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Bill Fairman:
Hello, everyone. Thanks again for joining us. So when do you know when it's time to hire? That quiz,
Wendy Sweet:
You have more that goes along with that, Bill.
Jonathan Davis:
You pause too long between all your words that she thought you we're done.
Bill Fairman:
It's part of my style. I'm trying to get where it's okay to have a silence space.
Wendy Sweet:
Maybe it's not, I'm interested in finding out why we're having to go individually instead of our regular zoom room. What happened?
Bill Fairman:
Like I said, that question and many more. Thank you so much for joining us, everyone. We are Carolina Capital Management. I'm Bill Fairman. Wendy is below in the bottom. She takes up a whole half a screen because she's very special and Jonathan is to my right or left depending on if you're upside down while you're viewing us,
Jonathan Davis:
Whether you're viewing us from a mirror or not.
Bill Fairman:
That's right. So, thank you for joining us for Passive Wealth Show. Don't forget to subscribe, share, what else?
Jonathan Davis:
Hit the bell.
Wendy Sweet:
Like, hit the bell.
Bill Fairman:
Hit the bell, like, all that good stuff. Our website is CarolinaHardMoney.com. If you are a borrower in the Southeast, click on the apply now tab. If you're a passive investor looking for passive returns, click on the accredited investor tab. So it's been a interesting beginning of the week. Wouldn't you going to say?
Wendy Sweet:
In what way do you mean, Bill?
Bill Fairman:
I'm seeing little bits of spring happening.
Wendy Swee:
Oh, we've got cherry trees that are blooming already. It's amazing. I'm loving it. Thank you, Lord.
Bill Fairman:
The one thing that discouraged me was during a rainstorm, I noticed the yellow pollen rings around the puddles. So that means my car is going to be constantly dirty and I'm going to have watery eyes and runny nose. The older I get, the more susceptible I get the effects of pollen in the air. So the reason we're all joining you guys separately is at the last minute, we had a computer crash and our large conference room where we were getting ready to do our annual meeting. So I had to pull the computer out of our studio and then order a new one to replace that one and I forgot all about it and I didn't go in and test it beforehand and our really nice camera makes us look really tall and which probably would have been good because it also made me look a lot thinner but it just didn't look right. So off to our own desks and I'll mess around with it later.
Jonathan Davis:
In short, technical difficulties. Thanks for the story, Bill.
Bill Fairman:
Well, you know, unlike Wendy, I heard Wendy today on a call and she says, yes, I agree with you. And, the only difference is I would have used a lot fewer words and that made me crack up.
Wendy Sweet:
Just show me the baby. I don't want to hear about the labor pains. Just show me the baby.
Bill Fairman:
Before we get started, I would like to go over some breaking current news. Okay. So weekly, we try to update you on employment numbers and stuff that has to do with banking real estate investing. I did want to mention that in our area, we have a home, it's called home American homes for rent, which is a rental only. They build subdivisions to rent. They've just recently opened up their six subdivision in the Charlotte market. This happens to be in Belmont, which is in a different County from Charlotte, but close enough. It's in the same MSA. 83 new homes that are going to be available for rent. And again, this is their sixth subdivision for rental single family homes in the Charlotte market. It's turning into a pretty big business. There's another reason why we're having a hard time with not enough inventory for people to purchase. Builders are building them to rent them out and they're not available for,
Wendy Sweet:
Which is a great, that's a great new market. A lot of big builders are getting into that.
Jonathan Davis:
Well, great strategy. It just doesn't help with the inventory.
Bill Fairman:
And at some point they might be for sale, but we don't know when we also thought that after the big hedge funds came in and bought up all the existing inventory after 2008, but that hadn't happened either. They just want more. So they can't find any existing to rehab and rent. So what are they doing there? They're building whole subdivisions, which makes more sense, because from a maintenance standpoint, you have stuff that's a lot closer and it takes a lot less money to maintain properties that are closer together. You're not driving all over town to do that kind of stuff.
Wendy Sweet:
Anyway, what were the numbers you were going to talk about? Fewer words.
Bill Fairman:
Am I using too many words, again? So, yeah, unemployment. New applications for unemployment came in around 745 and that 745,000, they were expecting 750. So it's a little bit less than they were expected. It's still about the same as it has been ongoing for months and months and months. So 4 million continuing claims and then we still have 19 or so unemployed, but I guess they don't, they've run out of benefit. So only 4 million continue to receive benefits. And then mortgage applications are down or up 5% from,
Jonathan Davis:
Purchase or refi? Or does that go together?
Bill Fairman:
Everything.
Jonathan Davis:
Oh, everything. Okay.
Bill Fairman:
And purchases, purchase applications are actually dropping a bit. And again, it's not because people don't want them. They're just not enough inventory yet. And that's going to be an ongoing problem. At the same time, it's going to be an opportunity. It's going to be a problem because home prices are going to continue to go up as long as inventory is tight. And it's hard to build because commodity prices keep going through the roof. I think we discussed 78% lumber prices. I had a conversation with, and again, this is anecdotal, but steel prices are going up too. There was a guy doing some raw iron fencing and he said that his prices are quadrupling on the materials
Wendy Sweet:
Well, know to the fact that the employment numbers really aren't changing all that much and the benefits are running out. That's an opportunity for, for business owners, small business owners and some of the larger companies too, because now we can really be more picky about who we're hiring and even what we're paying. So, that could be a good opportunity for the small business world. I know, in our short term management company, we're looking for cleaners and put an ad out. My assistant, Wendy, yes, I have an assistant named Wendy as well. She put an ad out and in the first 24 hours, she had 83 applications. And by the next day it was up over 120. So she actually had to pull the ad and it was just amazing. The, amount of people who were applying for that part-time cleaning job. Weekends only. Part-time weekends only cleaning jobs.
Bill Fairman:
If you think about it, if your kids aren't in school, they're learning from home. It's harder to get that full-time work during the week. And on the weekend, uh, the spouse can keep an eye on the kids while somebody else is out doing some part-time weekend stuff. That might be a good opportunity there. Do you have anything to add on that, Jonathan?
Jonathan Davis:
No. I mean, I think, you know, there's, alright, the computer just came on.
Bill Fairman:
You have a ghost.
Jonathan Davis:
I know, I think there's a lot of opportunity when, you know, when we're handed tough situations, when the world's handed tough situations, country, states, people, individuals, like there's always the silver lining to it and, you know, while there are a lot of high unemployment numbers, it does allow for an opportunity for those people who want to make a move, who have the skills to do something a little bit more. Companies are more willing to hire them now than they were before or willing to, you know, to make those moves and I mean, we saw that from, you know, basically one month after, you know, the pandemic and it's still continuing now. I mean, I have a lot of colleagues on, on LinkedIn and I mean, it's amazing. I bet half of them haven't had a job change in the last 12 months.
Bill Fairman:
Have or have not?
Jonathan Davis:
What's that?
Bill Fairman:
Have or have not?
Jonathan Davis:
Have. Yeah. So moving to another company for whatever it is, you know, better benefits, more money, a better opportunity, whatever it is. Now, when they move, it opens up opportunity for other people to fill the spot or left. And so, you know, there's is opportunity out there it's, you know, I think it seems bleak for a lot of people, but I think there is opportunity there if you're looking and you're willing to do the work.
Bill Fairman:
Sometimes you just have to change the sector that you're in too.
Jonathan Davis:
Yeah. If you're in hospitality, I mean, maybe.
Wendy Sweet:
It's time to move on.
Jonathan Davis:
Maybe loosen up for a little while. I mean, hospitality will come back. We know it will. But yeah. You know, maybe switch it up just a little bit.
Wendy Sweet:
Yeah. I've been talking to a few people who have been flying just recently, like this past week and what I'm hearing is that the airplanes are full now, so maybe they'll start adding on more routes, you know, getting back to where they were on that.
Jonathan Davis:
Charging us more now tickets. Tickets are going to go up again. What was it, Bill? You did a round trip from here to Texas to Florida and back for, was it $300?
Bill Fairman:
I think it was like 267 or something like that.
Wendy Sweet:
Yeah, it's crazy. We had an opportunity for round trip tickets at one point to Philadelphia from Charlotte for $58. Didn't get much better than that.
Jonathan Davis:
It's amazing they can offer those prices in a pandemic with, you know, everything going on, but when things are good, the prices are 10 times that.
Wendy Sweet:
Right. Right.
Jonathan Davis:
I think take advantage of that price point because I didn't want to sit with the goats and chickens. So I prefer being next to people on my flights or not. It's not farm animals.
Jonathan Davis:
To go back to what Wendy and I were talking about, you know, it was a good segue into our ugly question.
Wendy Sweet:
Yup.
Bill Fairman:
Before we, were not bringing up the good question yet, right?
Wendy Sweet:
Why not?
Bill Fairman:
Because we have fancy graphics.
Jonathan Davis:
Okay. I forgot. For now, Bill,
Bill Fairman:
Now it's time. Let's talk about the ugly question.
Bill Fairman:
Sounds awesome.
Wendy Sweet:
All right. Back to you, Jonathan.
Jonathan Davis:
When you have someone who's left or whatever it is, a company, you have a position available or multiple positions available, do you hire somebody in person to come in and fill that void? Or do you outsource whatever that task was and how do you know when and what to do? Like that's, you know, we were faced with that. Like we had it, we had to go through that. Wendy, you want to talk a little bit about that?
Wendy Sweet:
Oh yeah. I guess it was in April of last year after we had pretty much sent everybody home and we actually laid people off for a little while. But we were still doing, you know, a few loans during that time, just for a few months. And we lost our underwriter and I really thought that was going to be the worst thing that ever happened to us is that our underwriter left us and went to a job offer that was, you know, offering her twice as much as we were. So I thought that would be scary, but it turned out to be one of the best things that ever happened because we were able to outsource portions of her job and, you know, one of our team members that's already here was able to step up into that position and since then, we've hired more outsourced help, you know, virtual assistants that are just excellent. We're, you know, I'm thrilled with the people that we have on our team. We've kissed some frogs before we got to the right people, but I'm thrilled with the people that we have on our team and the different that they're able to fill. Just last week we had our yearly meeting, a two day meeting and we were able to have our virtual assistants from the Philippines join us in those meetings and be a part of that meeting and I thought that was really, really cool cause it's just like they were here. It was great. On the other hand, there are certain things that you really have to have somebody here in an office, which is why I also was able to hire, Wendy, my new mini me.
Jonathan Davis:
Quite so literally.
Wendy Sweet:
So it's, you know, it really depends on what the position is and what those needs are and you know, what can they do and what can't they do if they're here in the office or not in the office. Right?
Jonathan Davis:
Yeah. I mean, if you would've asked me a year ago and said, is your underwriter position, is it a position that needs to be in person in the office? Or can it be virtual or farmed out or whatever the case may be? I would've told you it's in person, it's in the office. I need to be able to talk to that person. I need to be able, you know, we need to be able to have face-to-face interactions and yeah. And here we set and, you know, there's probably, I would say what? 80% of our underwriting is outsourced. I mean the final 20% has to come to Wendy, me or one of our team members here, but, you know, for the final approval, but most of it's, I mean, it's done outsourcing it and it's been great.
Bill Fairman:
And part of the thing about being a private lender is that it's hard to put underwriting in a box. When you're doing conventional loans. It's a lot easier to say, if it doesn't fit into this box, then you know, we're not doing it and you have a lot of contract underwriters that work from their homes on a conventional consumer mortgage, you have a computer that's doing almost everything. The only thing the underwriter is doing is once all the documentation is in is they're just double checking it and making sure that that documentation is what they actually need and it provides the proper information. But we found out that while private money is a little bit more nuanced, there's only really a pretty small percentage that has to be discussed or looking more at the big picture that is not in, you know, involved in being able to put it in a box. You know what I mean? Does that make sense?
Jonathan Davis:
Maybe. I'll have to watch it again and make sure.
Bill Fairman:
By the way, since you said that, this episode will be recorded permanently in 24 hours. Yeah.
Jonathan Davis:
But I mean, there, you know, there are positions, it's a tough question. Like, well, how do you know what needs to be in-person cause I'm a firm believer with the in-person hire, the person who's in the office. There's this intangible that comes out of that and that intangible is this level of creativity and bouncing things off of each other that you don't get via zoom. You don't get on the mail, you don't get it there. So there is that intangible. Now, does every position need to create that intangible? No. No, it does not. There are positions that, you know, in my opinion, that are more, I guess, task oriented and more, you know, like just kind of, I wouldn't say repetitive, but there are repetitive features to them and, you know, those are the ones that are easily outsourced. There's a process and a procedure for those. If this do this, then this, then that, like, that's something that you can farm out, you know, something like what Bill or Wendy, or I, like if we have, like, if you need somebody who needs to look at a project or an opportunity and say, well, here's how we do it. That's not something that you can probably farm out. You can't farm that piece out. So when you create your core group, which is, you know, for us, our core group is Wendy Bill, myself. Our accounting team honestly, could work remotely. They don't have to be here, but if the three of us are in the office working together and bouncing things off of each other, I feel like things will move forward. Does that make sense? If you have positions that don't necessarily need that intangible of creativity, those are the, probably the first ones I would look at to outsource.
Bill Fairman:
Well, I still think, and I agree with you on the creativity and it's nice to have somebody around that you can bounce stuff off of and pick up things that you wouldn't be thinking of. I think if you schedule regular video meetings throughout the week and your teams have an opportunity to collaborate a lot easier and especially if you're doing tasks or trying to accomplish certain goals, and you're doing it through a Google sheet where they can collaborate, you know, at any time and it's kind of like text messaging each other. It's not exactly the same as right there with somebody and hearing their conversations, but it helps, it goes a long way. It has been pretty helpful for us and I'm sorry, we're getting close to time, but time to hire time to outsource, it's very subjective depending on the needs that you have. I can't hand a pile of envelopes and say, could you take this to the post office for me? That's not something you can outsource but there's a lot of positions that, and we've learned this from COVID that can be done from home and still be very productive doing it as well and that's why the commercial real estate is starting to go down.
Jonathan Davis:
And I want to say like, you know, there's almost no position that can't be remote or outsourced that isn't, that probably won't be adequate. But it's probably not as good as if you were in person. So like if Wendy and I were working remotely from our respective homes and we were working on things, would we get things done? Would we get, you know, close loans and talk to people? Absolutely.
Wendy Sweet:
Probably more,
Jonathan Davis:
Maybe more. Maybe. I don't know. But kind of that intangible where, you know, she walks into my office or I walk into hers, we talk about something and it sparks a whole another conversation, a whole thing of something else that either helps us become more creative on a loan that we were looking at that we thought we couldn't do or changes a decision that we're going to make on something else. There's just that piece. So I think, you know, can we do those things from home? Sure. Are they as good, is the product as good? I'm not sure it is. Is it adequate? Yes. But could it be better? And I think, yeah, it could be.
Bill Fairman:
Remember when you're building a team, done is better than perfect.
Jonathan Davis:
Yeah, that's right.
Bill Fairman:
So you can always work on and make sure that they're tweaked as they go along, but we only have a minute left. So I got to get in all my plugs. Wednesday With Wendy. If you're over here in the chat, you can see the links to that. Our next show is coming up. There's a link to that as well. We're going to do a deal or no deal. So we're going to compare some deals and see which ones you like. Don't forget to subscribe, share, like hit the bell, all that good stuff. We are a lender in the South East. CarolinaHardMoney.com is the website. If you're a borrower, click on the apply now tab. If you're an investor looking for passive returns, click on the accredited investor tab. We will see you either momentarily or next week,
Wendy Sweet:
Whichever you choose.
Bill Fairman:
That's right.
Jonathan Davis:
Bye
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