Ep 163: The Coming Housing Bubble and Recession – A State of The Economy Update 

So what does the economy look like in the near future for us working class citizens who have to actually work and pay for things with our hard earned money?

Have you ever heard the economy works in cycles? Well, it is true, there are good times and bad times; well, it is part of the economic cycle. If you pay attention and are prepared, in most cases you can weather a downturn, even a nasty one, in the economy. In some cases, you can even grow your wealth. The problem is most Americans do not pay attention, we definitely know our politicians don’t and spend our tax dollars like drunken sailors. Does that mean we should all do the same? 

The second leg in The Three-Legged Stool of The Simple Life is Financial Freedom. The key to Financial Freedom is not following the herd to indentured servitude of lifelong debt. Today Rob Kendall and I discuss, the storm that is coming in the housing market and a future recession. We both firmly believe they are unavoidable, the debt is due and someone is going to have to pay for it!

The key is to make the right financial moves, and ignore most of the advice the financial institutions and federal government are telling us, as they do not have your best interests at heart.

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Rob Kendall is the co-host of the Kendall and Casey Show heard 9:00 AM to 12:00 PM EST on 93.1 WIBC Radio, Indianapolis. Prior to joining WIBC, Rob served as an elected official for the Town of Brownsburg, where he proudly claims massive tax cuts and government reform as his greatest accomplishments.

Topics Covered:

  • Why Rob decided to buy a home now in an overly inflated housing market
  • Why there are always deals to be had in real estate, even in a hot market
  • How Americans get duped into overpaying for a home
  • How and why most American lose big in their houses
  • What is the key to properly financing a home
  • Why the housing market is primed to burst, even though the financial and real estate industry is telling you different
  • Why a world of economic hurt for Americans is unavoidable
  • How to survive and thrive in a terrible economy
  • Why the sugar rush of fiscal stimulus has to come to an end
  • Our predictions on how high interest rates will have to go
  • Why the midterms are not the answer to our financial woes 
  • Why the American Dream is a steaming piece of you know what
  • How to thrive and live the life you want, once you know how the game is played

Episode Resources:

The Kendall and Casey Show: https://www.wibc.com/show/kendall-and-casey/

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Transcripts :

hey rob thanks for coming on this will

be your first appearance on

a gary economic update and the reason i

wanted to bring you in you live in a

different part of the country

you’re a different uh age group than me

and you have a little different

background um you’ve been an

entrepreneur i’ve been doing real estate

for 25 years i’m not a

billionaire because i don’t screw people

and tell people false things and then

make them buy property that’s worthless

that’s how those guys get rich

or they get it pennies on the dollar

from screwing someone else but

uh

i want to talk about because you

recently bought a house and i’ve told

people for the last year do not

buy

a house don’t do it let this thing cycle

out

and go through but you did it for

different reasons and i tell people

though at the same time that there’s

always deals no matter what the housing

market real estate markets doing there’s

deals out there they’re just harder to

find

and it depends what you’re doing so take

it with a bit of a grain of salt

explain the difference of why you bought

now and how you were able to avoid the

interest hike

yeah so i bought a house based on

geographic

location i had looked at i’d sold a

house two years ago two and a half years

ago now had been renting a house i had a

great relationship with my landlord we

were what you would uh call probably the

perfect tenants in the sense of and he

said this you know he said

you guys aren’t doing drugs you always

pay on time you often pay in cash as

soon as something breaks in the

apartment you know i’m immediately

notified and literally the guy who owns

my house lives right around the corner

from me he owns several properties in

the town that i live in so

one of the deals when my first year’s

lease was up with him at the time what i

rented this house for seemed a little

expensive that was before covid and

immediately after cove took place it

went from being a little bit pricey to a

hell of a deal and so part of the deal

he made with me when my year’s lease was

up is he did not raise my

rate

uh primarily because indiana like many

other states in this country and in fact

i think the entire country had a

moratorium

on kicking people out of the property so

landlords were pretty much held

completely uh

they had no defense if somebody didn’t

want to pay their rent there was a

period where you could not kick them out

so having somebody who paid on time paid

in cash uh kept the place up and if

something broke was a huge value to them

so i had a great deal i bought my house

so i’d been looking the entire two years

though for a house and

everywhere i would go the prices were

astronomical but the la the

friend that i had who was helping me uh

look at houses said well but you gotta

factor in the interest rate

and my thing on that though was if i can

never sell the house for what i’m paying

for it the interest rate doesn’t much

matter because the end of the day i’m

going to have a giant

debt issuance

once the house comes to sell there was

one house we looked at that we really

liked it was pricey but because of

interest rates we thought well maybe it

would work

and then when we started talking to the

person showing the home they said okay

this is the price of the house

anticipate

25 000

cash on hand at closing above whatever

you pay for the house and say wait wait

wait wait

wait

we’re not talking like we’re gonna take

like a half a million dollar home we’re

talking about a 200

200 225 000 home so you’re talking what

an eighth of the price on top and cash

at closing and they said yeah every

house in this market right now is

getting that and so it came back to the

whole thing of you

up here until recently you cannot make

the numbers work to be able to resell

the home unless there’s some sentimental

or added value to a property as an

investment in many cases it’s a terrible

deal

and you came in you were smart and i’ve

told people about this and me and you

talked about it most people don’t

understand how to lock an interest rate

because the banks never tell you

you can do it i’ve done it on every

single house i find i don’t finance

houses anymore i haven’t had a house

payment for 12 years it’s the best thing

known to man

i love my life this way not having a

house payment changes your life uh

period um

but i would always lock in because i

never i bought during the peak once got

my ass handed to me i learned my life

lesson right there that’s why i teach

the things i teach now

and

even though i would have gotten my money

back if i would have sat in it long

enough but it wasn’t worth it i mean i

did the math and everything it was

better to get rid of it

but

you can lock in a rate and

you have two usually two times where you

can re-lock it the banks don’t tell you

that i think a lot of people are going

to get caught in this one

who recently purchased and their rates

are going to float up on them because

they didn’t lock because the bank didn’t

tell them their broke mortgage broker

didn’t tell them you can lock it now

and if it goes down you can re-lock

again

right so you locked yours way early

knowing this yeah so what happened was i

had given up looking at homes and i like

you gary said i’m just going to ride

this out i think my landlord was pretty

content even though indiana like other

states he could begin to evict people if

they didn’t pay et cetera he could have

gotten more for the property i think it

was just worth it to him because i think

he has some other

this will shock you gary when you own

multiple properties some of your tenants

uh don’t value the property the way that

you do

uh i won’t talk about tenants i’ve had

them i’ve had them i’ve had them so i

don’t think he was i don’t that was not

an issue but what happened was because

my radio show we always used to talk

about hey rob’s looking for a property

in brownsburg if you’re willing to give

him a hell of a deal call him

and then eventually

the person who literally lives next to

my dad which is the house i grew up in

said we listened to you all the time we

came over to my dad said if rob wants to

buy a house we’re going to move to

florida

and have rob contact us because we can

probably do this without a realtor which

will save everybody a lot of money and

uh and then we can reduce the price of

the home

if rob’s willing to wait because they

weren’t moving until the summer of this

year

and so they said if he’s willing to wait

we can everybody can kind of get out

okay on this and because obviously we

were locked into a good deal here uh i

was able to start that process and i

have a friend who’s a realtor who’s

willing to take care of it for both of

us so my case is a little different

there’s sentimental value to the

location of the property uh my dad is uh

not by any means very old and you know

on his deathbed but for long-term

planning to be able to look after you

know someone who’s older my mom lives in

this town too

so

literally at some point my dad lives in

a two-story house we live in a one-story

house we could just flip homes at some

point if that needed to happen so there

were a whole bunch of reasons that even

though the price

the what would have been the list price

was still astronomically high like we

talked about in this market being able

to save money by not having to use a

realtor having a realtor help us with

the the the process

um and then the location and then it

comes back to i was able to lock in even

though it was a long term i worked with

a great lender who was willing to lock

me in far in advance i had to pay a

little bit higher premium at the time on

an estimate of what the market was going

to do but they told me you should

absolutely pay this premium because

several months from now it’s going to be

astronomically higher and and it was so

if all those things had not happened i’m

100 with you i had would not uh have

bought a house right now well and i’m a

hypocrite too because i told people not

to do that i bought a commercial

building

so

but i did it because it’s the building

that i do fulfillment out of and i have

for eight years i have a good

relationship with the family i’m good

friends with them it was the family son

and me as business partners and his wife

we bought the building

uh we the real estate agent we’re

friends with two and so it was a deal we

got it for like 50 60 bucks a square

foot

so it was one of the yeah i mean it was

one of those that

it made sense but again right situation

right good interest rate even though the

the bank screwed us a little bit but

that’s okay um

but people this is the mistake i always

tell people with credit and i want to

dive into this cycle we’re gonna have to

burn through because you talk about it i

talk about it the big mistake people

real quick because because i know you

want to get off this but real quick if

you intend to live in a home the rest of

your life up until about three months

ago buying a home

because the interest rates were so low

was not a bad investment you could save

a lot of money over renting but that was

contingent upon like this house i’m

buying now will be one of the last two

homes i live in in my life either that

house or the house right next door to it

will be the only two homes i will ever

live in ever and ever but most people

are not in that position and it goes

back to that home i i told you about

earlier where

it was what it was 225 000 plus 25 000

at closing that was not the home i was

going to die in and so as such you’re

going to try to sell that home within

the next 10 15 years

and there’s no way you were gonna make

your money back so that that is one

thing i would caution people and by the

way consult your trained real estate

investment professional on anything uh

you hear from me because i’m not that

just one guy’s experience that if you

intend to live in a home for 40 years

it was you know probably a good

investment to get into something but if

not no absolutely not

yeah and if you need advice i have

consulting people that’s what i do um i

do this for a living

[Music]

[Applause]

you

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