Josh Barker Real Estate Podcast #12

Joey: Okay. We're back.

Josh: Hey, we're back. Alright.

Joey: We're back again. It's October.

Josh: It is.

Joey: Although the weather tells you it's July, [chuckle] but the calendar tells me it's October.

Josh: Oh, man. It's a good place to live.

Joey: So last few months, we've been talking about how the absorption rate, which is how quickly if no homes came to market, how fast the current purchase rate would inventory be gone, and you've always said that if it's three months or less, that's considered a seller's market, 4-5 months is neutral. Anything more than five months is considered a buyer's market.

Josh: That's right.

Joey: We've been watching it creep because I remember... I don't know if it was last year, but it was like 1.2, and it slowly started to creep up. I think the last time we spoke, I think you said it was 2.75. Do you know where it sits right now?

Josh: The absorption rate right now is about 2.96.

Joey: So we're still in a seller's market?

Josh: Yeah, we call it the tail end of a seller's market, but with the angle of that trajectory, though, by next month, I would imagine we're going to be in a neutral market.

Joey: So what does that mean for... I mean, is it... When you talk to sellers and you talk about pricing, that affects pricing, right? Because it's pricing before when the market is so... The inventory is so low, you're always trying to price for what's about to hit.

Josh: That's right.

Joey: If the market's going up?

Josh: Yeah. Yeah.

Joey: So what are you guys doing now when you have conversations?

Josh: Yeah, how we're changing that?

Joey: Yeah.

Josh: Well, first, I would say it's a lot different between... There's a difference between what a real estate and does for pricing strategies and what an appraiser does. So real estate agents are typically trying to project what might be happening in the future, whereas appraisers are typically requested to provide evidence of what's already happened in the past. And so that's where there's always this little conflict that pops up from time to time between what a realtor might be able to generate for an offer on a home and whether the appraiser can justify the value. Those things pop up. But to answer your question, when you're moving into a neutral market, the advantage begins to slip to more of a neutral position and pricing more accurately from the start instead of testing the market is typically how the more successful sellers approach it. So if they have the option of pricing at the high end of the range or pricing at value, most sellers, if they want to get moved, are pricing at value right now and not risking that they overprice and perhaps even chase the market down if it declines a little bit in this season.

Joey: And you're always trying to balance that idea like, "Look, we wanna get you the most for your home, obviously."

Josh: Yeah, absolutely.

Joey: But at the same time, people don't want their homes to sit on the market for a long period of time. It's considered like a negative thing, right? So you have to price... It's probably a little bit easier now, I would think, than it was five months ago when interest rates first... Five or six months ago, when interest rates were first... Because they jumped very quickly.

Josh: They did, yeah. They've doubled now in the last eight months.

Joey: And at that point, people were like, "But my friend just sold their house four months ago for X." That was a 2.9% interest rate.

Josh: Yeah and the media was a little bit behind that, too. It's always tough for a real stage, and when you come out and you can... You know the facts on the ground that day. You know how much the rates have moved up. You know exactly where... What's selling and what's not, but the property owner that you're going to meet with may not be up to speed with the same situation. They may not see the same fact pattern that you see, and so when you show up, it's like this... You're trying to educate them on where the markets are before you dive into valuation and things like that because you're trying to make sure that they understand what's going on. And sometimes in competing situations, where an agent's... When a seller is interviewing multiple agents, maybe some of those agents are up-to-date on the market, and maybe some of them are not. That's challenging too. Because if they heard a conflicting story of the market compared to what you were saying, naturally, the seller would want to be focused on the more optimistic person. That certainly sounds appealing. Of course, it doesn't necessarily translate into your home sold.

Josh: So my point is that recently the media has caught up, so you see all the news reports and all the headlines, and I think unless you were hiding under a rock or something, most people know the market has now shifted. There are still some local radio stations with some fear-mongering going on with some advertisers or whatever, but the reality of it is, is that we've had a long period of market expansion, and it's natural that we would cycle into a little bit of a retraction period. And that's kind of where we're at right now.

Joey: And there's a bunch of factors that... Because for the last few years, I have been going on a radio show talking about, hey, the renting market's going to climb, right?

Josh: Yeah.

Joey: And we would talk, and people would say, "Yeah, but it's gonna be a bubble, and it's gonna come back down." And they always refer to 2007, 2008, because that is historically the single greatest housing bubble that we... You know what I mean? I'll always refer to the absolute best or the absolute worst. It's like, "Yeah, but the factors that drove that, the easy loans, the people purchasing a second, third, and fourth home without renters, that's not there."

Josh: No, no, and what we really don't... What's not there now is inventory.

Joey: That's the other piece.

Josh: Yeah. That's a huge difference this time around the last time. Last time we had a massive amount of speculation going on. We've seen numbers as high as 45%. 50% of all purchases in 2005 and '06 at the beginning of '06 were speculation.

Joey: Which is crazy.

Josh: Crazy. And so you had massive amounts of new construction taking place, a lot of vacant properties all over the place.

Joey: This means was super low rent.

Josh: Super low rent.

Joey: This is not what's going on now.

Josh: No, not at all. Well, because, again, inventory, right? So back then was a different fact pattern. You had negative amortization, interest-only loans, and variable interest rate stuff that was floating around out there and just primed for a market correction. But I just pulled this up. I'm looking right now at our MLS. This is for... That's 2021. Let me get to... I had 2008. Here we go. September of 2008, listen to this. So for those listeners who are listening to this right now, 2005 and '06, arguably that was the market's peak by '07, people were like, "Uh-oh, we're in trouble. Something's going on." By '08, everyone recognized the market had shifted. Prices have changed a lot. So listen to these numbers. The median sales price in 2008 was $274,000. Okay, now this is like the all-time worst market, 2008. If you guys paid intention, that's right around the financial melt-down crisis, and everybody's... Banks are closing down. I mean, things that you never thought about. Hallmark companies in the country are collapsing. There were 179 properties that closed escrow in September of 2008.

Joey: Wow.

Josh: 179.

Joey: Even in the...

Josh: Even in the worst of the worst, 179. This is why I try to push back against people that go super negative. I'm like, "Look, at the end of the day, people need a place to live. No matter what, they need to do it." And they have the option of owning a home or renting a home. Those are the only options those people have unless you're going to live with a family relative or something like that, and for your parents out there with kids in the house still that want them to move on hostile, I get it. But that's really the option, 179. And so right now, last month, we had 238 here in our market. We're still selling a lot of properties locally.

Joey: Yeah, it's just the prices have shifted a little bit because now the cost of money is so much higher.

Josh: Absolutely.

Joey: And anything that goes up that high, it was... I think about 10 years straight of just a quarter after quarter after quarter, and it got super hot during COVID. Really, the market started going crazy, and year over year, people are seeing like 20% to 30% increase in prices at some of the lower segments. The $220,000 house, a year later, was like $265,000. It's just crazy.

Josh: Well, and this is the argument I have with my parents and stuff like that about the higher interest rates, 'cause everybody says, "Well, you know what, we had rates at 16% in the '70s." I'm like, "I get it. I understand."

Joey: You also bought a house for $58,000.

Josh: Thank you very much.

Joey: Yeah.

Josh: That's exactly right. And what we had during COVID was insanely low-interest rates. It absolutely triggered a robust buyer's market with a market that was already really slim on inventory for obvious reasons, driving the valuations high. If anything, what we're giving back right now is very similar to what the stock market's giving back. We're giving back the value that was created during COVID.

Joey: Basically, yes.

Josh: Basically, that's what we're doing, right? And the stock market right now, for apparent reasons, it looks like it's making those adjustments to it. It'll find its new equilibrium if you will, and it'll continue to grow, I'm sure, over time. I'm not the stock guy, but I would assume it is. I hope so. I'm still giving money to them every year. So I would assume that the real estate market will be the same. We're going through a correction there because we had really low-interest rates that pushed prices up. We're going to have this correction that, obviously, we're seeing right now. We'll find a new equilibrium, and then we'll continue to grow out of that.

Joey: Maybe not for this month, but next month or the month after that. What I think would be good for us to just to carry on with this conversation, is to say, look at the median price and let's look at the median price one year ago and two years ago, and what you might find is it only slips down a little bit. Yes, it came down, but it only came down a little bit. It's still much higher than it was two or three years ago. People still see appreciation in the market, and a lot of appreciation too.

Josh: Well, the median sales price right now last month was $424,000. That was the median... Sorry, the median list price. Median sales price.

Joey: That sounds high.

Josh: Let me rephrase that. The median sales price was $361,000. The median list price was $424,000.

Joey: Wow, what a difference.

Josh: Oh yeah, between the two, yeah.

Joey: Little bit of disparity there. Oh, yeah, and it goes back to what you said about the realtors that come in and interview and they're, "Well, I can get you a... Whatever. Retail plus 20%. Sure." Like, there you go.

Josh: Well, there's the market, right? And right now, what we have is a situation where the median price of a home is higher than the median qualified buyer, and that's because of interest rates going up. And it's going to take some time because the median sales price either has to continue to come down or the median buyer somehow has to be able to qualify for more, which could be either through wage growth or through interest rates going down, but we're going to continue to see pressure until those two things are closer together. Right now, there's a pretty big spread between the two, the median sales price and the median buyer that qualifies. But as those two numbers come closer together, the frequency in the volume of home sales starts to go up more, and you start to see the market begin to find itself again, and that's really the transition that we're in right now. We're not done. We still have a transition to get through, but as I said, everybody's still faced with the same decision: Rent or purchase. And right now, it's not the peak anymore, so would you rather buy at a peak or closer to the bottom? And in this cycle, we're moving that way.

Joey: Well, as we've said, somebody else coined it, but "You marry the house, and you date the interest rate." So purchasing at the lowest point and then refinancing a couple of years later when the interest rate... Something's going to have to give. Something will give.

Josh: And another one I like to hear too, we're all hearing these little phrases popping around. The other one that I really have taken a liking to is that "If you rent, you're paying 100% interest."

Joey: Yup.

Josh: because you're not gaining any equity.

Joey: None.

Josh: Whereas if you own, currently, right now, you're probably paying an interest rate at 7% or somewhere in that range anyway.

Joey: Is it up to 7%?

Josh: Oh yeah.

Joey: Oh wow.

Josh: Yeah, in fact, for some, it's higher.

Joey: Wow.

Josh: So, right now, the interest rates are...

Joey: I was still thinking we were in the sixes.

Josh: No, no, man, that was so last week.

Joey: That was so last week.

Josh: No, rates right now, guys, if you don't know that, the rates right now, they're balancing somewhere between 7% and then 7.5%. You can get it down in that 6.5% range, but you'll pay some points to do it. And that's kind of what's going on right now.

Joey: There's a lesson in there because I remember when the rates were 5% just a few months ago. People were like, "Well, I'll just wait till it comes back down," and look what happens.

Josh: Yeah, it didn't change, and people are still faced with the earlier part of this conversation of whether you're either renting or you're buying. So it's a tough situation to be in, but I'm very optimistic in the long term. We had what, two million people migrate into the company, and obviously, that's... Whether it was illegal or legal, it doesn't matter. You got two million people here that need to be housed.

Joey: Oh, you said in the company. I was like, what?

Josh: No, not in the company. In the country, I'm sorry. So I look at the demands on housing, and I say because of the demands on housing that we can visually see, that's why I'm optimistic about the real estate market going forward. We don't have enough housing units to provide adequately for those who are going to need them, and that's the pressure that, over the long term, I could see the housing market continue to strengthen over time, and that's the reason why is because the demand's not going away.

Joey: Now, when a market shifts like it is now, this is usually that time when people are like, "Oh, I'm gonna hold on to my cash because there's gonna be foreclosures, there's gonna be short sales," but that's probably not what's happening. That's probably not going to happen because of that whole inventory issue, right?

Josh: It's tough to know for sure what the shadow inventory really is. Last year, we purchased some data that gave us insight into the moratorium market in terms of how many people were in some sort of forbearance program. We have researched that as heavily as we could to get a feel for it. I'm not going to quote numbers in this podcast because I'm not confident that everything was accurate.

Joey: Oh, okay.

Josh: What I will say is that it was a lot of people were there. However, like six months later, that number had diminished a lot because a lot of those people had transitioned away from the forbearance program. So they'd either refinanced their home or brought their mortgage current or they sold the property. And all three of those resolved the forbearance issue. So now you go into where we're at today, and I would say maybe about a third of who was experiencing that during COVID is probably what's still left to be what we consider to be distressed. And they're probably in a position where they have to decide, do we sit on our homes longer or sell them if we have some equity? And so we're not quite there yet. I think it'll probably take another six months before we know what that market looks like. I can tell you right now we don't have a lot of for closure showing up, and we see occasional short sales, but they're very occasional, and for most of them, those are people that have purchased over the last 24 months because anybody that's owned their home longer than that, usually has plenty of equity just to sell the property, if that's what they want to do.

Joey: And hopefully, took advantage of refinancing in those high twos, low threes.

Josh: Yeah. Yeah.

Joey: So we're not going to see that. So what is it? We see inventory climb, very... But for the small amount, you just went from 2.75 to 2.9 in a month. It's still not going crazy. We are going into a neutral market. Interest rates continue to rise. Is there any news coming out that's like, "Hey, over the next few months, this is what... The feds are going to do this or nothing. Is it just cloudy?"

Josh: Well, it's... They've been pretty clear, actually, right now with this most recent inflation report, I think it was like at 8.2 or 8.3, I think that gave the Federal Reserve, that's the entity that sets short-term interest rates. I feel like it gave them some runway to raise that rate, so I'm no expert, but the experts that I'm listening to are saying that it's likely going to be a three-quarter of a percent increase in their next meeting or when they make their next announcement for raising the rate. And that's what they're saying. My personal opinion is it's probably anywhere between half a percent and three-quarters of a percent, so I'm somewhat agreed that it's probably somewhere in there. That will translate into some upward pressure on the long-term mortgage rates, but they've not tied lockstep, you know what I mean? So, just because the Fed raises the rate doesn't mean the mortgage rate goes up overnight just like that. The mortgage rates are set a lot more by the demand for mortgage-backed securities.

Josh: And actually, the biggest pressure, I think, on the mortgage market is that they think that long-term interest rates are going to be lower, and so they're kind of pricing into mortgages, they're doing now...

Joey: That means they want to buy the mortgages now at 7%.

Josh: But they know that they're going to refinance out of them, though.

Joey: Oh. Okay.

Josh: You get what I'm saying? So the mortgage companies recognize that "Hey, you know what, I'm going to go and give this loan to somebody at 7% today, but in two years, the rates are probably going to be 5%. I don't have a crystal ball, but if that's what they're thinking, then they're thinking, "Well, I'm only gonna have this loan for a couple of years, so I've gotta charge some points upfront." Do you know what I mean?

Joey: Yes.

Josh: Or do I have to charge a little bit of a higher rate? I have to get a bit of a better return because the chances are they're going to refinance out of this loan over the next 24 months, and that's actually what's creating some of that challenge right now in the mortgage market. So I'm pretty optimistic again about interest rates too. I think that it's highly likely that once we get inflation numbers to come down, you will also see mortgage interest rates going down. And I'll tell you right now, listeners, the moment that mortgage interest rates consistently go down, you will see buyer demand or affordability correct. Because we had talked about it in a previous podcast, and I'm serious about this, we do not have a demand problem. We always talk to buyers who want to purchase, but we have an affordability issue, and a little higher interest rates have created that affordability issue.

Joey: And there's... I'm very conflicted because I try not to listen to any news, but unfortunately, I'm able to pull some pieces of data in. There are a few things that have popped up recently like. I was reading how the British pound has never been lower against the dollar for some long period of time, and that the European Union and some other Countries were applying pressure on the United States to say, "Hey look, you need to stop raising interest rates because it affects the dollar" because the dollar is basically still the currency of the world. So it didn't get too far, and it just said that there was pressure. They're trying... Outside forces are trying to stop us from raising interest rates. And then, on top of that, I was reading about how there are some proposals in California around trying to slow down the... I think it was the effects of that capital gains every two years, you know how it... Which just kind of escalated people flipping homes. So there are a lot of forces at work trying to slow this down... Do you know what I mean?

Josh: Yeah.

Joey: I don't know what they're going to... I don't know if that's what's going to happen from that.

Josh: Yeah, I don't either. I don't think the Fed is probably too concerned about what Europe's doing right now. I think the Fed is probably pretty focused on just handling the inflation issues in the country. They probably have more of an egocentric opinion of "if we can keep our inflation in check... " They've already solved the problem for the rest of the world, [chuckle] And I don't mean that to be egotistical or anything, but I do think the Fed...

Joey: Mocker...

Josh: Yeah, right.

Joey: Mocker.

Josh: I think the Fed is more focused on controlling the US issue.

Joey: Well, we also talked about how at some point, supply chains are going to catch up. And then... And that's going to cause... Inflation is going to come down.

Josh: Well, it's happening now.

Joey: It is... And then, once you have inventory, inflation will come back down.

Josh: Absolutely, no, we got inventory, and supply chains are being re-established. I think, for most intentional purposes, the shipping lines are now open. What we hear now is that... I'm reading this... I read this from Economist. There's a great article out there, I won't quote magazines or anything like that, but there's some, there's some good reporting out there right now that's suggesting that shipping, for one, for example, the demand has fallen. And so now, they're not backed up as much as they were anymore. The bigger issues apparently currently are around the trailers of trucks. Getting enough truck trailers available to move the stuff out of the ports is where the next issue is now. And it's kind of like a traffic jam. How many times have you guys driven down the freeway and then suddenly stopped, and then you start moving again, and you're like, "What the heck, why did everybody stop right here for?" Do you know what I mean? It's just like...

Joey: The accordion effect.

Josh: The accordion effect.

Joey: When you have a big group that just does that.

Josh: Right now, the accordion effect has moved all the way out now to trucks driving down the road. Fortunately, that's where the choke point is, where all of us were hearing about the ports before being the issue, right?

Joey: Mm-hmm.

Josh: The issue now has moved to the trucks and the trailers for those trucks, so we're kind of working our way out of it. You can just see it one step at a time, resolving the supply chain issue, and as you said, it's going to bring down inflation long-term.

Joey: So once they reduce those interest rates, housing prices will probably start climbing again.

Josh: That's my opinion.

Joey: Very quickly too.

Josh: I am so, I am so bearish on, or bullish on that, yeah.

Joey: Because the demand's there.

Josh: What's that?

Joey: Because the demand's there. So that demand is like an immediate pressure, like the minute the valve is released with interest rates going down...

Josh: Yes.

Joey: You're going to immediately feel like, "Okay, it's gonna drive... "

Josh: Yes.

Joey: People are going back to, like, "Hey, I've got six offers for you."

Josh: And the people that are in the market right now, I mean, that have the option of purchasing right now, don't forget, and maybe you didn't know, but don't forget that 18 months ago, it didn't matter if you found an amazing home that you were excited about purchasing. You were one of probably 15 other people trying to buy it, so 14 people who wanted to buy it were excited but didn't get to buy it. Today, you can shop, and today, you can make decisions, and today you don't have to be one of 15 offers, but when rates start coming down, watch out because you're right, it's going to be like a pressure cooker, all that pressure is going to get released.

Joey: About 18 months ago, my brother-in-law put in an all-cash offer for the asking price the second day the property was listed. They didn't even get countered.

Josh: No.

Joey: And I contacted the agent, and I said... And I won't throw them under the bus, but I said, "Hey, why didn't you counter? Like all cash, full price?" And he's like, "Oh well, I didn't think it would appraise." I thought to myself, "That's why it's all cash, buddy. It's... Did you not catch the first part of that?" But it was just, he took an offer for 10 grand more, and it just, it was the beginning of, the market just getting crazy, and people just getting multiple offers same day over, and it just became a bidding war. That wasn't that long ago.

Josh: No, it's not. And I don't want to put roses over everything. We are definitely still in a market correction, and we've got months to go before we can resolve that. We'll likely be in a real recession, fully documented, by the end of the year, beginning next year, for sure. And that's, that's probably a good thing. For those who don't like recessions, losing a job is no fun, and that's the sucky part about recessions, which is that typically it reflects a bad job market, right?

Joey: But that's not what we have.

Josh: That's not what we have.

Joey: At all.

Josh: No, we just have a reduction in GDP, largely created because of the inflationary numbers we're seeing. So I think that we're going to see this recession come in and we're going to have to cycle through that issue. Higher interest rates are definitely going to be a drag on the housing market, and then as we work through this and get to the other side of it, it's going to be pretty optimistic. But if you're selling in the next 12 months, today is probably your day. Do you know what I mean? And if you're buying right now, don't buy and only plan to stay there for a year. Plan on staying there for three, or five years, and if you do, you're going to be great. As I said, you still have to make a decision today, "Do I wanna rent or do I wanna own?"

Joey: Which is part of that pressure, because as soon as those interest rates turn, all those renters that are paying $1800 a month for a small three, two, or higher... Do you know what I mean? They're chomping at the bit.

Josh: Oh yeah.

Joey: Because, as you said, they're paying 100% interest.

Josh: Yeah.

Joey: They're paying someone else's mortgage. There was a TV show when we were growing up, I don't know if it still exists, but it was... I think it was called Point Counterpoint, where someone would make something and I feel like I have to be negative to your positivity. But the problem is that NASA could deflect an asteroid, and so I was going to bring that in, like interest rates, we've got asteroids headed to Earth.

Josh: Well, I didn't even know why they thought that was a big deal. If you want to go back in history, I was alternating. I was alternating... Is that the word?

Joey: It depends on... Finish the sentence, and I'll tell you.

Josh: Yeah, I was moving the course of an asteroid years ago on Atari because I was playing the game asteroid, remember? And you'd shoot it and the asteroid would literally move its trajectory in another direction, so this NASA stuff, not even a big deal. I've been doing it since I was like seven years old.

Joey: I was going to say, I think they, I think they brought in Activision just to help them with this one. Which...

Josh: Yeah, it makes total sense to me.

Joey: Yeah, so I'm not negative about it either. I think a lot of people like you said, I think when the market is so hot, and it's been so easy to just to buy, "Hey, got you in at 2.9 percent. Hey, we listed your house today, and we got 12 offers." It's just, it gets this weird, rather silly euphoric feeling like you're in a casino, and just the dealer just keeps busting type stuff. For any type of correction, people are hyper-sensitive, and they always want to go back to the worst market ever, and none of those variables are in play. We don't have the huge speculation, we don't have inventory, so the one headwind that we have is interest rates, and it's just trying to counter inflation, and I think that the factors pushing inflation are going to catch up. We are. I mean, that and they printed a ton of money, man, that's another big one.

Josh: Yeah, these podcasts are not designed necessarily to get into those things, but yeah, it's not... That definitely creates a burden for our kids. The more debt that the country assumes, the larger liability for our kids to have to deal with when they're our age, right?

Joey: Our country has debt?

Josh: Just a little bit.

Joey: Just a little bit, little bit, a little bit. Little bit.

Josh: Just a little bit. But I think the last thing to talk about is if we want to have a more sober-minded conversation, less optimistic, I would just say that right now, as we're going through this transition. And I said it a minute ago, is that seller... It's probably more important right now than ever before to make sure that you are educated on the market before you make a decision on what you're going to do. Some agents have been on the market for just a little bit of time. Some have been here a long time. In reality, that doesn't necessarily mean that one's more educated than the other. Make sure you're talking to an agent that is up-to-date on the market, understands what's happening today, is assessing that seller's unique situation and what they're trying to accomplish, and then make sure you design a plan that complements that.

Josh: Right now, more than ever, you've gotta slow down and really look at the big picture before you make a big decision like that because people are stuck, they're trying to figure out, is it a good idea to move? Is it a good idea to move up or move down? So there are a lot of questions in the market right now, and I think it takes a lot more discussion upfront before making a decision.

Joey: Yes, one of the things that I think... When a hot market, you just... Anybody could have sold a house because the second you put the sign out front, the neighbor is like, "What? Your house for sale!" People are flocking, and that's not... And so you need to make sure you find somebody that can say, "Look, this is what we think your house is worth." Well, yeah, but I wanted... It's like, "Okay, then let's go with... " 'Cause I've heard these conversations in here where they've said, "Hey look, this is what your home is worth." Well, I was hoping to get this. "Okay, if we go to market with this and we don't see certain signs, is that gonna tell you, like, Look, this was the price."

Josh: Right.

Joey: Because when someone works on commission, of course, they want the highest... I was hoping to sell your house for a billion, you know what I mean? But the market... What determines the price? The marketplace. And just having those kinds of conversations and having people that can even have those conversations, realtors that can sit down and say, "Look, I can tell you why I came up with this number." I didn't pull it out of a hat."

Josh: That's right.

Joey: And these are all the variables, and it wasn't one var... Well, your neighbor sold last year for 369, so I have to think 372, right? No, the more variables you take in, the more accurate your assessment will be.

Josh: I 100% agree. And buyers are now shopping active inventory, not homes that sold in the past. So a really healthy dose of reality is to look at what's active for sale also and try to determine where you would position yourself on a scale of one to 10, 10 being most likely that you'd be picked... How do you position yourself at that price point where you'd stand out as a value because not everybody will sell right now? We're about to move into that neutral market.

Joey: Well, awesome, Josh. Thank you. I think... You were pretty optimistic, you know what I mean, but we need some optimism because, as you said, there are a lot of people that are being a little too Chicken Little right now. The sky is not falling.

Josh: A little bit. Yeah, it's never going to be as bad as everybody thinks it will be, and it's not going to be as rosy as everybody talks about. Let's just be rational. It's somewhere in the middle, right? Awesome, let's stay rational.

Joey: Thanks, Josh. I appreciate you—next month. Have a good one.

Josh: Thanks, everyone.