Norris Bruce
Aug 03, 2018

Bruce Norris and I Survived Real Estate #602

Bruce Norris radio

On Friday, September 28, the Norris Group proudly presents its 11th annual award-winning black tie event, I Survived Real Estate.  An incredible lineup of industry experts will join Bruce Norris to discuss perplexing industry trends, head-scratching legislation, tech disruption, and opportunities emerging for real estate professionals.  All proceeds from the event benefit Make A Wish and St. Jude Children’s Research Hospital.  This event is not possible without the generous help of the following platinum partners: the San Diego Creative Real Estate Investors Association, InvestClub, Inland Empire Real Estate Investment Club, ThinkRealty, Wilson Investment Properties, Coach Fullerton, First Lending Solutions, PropertyRadar, the Apartment Owners Association, MVT Productions, and Realty411.  Visit www.isurvivedrealestate.com for event information, and see Amazon Prime or YouTube for past events.

Aaron Norris is joined this week by his dad and president of The Norris Group, Bruce Norris. This week they are launching I Survived Real Estate. They will have the new intro and outro starting this week. Leading up to September 28, they will be doing interviews with several, although not all of the panelists before the event. They do not want to give everything away before the event, but they will be interviewing people who support some of the questioning and research up to the event. They had such strong sponsor support that they actually sold out about 4 months before they even officially launched.

Episode Highlights

  • Who is featured on this year’s I Survived Real Estate panel, and why were they chosen?
  • What was the book John Burns wrote, and how has it helped Aaron and other investors?
  • How will artificial intelligence and technology play into the discussion?
  • Where does our industry stand in terms of how realtors are being affected by technology?
  • What makes the I Survived Panel different from others Bruce interviews, and how do they challenge him?
  • What are some of the major topics that will be discussed?
  • What are some of The Norris Group’s other upcoming events?

Episode Notes

Today, Bruce and Aaron will discuss some of the biggest questions they have been getting and why they have the people on the panel this year. This is the 11th year for I Survived Real Estate. When they started 11 years ago, the title I Survived was where they were. Aaron said the standout comment he remembered from the first years was someone from the Builder’s Association. He had been talking a lot; but when Bruce asked him a question, he said he did not know and hoped he had the answer. Every year, they build a panel that is highly appropriate to the market and what is happening.

They have built some fun relationships. Their next radio show will feature Christopher Thornberg, one of the all-time favorite guests they have had over the years. He is always exciting and very opinionated. However, what is most exciting about the event for Bruce is that the panel has learned to trust each other over time. They let their hair down and give honest comments, and the feedback is really honest too. It’s not like a combat where somebody is trying to win. Instead, you have the biggest brains in the industry mulling it over in front of an audience.

It is very rare they get to be on a panel with people from different sectors. Bruce and Aaron go to events with the Mortgage Bankers Association or National Association of Realtors, but typically you are on a mortgage or broker panel. To have them on stage and representing their skill set there is quite exciting. Aaron has gotten amazing feedback from speakers over the years saying it is one of their favorite events they attend. It is both fun and thought-provoking. In 2010, Pat Coombs of the National Association of Realtors told Aaron that when she was the Chair of NAR, she spoke 300 times that year. To have that kind of feedback is very special, and having the repeats who love to come back is too.

Bruce and Aaron began by discussing why they chose the people who they did for the panel. First off is John Burns, who Bruce and Aaron believe they should get royalties for how often they refer his book. Bruce really respects him. He wrote a book where he could have charged the information for, and it was a gift to the industry. He has the ear of major players, hedge funds, and national builders for a reason. One of the greatest comments he ever heard anyone in his position say is that he does not spend much time patting himself on the back for what he knows. What keeps him up at night is what he does not know. Bruce said if he had a consultant, that is the attitude he would want him to have.

John Burns is the CEO of John Burns Real Estate Consulting. They have offices all over the country, and he wrote the book Big Shifts Ahead, which Aaron has been referring to a lot lately. He gets a lot of phone calls from people wanting to talk about moving their money out of California but don’t know where. It is such a personal decision since there are so many things that go into it. This is when he asks them if they have read the book and refers them to it. Bruce had a meeting only ten days ago with a major builder, land guy, and property manager in Florida. In this very meeting, the topic was John Burn’s book. This gave them a commonality, and they liked Bruce more because of this. It made sense for them to study this, know where they wanted to build, and know why Florida will get lots of migration.

Bruce loves the way the book separated the generations into separate timeframes. This was very helpful since you don’t have a lot in common with an 18-20 year spread. However, you do more when it is a 10-year spread. Differences can emerge since they really different. Bruce’s wife Sandy has a grandson now who is about 1 year old who is walking around with an iPad. They may not be able to talk yet, but they can find videos of themselves on the phone. They are already talking to Alexa by the time they are 4; it is a trip. This is the generation growing up with no walls and is the zero-interface generation.

One of the things Bruce and Aaron were talking about that they were really knocking out of the park is the ability for them to use technology that is honing in on the likelihood of the next decision by the homeowner. Aaron is working on an interview right now; and instead of interviewing Mark Lesswing, the technology officer for NAR, he is interviewing the CEO of Offers. Mark does research on things like Blockchain and artificial intelligence and has some exciting things to say, so Aaron does not want to interview him before the event. Offers provides data to realtors, and they have a 70% certainty they know when a seller is going to sell in the next year.

They are looking at over 30 different data points, everything from public records to how they are visiting websites and searching as well as using artificial intelligence to say “that person.” There are already some real estate investors using that technology as well. Instead of marketing to a general list of non-owner occupants, if you can whittle that down 90% and market the heck out of the 10%, whether through door knocking or other methods. Bruce said if you are not keeping up, the competition can get intense. If, as a realtor, you think you can just go around and door knock, you may need to think again.

The next person they discussed is Mark Lesswing, who is flying out from Chicago to be on the panel. On the topic of technology, Zillow’s speaker will be replaced with Marnie Blanco, the executive director of industry relations for Dotloop. Aaron hopes Zillow’s Nick Bailey can be on the radio show soon as he spoke on the panel two years ago and did one of the most fascinating moves in the industry that Aaron has seen. He moved to Century 21, and he is rebranding them.

Inman Connect had their conference within the last month, and they interviewed Gary Keller. He breaks down where our industry is at. The realtor is dead; but the industry, being 100% automated, is not likely. He talked about the tech enabled agent and the agent enabling tech. Gary leaned into the speaker for Inman and was very unhappy, telling them they are basically in bed with all these technology companies when they are not supporting the industry. Aaron hopes he can ask Nick, having come from Zillow, how he is recreating and refreshing the brand and leaning into technology.

Marnie’s background is in Dotloop, which is an online platform. Zillow made no qualms about it since they are focused on the top 10-15% of realtors and creating a platform for them, soup to nuts, where you can have everything within that platform. In addition, over the last two years they said they were not getting into homebuying. They joined Open Door, and a lot of companies are buying directly from sellers. Zillow getting into that game is fascinating since they already have that technology and the AI to say that person is doing a lot of searching and looking to move. They know before anybody else, which can be some scary stuff. The top agents are getting those leads or getting the property that Zillow buys. They may not even care and are literally rolling out the CarMax model.

Their goal is not heavy fixers. Aaron got to talk to Open Door about this, and they did not want to do this. Zillow has reached out to some larger real estate investment firms and talked to them about not wanting to do hoarder houses either. They are looking for an exit strategy there as well, so maybe they will become a friend of real estate investors. Aaron thinks they will make the idea similar to CarMax. It will be easier since they are brand name, can be trusted, and will sell at all cash. As long as it is not a heavy fixer, they will probably de-junk it and give it to the realtor to sell. They are wanting a 7 or 8% discount for that, so we will probably hear a lot more about this.

Doug Duncan, one of Aaron and Bruce’s favorite economists, is back. Next to Christopher Thornberg, he is very candid. It is very unusual for someone in his position inside the Federal government who is so forthcoming. Bruce said he has interviewed other people in his similar position, and usually there is a process. There is a series of questions, and they line out the questions they do not want to be asked. They have never had to do this with Doug. Government entities can be very tricky as they have to be very aware that they cannot be political. He has really given it to everyone straight every time he has been on the panel.

Bruce said on the first panel they did, even their clients were investor based and didn’t even know what they were coming for, whether it was a seminar or something else. It has evolved into something that has sold out before they could even say it was on, and this was new this year. The sponsor support was so unreal. What also happens is for people like Doug and David Kittle, the word is out for them. David will even refer people to the event and push them to go. Sometimes, Doug has stayed up until 1 in the morning after the even to answer people’s questions, then he will have to be up at 4 in the morning to fly to another speaking engagement across the country.

When you think about how much brain power is on these panels, it is a great luxury for Bruce. Whenever he interviews people, almost 100% of the time he knows the answer to the question he is asking. He has a back door, can provide the answer, then move on to the next thing. However, for this panel on that night, he gets to ask questions to which he does not know the answers. It is fun because he can think about some good things he would like to know and their opinion about the next recession. Doug has talked about interest rates and wondered what he thinks now since we have not had this recession show up or the GDP growth.

Bruce asked Dr. Thornberg when the next recession was, and he was not sure, nor was he sure the cause. There will be more than one brain on the panel; and if the collective thought is that they do not really know about an imminent recession, then California has a different ending. This needs to be discussed since they are thinking about an alternative ending. If they can say they can go until they are done again to the peak, then they have to figure out if there is an exit, what it is, and what the next thing will be that will happen for California. This panel is important to Bruce because he likes to see what they think of the fact that we are already at a peak price and how the next recession will impact real estate. Real estate really drove the last recession because of the loans; this time we might be the benefactor of the recession because of the lowering of interest rates.

Gary Acosta, co-founder of the Mortgage Collaborative, is back for the second year in a row. He is also the CEO of the National Association of Hispanic Real Estate Professionals. He comes with such a great knowledge of so many different industries. He is consulting for the CFPB and has been on committees helping them shape that. In the Inland Empire, we are over 50% Hispanic, so they are one of the largest growing sectors on which we have to focus. The way the Hispanic community buys and sells is a little bit different. It will be interesting to hear what he sees as growth. There is an initiative called One Wealth, which focuses on the Hispanic family and getting them into homeownership. Aaron wondered if this changes what people are building here in California and if multi-generational housing is still a thing. He is excited to have him back for the mortgage side as well as the NAHREP side.

Bruce said the Mortgage Collaborative, which David Kittle and Debra Still are also a part of, has helped the industry assimilate into the documents and making it through the maze without too much damage. It will be interesting to see their take on the next round of easing of the ability to get a loan. That also impacts where prices will go and the danger of a downturn. If you have two years where people can get in with less and less qualification, more tricky programs, and less down, who knows what would happen. Aaron wishes they had done this 7 years ago, but that is not how it works. You’re real conservative, then at the very end of it things change. Bruce did not think we would get there this time and be able to let everybody in.

Some of the programs will probably never come back, but the ones that are coming back may not be in sufficient quantity to cause damage. Aaron does not understand Dodd-Frank since we are so regulated now. If the CFPB does not take the data we have to provide and turn it into action, then Aaron gives up at that point. When you are dealing with consumers, the amount of data you have to provide the Federal government now as a lender is insane. Race, ethnicity, location, price, and how much done are only a few of the major data points.

Sean O’Toole of PropertyRadar is back again this year. He has been on the panel almost every year, and Bruce loves hearing him say what will happen next. He loves the 3D space, so Aaron is excited to hear what he has to say about this. Last time he brought up how he thought mortgage lending has to change, which makes sense considering the mortgage industry is already struggling a little bit. Refis are not as plentiful, and they are expecting a lot of people to leave the industry since there is not as much business. Sean thinks it needs to change completely. Bruce likes the fact that he is so into the 3D that he has that take on its impact on real estate. He is up on the newest house. What if they could build a 3D printed house for much less? That would be scary.

Aaron wanted to talk to him about the political ramifications of this too. It would create jobs, and it’s environmental. While the city might say, “Wow, look at that,” to bring that up to a standard price would require a lot of money to be charged for those permits. Aaron just met with the city of Riverside to interview them on an article he is writing. In the article, he talked about ADUs. If you are able to print one of these in your backyard in 24 hours, get it up and running, and have a little Airbnb, vacation rental, or granny flat in the back within a week, it is pretty amazing. Bruce wouldn’t be surprised if we are close to this becoming a reality.

The last person on the panel is Eddie Wilson. He is Affinity Worldwide CEO and owner of ThinkRealty, the rebranded version of Personal Real Estate Magazine. He has a media background, and Affinity Worldwide owns around 70 companies. One of them is an insurance company, another is the association of private lenders. He is an interesting nationwide voice for real estate investors and what is going on nationwide as well as what worries people. He is also very active in the charity space.

If you do not have a ticket to I Survived Real Estate, check out the sponsors. Some may have a seat at their table, especially the real estate investor clubs. If not, call the Norris Group and they can put you on the waiting list. The Norris Group is also now on Amazon Prime 2017. If you tell Alexa to find Bruce Norris on Amazon Video, it will bring up the brunch at which he spoke. From here, you can whittle around and find I Survived Real Estate.

Other events coming up are Cashing In On A Boom, which takes place September 8. The content is completely new, and they are focusing on creating inventory, which includes adding square footage, accessory dwelling units, mobile homes. They will also talk about adding value in this market when it is hard to find it. What is great about that is the content will go on the website. The Norris Group is expanding their Buying Systems course, and this is part of the process. They are adding two new chapter and renovating two. What is great about that is whenever you have seminar books; it is a finite package, the market changes, and the document doesn’t change. It is a fluid piece that constantly changes with the market, and he can add the new pieces every time with what he knows now. This makes it very valuable.

Another upcoming event is the Cutting Edge Financial Tactics Brunch. If you don’t know what that is, you can also find it on Amazon Prime. Aaron is really proud of what they created last year, and this year will be harder since people want to get away from the basics. On the panel this year, they will have an attorney, a CPA, Kaaren Hall with uDirect IRA, and Bruce. He will talk about things from reverse 1031 exchanges to entity selection in the Trump era and the tax ramification of those decisions. It will be really beefy this year and is a limited audience. It is not a beginner class, so you will definitely want to watch the Amazon Prime, which is free if you are a member.

The Norris Group would like to thank its Gold Sponsors for supporting I Survived Real Estate: In A Day Development, Inland Valley Association of Realtors, Jennifer Buys Houses, Keystone CPA, LA South REIA, Las Brisas Escrow, Lawyers Title, Michael Ryan & Associates, New Western, NorcalREIA, NSDREI, Orange County Real Estate Investors, the Outspoken Investor, Pacific Premier Bank, Pasadena FIBI, Pilot Limousine, SJREI, Spinnaker Loans, South OC REIA, uDirect IRA Services, White House Catering.  See www.isurvivedrealestate.com for event information.

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