Why You Should Try and Buy a Home in 2026

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1:05some of you out there and we're certainly piss off a lot of the doomers. We're going to talk about why you, yes, you should try and buy a home in 2026. Don't know if you've seen the numbers, Matt. I'm sure you have but record low demand supply is growing. The world is ending real estate will never be the same ever but why? Why will the smart people try and buy a property this year? What say you? Well, I mean, you know, it's same as COVID. COVID took me to a whole new level of wealth and it wasn't because it was the easy path. It was the much harder path. How many people were telling you we're all screwed? Don't buy anything in COVID. Don't buy a house. Don't like. We are screwed. No one's going to pay their rent. Society's going to flip on a 10. We're entitled. Well, lots of people. I had several people almost laughing at me. Yes, right? Because I had this channel, right? 2018.

2:06You know, let's just round numbers up to 200 units. Lot of haters out there and I don't know, probably 30% of my comments were people telling me I'm going to go bankrupt and go get a job. So yeah, I had a lot of nasty comments. The only answer that I had for everybody was what does your $100,000 a year job do to qualify you to have an opinion on my wealth? Well, I got to tell you, I mean, I still remember the morning. It was probably a week after the economy shut down. I woke up in a panic. So I set up a whole new communication structure with my team. I got daily reports. Because again, we could survive. I think we did the math one time. We could have survived it like 30 or 33% non-payment. But if it got to 50% that would have been a problem. And again, it was my first pandemic. I didn't know what was coming. Sure. I didn't know what the government was going to do. But I remember being scared for probably, I like actually scared probably for two weeks until I kind of saw what was happening around to some like, oh, all right, they're just

3:08going to print it because $Zillion. And this is going to be nothing. $Zillion. You know, kind of just watching the scenario, right? Watching the scenario and just saying, you know what, the government's not going to let the economy fail. We are still the best investment option anywhere in the world. And for those who are like, wow, China growth. Well, hey, dude, communist country, enjoy not getting your return back. There's a lot of problems with investing in China. There are a ton of problems. And it's only people that only return of capital is more important than return on capital. It's exactly, perfectly said. So and people just don't know that, right? Because they haven't been investing high enough to understand that literally companies have disappeared overnight. Capital has disappeared overnight in your cook. So why am I buying a house today? Who incidentally, Michael, I am spending the most money I have ever spent buying a house this month. Yeah. Most I've ever.

4:09So I want to talk about that. Because again, I think a lot of people see the headlines. I think more and more people are realizing the crash bros and crash sisters are just out for themselves. So I think they're going to disappear, which couldn't happen to a more evil set of people. But still, you know, you got realtor.com and Zillow and these trusted publications talking about, you know, growing inventory record low demand. And I just try to tell investors, right, are people. And frankly, you could be a home buyer and think this way too. But when I hear growing supply, record low demand, all I can do is smile. That's all I can do. I'm like, time to go hunting. Yeah, I want to get super popular, walk into a room with a pre approval letter for any amount. I can buy whatever I want here who wants to talk to me. Really incident approval. I think the key is is that, you know, I am a countercyclical investor. Yes. When everybody was running out the door and everybody had their hair on fire, I was batting down the hatches and going, OK, I know exactly what's out there and available.

5:12I know exactly how much it is. I know what my debt acquisition costs are. And I said so. And for me, it was I'm, I'm too emotionless to use my emotions to figure it out. And so I just said, OK, math. Let's use math. If a house is worth $500,000 with a 7% mortgage, how much is that house worth with a 3 and a half percent mortgage? You don't know how to know exactly, but I can tell you it's a lot more. It's a lot more. And certainly, yeah, certainly if you're buying it for cash flow, absolutely. Yeah, but we did was we took, we took the opportunity. We were the we were the counter party to fear. Yes. Everybody else is afraid. Everybody else is scared. And I said, no, it's math. It's math. And you know what? If I blow up, I got bad news. You guys blow up way before me. Exactly. Because we've got, because we specifically had been putting cash away for such an event. And we knew also it gave us not just favorability in the market for buying.

6:14Give us favorability with the banks. The banks are like, you're still doing transactions. And I'm like, yeah, they're like, well, we're still trying to do transactions, but it's really hard. I was like, I'm here to make it easy. Just let me buy whatever I want. And so that's what we over the course of a nine months, we actually went through or six months actually six months. We went through and refied every single property in our portfolio that we had acquired more than eight years ago. Oh, yeah. Seven years ago. Yeah, it might have been four years for us. Yeah. Every. We took our average, our average debt structure. And again, we'll get back to 2026, we'll close on COVID. But I think we took our average debt structure from what we'll call it six and a half. Yeah, to sub five for sure. Yes. Yeah. Right. Yeah, we were four. We got to cross it four. Yeah. Good for you. Good for you. So again, let's get back to right now. Again, it's recording this on September 8th of 2026. I've told people the last six months of the year are going to be the roughest of this cycle. Which again, if you're looking at transactions, it's going to be rough, right?

7:17Again, demand is low, supply is growing. This is where investors go hunting. And not to, you know, let's give Cody Davis some love here. He just put a 45 unit property under contract, actually under contract, nine percent down. First bank is coming in for 65%. The seller's taking back 25%. And he got the seller to take back the 25% at zero percent interest. So his blended interest rate has a forehandle. I was going to say, yep. On a 45 unit building, put a nine percent down total, plus he's getting some credits and whatnot. But this is, this is the time where investors can get deals of a lifetime. It's because they're the, we're the only people buying. It's good to see that he changed his mind that smaller was better. Oh, he is definitely on the, let's sell the three's and six's and let's go. Yes. Hey, listen, this is what it is. It's monopoly. This is what it is. It is. You get into the assets that are working that you can invest in that you can create equity and

8:21that you can create cash flow in. And then when the awesome opportunity comes up for a deal like this, we can get a beautiful blended. You know, we did that deal two years ago where we got a blended of like 4.25. Rates were at seven. And we had to get them basically at zero. We were just above a point. You know, so we got blended rated a little over four. It was the most, I mean, just gorgeous financing. But those are the deals that get creative. But for me, I just don't like them being a whole, my whole portfolio. I like being able to kind of diversify my risk. And that is not necessarily just asset based. It's asset based. It's tenant based. It's, it's bank based. If you look at our portfolio, you're just like, you don't use one bank for everything. No, I don't. No, I use four. I use four banks. You know, and so that's the powerful thing. Do you have one typical tenant profile? Nope. I have six of them. What? You know, and that's what people don't understand is that you get diversification

9:21in the assets and how you approach it. Do you have the same type of buildings? No, I have four different types of buildings. Small, Rezzy, large, Rezzy, mixed juice, and commercial. So I got four different types. So that always shows me that there's a part of the business that's surging. There's a part of the business that will lag. How much will the lag lag? How much will the surge surge? And then there's two that are usually plateaued. So all that's good. But that's why I'm buying a house today is because something in someone's market works. Something works. I just want people to realize that when you have, because again, the headlines will read Rezzyn's supply record load demand. But what is not said there is actually the most important thing. And why I want people to get aggressive and greedy. It's because motivated sellers will be easier to find. than any time in the last 12 years. In COVID, when rates were 2%, trust me, motivated sellers absolutely existed. But you can never find them because they put a sign in the yard and the head 17 offers.

10:23That's right. Today with low demand, you can find them and you can take your time and you can follow up and you can get aggressive and you can get seller financing. And all of these things happen when there's less demand and more motivated sellers. So talk about the deal you're putting together. I'm sure you're not paying more than you've ever paid because the deal sucks. You know, what is it? It's a unique deal. It's one of the things that I always teach people to look for, which is the big thing about ADUs is I've been buying multiple buildings on the same lot for years. When land's expensive and it's hard to come by, people try and leverage land and get the most out of it. The biggest yield out of the land that they possibly can. So yield isn't just about finance and return. Yield is about return on the land that you have there. Yep. So this particular asset's very unique. It's a duplex five bed one bath on each side. It's a single family five bed. It's a quadplex with two twos and two ones. Oh, and it's an ADU in the back with yard.

11:24It's a two bedroom one and a half bath. You can have six rental units there. Eight eight. Jesus wow. Okay. Yeah, eight. So eight rental units on the same piece of land. That deal is just under two million bucks. So I'm paying about to a little between two and two fifty a door. And the returns there are going to be spectacular. The person that's on the go ahead. Yeah, no, I was going to say what kind of what kind of loan structure you're getting? I just typically just 25% down 75% bank or what are we doing? Yeah, so great question. So we couldn't do any seller financing on this. The way that their debt was currently structured. Because I don't just look at the guy who's got to get rid of an asset. I look at the big guy who wants to make moves and says this asset is an awesome for me. It doesn't super perform. I don't have a ton in this area. Like know the people that you're buying from. This guy doesn't have a bunch of assets in the area. This guy doesn't do a bunch of work in this area.

12:25This guy, no, I know. It's the odd ball. Yeah, I know he wants to go do bigger and better things somewhere else. I am more than happy to help him participate in that. So the thing for us is it's going to be, so this is the other thing too. I went to the bank and I said, I know that with where things are today in the economy and the market, I know that you'd like to see 25% down. Well, 25% down of, you know, call it a couple million bucks. It's a half million dollars. That's a big check. That's a big check. So anything I can get shaved off of that is good. So I got them down to 20%. Okay. Which means I saved a hundred grand. Yep. Now that hundred grand allows me to improve the property over the next six to 12 months. I like it. And vastly increase rents on units that go vacant. There's a number of leases. So there's a couple that we know where that their people are going by the wayside. This guy had a couple of employees in a couple of units. He's like, you don't care if you lose them. I said, nope, don't care. He goes, I can give them another place just as easily.

13:26I said, I don't care. I don't mind you losing them. Yep. So we'll be able to go in, spend a hundred grand. And we'll probably take, we'll probably take gross rents up. I would guess at least 10% if not 15, if not 15 or 20. So let's tell people how it was this deal just MLS base. Was this a realtor network thing? I mean, how did you find it? MLS based. No deals in the MLS, Matt. Didn't you hear? Ever. So I've heard. But I saw what my competition was. My competition was a lot of dreamers, a lot of one of these. This is where relationships matter. I know the listing agent. I've had a number of conversations with him over the last five to seven years. He's mostly wrong on everything. And it's fine. I still like him. I think he's hilarious. But more importantly, I know he's a hard worker and he's a deal maker. So they hired the right guy to get this deal sold because it was going to have some hair on it. Yeah. I'm sure. My broker's awesome. He's got a good relationship with him. But all of it was relationship because when he said

14:28listen, we're going to get multiple offers. Do you guys really want this place? We're like, yeah, we'll be we'll be your easiest buyer. We'll be your easiest buyer. Everybody can go best in the final. But we're going to be your easiest buyer. We have nothing to sell. Yep. We have no contingencies. We have approval from the bank. And I said, if you let me spend three hours going through everything myself with no inspector, I'll go through it myself. And I said, it's just going to be past fail. And I already know of these seven issues. So the only thing that I'm looking for is something big. And there was there was nothing big there that wasn't already on my list. Okay. All right. So what what you know, let's talk about again, 2026 right now, why people should be aggressive. Even if I mean, let's flip the script, you and I are investors first, no, no doubt. But I want to talk to the FHA and VA buyers to the oh my. I think I think they should be extra aggressive because again, in a market where demand picks up, they're ignored. Yes. It is perceived that they are harder and take longer to close. Now, I don't think that's true in reality, but perception is reality sometimes.

15:32So if you have an FHA buyer, VA buyer, and you've been sitting on the sidelines, you're getting your teeth kicked in from cash buyers like you and me. Shouldn't they be aggressive right now? Same deal. Right offers disrespectful. Go for the credits. All that. Shouldn't they get aggressive when everyone else winners run to the fire when everybody else is running for the exits. That's what happens. And so you weren't getting listened to for two or three years and you did nothing but bitch about it and maybe even gave up. Right. Well, now's the time to get the boots on. Let's get the boots on. Let's get elbows and knees deep. Let's get into it. Let's start making aggressive offers on a lot of these different places. They're now far more than likely ready to listen to you and just see. You'll at least get a counter, right? Exactly. Well, in FHA and VA buyers, the buyers aren't the bitch. The program is the bitch. The program, that program sucks. And the reason why it sucks is because they will fail a house on some of the silliest dumbest reasons I've ever seen. Meaning the inspections. Yeah, the inspection side. Yep. Yep, the inspection side.

16:33Like, they'll fail the roof. No, like, but it's not leaking. Well, yeah, but you can tell it's got some curled up shingles. Okay, it's got four curled up shingles. Like, we're going to fail of $500,000 purchase for $19 worth of shingles in time. Yeah, when people need to realize what Matt's talking about here, this is why people perceive FHA and VA to be more difficult and more time. It's just the certainty of closing or the cost expected are really not known until the inspection. Because again, FHA high, high leverage loans. So they're trying to do their best to make sure the quality is at par. So that's what he's talking about. Yep, absolutely. And so, yeah, you were getting ignored. Well, now's the time. Now's the time. And again, get aggressive, right? Well, when they think it's a good time again, all of us are going to be out there right and checks and cash. And they're not going to listen to it again. Exactly. That's the point. This is such a momentum game. And why I want everybody to literally like smile like a Cheshire cat when they see realtor.com talk about rising inventory and record low demand. It's like, yes, finally, it's my time.

17:34So if I'm an FHA and VA buyer, hopefully you have a buy box or something similar to that. Yes, I would tell you to start writing offers 15, 20% below asking, especially if the property's been on the market 30 days or greater. Folks, it's like FHA and VA buyers, in my opinion, feel like they have to pay less price because of their loan structure. Yes. You don't have to, right? Right. And this market, any buyer stands out. Right? So again, get aggressive. Right. We agree. We had on our property the single family that we just sold in within 10 days. Full price offer with inspections. We passed all inspections. We spent a few thousand bucks there. But full price offer deals done and it closes in a week. You know, and then that deal is completely finished. And that deal will work out. We'll make some money. But for all these guys, we're like, houses are just sitting for 10 days. How is it just selling it massive discounts? Full price minus 4K for all the work that we did. Like, and so it depends really on the market.

18:35Most importantly, people need to be taking action doing. You know, you're not going to get the perfect house to come across your desk by doing no work until you have a reputation. Like you get a bunch of stuff that comes across your desk. Your desk, I get different after 20 years. Yeah. Deal flow gets different. I mean, for me, it took, it took like 15 or 16 years to get that deal flow. Absolutely. And the mistake that I made was I wanted to be quiet. I wanted to make no noise. I wanted to just be the guy that was investing. And then proof before you knew it, I was top 10 in the three towns that I invest in. And then all of a sudden, they're like, people looking it up and they're like, this guy, and then people, you know, wholesalers calling and it just that makes it a nightmare. Yeah, no kidding. But people need to be out there. They need to be doing the work. They need to be looking at more properties than they've ever looked at before. And then watching them, watching them. And then creating a box, not even a buy box, but just a preference box that says, these three or four deals make sense. Right? These three or four deals make sense.

19:35What I need to do is keep track of those three or four and be aggressive in offering on those and then see if anything happens. And consistent and follow up as this. Right. Right. No deals that I would call deals of the decade or deals of a lifetime, wherever God on the first offer. Most of it's three, four, five offers in constant follow-ups. So guys do the work. Constantly back and forth. And they need to see what the markets like. Yeah, exactly. You know, they're like, hey, I don't know if it's actually like this guy say, or if it's not like this guy saying, one of my students actually came to me and said, so I do have a question. And I said, I'm all ears. And he said, I've got a tenant that I'm trying to collect from. I said, sure, talk to me about the cadence of what you're doing reaching out to them, trying to get paid. He was, well, I said, what was the last message you sent? He said, I sent one yesterday. I said, great. When was the last one before that? He goes two weeks ago. I said, here's the thing. I would ignore you too. Yeah. I guarantee that person knows money to multiple people. I would ignore you too. Yeah. If you're contacting every two weeks about owing you money,

20:36I would ignore you too. There you go. Because somebody's contacting me every other day via text, via email, phone call, having somebody else call, like something there is happening. And that's the person. It's just like, dude, squeaky will gets the grease. So, people need to keep in mind, put yourself in that position when you're a buyer. Hey, I'm interested in this house. I would like to put a deal together. This is where I'm at 410. Yeah, I'm at 450. It's like me at Pennyless. Completely understand. Would it be all right if I touch base with you in a week or so? Just to see what the week seems like too fast. So you're not. So you're at a price where you don't expect to even get an offer in the next week. Yeah, exactly. Turn it right back around on them. They're like, well, no, no, no, not necessarily. Right. So all I'm saying is it costs us nothing, but you know, a couple of minute phone call, hey, making progress this week did it go well. And if it didn't, you already know what my number is. And then if they get another number that's south of mine or around mine, they're not just going to take the other guys off. They can come back to me and say, hey, listen, I've got another offer for this.

21:37Would you do X? And it's probably a little bit more. And my answer at that point is, yeah, sure. Sounds good. Yeah. So again, folks, the other thing I think we should talk about is I think I think mortgage rates are going to have a seven handle on them. And you know, probably this month, sometime is my guess. Just a guess. And if that happens again, more and more people will be turned off. But again, folks, that's the time to go hunting. Right. If you can write a cash flow deal, cash flow positive. And it has seven or seven and a quarter. Like, let's say investor debt seven and a half. Yeah. And it cash flows because you're doing the work and you have no alligators, which is a big thing for me. Guess what happens in, I don't know, two, three, four, five, seven years when mortgage rates are five and a half? You just go back and, you know, refy the loan. And if you don't take any cash out, your payment collapses. Right. So again, I would do it. If I had a magic wand mat, I got to tell you, I would make rates 9% today. You want to really shake this thing out?

22:39Let's go. 9%. Absolutely. Because then that's going to completely stop the presses. And then you can do more creative finance, right? People are more willing to do creative financing out of the deal. You know, or having for bid, you do a deal and you can show them the math. This is where this deal works at 9%. Are they going to be 9% forever? No. In two or three years, they're probably going to be 5%. Right. And then you do a refy and then it's my, I'll go to the bank. You're all my goodness. And then you're like, exactly what I do with all my seller finance. All of them. We just do the math together. Because they're, you know, in this case, they're, they're investors too. And I'm like, Hey, I don't know about you, but I can't operate this for less than 50% expenses. So, you know, that just makes the math really, really easy. So, yeah. So again, I do think it is a great time. As the headline said, why you should try and buy a home in 2026. The word try is there because I want you to do the work. You can't guarantee it. Every market is different. You know, Connecticut, New Hampshire seem to be on fire these days.

23:40Chicago is well for some reason. But again, a lot of the country motivated sellers are getting easier and easier to find. And I want you to take your shots at creating great deals, deals of a lifetime. So any closing thoughts? Chicago's usually on fire because it's a car fire. No, why Chicago's on fire? I don't think it is not. I think they have record low inventory, looting downtown. Oh, it's usually what it is. Okay. I need the Chicago market. There's guys here that have made it really successful. And, but, you know, some of you see some of their taxes and tax pressures. It's crazy. Yeah, the parting words are do the homework, do the work, understandings don't believe the headlines. Like just do the opposite of what the masses do. Do they really believe that any of these talking heads have actually looked at their specific town? Or one of the 7,000 markets in the US and that they have anything at best, it's anecdotal numbers, it's past data, not future data, it's past data.

24:41They don't know your state, don't know your city, and certainly don't know your buy box. Get off your ass and do the work. And don't know your ability to execute. Like they don't know anything about you, but they're saying don't buy. Right. What? I'm waiting for the class section lawsuit that takes all of those plounds out for giving horrifically bad advice for the last six years. You know, because if you imagine crash throws lined up, they should. That's exactly what should happen. So it's kind of crazy. But yeah, my parting advice is I got Thursday night show, 9 p.m. I'll sit there, I'll answer your questions, whatever questions you have, whether it's rehab, market, money, reserves, whatever it is. Talk to you about what we're doing, because we'll go deal by deal. We share all of our numbers deal by deal. You know, we don't show our portfolio numbers, but we show all of our numbers deal by deal. So you can see, hey, this is something that Matt's buying. And surprisingly enough, as a real estate investor, I sold to and I'm buying four. So it's actually happening. There you go. Matt, you're amazing.

25:42Thank you for stepping in today. We appreciate you. We'll see you tomorrow as well. Thanks, Mike. Later.