Templar Real Estate Radio Show Transcript 10-17-2020

Learn about Real Estate by one of the premier Real Estate Investors in New Jersey. Each week Joseph J. Zoppi will be talking about investing in real estate including buying and selling houses and apartments. Understand how the economy, the Fed and world events impact real estate and how to adjust to these dynamics.

Templar Real Estate Radio Show for October 17, 2020


The following program was paid for by Templar Real Estate. The views and opinions expressed on this program are not necessarily those of the staff and management of WMTR.  As always, it is advisable to consult a professional before making a major decision.

It’s time now for the Templar Real Estate Talk Show. Here’s your host for the program, Joseph J. Zoppi.

Joseph J. Zoppi:

Hello, welcome to the Templar Real Estate Talk Show, my name is Joseph J. Zoppi, a real estate investor, consumer advocate, author, and managing partner of Templar Real Estate Enterprises. You could reach us at templarcashforhouses.com or call us at 973-240-8593. Again, that’s 973-240-8593 or again on the web at templarcashforhouses.com, that’s T-E-M-P-L-A-Rcashforhouses.com, it’s one word, and once you’re on our site, you could ask us any questions in terms of the show and we could talk about it on this show or any other questions, or you could call us directly and we’d be more than happy to address anything that you have.

My company is a real estate investment firm, we buy houses for cash, we purchase apartment buildings, we do joint ventures with other real estate investors, we loan money for rehabs and provide transactional and gap funding. We work with individuals that want to invest with us in single-family houses up to apartment buildings. We do not speculate and we’re very protective of our funds and our investors’ funds. I am not a real estate agent and we’re not a brokerage but I have individuals on staff that are agents that will sell your house through the traditional Multiple Listing Service.

This show will go through everything that is about real estate and those things that impact real estate. We’ll talk about our rehabs, some of our investments, what went well, what challenges we had, and we corrected them. We’ll discuss trends in the real estate market. Real estate is one of your biggest investments, so it’s important for you to know as much as possible about it.

This show is based on my opinion and my experiences. I always recommend everyone to do a lot of research in terms of anything they’re doing, whether it’s working with a contractor, even purchasing something online, you look under the reviews and try to get a good understanding of what it is. I was looking at some reviews for one of those vacuum cleaners that’s portable that’s automatic and I was reading some good things about it, it had a lot of positive reviews, but then there’s like, really negative ones and I’m glad I read it because if I look at the number of stars, it would’ve been one thing, but what some individuals are saying is that if it’s broken, they had to get the parts from India and they weren’t readily available, so I nixed that, and I had some other experiences with some other products that I was going to purchase on Amazon. After reading some of the reviews, I’m like, yeah, there are some good points there. One was, I think, for a pan, a nonstick pan, so by the time it was over, I didn’t purchase anything because I couldn’t figure out what’s a good pan or not. Sometimes, too much information isn’t good either, but that’s the problem in this world right now, there’s just so much information out there that you really don’t know what’s true and what’s not, and it is a challenge, and I’ve said this before, that only look at whatever it is, if it’s a service provided by an individual, is that there’s a lot of average people out there, it’s just the way it is historically and the way it is based on the bell-shaped curve, so the question is, are you getting something in that big hump, that average, or are you trying to get it down? We all try to get the A player, the A+ or B+ player, but sometimes, it’s really, really hard to determine what’s good and what’s not. Case in point, I have, sometimes, individuals that say, “Well, this individual has 30 years of experience in the real estate industry,” and to me, that doesn’t really mean anything. 30 years, okay, 30 years is a lot but what are they doing with that? Are they very progressive or are they just clicking off the ears and putting in the time?

One of the things for us is that when I first started in the job market, I was in IT for a long time and in the late 80s, early 90s, when PCs became available, in the mid 80s, we’ll say, it was always based on technology changing a lot, and it’s always been that way, especially in IT. Every year, the technology is constantly changing and for you to be good at what you are doing in IT, you constantly need to change, so for myself, that was my mindset. It was always what’s next? How was it changing? How do I become better? So on and so forth. In certain industries, you go into those industries or you talk to individuals in those industries and it’s like, “Well, this is the way we always did it,” and mindset is just, it’s different, it’s very stagnant, mindset of “This is the way we did it, this is the way we did in the past, it worked and this is the way we’re doing it now,” whereas myself and our organization is based on change and how to develop those changes and make sure that we are on the edge, not the leading edge always but we’re on the edge of change and we are always doing something to ensure that we are better than yesterday, and that’s the big thing, is how we are doing things to be better than yesterday, and I know, it doesn’t matter what industry. A lot of industries aren’t like that. Say you go to a restaurant and you have your favorite restaurant, and I have tons of favorite restaurants and some of them don’t change at all, and sometimes, that’s good. You like to feel comfort and that’s a good thing, but on other things, you need that change and sometimes, I go to this one deli, it’s like a deli and they don’t change that much, and it’s like, okay, what’s next? So sometimes, it just gets boring and stale in terms of the change, and you see a lot of companies like that and that’s why sometimes, they are not doing well or they are happy with what they are doing. “We have a set number of customers, we do it this way and this is the way it is.” For us, that’s not what we do. Again, we are looking for change, we are looking for people that are constantly evolving and being better, and I think that’s a testament to our team and one of our principles, really, is to always be better and as a result of that, I think a lot of customers have liked and our clients like the way we do business because we are always pushing it and we are always trying to be better.

So I’d like to also have a shout out to one of my listeners, Paulette, hope you’re doing well, and again, if you need to sell your house fast for cash, please give us a call, we are always here, we work typically seven days a week and I do take some time off but we work a lot of hours and we do that for a couple reasons. We don’t know when someone needs our assistance and when you’re in a financial difficulty, it comes to such a point that you just need to talk to someone or you need for someone to come out to the house because it’s just such a point, tipping point, and we are always here for you. The other reason we work a lot is we just really enjoy our work and we enjoy the people that we work with and we enjoy our clients and we enjoy solving problems for our clients, and that is really so important to us and yes, I do give time off for people and they could take as much time as they want. I’m very flexible with that, but there’s a belief in our organization to always be helping people and as a result of that, I think we have a really strong following from our past clients and they always recommend us for future clients, so that’s always a great thing.

Another thing is that we look for apartment buildings, we are always looking for apartment buildings, especially 100-plus units. We will do smaller units, 10, 20, 30, 40, whatever it is. If you have some, please give us a call on that. If you know anyone that has it, anything that they’re interested in selling or they are having some challenges, we’d be more than happy to talk to them. We also give finder’s fees for anything like that, we are always very discreet with that. Privacy is always important, so if you give us someone’s name, we’re not going to say, “Well, Jimmy sent this,” or so on and so forth. So we will just be discreet with that.

Another thing that we’ve encountered this week which was a little frustrating, so we do a lot of transactions, so as a result of that, we always run into situations, issues that do not go as smoothly as we want them to. It’s just, that’s the nature of it, it just is. So we are closing on a house this week and last week or the week before, we went through some permits, we want to make sure everything was closed, we had the CO arranged and for the CO to be arranged, you gotta have all permits closed. We had that but we were checking a few things because we are extremely diligent in terms of making sure everything is, the I’s are dotted, the T’s are crossed, and there was a situation with the building permit. The permit was given but it wasn’t closed, and it was more of, what happened was, we had an open space concept for the house, when the walls were taken down, my contractor said, “It’s not a load-bearing wall,” they had the ceilings open, so on and so forth. I had an architect also go there and I’ve used this architect for how many years, and they said, “Yeah, it’s not a load-bearing wall, it’s really a partition wall,” they called it, so we submitted the plans just to have them on record because we want to do that and I didn’t have to, but I wanted to submit them, and they came back and they said, “We wanted a letter stating that it’s not a load-bearing wall,” and we did that, and then all of a sudden, the permit was still open and they approved it, so that’s a good thing, so really, just close out the permit. So they came over and then they were questioning everything, and I’m like, I can’t believe we’re doing this right now, you’re questioning it.

So before I continue with the story, I’m going to close out the segment and I’ll be right back. Again, if you need to call us, please call us at 973-240-8593. Thank you and I’ll be back in a few minutes.

Joseph J. Zoppi:

Hello, welcome back to the Templar Real Estate Talk Show. My name is Joseph J. Zoppi, managing partner of Templar Real Estate Enterprises. You could reach us at 973-240-8593 or templarcashforhouses.com, that’s T-E-M-P-L-A-Rcashforhouses.com, that’s one word.

So as I was closing out on my last segment and I was talking about a house that was going to be closing this week and there was a permit that was granted, so when you grant a permit for plans or whatever the case may be, they have to prove it, so the township approved those plans, then I saw that it was open and I was going through a few things, and they wanted to come out and take a look, and the building inspector came out, and then he started questioning everything, “I want to see the plans,” so on and so forth. I say, “I don’t have the plans with me, I don’t carry the plants with me. You already approved this. You’re going in there,” and he says, “I don’t know, I don’t feel comfortable with this,” and I’m like, “I can’t believe we’re talking about this at this point,” but I really didn’t say much because you really can’t say much to inspectors. If you do, it’s just going to cause more problems. So he went back to the office and contacted my architect. I spoke to my architect also and I said, “What’s going on here?” He says, “I have no idea, we are standing by with the provided,” and he says, this is the manager of the architectural firm, he says, “I’ll talk to the architect again on this,” and he did and they wrote another letter stating, “We understand your concerns but we back the decision we made that it wasn’t a load-bearing wall.” So they finally released and they said, “Okay, we’re going to close the permit,” but you just never know any of this stuff, and things come up that shouldn’t come up but they do come up, and that’s the biggest challenge and it’s how you address those issues, and if you have a great team, which I do behind me, so that’s the thing, and they were going to stay strong on it because they were confident in the information that was provided. I had made sure that we sent someone certified to ensure that everything was done correctly beforehand and we didn’t just assume that, and I didn’t, even though my contractor is very good, when it comes to architectural design and structural issues, they do know a lot but they are not certified architects, and you’ll want to make sure that you are sending good people to handle these things. So that made me feel a lot better and we’re going to be closing on the house Friday which is today, so all is good. When I finish with a house and my team does, it’s sometimes bittersweet. Sometimes, I say, the happiest time for any of our flips is the day we buy it and the day we sell it, because in there, there’s a lot of turmoil that goes on, there’s a lot of changes, and it’s difficult, and anyone that says it’s not, it’s just, they don’t understand it. They might have a small project but again, when you start doing volume, you start encountering these things.

The other thing that I have to say about the architectural firm is that if there was an issue, and then we had to redo things, that would’ve been just, it would’ve been just a nightmare because when we design something, we are designing it, as I always talk, from an aesthetics perspective, and once you change that, we have counters in, everything, everything was in, lighting, and I was looking at it afterwards on site and I’m saying, “If we had to change and put some header beam up and some columns,” I was looking, I was like, holy mackerel, I couldn’t figure out a way to make it look good because there was just so many changes we would have to do. It was horrendous, and I said, “Ma’am, we are really happy it ended up the way it is because it could’ve been a complete disaster for us and for the buyer.” They bought the house based on the way it looks, not putting additional an header up and that header would have had to hang below the ceiling because of the way the design of the house was and the columns would’ve, it just would’ve been a big mess, just a big, big mess. So I’m happy to say we are good with that.

A couple other things, I put up last week if I’m not mistaken, again, if you ever need to, you are in a pinch and you need something from Home Depot that you are currently not finding and you have to put an order or it’s backordered, go to the superstore in Union, it’s Vauxhall, V-A-U-X-H-A-L-L, that’s the Home Depot superstore. It’s the biggest in the country and has a lot of products. It’s probably three times the size of a regular Home Depot and it’s got a lot of different things that you wouldn’t see at a Home Depot – very high-end fixtures, as well as the standard stuff that’s there.

The other thing is that we do a lot of shopping on Wayfair.com, that’s W-A-Y-F-A-I-R.com, and you get some decent prices and we get tiles sometimes from there and stuff, there’s really nice things there.

A couple other things, in terms of the economy, I’ve been preaching about it, concerned about the economy, you have an individual saying, “It’s rebounding.” I’m not disputing that, I’m just wondering, again, six months, a year from now where it’s going to be, and that’s a major concern of mine, and it should be everyone’s, and that’s why I’m saying very cautiously, so if you’re going to sell your house, sell it as quick as possible, that’s the first thing, but if you’re going to buy a house, I would wait. I really would wait and see where everything is going to end up because again, the housing, it’s going up but we are going to come to a point, I’ve seen it in certain towns where things are maybe taking a little longer than a month ago, they are still moving very quickly, I’m not disputing any of that, but in a few towns, things are starting to linger, inventory is increasing a little bit, so just be wary of that. Again, if you’re going to sell, sell as quickly as possible. Where the economy is going, who knows? But you have stock valuations that are extremely, extremely high, and I’ll talk about that hopefully in a couple of minutes if I have some time on that.

But I was reading an article about Citigroup, so they said that they let go of 1% of their worldwide staff, but they hired back about the same amount, so they let go of, I think, 26,000 employees, and they said they rehired or hired 26,000, so it was like an offset, technically. That’s like, code for “We brought on cheaper staff members, employees compared to what we let go,” that’s really what it means, so just because you see the numbers changing, it doesn’t mean anything. There’s an article that I read and they were quoting some numbers and they said that unemployment is at 7.9% but it’s truly around 12% and that’s because of the underemployed, so those are individuals that basically took a job because they needed a job, not because it was where the salary should be, what they expected, and what they are used to previously but they took a job because they needed a job and that’s always a scary thing, and if you don’t always see those numbers and you really don’t know the impact, and it puts a greater strain on the family or the single person, so that’s something that we really gotta be just cognizant of.

I was also looking at, I’ve been talking about the valuations of stocks and people are just buying stocks up and there was an individual from a trading firm that said that the valuations are extremely high and he’s worried about all these Millennials that are jumping into stocks and just trying to purchase and they think they’re going to continue to go up, and I have been through it, so I know exactly what it’s like because when I was young during the dotcom boom, that’s what I was doing, and history does repeat itself, and it’s scary because one day, all of a sudden, it’s just going to come down, and I remember back in 2000, 2001, whenever it was, that I was in New York City and I went to a client and I came back and the stock market was down so much. I’m like, holy mackerel! And I didn’t know what to do, and I didn’t have what’s called stop-losses in there that said if it got to a certain point, the stock would automatically sell, and I was like, holy mackerel! And then, by the end of the day, the stock market rebounded, like almost as much as it came down. It was less but it was like, oh, okay, and then the next day, it came down again and it just stayed down, and it was just unbelievable in the carnage, and everybody doesn’t think it will happen again but these things happen and there’s corrections and there’s fear of corrections, and you really gotta watch out for that and if you stay in the market, at least put a stop-loss in.

Now, with mutual funds, you’d have a stop-loss but it doesn’t get executed until the end of the day or the closing of the day, so your losses could be considerably longer and larger than in a stock or an option. So that’s just something to be cognizant of, to know that, but I would always, always, always recommend you put a stop-loss in. Whatever the percentage is that say, okay, if I lose this much, okay, and if it hits that number, don’t always think about oh, I’m just going to go back in at a better price, just be wary of that, please. It’s really, really something that you really gotta watch and one of the biggest things is capital preservation when you’re investing. When we have our investors, the biggest thing is capital preservation. We give a steady return but they are not going to, it’s locked into the property and we make sure that they are not going to lose that capital. It’s that simple, and with the stock market, if you have a lot of gains, just protect those gains and just understand it and understand how to do stop-losses because certain types of stop-losses, if you do certain things, it won’t kick off even if it goes past that number. So when you put a stop-loss in, please make sure that you are doing it correctly. That’s the biggest thing, is to put it in correctly, and if not, then you’re going to get burnt by it.

So I’d like to continue talking but my time is up. Thank you very much for everything, I’m going to see you next week. Have a nice weekend, God bless, and take care.

The preceding program was paid for by Templar Real Estate. The views and opinions expressed are not necessarily those of the staff and management of W! . As always, it is advisable to consult a professional before making a major decision.


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