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welcome to the Deerwood Realty YouTube channel I'm John Schink founder and managing broker dearwood realy in St lless Missouri you know as a YouTube Creator there are times when you see topics that you should shy you should shy away from because they're going to cause issues and you don't want to do that you don't want to cause any drama in your life you don't want to be canceled there's other times where you have to push forward knowing that there's that risk and so tonight um I might I might be on that risky side you can always follow me on uh on Rumble and odyssey um I don't think what I'm talking about is that controversial but perhaps it is you never know what the line you know there's Community guidelines on YouTube and um those are just guidelines if they think something if there's something that some sensors see somewhere uh you're just not going to be able to get forward now there's two different ways they can do this they can just get rid of my Channel all together um actually three they can get rid they can give me a strike um or they can just uh shadowban the video Al together I wouldn't say that I'm 100% sure that I'm shadowbanned but and every once in a while I start to think that maybe I am you know my content could suck as well I mean that's that's certainly possible but uh I just feel like we have a big issue with affordability in the United States and we we have Market levers that people are going to be pulling and I think that we should be aware of what's going on um with those levers and you know how we should uh you know view this stuff and so with that I'm going to get into the article if you're triggered I I apologize I I'm I'm going to talk about it with what I think is an open mind I don't necessarily agree with everything and I'll I'll point out those those things that I disagree with but you have to have some sort of critical commentary when people write things um on both sides of the aisle and um I know we're a very partisan Nation at this time but my hope is that someday things will work themselves out uh for the better of everyone here we go that being said starts off with a flamethrower why Biden's policies are a nightmare for housing affordability and just right off the bat I want to say this inflation the massive amounts of inflation started under Trump and you say John how can you say that well when they when they closed the government and they decided to just start printing money left and right that was the start now you can argue that this crisis started in 2008 and was never fully addressed that's fine I'm what I'm telling you is I don't think that Biden or anyone else's policies matter in this situation as it relates to his a historical perspective it's it's bad it's bad policy in the United States causing these issues Biden happens to be the president now if anyone else were the president you know next week there these problems would still exist so there's my apology my blanket apology for all those um who might say that uh that it's Biden's fault or that it might be someone else's fault it's they're all at fault okay so here we go it says we're entering a stagflationary crisis there's no way around it it doesn't matter how much Jo oil Joe Biden pumps on the market from the Strategic reserves it doesn't matter how many jobs he's able to temporarily Buy with 8 trillion plus deficit spending it doesn't matter how many lives or how many times the mainstream media claims were in a recovery or or claim to see the green choots of a soft Landing in reality most Americans are struggling to afford Necessities increasingly they're simply unable to participate in essential markets the longer this goes on the deeper the hole and the hard it will be to clim for people to climb out now look a couple of things number one uh economic principles prices are sticky okay what does that mean it means like if you look at gas prices do you ever notice how they go up but they seem to go down much slower it's kind of sticky they so when we see these policies well when we see inflation as I can't imagine you not seeing inflation I mean things are ridiculous at the grocery store things are ridiculous at most stores and I mean most of your utilities you're seeing like uh service increases you know your cable Netflix anything is seeing these increases these so I mean this is inflation this is devastating I have railed against inflation since January of like 4 years ago I was like this is not a good plan and yet here we are uh just a destructive uh destructive problem now one of the other things that I saw this weekend that I hadn't seen I saw it in a tweet and I I apologize for not bringing it up but someone was talking to someone so it's anecdotal right but there's this issue of keeping up with the Joneses and it's so strong in the United States that it's quite possible that there are many people that are really really really towards the end here with their economic policies their personal Pol their personal spending habits um but we haven't seen it yet and and to be fair I put out an article just yesterday about how the economy while they're you know you could argue that things are awful you could also argue based on certain people that things are not bad now if you want to know where I fall I I fall in the things are awful category now why is that though well I'm a real estate agent right and I've seen houses appreciate and value like a tremendous amount in a short amount of time and I've seen buyers be sidelined in the marketplace and not be able to purchase a decent home for themselves their family and then I've seen the inventory that comes on the market being uh not great and you know I worked and worked and worked and worked for the last two years to help people buy homes you show a house you put it an offer you're one of 30 one of 40 it wasn't a fun time it wasn't enjoyable and now just as if someone just turned the spet I no longer have you know I no longer have to worry about multiple buyers on a weekend and set showing houses like things have slowed down dramatically okay and I know that this is due to Fed policy so I am critical of fed policy because it is affecting me okay so just understand I am completely biased because my wallet is hurting simply enough and I think many Americans wallets are hurting as well so it goes into to say this is how economic disasters works by the way I put the link to the article in the in the description so that you have a a way to find so it's not just me going crazy it says for most people it feels like they wake up one morning at the bottom of a pit barely able to see the sun wondering what happened everything was going fine just yesterday how do we end up here for those who pay attention we can watch the pit get deeper a shovel full at a time granted we have seen worse conditions in the US in the past both the Great Depression and the stagflation crisis of the 70s were truly severe okay now I'm going into the next sentence because that this is kind of one of the things that we've talked about on my uh shows often it says the people who think conditions are bad now haven't seen anything yet interest rates eventually climbed to 20% in the early 1980s now it's not me so much but you will see people say that this housing uh situation is very similar to the 80s okay and so you say well that's that's fascinating it's not 2008 then that's not the comparison and people say no it's the 80s now and you will get a counterargument from some that will say the affordability now is worse than it was even in the 80s I find that hard to believe I mean even growing up I I was born in the late 70s okay and I can remember how things were when I was growing up and it wasn't this is this is not the world we're in now just as an example anecdotal of course buying a television like they were expensive okay they were expensive you can go get a flat screen TV right now I suspect probably a 60-in flat screen TV probably 200 to 300 bucks so I mean there's the the ability to buy the Craft Beer I mean there there are things that have uh done well in the economy right like like how many different kinds of beer can you buy now you know back then there were like four Brands so I mean things have changed I don't think that this is like the 80s okay says part of this is ongoing part of this ongoing problem is the heavy inflation in housing prices if you notice I've done an art I've done an episode of this uh in the past I believe the problem is inflation in the prices and not not the affordability argument that you hear okay so I'm arguing that inflation has taken up the price of the home without really giving you anything okay and that it is not an affordability issue in the sense that okay I'm going to try and do this small example here say a house four years ago was worth $200,000 okay I say it was worth it it means you could go and purchase it for $200,000 that same house is worth $350,000 today okay nothing has Chang in the house okay if the late if the rate was 5% at 200,000 okay and then dipped to 3% the interest mortgage rate uh di dipped to 3% okay and it was 220,000 and now it went to 8% but the house is still $350,000 you didn't get anywhere okay inflation is what is eating away at the home price it is not an affordability issue that is my opinion okay affordability is useless when you have inflation that's just crushing you it says the current state of the housing market Market rental prices of the average American Home have climbed to $2,047 per month depending on where you live that might sound outrageous or M sign like a bargain either way compared to the average in 2019 it was

$1,465 that's a 30% increase in rental prices in the span of four years no anyone whose take-home pay has risen 30% in those four years now look there's this thing going around on Tik Tok and uh Twitter and those places where it shows uh wages uh and the price of homes and there's and on Twitter there's a community that says they're not using um they're not using the inflation adjusted number and I I just don't see the wage growth okay I just don't see the wage growth i' I've never seen it I feel like we've been stuck in since the 1970s to actually see real wage growth um but this is a feeling and statistics may prove me wrong the FED puts out numbers if you believe those numbers you know wages are increasing but again are they increasing because of inflation in the sense that that that it's just it's just inflation being shown versus like actual wage growth it says for apartments which are generally the lower-end rental option the average cost today is $1,372 a month compared to $1,078 per month back in 2019 that's a 27% monthly price on the cheapest form of housing know anyone whose take-home pay has risen 27% in the past 4 years I do not now the argument against both of these is that more Supply will come on the market okay they're building more and more units therefore more Supply which will lower the cost of rentals at least in the multif family space in the single family space I used to work as as a property manager I never felt like um I never felt like rents made any sense in that space um I just found him to be odd and I and I mean that in the nicest way possible um you know one house is you I we would always rent over $1,000 a month uh but the occupancy would be like 98% I mean it was just amazing uh it it was very odd but if you moved that number like 25 or 30 or $50 higher per month I mean it would cause a dramatic difference in the ability for people to rent so that was you know 10 years ago or longer now I have no idea what's going on in that that segment um but it says we know that no more than 30% of a family's income should be spent on housing if it costs more than 30% to keep a roof over your head you're considered overburdened by housing cost spending too much on shelter forces us to make uh tough decision tough choices e economizing where we can cutting back on other categories of discretionary spending well the rent to income ratio in the is now 40% meaning on average all households are overburdened now we we had the episode you know Target says that the you know that they are not seeing a weakening in the consumer the credit card companies sa for discover say that they're not seeing a weakening in the ability to pay debt so you know what is going on are are we early I mean is that the case is it just early is the worst yet to come I mean I'm not I'm not looking forward to that things are already not great in my opinion maybe look maybe you got a raise maybe you've got a million dollars in the bank and maybe you're earning I don't know 12% on your Investments I mean maybe you're just doing awesome but I go to the grocery store and it's just vicious it's just vicious it says what's going on the price of an average home has soared from 313,000 in 2019 to 431,000 today an astonishing 38% increase that puts a home far beyond the income of the major majority of American households pricing out more than 67% of the population it's not just a price problem there's also declining availability Across the Nation and so on this yes this is what I'm seeing there's just a massive explosion in the cost of of a of a house and so my younger buyers okay have been watching you know Tik Tok and they've been watching Instagram and they're seeing like hey just buy a house you'll be a millionaire but they're not taking that IND they're not taking the loss of purchasing power into that equation okay they just see the house price goes up they don't know what's driving it and it's just it's just sad because there's going to be many people left holding the bag at some point I can't predict when and at some point I'll be right and just like at some point someone else will be on the other side of that trade to be correct so uh rentals in many areas outside of crime ridden Metro neighborhoods are a washing application so much so that a new scam is developed among some Property Owners requiring upfront non-refundable fees just to apply these screening fees can climb into the hundreds of dollars for each applicant and that's the price to even be considered you're unlikely to get the rental even if you cough up the fee but you definitely won't get the rental if you don't that's the way it was 10 years ago where I was you had to pay a $50 application fee okay and we ran your application all right if you didn't get the house because your application was terrible too bad that's the way it was okay it was it would be unconscionable for us at the time to raise those fees to where we would profit off of them we literally had to pay I don't know like $40 to the service we had $10 a markup which is definitely not you know the greatest thing in the world okay we were not that was not our source of profits um the fact that that exists today is disappointing but should not be surprising because things have just generally gone to Hell uh uh there are claims that this trend will soon reverse and that Builders are set to flood the nation with affordable new properties but I seriously doubted given current conditions when it costs about the same to build a luxury multi-million dollar home or a low-rise multi-tenant building and the profit on the former is several times the latter what saying Builder would op opt for affordable housing construction and that's where I am I mean look development is a huge risk you can lose your shirt quickly okay why take that risk why no one no offense to anyone but you say you go and build affordable housing okay and say at the end of that project you make $5 you are not getting an award for your $5 that you've earned okay people will still hate you because you're a developer so it's it's like what is the point of this right just build something that's profitable at least I can I can build again another day um and so the incentives are not well aligned for quote unquote affordable housing skyrocketing mortgage rates are pushing more and more middle class families into the rental market people who would have been homeowners a few years ago are becoming renters which makes Supply and affordability problems worse and that's I've seen it are we becoming a nation of renters is that something we should strive for I was uncomfortable with George Bush back in 2006 2005 uh touting home ownership is his number one achievement um not because not because it wasn't a decent thing it's not it's it's great to want to have home ownership right but it wasn't it's not great to just fo that on people right it's it's not great to make the environment in in such a way that um that people who may not really be able to afford a home or in one that's why I was a little uncomfortable at that time so what can be done about this I'll rephrase the question what Solutions can be pursued that will have fast results rather than taking a decade or more with minimal effects the truth is the solutions are simple but they require actions that some people would consider contrary to their political and business aims and that's um my opinion as well is I think you know I know this sounds crazy but if you were elected dictator of the United States I say dictator and I mean it you could fix a lot of problem quickly you would stop a lot of problems quickly in that solving those problems you may create other problems right I mean this is the way things are so the Situation's not perfect right um I would I would say that the biggest reason why we're having so many issues in our uh our affordability is because uh the corporations and government have come together um and it's a terrible terrible thing you can look up the definition of that online if you'd like I don't want to suggest anything um any sort of name for it but uh there's one out there um certain interest would do everything in their power from to prevent such solutions from being achieved and that's the ultimate obstacle it's not only that inflation is rampant and prices are high and Supply is low the great obstacles are the political groups and corporate cabals that will try to stop basic forms from happening to alleviate the crisis that's right no one cares about the consumer in this case they only care about the consumer so that they can spend and spend and spend and spend okay there's not good of the country there's not good for the consumer it's what's good for a major Global conglomerates back pocket that's what it's good for so here we go now here's where it gets a little dicey now he proposes this author Pro uh proposes things that I will never ever expect to see happen in the United States and I do not condone these Solutions but I think it's important to uh put them out there because it's in the article okay so step number one Deport all non-citizens there's an estimated 16.8 million illegal immigrants residing in the US as of 20123 though the real numbers could be much higher to put this in perspective only 3 million gen Z Americans have turned 18 since the year 2000 and I think it's safe to assume that they're going to want to live somewhere so do you really think in the United States that they are going to deport 16 million people like do you know the cost of that just for airplanes and trains and buses it isn't going to happen and let's be honest once you've hit the United States you pretty much just like once you get here you're pretty much here I mean you can you can be deported but the odds are probably in your favor as long as you set foot in our country so I'm not I don't think that's realistic at all I don't think that would I don't think that's I mean it's just not going to happen so you don't so why why propose something that isn't likely to Spur discussion that you're not allowed to have I don't know but I anyway number one I don't I just don't see that happening okay uh number two stop foreign purchases of us real estate this is an action that some state governments are already pursuing more so in the case of presenting the Chinese government and their corporate Partners from buying up property but this should apply to All Foreign buyers China has already taken this step along with 28 other nations so think about in China you're not allowed to buy um buy property but the Chinese can buy property here now look I'm a little bit uncomfortable with this I just I I I just to to me what has happened okay uh in all honesty is that I believe that there were safeguards in place uh for a a good economy and what I mean by safeguards is um there were like ways to monitor where money was going and how much money was being spent and how did that uh how was that close to what people are able to earn and there there to me there was like some sort of balance and it's gotten out of whack okay but let's continue it says just how big of a solution would this be consider roughly 40 million Acres of us agricultural land is owned by Foreign company and foreign buyers purchased over 84,00 homes in the United States in the past year yes higher interest rates are slowing these purchases but not enough now look I like Croatia I really do the if you've the dalmatian Islands or the islands of Dalmatia in Croatia are probably one of the beautiful things I've ever seen in my life I would buy a place there in a heartbeat I would move there in a heartbeat if I could figure out a way to make any money I would do it but you know what not allowed to buy a house in croaa can't own

it so you

know I I don't know I don't know I don't want to vilify the Chinese I don't want to vilify anybody okay I I do I do see it in in these terms okay if a chinese Corporation is buying farmland for the purposes of farming okay depending on their financial ability they're going to crush any Farmer in the US I mean that I mean the I mean look at Smithfield look at the pork producer Smithfield it's entirely owned by the Chinese I mean I just like like proposing Solutions now seems a bit Hollow seems like we're already we've gone down this path and we're in trouble and number step number three according to uh moratorium on Corporate Home buying according to data compiled by pe corporations own nearly one quarter of all homes in the United States many disguise themselves as smaller investment groups to muddy the water that's 25% of the total housing market controlled by a handful of Corporations who can level that housing Supply shortage into higher profits for themselves Nationwide and of course higher rent costs for everyone I totally believe that the corporate housing thing is a problem I do not know how to solve it and let me let me try to explain it the best way I can let's just say let's just say beautiful Suburban neighborhood okay there's a house where an old lady owned cats not just like three cats but like a 100 cats and well one day the the people knocked on her door and found out that you know the cats had taken over and she was dead okay do you know what that house is going to smell like do you know how damaged the walls are going to be okay this is a nice neighborhood right nice nice thing the average buyer that I see now isn't looking for quote unquote sweat Equity they're not looking to go in there and fix up the house themselves okay first of all it's kind of problematic with the mortgage because you have to technically be able to live in the house to get a mortgage you know that's part of the part part of the issue the second part is is you know if you're a computer programmer are you really the best Carpenter I mean should you be working on these things that you may not be well qualified to be doing I don't know it's just something I'm putting forth so here comes an investor now they take on risk of buying this home and they fix it up and then they get a profit for it I don't really have a problem with that now you say well what what levels will you have a profit now what I have seen personally in my time in my own subdivision I saw a house that was dated the people were old and they were moving to a a retirement living couldn't sell their house nobody wanted to buy it for their ridiculous price at the time someone did buy it um let's just say for 180,000 okay the the people were asking like 220 and it was not even close okay so now someone buys it for $ 180,000 they put like $40,000 into it and sold it for 320 now that seems a little bit Rich right I mean who wouldn't want to do that but but that's somebody bought it I know it's crazy but anyway um again if the primary danger in US housing is lack of Supply driving up prices then we must create more Supply to make housing affordability now look this is a different argument than he had before okay but he's saying if so let's I'm not I'm not criticizing the author I'm saying I'm saying it's inflation the author has said it's inflation earlier you can argue about the causes of inflation this being the lack of Supply driving up prices I'm saying that there's so many things into that inflation number that it it it may not just be lack of supply um we can't compel the market to build more houses for cheaper and we can't compel home builders to take loss what we can do is free up the existing Supply and take it out of the hands of people who shouldn't own it in the first place and restrict those groups who are attempting to Corner the market now look if I want first of all in a single family rental I think that the tax structure should be different I I just think that it should be different I think that there should be a longer I mean fix it right tomorrow you can do a longer period of depreciation take it from 30 years to something more I mean I don't think it's it's going to happen I don't think it's going to happen but I still think that there are ways to fix it that are not um not not um against uh not against the spirit of the United States I think I think that for if you do stop foreign purchases of us real estate instead of saying that instead of saying we're going to tax foreign owned real estate at a different um rate and if we tax corporate home buying if you buying your home in an LLC you know a C Corp anything like that there's a different tax structure I think those two things could provide relief without injuring everyone because if it's like if it's still worth it for a corporation to buy something they'll do it okay so that's that's where I'm at on that now Jerome pal has what will happen instead Jerome PA has a different plan and this is sadly true I believe this it says the Federal Reserves plan at least the plan they opened admit to is completely different they're actively attempting to crash the economy and cause Untold Financial harm in order to drive inflation back down the same way that zero interest rates and trillions in printed money Drive prices up not just prices of food and gas but of assets like homes raising interest rates and bading liquidity out of the economy makes prices fall and I think that's what they have chosen I mean they don't control government spending okay if you could kind of cut that down you probably wouldn't have as much inflation but the FED does not control that and so they can only really do what they're going to do and it's going to be brutal see once people lose their jobs they can't afford food or gas or rent remove demand and prices fall problem solved so they're kind of hitting the Demand right they're kind of hitting demand we cannot afford an 8% mortgage okay corporations cannot afford to borrow money at 10% or above that slows down economic growth yes it's the financial equivalent of carpet bombing which punishes the guilty and the innocent alike yes it will work by pushing the entire nation into a recession so brutal that the only solution is a Federal Reserve intervention Q money Printing and interest rate cuts which sets the stage for the next enormous surge in the cost of living welcome to the modern economic cycle where your economic well-being is managed by an unelected cabal of academics who've never really had a real job in their lives and that's exactly the situation that's exactly the situation so will my video be on on YouTube forever I don't know will it get a strike I don't know I hope not I'm not advocating for any of those positions I'm just putting forth that those positions are there and I think that housing affordability is out of control I think it's due to inflation we can argue about what the what the what the what the general inflation what the reason for that is but I don't think it's as simple as supplying demand that's me what do you think put it in the comment section below judging from my best performing video which happens to be about camping a YouTube channel about camping I'm not going to answer every every single comment if it's if it's just what I think to be is dumb if you haven't watched the whole video and you write something I don't really I mean come on right so anyway with that I'm going to head out look if you like this type of content please consider subscribing it'd be great to have you trying to build a community of real people right all walks of life just real people and who have an interest in the real estate world and the real estate market in the real estate media it's fascinating what you come across daily and I'd like you to be a part of it with that I'm going to head on out thank you for watching thank you for listening and I'll catch you on the next one