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Joe
Welcome to Off The Record Talking Real Estate with Joe and Makayla. If you're interested in the Portland, Oregon real estate market and want the unvarnished inside scoop, you’ve come to the right place. Thanks for giving us a listen. Okay. Welcome to the show, everyone. Hi Makayla.
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Makayla
Hi. How are you?
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Joe
Great. How are you?
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Makayla
Pretty good. More punchier, to be honest.
00:00:30:07 - 00:00:38:21
Joe
I am, too. It's our first show of 2024, and everything's not smooth right now. My voice.
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Makayla
You don't have a voice. It's a little gray outside.
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Joe
Yeah, We've got snow on the way. So, you know, it's kind of looking like those Christmas blahs.
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Makayla
Seriously? Yeah. I was reviewing some of our episodes from last year, trying to pull some reels for some content the beginning of this week. And I notice that every time we hop on, I always say that I'm good. Yeah. So this year I think I'm going to be more honest.
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Joe
Okay.
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Makayla
So today is punchy.
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Joe
Punchy. Okay. I need a different adjective every single time.
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Makayla
Love that.
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Joe
It's 2024 and the housing market's off to a screaming start, rates are starting to come down a little bit. It seems like consumer confidence is starting to pick up a little bit. But the thing that we're going to talk about today is buyer's remorse.
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Makayla
Or how to avoid buyer's remorse.
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Joe
Well, yeah, talk about what it is and I think just the fact of understanding and talking about what it is will help people be prepared and be able to avoid it, you know, moving forward. But also, I think our marketplace that we've had over the past two or three years has caused a lot of this. Right. You know, people get forced into some bad situations.
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Makayla
Yeah, exactly. When you're bidding on ten different properties, you kind of just a lot of people got stuck with what they can afford or what they can just get their hands on.
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Joe
Yeah, and that's weird. I've never like 20 plus years, 29 years now in the business, and I've never thought of buyer's remorse as anything. I've never, you know, it's never really been a thing.
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Makayla
Well, it's confusing because, I mean, we know it maybe exists somewhere, but all of these charts that we've pulled through the episode, I'm just kind of confused on how they got all this data. Like, are they you know, are they interviewing people who bought a house in the last year? I don't really know where all this information comes from, surveys.
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Makayla
But like who?
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Joe
I don't know. Do you do some surveys? No. No, I don't either. I actually charge them.
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Makayla
What does that mean.
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Joe
When I get a. So my wife completed a phone survey one time. Years ago. And now we're on the master list for all phone surveys about any topic because they've found the one person that's willing to answer something. And I get the calls now for whatever reason to my phone. Hi, Stephanie. Would you like to do a survey on X, Y, Z?
00:03:11:08 - 00:03:34:04
Joe
And I'm like, Well, first of all, I'm not Stephanie. Stephanie. Second of all, I charge $35 an hour. I will do quarter hours. I'm ready to take your visa number. And they're like, Well, we don't pay. And I'm like, Well, then you don't get a survey. Do you want one? It works every time. Makayla.
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Makayla
You're the only person I know who would do Well, that's hilarious.
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Joe
Well, I'm waiting for the one that's actually going to pay me for my time. And I should be charging more than $35 an hour.
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Makayla
Yeah, absolutely should. This is valuable information. Valuable feedback. So you're saying the people who fill out these surveys are people who don't have a lot of other things to do?
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Joe
You know, I think in this case, it's probably, you know, people that are on the records, tax records, whatnot, that have just bought a home and they're able to track them down and get their opinions on, you know, a bunch of different questions.
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Makayla
So I'm just thinking about the survey now calling all these poor people. Yeah. Hi. How's your home? Sucks.
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Joe
Yeah, well, we love the home, but X, y, Z, right? Yeah. They're saying that up to 75% of recent home buyers admitted they have some level of regret.
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Makayla
What? That seems insane. See, that's why I'm not so sure about this information.
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Joe
I think, you know, you need to categorize that as well. As you know, I don't think it's 75% absolutely regret buying a home. I think there are certain portions of the homebuying process or their home or whatever. And that's what we should talk about, just so people can understand that and be like, okay, I guess I do need to spend more time thinking about that or whatever.
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Makayla
Yeah, I think so too. That's why I think this is important to talk about.
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Joe
Yeah. So let's dive right into it.
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Makayla
Okay, let's do it.
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Joe
So what do you think the number one regret is?
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Makayla
Well, my actually, my guess before this was that they bought the home sight unseen and didn't, like understand something about the property because that was happening so much in 2019, 2020. Right. And actually happened to my parents and they have serious buyer's regrets. Yeah. So that's that was my guess. But yeah, the top thing according to our MLS is 30% of the people said they spent too much.
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Joe
Yeah I guess that's yeah. How fast prices appreciated and how much people had to pay over asking price for you know, what 24, 32, 38 months, whatever it was in a row, that's got to have some sort of bounce.
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Makayla
Back just you know talking about now if they're thinking about selling in the next five years, they might have problems getting their value back and we could do a whole another episode on appraisals. But a lot of people of their appraisals or paying for that gap in appraisals. So it's just.
00:06:05:13 - 00:06:16:19
Joe
Did they pay over less per asking price? Your parents? Yes, that's a tough one. But that was the environment we were in back then, right? If you had to get into a home and you had to do some crazy stuff.
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Makayla
Right. But explaining this to somebody when they're so hard on it and they need to get into a house, it's so hard to bring them back to reality. But I think we can learn some important things from the last few years. Yes.
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Joe
And I think part of the conversation that you and I were having that I think a lot of people appreciated was, well, how long do you anticipate being in this house because you're paying X over asking price. And according to our valuation that we've done for you, that's about one and a half years appreciation. So basically you're forgoing a year to a year and a half worth of appreciation to get into this House now.
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Joe
And if they said, well, we're only thinking about being here two or three years gets a little iffy right?
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Makayla
Yeah, absolutely.
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Joe
But if you're like, no, this is my end all be all house, we're going to be here at least ten years, 15 years, then it makes more sense.
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Makayla
Well, so I think with that too, more than just paying over what they're asking, I think it's important to look at the taxes. You know, per county, taxes vary if you're in an uncomfortable position that way, that can bite you later. You get tired of paying that much or even just things like the water bill, power bill. Yeah, all things to look out.
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Makayla
Do your research I think is what we're trying to say.
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Joe
In the next item on the list was changes in interest rates. Well, remember when rates were so low, people thought they would just keep going down, right? Sure. And then for a while they did. You know, they were at 4%, 5%. And everyone's like, wow, I want to buy, buy. I think I'm going to wait till they go down to three.
00:07:46:04 - 00:08:14:13
Joe
And we're like, I don't know. I don't know if that's going to happen. And then it did. And then some people were getting into the twos and everything and it just was nuts. Some people bought at four or five were like, man, now they're at this. And sure. But the I think the opposite has happened in the last 18 months here where all of a sudden for a lot of different reasons, the rates have gone the other direction and people are like, I had a chance that when I when they were at six and now they're at seven, now they're at eight.
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Joe
Timing. The market's difficult and having regret about interest rate is one thing that I think you can fix. I get a lot of those people that had to buy and bought it for six months ago when it was 8% or more are probably looking at this summer this spring as a good time to refinance.
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Makayla
Yeah that's true. I won’t get too hung up on that it is hard to predict like you said.
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Joe
Yeah. What else is another one?
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Makayla
Is that my home requires too much maintenance. This is a big one.
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Joe
This is a big one.
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Makayla
Especially back in that time that we were talking about, people were waiving in the inspection periods, not really going through their list of repairs like they probably should have. And now they're sitting with, you know, maybe the fact that they have to replace their roof or their plumbing or something really serious that's really costly. Yeah, that's hard.
00:09:01:04 - 00:09:15:10
Joe
There were a lot of inspections that got waived, too. I'm just not a fan of that. Personally, I don't think I could buy a home and just say, Yeah, I'll take it as if that's just too much of a roll of the dice for me. But for some people that was kind of what they had to do.
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Makayla
Yeah, they had to completely waive the inspection period. So they still have the right to do an inspection, but they didn't get to negotiate any of those items to be fixed by the seller. And that becomes an issue because inspection is always step one, right? You have a general inspector come in and look at everything, but they aren't always experts at some of these items.
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Makayla
They aren't always experts on a roof or a plumbing or some of the more technical things of the house. So during that period, we get a chance to bring in a roofer or a plumber and have them give their genuine opinion. And if you don't get to do that, then you're missing out on important feedback that could cost you your time later on.
00:09:49:01 - 00:10:05:10
Joe
That's a tough one. And when you waive your right for an inspection, a lot of people I know, we're like, have a general inspection, but I'm not going to do a sewer scope, I'm not going to do radar and I'm not going to do those type of things. And it's like you said, you really should. Yeah.
00:10:05:10 - 00:10:06:14
Joe
So lessons learned.
00:10:06:14 - 00:10:26:11
Makayla
There, right? Under that one, 24% of people say they bought a fixer upper for me. And because I was one of those people I think a couple of years ago was when all of those DIY videos on the Internet started getting pretty viral. Yeah, people got a little ambitious.
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Joe
Yeah. Was that you?
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Makayla
A little bit, yeah. Okay. All right. I'll admit.
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Joe
I respect that you're willing to raise your hand on that.
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Makayla
One of our goals this year is to do one house project a month to try and tidy everything up.
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Joe
And your husband is such a gem.
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Makayla
And that's pretty much just all of his.
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Joe
Thing now. It's just Mr. Mast going out there.
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Makayla
I hear you.
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Joe
You're very helpful, though.
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Makayla
No, I know, but the extent of my helpfulness is painting so much that is done. Yeah. So I can empathize with people on that one. But yeah, really think about buying a fixer upper before you do. So.
00:11:03:05 - 00:11:06:21
Joe
Yeah, for sure. Rushed through the buying process.
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Makayla
00:11:07:18 - 00:11:09:11
Joe
Interesting. Yeah, I.
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Makayla
I'd like to see what if they're talking about, like, the pre-approval or the whole thing from pre-approval to closing?
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Joe
Yeah, that would be my question, too. But feels like you got rush through it. That is something you should never feel like you're getting rushed. I mean, I get it that there's timelines and a lot of when it was such a seller's market was no inspections. We're going to close in three weeks, even with tough financing and get all these things done.
00:11:34:04 - 00:11:56:17
Joe
I get it. You can feel rushed and like, I didn't get the needed time to to do what I needed to do. And I get that. But hopefully in this new market that we're at, things are a little bit more balanced where a buyer can not be so dependent on having to give away a lot of the terms and conditions of the sale agreement and that we're talking about all these things that people have said.
00:11:56:18 - 00:12:16:13
Joe
But I think it's important for us to also talk about what those mean for the coming market. That's ahead. And one of those is knowing that it's all about price terms and conditions when you're buying a home. And if you give up on price, like if you give them the full asking price or sometimes more, in the past market, forget about terms and conditions, too.
00:12:16:13 - 00:12:32:02
Joe
You just had given the full now that you got the home. Now there's some flexibility there. You know, if you're going to give them full price, there's some terms and conditions that you can have them be flexible on. And all that's good to know so that you don't get into a situation where you have these type of regrets.
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Makayla
Yeah, exactly. So going down the list here, 17% of people said they regret buying their home because they bought it sight unseen, which is just crazy. But I get it. If you're relocating across the country, you're not always going to be able to make a visit out. But I think that speaks to trusting your real estate broker. I think a lot of the reasons why people have a hard time is because I always think about the unresolvable material defects, right?
00:12:58:22 - 00:13:16:00
Makayla
So I don't know if this falls into that category, but things like not having enough parking or living next to a train tracks or busy road or something like that that you can't change. Yeah, if you have a problem with it, just are the potential buyer is too.
00:13:16:00 - 00:13:30:12
Joe
So yeah, it's a tough situation to be in for sure when you're buying site unseen. And I remember doing and I know you did a ton of these too video tours. Most of the time it was for people that were out of state who were like, Can you walk me through this house? Let's take a look at it.
00:13:30:12 - 00:13:37:10
Joe
And you walk and talk and kind of go through it. And then they decide, okay, I'll get a plane ticket and fly up and be there tomorrow. Right.
00:13:37:12 - 00:13:42:10
Makayla
Much more comfortable with that scenario than. Right. Just making an offer online.
00:13:42:10 - 00:13:45:14
Joe
But the arranged real estate marriage, here's your house.
00:13:45:20 - 00:13:49:15
Makayla
You get good luck.
00:13:49:17 - 00:13:54:08
Joe
We laugh, but that was kind of what it came down to in situations.
00:13:54:09 - 00:14:10:01
Makayla
I know. I remember doing a video tour with a buyer. They were in like Detroit or something, and I showed them the house and they were like, it looks great. They're already in love with it. But then they open to the neighbors and they're like, Never mind, you can never again go. So it happens.
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Joe
It does happen. So what are a few other ones?
00:14:12:12 - 00:14:16:22
Makayla
So 15% of people said that they don't like their homes location.
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Joe
I get that even when you have the best laid plans and you do all your homework and all this, you don't really get to meet your neighbors until you move in and spend time.
00:14:25:22 - 00:14:42:07
Makayla
Yeah. Or just like drive times to work. Maybe you regret that. Maybe you thought you'd be okay with the longer commute than you are. You're too close to the freeway or not close enough. You know, there's. I get it. There's a lot of different reasons, but that's something you should be able to do your research on locally. So hopefully that's an avoidable one.
00:14:42:07 - 00:15:04:06
Joe
I had a family that I met with about getting their home sold out in Banks, actually, and they were told when they bought the home that the train tracks next to their house were defunct. turns out not the case count. Yeah, and apparently the train stopped running for a month, like, right when they moved in and they didn't even think about it.
00:15:04:06 - 00:15:25:03
Joe
And then one day, the train, I mean it like shared the tracks were right on the other side of their fence. And one day the train came rolling through and shook everything in their house. And her response kind of threw me off. I was like, that had been really awful. And she was like, you know, we were all moved in and it only comes, I don't know, once a week or so.
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Makayla
Okay, So it was very optimistic.
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Joe
Do you think people.
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Makayla
Are not going to.
00:15:29:02 - 00:15:30:13
Joe
Like that? And I was like,
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Makayla
Pretty much a deal breaker. Yeah, in most cases that one's so hard.
00:15:35:23 - 00:15:40:16
Joe
And when you're. Yeah, when you're right next to Union Pacific, it's that's a tough one.
00:15:40:18 - 00:15:47:01
Makayla
How funny is that though. I think the sellers like made the train stop per month. Well that's being shown. Yeah.
00:15:47:07 - 00:15:52:04
Joe
Well Rich which broker. Which realtor was like yeah. No that train doesn't run anymore.
00:15:52:05 - 00:15:54:08
Makayla
Yeah. That's a little confident. Too confident.
00:15:54:10 - 00:15:57:08
Joe
Too confident. Yeah. Anyways, that happens.
00:15:57:08 - 00:16:01:22
Makayla
And then tied with location. 15% say I don't like my neighbors.
00:16:02:00 - 00:16:05:19
Joe
We love our neighbors here. We've got a great neighborhood.
00:16:05:21 - 00:16:08:09
Makayla
I envy you for that because I don't like my neighbor.
00:16:08:11 - 00:16:10:17
Joe
Every time come by your house, your neighbors seem fine now.
00:16:10:21 - 00:16:12:08
Makayla
Yeah, they're. They're nice.
00:16:12:08 - 00:16:17:17
Joe
I'm just put them on notice that I'm coming over and be cool.
00:16:17:18 - 00:16:34:09
Makayla
I think you missed the drive bys, though, or the cars slow down for just a couple of minutes and then speed off the house across the street.
like we said, you don't really know until you move in. You know, the thing that I've heard people do, our clients do that I thought was really smart was they drive by their house after they get an accepted offer or even before. Sometimes they drive by at different times of the day. So morning, noon, night, and just try to get a feel for the neighborhood, because the neighborhood can be totally different at different times of the day.
00:17:10:16 - 00:17:24:06
Makayla
Right. And you can easily overlook things, you know, when you're all excited and you're seeing it in the light. That's something we didn't notice either. Our street has no streetlights and no sidewalks and that's right. Yeah. It's things to pay attention to. Yeah.
00:17:24:08 - 00:17:44:04
Joe
I remember when I was a young real estate broker in the business and we had I was working with a very savvy elderly gentleman who was, I think it was an investment. And we were standing out in front of the house and someone walked by and he was like, Hold on one second. And he chased down this person that was walking by.
00:17:44:06 - 00:17:57:23
Joe
It was like, hi, Hi, I'm Bill. And, you know, he I was wondering if you have 2 seconds. And I was like, what is this guy doing? And he started just chatting this person up. Do you live in the area? you live three doors down. You're just on your walk. I'm thinking about buying this home.
00:17:57:23 - 00:18:12:01
Joe
What do you think? And he just got a neighbor's insight into things. And I've seen that a handful of times since then where someone will see an opportunity to have a quick conversation with someone and you can get a lot of valuable information from them.
00:18:12:05 - 00:18:23:13
Makayla
Yeah, that's smart. I was thinking it might be useful to try and see if you can work through your broker and maybe ask the seller how they feel about their neighbors, but whether or not they're honest, you know, is another conversation.
00:18:23:13 - 00:18:26:09
Joe
So are you going to get a straightforward answer on that,
00:18:26:11 - 00:18:32:13
Makayla
Yeah. I mean, if it's something that they're posting about in an open house, then obviously, you know, it's probably true.
00:18:32:13 - 00:18:34:20
Joe
But I think you can do some due diligence there.
00:18:35:01 - 00:18:35:10
Makayla
Right?
00:18:35:16 - 00:18:38:06
Joe
Right. Not always, but sometimes.
00:18:38:11 - 00:18:47:15
Makayla
What else? What's the last one, Joe? Give it to us. 13% is can you not read?
00:18:47:17 - 00:18:55:09
Joe
I feel like we're on like Family Feud. You know, where it's like thing top answer was.
00:18:55:11 - 00:18:58:07
Makayla
I like that we usually don't really.
00:18:58:07 - 00:19:02:11
Joe
See family family feud style.
00:19:02:13 - 00:19:04:21
Makayla
So Joe can't wait for.
00:19:05:00 - 00:19:05:10
Joe
I can.
00:19:05:10 - 00:19:08:21
Makayla
Raise two really small writing I think that's like.
00:19:09:02 - 00:19:19:21
Joe
Well this is 13% also how can 13% of the people say flat out I don't like my home, We shouldn't be laughing about this.
00:19:19:21 - 00:19:23:08
Makayla
But yeah.
00:19:23:10 - 00:19:26:01
Joe
Yeah, I don't know what to tell you.
00:19:26:03 - 00:19:28:08
Makayla
Like floor plan. Like, what are we getting at here?
00:19:28:10 - 00:19:50:17
Joe
We got cars before that. We're like, I just I don't like this car, but I really don't like this car. Yeah, maybe it's the same thing with houses where you get in and, like, the windows are all squeaky and this doesn't work and that doesn't work. And my neighbor to the left is stinky. Not a good person.
00:19:50:19 - 00:20:02:19
Makayla
Yeah, that's a funny one. To me. It's like you can always change things in the home. You know, maybe expensive. That's the problem. But you can always make a home, homey, if you're creative enough.
00:20:02:21 - 00:20:05:13
Joe
I don't like my house.
00:20:05:15 - 00:20:09:10
Makayla
Well, probably stay with that for 3 to 5 years. So, you know what.
00:20:09:10 - 00:20:14:18
Joe
My advice LivPortland.com Reach out to Makayla Mast.
00:20:14:21 - 00:20:15:17
Makayla
Full circle.
00:20:15:17 - 00:20:31:16
Joe
And have her come over and do a valuation for you do a walk through and I'm sure there's some things about your house you like let's focus on those and let's get that puppy on the market and get it and market it and get you the best money and the least amount of time.
00:20:31:18 - 00:20:36:02
Makayla
Sell it to someone who might not like it either. But that's not your problem anymore.
00:20:36:04 - 00:20:45:02
Joe
Yeah, they'll probably like it, right? Who knows? We are sassy on this one. Like, would you say to begin with, Punchy.
00:20:45:04 - 00:20:48:19
Makayla
It's my word of the day. You can't take it for the rest of the year.
00:20:48:21 - 00:20:51:13
Joe
Well, you need a new word.
00:20:51:15 - 00:20:54:21
Makayla
Okay. Next week you do too.
00:20:54:23 - 00:21:03:21
Joe
I have to do this too. Yes. my gosh. Okay. I know how to find a dictionary, though.
00:21:03:23 - 00:21:06:18
Makayla
Think of.
00:21:06:20 - 00:21:27:11
Joe
All right, everyone. So we're going to post these stats at Livportland.com. You can go on to our podcast button there and see all of our old podcast. Also, if you want to click on this one, Buyer's Remorse, I think is what we'll call it, right? You can see all the stats from this and join us next time.
00:21:27:12 - 00:21:36:13
Joe
This is a new year. We've got a lot of exciting stuff coming up and we've actually got some interviews coming up that I am so excited about.
00:21:36:14 - 00:21:37:11
Makayla
Me too.
00:21:37:13 - 00:21:43:10
Joe
We're not going to spoil them right now, but be sure to check back because we got a lot of really cool stuff coming in.
00:21:43:11 - 00:21:45:01
Makayla
Excited, Happy 2024.
00:21:45:07 - 00:21:48:09
Joe
Happy, Happy New Year. Thanks, everybody.
00:21:48:09 - 00:22:04:17
Makayla
Thanks for joining us today. If you're interested in finding out more about Joe, myself or the LivPortland team, you can go to Livportland.com. Thanks for giving us a lesson and see you next time on the Off the Record podcast.
