Podcast - 12/1/23

🏡 Ready to make the big decision of whether to rent or buy a home? 🤔 Here's a game-changer: The average homeowner’s net worth is almost 40X greater than a renter’s! 📈💰 The Federal Reserve Board's Survey of Consumer Finances reveals this significant gap, and it's all thanks to soaring home equity. Home prices have been on a historic climb, and buying a home remains a smart way to grow your net worth over time. 💪🏠✨

Don't miss out on the chance to build your wealth! Tune in to our latest podcast for all the insights. 🎙️

Plus, check out our fantastic "House of the Week" 🏡 featuring a beautiful colonial home in Windsor Knolls, MD, listed at $850,000. With 4 bedrooms, 3.5 bathrooms, a finished walkout basement, and a 3-season sunroom with woodland views, it's a dream come true! 😍 #RealEstateWealth #HouseOfTheWeek

Tom Whalen:

I'm Tom.

Jay Day:

I'm Jay.

Tom Whalen:

of Jay Day and the Day Home Team, Real Estate Teams with our weekly real estate podcast coming into the Christmas month into the last month of 2024. Jay, are you ready for Christmas?

Jay Day:

No.

Tom Whalen:

No, neither am I. I'm never ready for Christmas, but it's always fun. Doesn't matter what happens, really.

Jay Day:

Yeah, yeah. I always, you can never be totally prepared.

Tom Whalen:

No, absolutely.

Jay Day:

It's gotten easier as the kids have become adults and it's definitely gotten easier than it used to be.

Tom Whalen:

It is easier and especially because if you don't have all those expectations, that's what lets a lot of people down. Let's let Christmas come and go another day of the week. That way you don't get disappointed. What we got going?

Jay Day:

Let's talk about, and I know this is something we chat about here and there when you're trying to decide whether you want to be a homeowner, if you want to buy a home today or if you want to rent, one of the key data points that's out there that could help you feel more comfortable with becoming a homeowner is every three years there's a survey that the Federal Reserve does and it's a survey of consumer finances, the SCF, and that report shows the difference in net worth comparing homeowners and renters. So that's one of these reports that can sort of be eyeopening. The report that just came out recently, the average homeowner's net worth is almost 40 times greater than a renter's. This most recent report that came out, the net worth for the average homeowner was $396,200. The renter's net worth was $10,400. So you're definitely not getting an increase in net worth by remaining a renter. The previous version of the report that was done, the net worth of the average homeowner was about 255,000 and the average renter was about 6,300. So that is a massive gap that widened if you think about it and look at those numbers. So the 2019 through 2022 growth in the median net worth is the largest three year increase in the history of them tracking this.

Tom Whalen:

I didn't know they tracked this Jay.

Jay Day:

Yeah, well, and I'll be honest with you, Tom. I didn't either.

Tom Whalen:

Aren't they more, they're not talking about people, professionals who live in major cities.

Jay Day:

No, this is just in general here.

Tom Whalen:

Just in general because some of the most wealthiest people in the world are renters paying ungodly rent beyond anything we could ever imagine.

Jay Day:

And this takes into account all the states. And it was interesting because I didn't know that they track stuff like this either,

Tom Whalen:

Neither did I.

Jay Day:

But when we're doing these podcasts, I always try to find relevant information and it can get boring when I get into stats and stuff like that. So I think sometimes it's good to think about things in a different light as well because a lot of people look and say, man, I'd love to be able to have that type of life, man, I'd love to be able to have this situation. And most of the people have through Wall Street and through real estate is where a lot of wealth has been built. If you look back or you look at the people nowadays that have a ton of money, a lot of it is through real estate, and I've talked about it on these before, those that were dealing with the Wall Street stuff and stocks. They have been, if you've ever heard of BlackRock, Vanguard, these companies own a ton of residential real estate now, a ton of it, and they didn't before, but they've jumped in over the last couple of years and you don't need to be a rocket scientist to figure out, hold on. These people were not seeing the gains that they wanted in the real estate market. So they're investing money in other areas and that other area has been residential real estate and there's a reason for it shocking that the numbers jumped that quickly just as they were also increasing and taking on more residential real estate. That's just something to keep in mind.

Tom Whalen:

The question we're talking about Jay is one of the biggest questions that a lot of people have on their mind. It's a matter of fact the biggest question of their life right now.

Jay Day:

And I get it. I mean, so I'm the opposite of, people are like, oh, everybody should own a home and don't take this in the wrong way. I really don't think everybody should own a home because there is a lot of financial responsibility with that. If you're living paycheck to paycheck or you don't have reserve funds, owning a home could be extremely dangerous for you because let's say your roof starts leaking and it's going to cost $30,000 to replace your roof. And what if you don't have that $30,000. Now water's going to be getting into your house, you're going to end up having potential mold, or let's say your HVAC breaks down and your heat is no longer working and you need to replace that and that's $8,500 to replace that unit and you don't have $8,500. You can't live in a house where there's no heat, and then eventually your pipes are going to burst and then you're going to have all types of issues.

Tom Whalen:

It's because of these issues. Jay, I have read during the morning show that Gen Z says I'll always rent because I never want to be responsible for any of this.

Jay Day:

When you look at things in general, the world has changed so much, Tom, from when we were younger and even more so rapidly in the last few years. But think about it, the world is becoming a subscription-based world. Remember, if you really, so you had your computer and if you wanted to be able to type Word documents or type documents, you would go to the store, you would buy a disc or a CD, and you would have Microsoft Office and you had it in your hand. Now what people are doing is they're paying a subscription service.

Tom Whalen:

You got to sign up, man. You got to sign up. Absolutely.

Jay Day:

It's a subscription service. And the reason they're doing so well, and it's going so successfully is because they sell it on the idea that you're not locked in, you can cancel at any time. It's a subscription service. Why do you want to have to own anything? Because the bad part when we used to buy it in the store is they would do upgrades, and when the service got updated, you had to go and pay and get the upgraded version. Now with the subscription, it just automatically updates for you and it's part of the whole process.

Tom Whalen:

That's a good analogy. That truly is, yes.

Jay Day:

And really that's what we are seeing, that the world is going in a direction of a subscription based, subscription based everything in all sides of it. And renting is a subscription based living situation. Period. You're alright, I'm agreeing to pay this. And yeah, you may have some terms, but typically you can cancel or if you can find somebody to replace you, they'll let you out. There's all types of interesting things to this, so if you're like to actually have something that you own, that you possess, I mean even now I'm going to sidetrack. Think about it. You're here at the radio station. Everybody used to buy CDs and tapes. Everything now is pretty much streaming.

Tom Whalen:

Streaming, kind of free almost for anybody. Pretty much.

Jay Day:

Books

Tom Whalen:

Yes.

Jay Day:

People used to go by now, and I'm guilty of this too. I download stuff on Audible all the time. That's how I get my material because it's easier and I click a button, I can listen when I'm driving. And in today's world, traffic's gotten even crazier. So it's a good way to pass the time in the car.

Tom Whalen:

And you can cancel it any time.

Jay Day:

Yeah, yeah.

Tom Whalen:

There you go. You're not locked in.

Jay Day:

Yeah, like I said, very, very different world man, but just think about it that way. If you have questions or want to sort of discuss the difference between the pros and the cons of buying and versus renting, we're here to help. But let's talk about the house of the week.

Tom Whalen:

Give us a home of the week, bud.

Jay Day:

This is one of the great neighborhoods here in Frederick County is Windsor Knolls. This home is 3048 Chickweed Place in Ijamsville, listed at 850. Again, it's in Windsor Knolls. It's situated in a cul-de-sac, four bedrooms, three and a half baths, a finished walkout basement. There's a three season sunroom with views of the woods, paver patio. If you're into the landscaping side, which I know you are, they have a grand crepe myrtle, tons of flowers. It's a nice ideal, very pretty setting. The home is a perfect layout for entertaining. The laundry is on the main level. There's nine foot ceilings. There's loft storage in the garage. There's a large master bath with custom tile work, paved walking paths in the community, large common areas in the community. There's a community pool, and this home is actually situated extremely close where you can walk to the community pool. Again, Windsor Knolls, great neighborhood. If you want to check out this home, go to wfre.com. Look up Tom and Jay's real estate podcast. If you like what you see, click the button or give us a ring and we will get you a private tour.

Tom Whalen:

I'm Tom.

Jay Day:

I'm Jay.

Tom Whalen:

of Jay Day and the Day Home Team of Real Estate Teams with our weekly real estate podcast. Thank you so much for listening and tell your friends all about it.

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