Homes in California is not being sold. They are being inherited

  📍 Homes in California is not being sold. They are being inherited. That's 18% of the property transfers, which is by the way, double the national average. We are, uh, quickly becoming an inheritance base market in very expensive counties. Um, one in four, 25% are becoming an inheritance, uh, market. Why does this matter to you?

Because it's killing inventory. I keep talking about how we need to address the inventory side of the equation. These properties never hit the market. They stay in the family and they become rentals or second home. Um, it's replacing a lot of the traditional home buying. So a lot of kids, instead of buying, they're just waiting for their parents or their grandparents to pass away and they just move in.

Uh, people are holding on instead of selling because of prop 13 and Prop 19. Um. For example, LA County has a huge problem. 63% of all inherited homes are used as rentals or second homes. Those properties never hit the market. So people were talking about the silver tsunami that was be, that was, uh, gonna come from, uh, uh, uh, this generation, um, boomers say we're gonna sell and flood the market.

It's not a flood, it's a trickle. Those homes are moving, but they're not hitting Zillow, they're staying within the family. So, big picture. Less inventory means higher prices and bigger wealth gap. What are your thoughts?

We have created a generation of 'forever' renters in California

  📍 Policies in California are creating the forever renter. It feels like every headline is about how the American dream is dead. Uh, in 2025, the National Association of Realtors did a study. The average first time buyer is in their forties. The average buyer of their second home is in their early sixties.

There's even a, a study from Northwestern University that labels Gen Z as giving up. There's going to be, uh, more than 15% less homeowners. Gen Z than there was in the prior generation. Also 40 per 46% of Gen Zs, um, agree with the statement that no matter how hard I work, I'll never be able to afford the home I love.

And there's major implications. Um, the implications is that, um, they don't have the drive to buy a house because they don't feel they can afford it. They now have to wait till they're married, have been saving for 10 years to be able to buy the first home in their forties. There's less motivation to do it.

Um, that creates a much older, uh, tenant pool and home ownership pool. Um, these tendencies also are gonna make it more difficult for them to create generational wealth. If you look at the largest tra uh, transfer of wealth, it's gonna happen in the, uh, next 10 years. And one of the major components of that is what real estate.

Um, this is also giving a rise, um, to senior living. Um, a rise in that because. It's getting to a point where if I can't afford to buy a house in my thirties and forties, then when I get older, I'm just going to move from a rental to a senior living house. Um, I can't explain how. Challenging and difficult.

This is to read, but this is our reality and we need to change how we approach real estate. We need to understand that we need to create more affordable housing, not low income housing. Affordable housing, and that, my friends, is a two bedroom, one bath house that a first tank buyer can buy. They don't need the five bedroom, three bath.

Um. 5,000 square foot house that sits on a half acre lot, those days are gone. So we want to get, uh, get rid of this type of market. Then we need to understand that the forever renter is here and we need to change how we approach real estate. Or the forever renter is here to stay for good. And guys, that is not a good thing for the state or this country will.

California has the right idea but wrong execution

 California is forces cities to build more housing or face legal action. California's giving cities 30 days to fix their housing plans or the state steps in, and honestly, they're right. We do need more housing, but here's a problem that a lot of people don't talk about. Every city is different. Herba Valley is completely different than Half Moon Bay.

You see, like Herba Valley still has land. It can build out new homes, new communities, it makes sense. But a place like Half Moon Bay, you're built out nowhere to go. So when the state forces every city to hit the same goals, it creates a total different problem. One city needs expansion and another city needs redevelopment, density, and creative solutions.

Bottom line is yes, we need more housing, all of it, but the strategy one size fits all is what's gonna create more problems than solutions.

California is NOT in top 10 for most expensive property taxes.

  📍 Revealed top 10 US counties where home prices plummeted up to 525,001 year. Spoiler alert, this is a millionaire problem, not average. Joe and Schmo like you and I. The majority of these counties are in Colorado, and there's two counties in California, Napa Valley and Santa Barbara, and most of these homes are between three to $4 million homes.

Hence why there's such large price drops. The reason I'm bringing up this article is I don't want you to think that somehow. Our local area is going through this. It is not. It is a very niche problem in a very niche area where the majority of us, it does not affect. This also reminds you that real estate is now regional.

It is no longer national. What's happening in Santa Barbara and what's happening in Napa Valley, million dollar homes is not happening in Riverside or San Bernardino County.

Fraud alert: If you rent homes in Riverside, Corona, or Jurupa Valley please be careful.

  📍 Fraud alert, fraud alert. So I use Zillow as a property manager to just, uh, get, uh, credit reports and backgrounds on people that are applying for some of the units that I manage. I got this that says that, Hey, I owe this all this money and if I don't pay it, and again, it's a QRC code. Then, um, they're gonna shut off my account.

The funny thing is my account is free. I don't pay for any premium service. I also had the potential tenant get a message that says that they owed money in order to use it and apply. They had to pay for it be To be very clear, these services you only pay once. And that's when you fill out an application for a property that you wanna look at.

There is no other reason to pay. So please be careful and don't give your money away.

These metros are slashing home prices. Is Riverside, Jurupa Valley, and Corona one of them?

  📍 Seller slash prices in, in one to five or 20%. In these nine metros. Guess how many of these are California? If you guess none. You are absolutely right. This is mainly Texas, parts of Arizona and Florida. And what do they all have, um, in common Is that they all built the most homes since COVID. And what do I always say, the issues in California until we address the equation side of inventory.

In other words, until we are able to build more. Faster, more efficiently and more affordable. This ain't gonna be us now. Yes, in California there's some price adjustments, but not 10 to 20% like in these metros. So if you're in California, the home is pretty much worth what it's worth. It'll sit on the market, but eventually somebody will buy it.

What do you guys think?

It is going to get easier to buy a condo/townhouse due to changes in Insurance requirements

  📍 When you, if you're looking for a house or um, townhouse or condo in Arpa Valley, Corona or Riverside, you'll notice that if it's under like $600,000, you'll get a bunch of units that have been on the market for a while. Well, it's not that people don't wanna buy them, it's that a lot of 'em cannot be because they don't qualify for conventional financing.

Fannie Mae and Freddie Mac are now revisiting this. Lemme explain. In order for Fannie Mae and Freddie Mac, which are government agencies that insure loans. Um, for them to ensure loan, certain requirements ha have to be met and a lot of these ho could not meet their requirements. Therefore, the units in the complex did not qualify for conventional financing.

So in essence, you pretty much had add a lot of money or gas, and that sucks for the buyers and that really sucks for the sellers. What they're doing now is they're changing to an a CV model. I'm not gonna go into too much detail, but in essence what this means is that it's gonna be easier now for the in, for the HOAs to get insurance.

They cover these big roofs. That was a big issue 'cause they were so expensive and in getting that insurance, Fannie Mae and Freddie Mac will now insure those properties, which means that you now can buy this unit as a first time buyer. Um, they were just really strict before and now they're revisiting that.

So by loosening the insurance requirements and simplifying the rules, they made it. They make it now where more buyers can finance these units, which means they should start to sell again. Um, it's pretty much expands for FHA and conventional, uh, lo uh, first down, low down payment buyers and first time buyers.

Alright, but there's a catch. There's always a catch. The catch is that starting next year, HOAs are gonna have to have, uh, instead of 10% reserves, they're gonna have to have 15% reserves, which I don't think is a bad thing, but that means that HOAs are going to have to hold off on doing certain maintenance or the HOA fees are gonna go up.

But I think personally that is a small price to pay for the idea that now first time buyers can actually buy a condo or townhouse when before they could not because of insurance issues. What do you think? What are your thoughts?

Is the mortgage that caused the last recession back in Riverside, corona, and Jurupa Valley?

  📍 So I saw this article and I thought it was interesting. The loan that burned millions is back the, uh, 80 20 loan, um, where you're getting two loans. Um, and, um, it's only fixed for two or three years, and after that it becomes variable. Well, in 2008, 2009, when the market crashed, this was a loan that was being issued.

The majority of the time, people who could not afford to buy a house, uh, were buying multiple houses using this product because they didn't verify income. Assets, as long as you had a social security and you breathe, you can use it. Um, this product is back in a limited version. Um, for the wealthier. Um, it's actually a version for people who think rates are gonna come down.

Uh, they are still verifying assets and income, so you still have to qualify for it for no. So no, it's not the same. Um, it is an option for people that think that rates are gonna come down in the future and you still have to qualify for it.

Iran was is driving up mortgage rates again...

 This is something we have to keep an eye on right now. Uh, the average rate has gone up to 6.11, which is the difference about $100 from like two weeks ago, um, due to the Iran war. The longer the war goes or the more issues there is in oil and that kind of stuff, um, it'll keep driving potentially this rate in the wrong direction.

So if you're looking to buy, um, just keep that in mind. Remember, you buy your house when you're ready to go. Meaning. Meaning the numbers make sense. You can afford it, you saved it enough money and it's right for your family. Don't wait for the market 'cause the market will time you out. You buy when you're ready.

So this isn't, uh, me telling you, you gotta jump in before rates shoot up to 7%. This is me telling you this is what's happening. When there's uncertainty in the market, rates tend to go up. And right now that is a direction they're heading.

America is 4 million homes short and it can take 10 years to catch up

 Well, this is just verifying what we've been talking about for the last few years. We are not building enough. We are over 4 million homes short in 2025, and about 2 million millennials and Gen Zers are unable to form their own household because it's too expensive and there's not enough supply. Hence, why the average first time buyer now is above 40 years old.

Oh, and it gets worse if you're in California. This chart shows that in California it's a lot worse. We're not building enough even close. Um, this is why if you're looking, waiting for the market to crash so you can quote, unquote buy and time the market, it's not gonna happen. Those days are gone. The reason is, is because we don't build enough, we have a supply issue, and until the supply side is addressed.

Homes will maintain their value or be more expensive, and that is the bottom line. Buy if you can buy, don't wait to time the market.

Why Riverside, Corona, Jurupa Valley is the fastest growing area in California.

  📍 Most people don't realize this, but arpa Valley, Riverside and Corona are part of one of the fastest growing regions in California and possibly the entire country. There's four main reasons why our area is exploding. One, people can't afford to live in LA and Orange County, so they gotta move East two remote and hybrid work ever since.

COVID, a lot of people. Don't have to live in those counties anymore so they can work from home. Where housing is more affordable. Logistics and jobs, warehousing, healthcare, education, construction, that is fueling our growth and geography. There's literally nowhere house in Southern California to expand.

This region isn't growing by accident. It's growing because it's the pressure valve for all of Southern California.