 This is Keena Nisley with team K squared of Keller Williams, and we're bringing you the life of the land is in its real estate. Today's guest is Colette Cheen. She is the regional director of Inland Empire and the operating principal of KW Mallee, Brentwood, California, and Honolulu. Hi, Colette. How are you? Hi, Keena. I'm doing great. Thanks for having me. Thanks for coming. So just go ahead and tell us about yourself, who you are, your company, and what exactly is the regional director of the Inland Empire do? I'd love to. First of all, I want everyone to know that we are practicing safe distancing. I'm in California and of course, Keena's in Hawaii, which I wish I was there. It's beautiful. So I'm originally born and raised in Hawaii, and I moved to California in 1990. I've had 25 years plus of real estate experience. I'm the regional director of 21 offices in the Inland Empire in California. I also own three of my own franchise Keller Williams offices, KW Honolulu, Keller Williams and Multimawee, and new soon to be launched also Big Island and KW Brentwood. So yeah, I've been in real estate quite some time. I've seen a lot of cycles. Wow. Okay, so great. So where exactly is the market now? California started this lockdown a couple weeks before Honolulu did. So what are you seeing in California's market versus Honolulu market? What maybe can we expect? Okay, so when we talk about the overall market, we were at Safer and Home Shelter on March 17th. So we were two weeks behind you and then other states and Hawaii soon to fall. And I think what you can expect is I do have some bad news and then I have some good news. So you pick which one you want me to start first at a very macro level and then I'll bring it down locally. Oh, let's hear the bad first. Okay, perfect. So here's the thing internationally, they're saying the IMF which is International Monetary Fund that follows economies globally. And in the United States, they're saying, which I've heard already before that this will be one of the worst financial crisis you've ever seen. And it's not just a financial crisis. It's a global crisis, right? Health, political, economics. And so think about 2008 when we were hard hit with the financial crisis that was Wall Street, that was also a banking, right? This is a little bit different. So they're saying it's going to look more like the depression era. So imagine that, you know, where prices dropped in real estate in California, in 2008, 2009, like 40 to 50%. Hawaii didn't feel that hit. You guys didn't experience that. So the good news is that while we're experiencing this in the mainland, and I'm a local so I can call it the mainland, and we're experiencing this internationally, the good news is they feel that the US and global will hit a depression because of unemployment. Unemployment will go up as high as 30%. In 2008, it was 12%. What does this mean for the market? This is what it means. People are taking their money, some of it out of the stock market, and they're investing it into assets. And what's an asset? Real estate. So the good news is we're going to have a bumpy ride. So imagine like a roller coaster ride, stocks, real estate investing in California alone. I recently heard that in the last 10 days, 216 homes were taken off the market because of cancellations or on hold. We're saying time that year with 71 listings, low inventory and everything sold in the first day. So again, you're not experiencing that in Hawaii. So the good news is, and I'm sure you're getting these calls, Keena, if you're dealing with investors and you have liquidity, people are buying. They're going to come off of this, stay at home, they're going to be cooped up, and one of the first things they're going to do is shop. Consumerism is going to come back. They're going to look at real estate, something a little bit more solid. So even though we feel we're going to have a decline in California, maybe 25%, 30%, I don't believe that's going to happen in Hawaii, especially with the low interest rates right now. And maybe you're going to be longer to get that hit. Maybe your hit is 160 days out versus we're seeing that hit right now for us. So yeah, because we're still seeing activity. We are still, and as it mentioned to Colette earlier, I got two calls today from buyers in California that are offering on properties here. So they're ready to get out and start using some of those. And here's the good news, right? Here's the good news. If people are really liquid and they have cash right now, they're going to control the market. So in every shifting market, there's a buyer or a seller that will buy and sell. We just got to figure out who they are. And so for investors right now or those buyers sitting on the sidelines that couldn't buy that really nice property with interest rates coming down and property values coming down a little bit and an abundance of inventory, my guess is buyers are going to get some good value and sellers can trade up. Yes. So okay, so we do still have buyers and sellers. So what are your agents doing differently to get these properties sold? Okay, so we have to pivot, right? So this happened. We can't go into homes. We can't show home. So a lot of virtual marketing is happening. A lot of Zoom conversations. I don't know about you, Kena, but I'm on Zoom every hour. I feel very connected. You know, and this is what's so great about this next wave of how real estate is going to happen at least over the next six months, because everything is going to have to be safer at home, virtual. Things are going to have to be clean. Sellers are going to have to make sure that they need to make sure that the buyers before entering their property, whether they're there or not, they sign a disclosure and that buyers the same thing that they extend their contingency periods until they can actually have an inspector go in. So we just have to pivot and adjust. But if you have a buyer out there that's been looking and they're willing to buy virtually, they're going to get some amazing deals right now, right? You're going to get some amazing deals. Side-end scene or see-through virtually, it's the same thing. Yes, we're doing a lot of this differently. Yeah, a lot of FaceTime showings, a lot of virtual open houses, and we're still seeing activity. The listing agent has to go through the property and now present it in a way that was different, right? Really connecting with the consumer. So what's really great about our company is that we have this consumer app. And so the consumer now, like think about banking. Mobile banking deposits change the way we do business. Do we really need to go to the banks and deposit? No. So with this consumer app, a client like yourself could actually look at property online and put it in offer online. And an agent and the consumer can be connected. That's the way, that's where we're headed. So and it is working. So you've been in real estate for several years, when you were 12. In 2008, is this reminiscent of what you saw in 2008 or no? No. And I'll tell you why, because 2008, as I said, was when we had a bear market, stock market crashing, which is what you're seeing. But if you're watching the stock market now, it's going like this. It's like bouncing. In 2008, it just went like this, right? Steady decline for like four or five years. Same with real estate. You saw the decline in California, not so much Hawaii. But what I do see that's similar, similar is that the interest rates are the same. So 3.5, anything under 3.5, it's unbelievable. That's the same. That's, you know, agents after being through that, they understand short sales for closures, defaults. That's coming back, Kena. That's, so agents that were those agents in that market, they're jumping in and they're already pivoting and fast and connecting with banks. There's all this ghost inventory. It's going to come out. So yeah, it's same in that way, very different in health. I mean, we weren't forced to stay home. We weren't, we were able to show actual property, even if it had a lockbox on it, right? Yeah. Yeah. Times are different. Yeah. It is very different. Now we show with a mask and a bucket of white. So if you can make a prediction, where do you think we're going to be in six months? Where do you, where do you see the market going? So my prediction, California and Hawaii, like I said, you guys, depending on when you come back, the thing that's going to be the biggest challenge for Hawaii is the unemployment. With closing down tourism for two months, two whole months, it's going to take a minute for you guys to get back up. And even though you're seeing offers and you're seeing people invest, these are people that have been liquid and have been saving, right? So my guess is in the next six months, you guys will see a steady upward movement with investors. More investors are going to buy, right? So that's going to be good. But your economy and the age of the people that are working the day to day, they're going to have a hard time adjusting and getting back in California. We're in it till the end of the year. It's going to be for us because again, you're on an island, you have beautiful ocean around you. And if I was living in, you know, I was living in Northern California and I was paying a million dollars. I'd rather come to Hawaii and pay a million dollars and go, you know, it's time for me to go to my next level of life. So you guys are going to be great. However, I would say to you that there are going to be defaults, there are going to be, you know, short sales. So you might want to get familiar with that market again. And in California, we're in this for probably this ride for the end of the year because they may pull us back in again and stay at home another two months. So we have to be prepared. So do you have any advice for people who would like to sell or buy a home now? So what's your advice for sellers right now? So my advice for sellers is if you have a lot of equity in your property and you've lost your job or you're not quite sure where your income is going to come in, you might want to think about refining, refining, taking a little bit of money out if you don't have any reserves, right? Or if you're a seller and you always wanted to buy that nicer property, but that nicer property was so expensive, I might consider looking at my equity and going, wow, maybe the prices have come down on that nicer property. Or if I want to reduce my expenses because I'm going to retire and now I'm like, you know, I'm not working, then I might want to downgrade, but I have enough equity in my home to put some money aside. So just a couple of ways of thinking about it. There's always opportunity within the opportunity. My favorite thing. Yes. So yeah, so for sellers, refinance, maybe sell and buy something new. Right, right. Whatever you get to do, if you're really a seller, be a real seller. You know, don't just test the market out. Yeah. So what advice would you have for buyers if somebody was waiting to buy? Well, you know, there's no time like now because you can never forecast or predict when the bottom is. I mean, look, we've got the COVID-19 tourism has stopped for two months. You've got 3.5 interest rates. Do you realize, Pina, that if interest rates were 4.5 that a buyer would lose 10% purchasing power? Oh, yeah. Right. So if I'm looking at a million dollars and a couple of six months ago was at 4.5 and now it's 3.5, I now can afford a million one. So what might I get at that, right? Or a condo, a better condo. So it's a great time for buyers right now, especially if they have cash sitting and they qualify and they have great credit. Yes. Yes. Get the short sales. Great time to look at the values right now. Yes, definitely. So what can people do to maybe educate themselves during this time? We're all home. People are getting bored. What could they do to educate themselves to maybe prepare themselves to sell or to buy? Well, I think first and foremost, get with a professional agent. That's really important. I mean, how you can prepare is the way we're going to list a home now is going to be very different the way we listed it three weeks ago. Right? Yes. So how you prepare is if you already decided, hey, I'm going to sell, get yourself a professional agent and Keyna's on the call. So there's an agent right there. And I would want to have inspections and everything done prior. I want a tour of the home. I want to make sure anything that's going on with the house that we prepare the home. So when it's on the market, it's clean stage ready to go. Right? If you want to figure out refinancing, we've got amazing mortgage opportunities. Our company has a zero plus cost loan. There are local banks that are doing some great deals right now. So look into what your property can appraise for. And you don't have to pay for an appraisal. Again, be prepared, call your professional agent and get a value read on your property. Again, if you don't have any reserves or you want to do a heat lock and put some money aside. So there are many ways and many things you can follow right now for sellers. So yes. And when she says inspection, she means a pre-listening home inspection. And we connect you with a lot of different inspectors that will come in. And they're doing it differently now as of COVID. They're doing all their feedback via the phone or FaceTime. But I definitely recommend those pre-listening. The thing is, you want to bulletproof these transactions, right? When a seller finally commits the selling, they don't want to be in the middle of an escrow. And all of a sudden, things happen. So right now, more than ever, we have to prepare on the front end. That's why the pre-physical inspection, the pre, you know, anything that can be done prior to so that when the property is on the market, it's ready to go. And you can disclose whatever you have to disclose. So that's for the sellers. Yes. So how would a buyer educate themselves to get ready to buy in this market? Okay. So if I was a buyer today and I've been looking, I would first go to a lender and want to know, okay, what do I qualify for? Right. And get an idea and pick the areas that I really like and find a local expert in those areas. And just, you can window shop now. Isn't that great? You don't have to actually go and get in a property. But I would start looking at the areas and communities you like on the island and work with an agent and they can email you all this and you can do this in your leisure time. And just understand and watch in the next 30 days pricing what's happening and get the best value. You don't want the most expensive property. You want the best value property in a good neighborhood. Right? Yes. Something I learned a long time ago, Kita, I love this. It's a saying, sell at the wedding, buy at the funeral. So right now with COVID-19, I don't mean to be morbid, but with everything going on, this is a great time as a buyer to look at the values. Yes. What's the values that are out there? Yeah, because there are some deals out there. People are much more willing to negotiate than ever before. Still seeing new properties come on every day. I think I checked yesterday we'd had 140 new listings last week and 89 went into escrow. So we're still seeing movement, but you definitely still want to get out there. And if it's a good property, it still goes fast. Yeah. And you can be, you as a buyer can be your own expert now. You can peruse shop online and just like I said, window shop and be a voyeur and start looking at the properties as they come up and then make your move once you're ready. You have the financing and you're qualified. So what resources are out there? What does Keller Williams, what do you guys provide? Like I said, we have Keller mortgage, zero cost loan. What that means is exactly what I said. It doesn't cost you anything to get a loan or refi. No points. Yeah, you heard me right. Refi, no points. And they give you a thousand dollars towards appraisal closing. It's unbelievable. I personally just closed today on a refi and I got a 2.6% loan, 2.6 zero cost. So that only comes to Keller Williams. And then the second thing is we have Keller covered, which is an insurance, which is a great insurance to match your insurance locally. So car insurance, health insurance, property insurance, right now sellers and buyers have to look at ways to save money. And these are ways for us to reduce it, reduce our expenses. So those are just two or three things that we have. Okay, so now anything else? You mentioned the app. Do you want to? Oh yeah. So we've got two rounds. Awesome. So I don't know if you can see this or I can show it to you, but I just want to show this to you. It's so much fun. So do you see that? Oh yeah. Okay. Okay. Do you see all those squares or things? Those are all the properties right here in my neighborhood. Wow. So the people are sitting home bored. They can just kind of float. Yeah, I could go 1.5, 900,000. Oh, I want to look at 7.99. That never happens in my neighborhood. So this is what's so great. So your agent at Keller Williams can give you access to this consumer app and I can apply for mortgage on the consumer app. I can do many things. I can navigate, I can put in my area. If I was a seller, I could put in my address and find out what my competitors and neighbors are listing their homes for. So this is how a seller and buyer can be prepared in this market. All right. So are you hearing of any issues? I know with everything that's going on, it may be harder for people to do, you know, appraisers to get into the homes, inspectors. So what kind of issues are we seeing right now and we have to avoid those? So okay, we call it bullet proofing the transaction. We can't avoid these new things that are happening. This is new to all of us. So they're going to be glitches. So what we're hearing is appraisals, right? If they don't come in at the appraisal price. So what you can prepare for is the listing agent maybe provides all the comps to the appraiser beforehand to prove the eligibility of that home and that value, right? So inspectors, you know, making sure we have a pre-inspection. Things are falling out because maybe the inspection came back and it wasn't as good as they thought it would be, you know. So bullet proof it all the way up front so that you don't enter into an escrow where you have challenges all the way through. So this is all new to everyone the way we have to handle this. So the signing of docs title, I mean this can all be done, you know, we can do wires, we can do traveling notary, we can do online signing, you know. It's amazing what we can do now with Zoom and, you know, the emails. So we were meant to be in this next generation. Yes. So and we're still seeing the Bureau of Conveyance is still open, still closing. We're so lucky, right? Even though title has stepped in and said we'll cover it if something happens but right now I mean knock on wood. You know what's really great about what's happening, Kena? There's so much collaboration, community and connection. Do you tell that? Oh, I yeah, so much more negotiation easier to negotiate. Everybody wants to help each other. You know, you're definitely a team now. Everyone is working together to close the transaction. Everyone's working together to show the property. Everyone's working together to do the inspection. Yes, it's a very different line. I've had escrow step in. We were $3,000 apart. Escrow stepped in and said we'll give both sides a credit. There you go. Everybody's making it work and I wish it was like this all the time but definitely we're seeing a lot more cooperation. So is there anything else you want to share or kind of just to motivate people and let us, I really truly feel like we're going to be okay through this. Anything you'd like to share? Well, here's the thing I'd like to share. First you have to survive this and then on the other side is you're going to thrive. So the biggest challenge is if you don't take action. If you're taking action every day and you're connecting with people every day, you're in forward moving. Things are going to happen. That's what the universe does, right? There's a quote that Paulo Coelho says, he wrote a great book I love called The Alchemist and he says, the universe is conspiring in your favor. So you just have to keep moving and helping people. Right now it's more important than ever to be of service. It's not about the sale. It's about how can you serve and help. So that's what I would leave you with. It's all about community connections and conversations right now. Yeah, just coming from giving. So during these times, like in 2008, we lost a lot of agents. So I have listened to the shift book four times now and we lose a lot of agents and they're telling you how it's a great time to go out and build your sphere because you lost agents. But what kind of motivation or what would you tell agents that are in that rough spot and are thinking of maybe I shouldn't be doing this anymore? So here's what I'll say. If you thought you were in the business of selling real estate, you're wrong. You're in the business of connecting people to real estate. So if you're not talking to people every day, then yes, you should think about leaving the business. And if you're talking to people every day, you're going to be fine. It's all about connections right now. So there are going to be people, Keena, that aren't going to make it. That's just the way it is. Just like right now, there are going to be businesses that aren't going to make it. The strong survive. I actually like a shift because it makes me forge forward and I'm always looking at other opportunities and right now there are opportunities out there for the right agents who are looking for it. So it's connection time, people. It's connection time. Yes, it's definitely pulled out the creativity. I will say, every day I wake up and think of something new. What can I do today? New. So all right, well thank you so much for coming with us. I appreciate being on this. I hope I helped you in some way. Yes, it was great information. And if anybody has any more questions, they can always leave a comment or they can reach out. I always answer my questions that come up. We're here. Like I said, we're still moving forward. We still have some great listings. We have a great investment property down in Waikiki that has two rentals. You buy one, you get two. Yes. And it's a great little property right between the L.Y. and Waikiki. So if you'd like more information on that, you can reach out. And our next guest in two weeks will be Johnny from, I don't remember who he's from, probably he's a lender. Sorry, he is a lender and he is going to come talk to us about the effects of the, where the interest rate is, where it might go, and what we can expect to see in the future with that. So thanks for being with us. Thank you again, Colette. You're welcome. Awesome. Thank you for having me. Take care. All right. Bye-bye.