real estate. Look, I love doing interviews, engaging with each one of my guests, and really diving into their brain and experience to grow my own base of knowledge. But they often limit our ability to dive into the week's headlines and relevant stories affecting the world of real estate and finance.

Mike Mills (00:00:59) - But in these more bite sized episodes, lasting about 20 to 30 minutes, I'll ensure you're in the know about the most significant real estate stories at the moment. Additionally, we'll sprinkle in some valuable tidbits of information to assist you along your real estate journey. I trust you'll find this market update both helpful and informative, and if you do, please consider hitting the subscribe button and sharing it with a friend. Your support means the world to me, and it enables me to continue delivering new episodes each and every week. And if you have a topic or story that you want to know more about, please reach out to me and let me know. I always appreciate feedback and would love to hear what you think. My contact information can be found in the show notes. Again, thank you for tuning in and I hope you'll stick around for more valuable insights and updates in the world of real estate. All right, so what are we talking about today? Well, we've got six topics to cover. First, I'll give you a brief rundown of the news stories affecting the real estate market this week.

Mike Mills (00:01:44) - Next, I'll update you on where interest rates stand as of today and where they might be headed. Then we'll dive a little bit deeper into a topic I discussed last week the pending class action lawsuit against the National Association of Realtors, Remax, Keller Williams and Anywhere Real Estate, formerly known as Realogy. If you aren't paying attention to this and you're a realtor or potential buyer or seller of real estate, then you really should start. It looks like it will impact how real estate commissions are paid, by whom and how much. So you don't want to miss this one? Then I'll share a little insight on all the special programs that are out there right now. Helping buyers get into homes for a little less cash out of pocket, and in some cases, a little lower interest rate. You want to be aware of these products to ensure you can help your clients find the most affordable home loan available on the market, I'll give you the seven steps to become an open house Jedi I've picked up over the years, working with some of the best agents in all of Texas.

Mike Mills (00:02:34) - And finally, if you stick around to the very end, I'll show you how you can save your kids $1,800 a year for the rest of their life. So I hope you find this episode helpful and informative. All right, let's start with some news you can use. So inflation everyone's favorite excuse to make everything more expensive these days. The consumer price index came out last week. And on the headline number it came in a little bit higher than we saw last month. Initially, the market had some pretty negative reaction to the news that inflation doesn't seem to be making significant moves downward, giving the fed the desire to stop the rate hikes or at the very least, pausing for a little while. And although the overall numbers came in a little hotter this month, when you dig into the meat of the report, the headline number can seem a little deceiving. So the biggest jump was the overall shelter costs. And this doesn't include people paying their mortgage, but rents and lodging away from home like hotels and Airbnbs and such.

Mike Mills (00:03:23) - Shelter was up 3.7% overall, and it makes up 43% of the overall core inflation number. That strips away food and energy prices. And the deceiving part of this is that the actual shelter figures were only up by 0.7%. These seasonal adjustments are just what some statistician says the number would be if we were in the summer and people were traveling more compared to the month before. Does that make sense? Of course it doesn't. But that's why after a strong negative reaction to the inflation report, the market bounced back a little on Friday. Once people dug into the figures more, they realized that much of the increase was from the seasonal adjustments and not from actual numbers. So go figure. The fed released this meeting notes on Wednesday last week, and all officials agreed that rates should stay restrictive for some time. Meaning if you think they're going to start cutting rates anytime soon, you might want to reset your expectations. As of now, it seems we're in this for the long haul, and a majority of participants agree that they may have to raise rates one more time this year.

Mike Mills (00:04:16) - Fed Chair Jerome Powell acknowledged for the first time that the idea of a soft landing was not the expectation. He's basically saying that a recession is the most likely scenario now. Many wholesale lenders last week raised their conforming loan limits to $750,000, ahead of the expected Fhfa decision coming down next month. The Federal Housing Finance Agency, or Fhfa, determines if it's necessary to adjust the conforming loan limits that conventional loans cannot exceed each year. And with inflation being what it is and the price of homes continuing to climb, over the last several years, we've seen this number increase every single year. The conforming limit for 2023 is currently $726,200 y 200. I have no idea. Also last week, Texas based startups high. 3D and icon are using 3D printing technology to address challenges in the US housing market, including chronic inventory shortages and climate change induced natural disasters. Hi 3D has constructed six homes using 3D printing to tackle the housing inventory issue, while icon is building an entire subdivision of 3D printed homes in Austin. The 3D printing process is faster than traditional construction methods and can use green cement to reduce greenhouse gas emissions.

Mike Mills (00:05:26) - And while sale prices for these 3D printed homes are slightly higher, they are supported by the community and offer a potential solution to the housing challenges. I really was kind of wondering when someone was going to try to start 3D printing houses. I figured it might help reduce costs if they can do it efficiently and quickly. Do you want to live in a 3D computer generated house? I don't know, we'll have to see what the market demands for that. And right now, 420,000 workers in the US are currently on strike, according to Bank of America, and they estimate that 545,000 workers are likely to be on strike by the end of 2023. This would be the most workers on strike since 1983, which also happens to be the last time inflation was a serious issue in this country. Meanwhile, a record 447,000 people now hold two full time jobs in the US. This is maybe why our jobs data is so out of whack. Wage growth just hasn't kept up with inflation, and consumers are starting to feel the pain striking for higher pay or taking on extra jobs to pay the bills.

Mike Mills (00:06:18) - But just keep hiking. Jerome. I guess. Since April of 2020, immigration in the US has increased by 5.3 million people. Rising immigration puts downward pressure on wage growth, since typically immigrants are willing to work the same jobs for less pay. And China's economy is even worse than here in the US, actually much worse. In fact, they've already reached the stimulation phase of trying to fix their economy this year. Already they've cut rates by the most they have since the 2020 pandemic and remove 50% of their stock trade tax. They considered making it illegal to short stocks, had their largest commercial real estate company, filed for chapter 15 bankruptcy and had their second largest real estate company fail to make their debt payments to the central bank this month. They're also already planning on handing out a new round of stimulus money very soon. Listen, things are not good in China right now, so I guess their takeover of the world I keep hearing about is going to have to be put on hold until they can sort out their own mess.

Mike Mills (00:07:10) - Also, live cattle prices, orange juice and sugar have outperformed most hedge funds this year, and many basic commodities are outperforming the S&P 500, meaning the prices for all those things are way up and so are their profits. Look, people aren't going to stop buying food. I guess we might need some quantitative mooing, because I don't think the fed can just print more cows. And it's just another example of prices being higher and commodities investors making a killing on the profit. And guess who's paying for it? Yep, you and me. But let's not call it corporate price gouging. Let's just call it inflation. Oh, and the Federal Reserve says Americans will run out of their excess savings either this month or next month. So there's that too. Well, there's the news you can use for the week. All right. Moving along now, are you looking to spin on that credit card, buy a new house or a newer used car? Well, you might want to think a little more on that.

Mike Mills (00:07:56) - Good news is, checking and savings accounts are now offering 4 to 5% interest for letting the bank just hold your money now, not chase Bank of America or Wells Fargo, but find any small bank out there and you can earn interest if you'll just allow them to hold your money. First time we've seen this as a market staple in decades. If your money is not sitting in account that's earning you interest, then you need to get one as soon as possible. It's the best way to earn a return on your money right now and keep it safe. But if you want to buy a car, well, new car rates are around 6% right now. If you have good credit, if you have bad credit, it's closer to 14%. And if you want to buy a used car, it's around 7% with good credit and closer to 21% with bad credit. Credit card Apr are averaging 20% for the first time in history, so be careful charging stuff up a $10,000 running balance on a credit card will cost you a little more than $200 a month.

Mike Mills (00:08:49) - Right now, that's half a trip to the grocery store, right? The average interest rate on a 30 year mortgage rose to 7.95% last week. It's the highest level since 2000. And because of this, mortgage demand fell to its lowest level since 1995. But guess that isn't so terrible considering the cost to use other types of debt to buy things, right? Look, just trying to be a little positive here. Moral of the story is debt is a heavy burden right now. Cars depreciate in value. Charging on credit cards will drive you to the poorhouse really quickly with no return on that debt. But you can at least get some of it back, holding your money in an interest bearing savings account, which is available these days. Look, mortgage rates are high, but at least that asset will appreciate in value while you own it. And the last ten years alone, home values have gone up 80%. When you factor out inflation and just look at real dollars 80%, that's not too shabby of an investment from the point of view of a mortgage guy, of course, but it seems unreal.

Mike Mills (00:09:43) - But it isn't. Okay, let's get into the meat of what we're going to be talking about today, which is the lawsuit update. The first half of 2023 saw over 60,000 realtors leave the industry. And with the latest news regarding the National Association of Realtors class action lawsuits, you might be seeing even more changing careers in. A very near future. So in case you aren't familiar with what's going on, here's a quick summary of what's been happening. The main issue the lawsuit is claiming, is that Nar rules violate antitrust laws and inflate the fees paid to buyers agents by requiring a listing agent to compensate a buyer's agent for listing a property in the MLS, Na's position is, or at least was, that the lawsuit misrepresents the association's rules as anti-competitive, and last week there were some fairly significant updates. Remax has already settled for $55 million to be paid to the plaintiffs in the case, or really mostly to the plaintiffs lawyers, with just a few hundred dollars being awarded to each member of the lawsuit now anyway.

Mike Mills (00:10:37) - Real estate, formerly Realogy and made up of Coldwell Banker and Sotheby's, has also agreed to pay $83.5 million as a settlement as well. Now, along with these cash payouts, the settlement also includes stipulations that brokerages no longer require agents to be members of the National Association of Realtors or follow Na's Code of Ethics or the MLS Handbook. The settlement agreements also contain changes in practice that firms will require or encourage agents to make it clear to clients that commissions are negotiable, that agents have the freedom to set or negotiate commissions as they see fit, and that agents will not be required to make offers of compensation or accept offers a compensation from cooperating brokers. But right now, Nar rules say that it has to offer at least $1 in compensation, so changing that to $0 is a minimum. Seems like a minor adjustment, and brokers will not filter or restrict listings based on the level of compensation being offered. Some feel these changes are a positive sign compared to the other potential outcomes in this lawsuit, as the terms are reasonable and doable without huge changes to the practice of real estate professionals, and that these terms just tend to focus more on transparency for consumers rather than wholesale changes in how the market operates.

Mike Mills (00:11:45) - And even though these brokerages also now no longer require Nar memberships for their agents, many agents will still need to maintain their realtor association memberships in order to gain access to the local MLS. And now, since earlier last week, Nar agreed to make changes to its compensation policy, allowing listing brokers to offer $0 in commission. This could very possibly lead to future class action lawsuits against Nar and other brokerages not currently being mentioned in litigation. Already, a third class action lawsuit is being filed in Boston against Keller Williams, Remax and HomeServices of America and Bright MLS, the nation's second largest MLS, covering Delaware, Maryland, new Jersey, Pennsylvania, Virginia, West Virginia and Washington, DC, is now allowing members to offer a blanket compensation of $0 or more. So what does all this mean to you as a realtor or even a potential buyer or seller? Well, that remains to be seen. We still have a lot of potential lawsuits that could be filed soon, and many consumer advocacy groups do not feel that the settlements have gone far enough.

Mike Mills (00:12:43) - Well, what does that mean? I don't know, we're just going to have to see. But in my personal opinion, I don't feel ultimately that this will be a good thing for our industry. You see, there are several people out there that feel that many of the fintech real estate companies like Zillow, Redfin and Open Door are behind the funding and promotion of many of these suits. And if you have large brokerages that cannot afford to continue to operate due to large legal costs, you start to shrink the pool of agents out there willing to represent buyers for smaller to no commissions. You see, what's lost in all this is as a buyer's agent, all the time and effort that you spend with a client on showing homes, negotiating with sellers and sellers agents is going to become extremely devalued. Think about it like this what happens when rates come back down again, even slightly, and we get back to a competitive market for listings that are continuing to dwindle in supply. In this case, if a home has multiple offers, the buyer and the buyer's agent that is willing to lower commissions, pay the buyer's agent, commission themselves, or even dump the buyer's agent altogether is going to have a significant advantage in getting their offer accepted, and a buyer's agent that has this happen to them more than a few times is eventually going to stop representing buyers and just go after sellers.

Mike Mills (00:13:54) - Then where does that put our buyers and their representation in the transaction? Who helps buyers understand their rights and outs in the contract when things start to sour, or the house isn't what they thought it was when they initially got under contract. Certainly not the agent that they just dumped in order to get their offer accepted. Now, in Texas, there is a clause in the buyer rep agreement stating that if the seller doesn't pay the buyer's commission, that the buyer is responsible for this. But real estate is a referral and relationship based business, and if it means your friend or client cannot get their home of their dreams unless they pay your full commission, what is it really going to do in that situation now? I'm sure some might demand to be paid if they go under contract on that house, but many will decide to let their friend win the offer and hope they can get paid on the next deal. But how long does that last? How many times will they agree to forego getting paid for work already done to save a relationship before they just stop representing buyers altogether? And then what ultimately happens to buyers and their interests in the real estate transaction, when the only person being represented by a professional watching out for their interests is the seller? This stuff won't happen overnight, but it will slowly to begin.

Mike Mills (00:14:59) - Begin to erode a system that has been in place and working for 100 years. And the winners in this erosion of the current system are the AI buyers of the world. Because once agents are out of the way, where does a buyer go to find a home and write contracts that no one is willing to represent them on? Zillow will surely help you out. I know on the surface this may look like a small thing or even small changes, but just the fact that brokerages and Nar are already having to make concessions on this might very well start the ball rolling down a hill that no one in the industry is going to be able to stop. But I really, really hope I'm wrong. All right, let's move on to mortgages now. So rates are high, prices are high. But did you know that there are all kinds of special programs popping up in the mortgage space for people struggling to make the numbers work? Okay, now let's be clear. There are mostly only five types of mortgages that you can get to purchase a home in the United States, you can use FHA, VA, USDA, conventional, and jumbo.

Mike Mills (00:15:52) - Anything that doesn't fall into those five categories is something that we call non QM bank statement loans, DSR loans, asset depletion loans, just any type of loan that doesn't fit in the box. But if you're doing one of those loans, you're not getting a better deal. So the idea is that you want to stay within the power five, FHA, VA, USDA, conventional, and jumbo because that's the place that you're going to get the best deal possible. Now, just to be clear, there is no such thing as a first time homebuyer loan or first time homebuyer incentives. And many people will say, well, Mike, what about all those special programs out there that I see on the internet offering special rates to teachers and police officers and EMTs and local heroes in the area? Well, this is a program that a lot of banks have modeled after, and it used to be something called homes for heroes. Now, this was offered years ago. The homes for heroes program was set up to where you could purchase a house basically at half price.

Mike Mills (00:16:45) - And then if you lived in the house over five years, the second part of that purchase price would basically be forgiven. The issue with this particular loan program was that it was only on homes that had been sitting as listings for a long period of time, and you couldn't apply this program to any home. It was only for homes in certain neighborhoods. And you can imagine what those neighborhoods were like. What they're trying to do with that program is they're trying to revitalize down trending neighborhoods. And the idea was at the time that there were a lot of listings available on the market. And when you have a glut of listings available, you need to come up with incentives to encourage people to purchase houses in areas that are not deemed as desirable as other parts of town. And that program was great. And if it applied to you, and you could find a house in an area that you felt comfortable living in, it was a great way to get a house at a really reduced price, especially for those people most deserving in our area.

Mike Mills (00:17:35) - But since then, you've seen banks pop up all over the place with special programs called homes for heroes, because they're piggybacking on the success of that program from years ago. And these days, because listings are way down, you don't see programs like that available because there isn't a need for it. Now, what there is a need for in the market are special programs available to buyers that help them get cash in order to put down for their house or pay the closing costs. But everything comes with a trade off. And in most cases, when you're getting a special program where you're getting money to put towards your down payment or your closing costs, it comes with higher interest rates. If you're going to get cash, you're going to pay a higher rate. If you're going to get a lower rate, you're going to pay more in cash. And in some cases, you don't have to trade a much higher rate for the cash. But you can't make too much income for your area or you don't qualify.

Mike Mills (00:18:24) - And in most cases, if you want to refinance that loan in less than 5 or 10 years, you have to pay all that money back. But right now, there are more and more options out there for buyers who don't have a ton of cash. You see, when banks are struggling to get loans, they're looking for more creative ways to offer better financing terms. But be aware that many of these programs come with a catch, and are mostly used to get you to pick up the phone and call. It's called marketing, but there are a few programs available that could help you accomplish your goals. The Southeast Texas Housing Corporation, called Seth, offers down payment assistance. They have higher rates. If the rate 7.5%, you might pay 8.5%, but they can give you anywhere between 3 to 5% of your purchase price to apply towards your down payment closing costs. And there are other organizations out there that offer similar terms as well. The Texas Department of Housing and Community Affairs, or TD. HCA is a government site that has all kinds of down payment assistance programs available on there as well.

Mike Mills (00:19:16) - The Texas State Affordable Housing Corporation, or T shack, is a nonprofit program that, again, offers higher rates with down payment assistance. But again, many of these programs come with a clawback period, which states, if you refinance or pay off that loan in a 5 to 10 year window, you have to pay all or at least some of that money back. And there are individual banks that have special programs that they offer internally that are usually sponsored by Freddie Mac or Fannie Mae. For example, at my bank, we have a 1% down Fannie Mae option that does not require mortgage insurance. Now, this is a special program offered for a limited time. And if your income exceeds the average, the average income in the area, then you don't qualify for that particular program. And there's also something called Community Re-invest. Loans. So if you look at big, large banks like Bank of America, Wells Fargo or Chase, they will sometimes drop interest rates dramatically in order to lend a certain aspects of their community because they require to, by law, in order to be an FDIC insured bank, there's a certain allocation of money every year that you have to offer to certain segments of the population to ensure fair housing across the board, and every individual bank has programs like this that you can fit into.

Mike Mills (00:20:25) - But just be aware, it's often just chumming the water to get the phone to ring because you don't qualify for that particular type of program because your income is too high, or the purchase price is too high, or you just don't really like the terms of the loan. I'm not telling you any of this to try to burst your bubble, but what I am saying to realtors and potential buyers listening to this is that you need to ask questions like, what's the program rate compared to the market rate? I have personally seen some recently that do have better rates. Is there a clawback period in which I have to pay the money back? If I sell a refinance, are there income limits, you might ask? Why would they offer it to me if I if I didn't qualify? Well, it all depends on how much the low understands about the program and how the income is calculated. If you're borderline on the income and it's household income and not application income, and your kid has a part time job, it may not qualify you for it.

Mike Mills (00:21:11) - Ask them if there's any restriction on the size of the loan or the location of the home. You see, here's the truth about the special loan programs. There are a lot out there that can help a certain segment of the population purchase a home that otherwise they would not be able to. And if it means taking a higher interest rate and a higher payment in order to be able to start owning your own home and getting out of the rent race, then I say go for it. Start building equity and stop throwing money away in someone else's property. You see, many buyers do not fit in the box, especially these days, with home prices being so much that the income needed to afford a starter home is often much more than is allowed by these programs. So talk to a good mortgage professional that understands all of these programs so you can pick the right one that makes the most sense, or just go the traditional FHA, VA conventional jumbo USDA loan route. All right. Are you ready to become an open house Jedi? We're all aware of how slow the market has become, and finding deals feels like searching for a needle in a haystack.

Mike Mills (00:22:06) - But did you know that even in such times, open houses can be your secret weapon to not only generate business, but also set yourself up as the premier agent in that neighborhood? In my 13 years as a branch manager, I've unlocked the playbook used by the industry's top performers to hosting game changing open houses. If you're ready to turn the tide in your favor, stay with me as I walk you through seven transformative steps to master the art of open houses and become the go to agent in your area. All right, let's start with preparation. Before the day the open house begins. Number one plan for dollars. Open houses can be a great way to prospect potential buyers. If you don't like cold calling or making videos and posting on social media, but you have to be consistent with it and become a master at the process. So block time in your calendar each week to host an open house, and you don't need to be limited to just one. There isn't a rule that says you cannot host open houses during the week, especially for homes that are vacant.

Mike Mills (00:22:58) - Buyers don't just look at homes on the weekends. Plan to block out 3 to 4 hours per open house. It seems longer than normal, but I'll explain why and write out this entire process. Primarily because you never want to skip a step and it will be cemented in your brain once it's written out. And if you ever add a team member and they want to start hosting open houses for you, they aren't having to recreate the wheel. You created the perfect process already. Number two become an expert. Know the local schools, grocery stores and points of interest. Example bars if you're in a downtown area, parks if you're in a residential neighborhood, study the area specifics so you can speak confidently about it. When people come through the door, be the expert on the property. Familiarize yourself with details like when the roof was replaced and when the Hvac was installed. Figure out what kind of payment it would take to live in this house, and how much money they would need to buy it. Call your preferred lender in advance and ask them for payment estimates on the house.

Mike Mills (00:23:53) - You see, buyers make emotional decisions on the spot. They may not decide to write a contract right that minute, but they may make up in their mind that this is the house for them right then, and inform your lender you might be sending clients their way the day of the open house, so be ready. Number three make your open house go viral. No one's going to come to your open house if they don't know that you're having it. According to one of the most successful agents I know at hosting open houses, there are three ways to make people aware of your open house online promotion, neighborhood promotion and signs. Signs everywhere. Their signs. So online promotion. Post your open house on MLS, Facebook, Instagram, heck even TikTok it if you want. Facebook groups are a great place to promote as well. There are specific groups for not only real estate and open houses, but also for that neighborhood you're in. And speaking of neighborhoods, the best place to find nosy neighbors is on the next door site.

Mike Mills (00:24:41) - It's a great place to post your open houses also. And speaking of nosy neighbors, the day before your open house, walk the neighborhood and invite each and every neighbor to attend a neighborhood only exclusive pre showing. If you're hosting your open house from 2 to 4 p.m., then let the neighbors come over at 1 p.m.. To preview before anyone else can let them pick their neighbors. It's just another great way to network with the neighborhood in a very friendly, helpful way. Number three signs, signs, signs. From what I understand from the open house experts, you can never have too many signs. One agent I know puts out anywhere between 25 to 35 signs each time in every possible spot you can imagine, with arrows leading all the way back to your front door. Featuring a massive cluster of obnoxious balloons tied to your main sign out front, get every person driving the neighborhood to wonder what's going on, and show everyone in the neighborhood that if they want to sell their home, no one's going to work harder or make a bigger spectacle than you.

Mike Mills (00:25:40) - Number four dominate the data you have prepared for this moment. You've planned everything perfectly, and you know everything there is to know about this house inside and out. And you promoted yourself like Don King at a price fight. None of that matters if you don't harvest the fruits of your labor. And the harvest is the data. Every person that walks in there is a contact that needs to get into your database for future marketing. Whether they buy a home today or six months from now, they will buy someday and you need to work into their consciousness with all your advertising. Use a QR code, use a sign in sheet or whatever you're comfortable with. I do recommend the QR code sign in because they can scan it. They can get all the details about the house and you get their email. It's a win win all in one shot. But no matter the method, the primary goal is to get contact information for every human that walks in the door. Make it feel like home. Home's not a place, it's a feeling, and your job is to make that place feel like home.

Mike Mills (00:26:36) - Every person that walks through that door has to want to live there and imagine themselves and the life they could have living in that house. Set the tone with upbeat music. Bring your diffuser and mix lavender and eucalyptus or citrus for a more energetic smell, at least so my wife says. At least snacks, drinks and a hub like the kitchen make everyone feel at home. Number six get one rock solid appointment. Engage with visitors as they come in and figure out really quick this person's potential for being a future appointment. If you find a person that has potential, regardless of who else walks in the door, stay with that potential client until you get an appointment set or they give you an indication that they aren't the appointment you thought they could be. Only talk to one person at a time and dive into their questions and discussion points until you either set the appointment or determine that they aren't the one, and then move on to the next one. But your job, after all this work, is to get one person to talk to you again, whether that be after the open house or in the next day or so.

Mike Mills (00:27:32) - And if you meet someone and they're looking at homes and they want to see something, then if I were you, I shut the open house down and go show that house again. The goal is to get the data, but the main goal of the day is to get one appointment. And once you get it, take it. Don't let the inspiration of someone looking to buy today get delayed until tomorrow. Life happens and they may not be in the same headspace tomorrow. And number seven follow up the day is done. You killed it. You got tons of data and you set one appointment. Now it's time to put that data to use. Follow up with everyone who came to the open house. Send them a thank you for stopping by. You can mail it, you can text it. You can call and speak to them or send them a personalized video text. So you leave a lasting impression. But follow up and thank them and ask them if they have any questions or need any other details about the house, or if you can help them in any other way.

Mike Mills (00:28:19) - They gave you their contact information. This is your permission to reach out and say thank you. There you got it. The seven Steps to Becoming an open House Jedi Master. If you're going to spend your weekends and time hosting one, you might as well make every second count. All right, last but not least, you want to help your kids save $1,800 a year for the rest of their life. Well, recently, a study compiled by Forbes, The New York Times, and Time magazine found that only 57% of American adults are financially literate. 73% of teenagers say they want more personal finance education, and Americans lose an average of $1,800 annually due to financial illiteracy. Yes, $1,800 a year. Do you know what $1,800 a year invested in a 5% interest bearing savings account compounds to over 50 years? It's almost half $1 million. So educating your kids on money and all things finances could be worth almost half $1 million over their lifetime. Just the education alone. Not to mention what they can do with that education.

Mike Mills (00:29:18) - And one way I found to start this process at a very young age is an app called Busy Kid. Now, busy kid is not paying me to say this, although if they hear this and want to start, I'm all for it. But seriously, I've been using busy kid with my family for almost five years now. My kids are 13 and 15 years old. What Busy kid does is it allows you to create chores and assign value to each chore. Each week, your kids go into the app on the phone or iPad and mark the chores they complete. And every Friday, payday hits and the funds get deducted from your account into their busy kid account. They can allocate percentages of their allowance to go to spending, savings, or investing. They even offer a debit card that isn't tied to your account so you don't have to worry about. Drafts, or getting lost and giving a stranger access to all your money. You see, when my kids were little, I started with basic things like brushing their teeth, making their beds, doing homework, etcetera, things that they were doing already to get them in the habit of completing tasks and getting small rewards for it.

Mike Mills (00:30:11) - This way they were always earning their allowance, and they had their own money to spend on things they wanted, instead of mom and dad being the bank for all things. And this means they have to start making decisions early on how to spend the money, the costs of things, and what it means to kind of have a job. Now, as my kids got older, the chores got harder, but also worth more money. In the beginning, they might have only gotten $0.25 a day for brushing their teeth if they marked it in the app, which was another lesson, because if they weren't responsible enough to remember to mark what they did, then they didn't get paid. But then as they got older and could do the dishes, feed the animals, take out the trash, mow the yard, etcetera, the pay for those items was more so. You teach good habits revolving around money early, and just begin to build a basic understanding and have conversations around it. We seem to put a lot of responsibility on schools for educating our kids, and therefore a lot of the blame when they aren't well versed in a particular topic.

Mike Mills (00:31:02) - But I think this all starts at home. It's our job as parents to talk about money and not make it such a mystery. Money drives the world whether you like it or not, and we do our kids a disservice to not spend a good amount of time learning about the thing that we all chase in adulthood. And Busy Kid is a great tool to get that conversation started, and it's a great. Kenny Powers once said, money doesn't buy happiness, but money does buy jet skis. And have you ever seen anyone unhappy on a jet ski? I didn't think so. Well guys, that's all for this week. Again, I'm still working on getting the process down of publishing this, but I believe my plan is starting. Next week will be to publish this weekly market update every Monday, and then publish my interviews on Friday. But I'm still working out the kinks, so I appreciate you guys sticking around to the end and continuing to tune in each week. I cannot thank you enough for your incredibly valuable time and attention.

Mike Mills (00:31:49) - Be sure to check out my interview from last week's podcast, out tomorrow with Michelle Jung, an affordable housing advocate. We dive into the housing affordability crisis, how we got here, who's responsible and how we can claw our way back out. And later this week, I interview Sue Buswell. She's a credit expert, so if you're interested in learning on how to maximize your credit to its full potential for yourself or your clients, you won't want to miss this one. I hope you all have a great week and continue to be great humans. I'll see you next time.