The Real Estate Espresso Podcast

Most business owners set goals at the start of each year. You had an intended plan back in January, a fresh start of a new year. In our company, we do our goal setting in December. So much has happened in the world in 2022. We had two more waves of the pandemic. The world watched in horror as Russia invaded the Ukraine and brutalized the population and traumatized the world. We experienced a runaway inflation, and rising interest rates. Many real estate investors had projects underway that got derailed by the increase in construction prices or higher interest rates or both. So here we are, coming up against the start of the fourth quarter. You have 90 days left in the year. Now would be a great time to ask yourself some insightful questions. -------------- Host: Victor Menasce email: podcast@victorjm.com

On today's show we're talking about the dangerous updraft of rising market conditions. ----------------------- Host: Victor Menasce email: podcast@victorjm.com

On today’s show we are looking at the auto industry for any clues that might predict future impact in the housing market. Whenever interest rates rise, we often see the impact in auto repossession six to eight months before we see foreclosures in the housing market. Foreclosures are a judicial process in most jurisdictions which involves a much longer process than an auto repossession. When researching this episode, I learned some pretty shocking statistics about the auto industry. --------------- Host: Victor Menasce email: podcast@victorjm.com

On today's show we are taking a look at what's happening to energy prices in Europe. We are very insulated in North America from the energy shock in Europe.  ------------------- Host: Victor Menasce email: podcast@victorjm.com

Scott Saunders has been working on 1031 capital gains tax sheltering and is extremely active in influencing the legislative process. To connect with Scott or to learn more, visit 1031exchange.com host: Victor Menasce email: podvast@victorjm.com

Paul Moore is the head of Wellings Capital where the company has launched its sixth diversified fund. To learn more, visit wellingscapital.com/resources where you can download white papers covering the different asset classes covered by the Wellings Capital funds.  ---------------------- Host: Victor Menasce email: podcast@victorjm.com

On today’s show we are taking a look at what is happening in global foreign exchange markets. It’s no secret that the US dollar has been very strong. This naturally has an impact on countries that have needs for foreign reserves. The strength of the US dollar makes the cost of imports denominated in US dollars more expensive. It makes exports denominated in US dollars more profitable for local manufacturers. A few weeks ago we reported on the problems in the European central bank and in the EU in general with sovereign debt starting to suffer a crisis of confidence. Central banks all over the world are known to intervene and inject liquidity when needed to solve problems for their domestic banks when they run short of reserves, and in some cases foreign reserves. But when central banks do intervene, like the Federal Reserve has been known to do, it sets off alarms through the global financial markets. Interventions are an indication of the central bank attempting to fix a problem that has already happened. They’re not being proactive, only reactive. Those transactions appear on the central bank’s balance sheet for all the world to see. There is an increasing trend among central banks to perform these interventions in a clandestine manner so as not to cause panic in the financial markets. That means performing the transactions off balance sheet. ----------------- Host: Victor Menasce email: podcast@victorjm.com

Our book this month is "The Intelligent Investor" by Benjamin Graham. This is not a new book. It was first written in 1949 and has been on Warren Buffet's recommended reading list for much of the past decade. ------------ Host: Victor Menasce email: podcast@victorjm.com

On today’s show we are talking about how conditions are normalizing in the world of construction. After two years of absolute insanity in the world of construction, lead times and inventory seems to be much more sane. One of the contractors I spoke with today recently priced the wood framing for an apartment project at $20 per square foot on a turnkey basis. That’s inclusive of labor and materials. Earlier this summer, similar quotes were coming in at nearly double that amount or about $40 per square foot. Only a few weeks ago I was quoted 14 weeks for glass patio doors. Yesterday I was quoted 5-6 weeks lead time. I can tell you that we are approaching construction projects with a renewed sense of confidence. We are still shopping around for bargains. This is necessary at any point in the economic cycle. But it’s particularly important in today’s environment which has not fully normalized. But in all cases you need to make sure you are ordering products that meet your local building code. For example, some areas don’t allow the framelsss glass railings for balconies. Some products sold online for installation in the electrical system don’t meeting all of the specifications for the local electrical code. ---------------- Host: Victor Menasce email: podcast@victorjm.com

On today’s show we are talking about the ways a city can block your project from coming to reality. Some people believe that once you have the correct zoning for your property, that’s all you need to submit your drawings to the building department for a building permit. It turns out there are several other conditions that need to be met in addition to the basic zoning. Parking ratios Traffic load Utilities load for water, sewer, electric, gas and internet School capacity Fire code and access You might have enough land to build your proposed building, and you might meet the zoning for your building. Of course you need to meet all the constraints for that particular building in terms of density, height, setbacks from the property line at the front yard, rear yard and side yards. But there is so much more. We see so many projects being held up by cities much to the frustration of property owners. This is where a comprehensive understanding of the complete set of engineering constraints is so important. ----------------- Host: Victor Menasce email: podcast@victorjm.com