A Month of Trends
WWIII and the memes that took center stage of this year are already strange ones. With Iran acting up (not that it's unjustified), and the coronavirus picking up steam, we should be looking forward into what the future might hold instead of seeing what might hold us back. Sure, we might get infected and the world will end right? I mean, it happened each time with SARS, bird flu, swine Flu, ebola, measels, etc. etc. and each time, the world came out, not just okay, but forgetting about it by the next big meme. In reality, these outbreaks don't scare me much, if at all. The way I've always seen it is: if I get infected, then I get to lay in bed for days on end and read and play video games. If I'm not, then I'm not. I think we, as a species, like to freak out with pandemics such as these because we're afraid of the unknown, especially with something like the coronavirus. We don't know much about it, and we get up in arms about it, but we shouldn't really worry.
Of course, it's not all doom and gloom. There are many strange things that are happening too! If you're looking to buy your very first and own home, then now is the time. A lot of people wanted to wait until the prices dropped and I'm not sure why they would do that, but you might EVER get another shot at getting an interest rate that's sub 4% ever again. That's right, LESS THAN 4%. During the last weekend, I had two lenders call me for two different loans we're in the middle of escrow calling me. They locked in the rates because, what would you know, they're at 3.5% and 3.65%. These two are the first two in years that I lock in at such a low interest rate. As I mentioned in my video, "The Cost of Waiting," this is something you always want to take advantage of.
A lower interest rate doesn't so much mean that your payment will be less, but the fact that your payment will be more principle heavy. If you're clever with these interest rates, you'll be able to pay off your home sooner than you think, and if you're extra clever, you might even be able to get someone else to pay your loan for you. That's right! Get someone ELSE to pay for your home. No more paying rent to someone else. Wouldn't it be better to just be a landlord yourself instead? That's why I'd like to announce the House Hacking Workshop of 2020. April 25th, I'll be teaching you the tips and tricks to get started on becoming a landlord and learning how to invest in real estate for yourself as I do. Of course, there are a lot of things to take into consideration here, especially in the Long Beach real estate market. I'll have more details about that workshop soon!
A Month Of Control
Speaking of house hacking, here in the City of Long Beach, there was a law that had passed not too long ago about rent control. Landlords couldn't raise the rent more than 10% in a year over year basis, plus inflation. What does this mean? that means that if your rent was $1000 a month, then your landlord couldn't raise it more than $100 the next year. In theory, a rent increase of more than even five percent is unsustainable, so it was easy for most landlords to forgive a 10% cap, but for others, it's not so easy. Rents in certain areas grow faster than others because of the high demand. Whether it's school locations, shops, services, and so on, rent does on occasion increase much faster than nearby areas because of such things. The prime example for you would be Belmont Shore, Marina Pacifica, or Ocean and Pine. Rent there has more than doubled in the past couple years, but if you look into other areas, rent has stayed pretty much the same.
That's when the State stepped in, limiting rent control to 5% plus CPI (consumer price index). In Long beach, the total is 8.33%. If your rent was $1000, then your landlord can't increase your rent by more than $83.30. In reality, it's not that much, but for landlords, it's extremely limiting, destroying any hopes into increasing market demands. One of two things will happen: landlords will sell to faceless outside investors, or buildings are going to stay becoming dilapidated. sue, but it's not as easy as one might think. Regardless, Long Beach is a more than capable city, and despite these new restrictions, I suspect that Long Beach will still be a prosperous city, despite what Sacramento wants us to do.
And A Month Of Great Loss
It was a cold morning, and quite honestly, I didn't really want to get up for the day. I was warm and comfortable, but I did have a pretty big obligation that day: the Home Buyers Seminar. I wasn't really in the mood to teach, but I got up knowing that dozens of families were going to have a serious amount of questions of a sometimes complex topic. As I got up and started navigating my phone for a bit, I chose to listen to music for once, instead of a podcast or the news. On my way out, I quickly glanced a comment somewhere that read, "More alive than Kobe Bryant." Dismissing this troll, I ignored it and headed out to the office. Once there, my parents were already setting up the seminar but that's when my dad dropped the news on me: Kobe Bryant is dead.
To be honest, I felt my heart sink, and I really felt like I wanted to cry. When I was a kid, I didn't really have many friends, and I had just moved to a new city, only to have less than no friends. I always loved watching Kobe Bryant and the dream team play, however, making me wonder if I would one day become a basketball star like him. (Spoiler alert: I did not) Regardless, his love for the game, his skill, his focus; these are the things I admired about him. It were the things that I lacked, but he had so much of it, that despite being either fifty feet away, or a two THOUSAND miles away, he projected that energy through my TV screen and into me, making me feel as if I was the one making each shot for the city of Los Angeles. Each jump was my jump. Each shot was my shot. Each yell was my yell. I moved, and ducked, and tossed along with him. All of those emotions were long forgotten, however, as I grew older and became more concerned with that pretty girl from fifth period. When my pops let those words out of his mouth, all of those emotions, feelings, shocks, and jumps came back in one big rush, and the realization that I had forgotten all that, and that I can never feel like that ever again created a great sadness inside of me.
Of course, this was, to me at least, the biggest shock of January. I didn't care about the coronavirus, or the threat of WWIII. I only care about Kobe, his family, and the families of the other victims in that horrendous crash. The world might never know exactly what happened in that helicopter crash, and much like the death of another one of my favorite celebrities, I would much rather not know exactly what happened. I would much rather believe that he died, comforting Gigi the whole way down with her in his arms saying that everything will be alright, only to open their eyes into a great hall where they can play ball together in peace for the rest of time.
I didn't really want to end this on such a sad note, but regardless, life moves on, and our pain of loss today will become memories of joy we can remember later. I guess one thing that tragedies like this always remind me of is to cherish each and every day, no matter how awful, because tomorrow, even the next hour, isn't promised.
Catch me on the next post and podcast! We'll talk about what to expect in February, how to move forward with your investments, and tips and tricks for the upcoming weather we see in beautiful Long Beach, California!