Today’s RealTrending features Rich Hopen, broker-associate of Compass and co-founder of REAL-E in New Jersey and Susan Vanech, broker-associate of Compass and founder of Compass Coastal in Connecticut. Hopen is a self-taught expert in all things ChatGPT and artificial intelligence and built an AI-powered listing chatbot. Vaneck used that chatbot to market a multi-million dollar property.
Today, they discuss the power of AI in real estate marketing, what the future holds, how they are embracing AI in their businesses and what trends they are seeing. Hopen is the editor of the e-newsletter: The AI Daily Brief where he discusses the latest trends in AI and how to apply them.
Here is a small preview of today’s interview with Susan and Rich. The transcript below has been lightly edited for length and clarity:
Tracey Velt: There’s a lot of controversy there over ChatGPT. You’ve heard Elon Musk talk about the necessity to have some controls on it before it’s too late. So talk to me a little bit about that and the possibilities for AI in real estate
Rich Hopen: It’s hard to look at the news and not see someone take a position on AI. It basically ranges from this advanced technology that’s going to solve huge macro issues, and then the other end of the spectrum is that we shouldn’t unleash this thing. It’s going to destroy the human race. But one thing that everyone agrees with is that it’s a very advanced and powerful technology. It’s hard for me to really come up with any industry that’s not going to be impacted in a major way. You have a small percentage of agents that are leaning into this tech. They’re using it to generate content. And then you have a really small percentage of agents like Susan, that are getting way ahead of that and asking where it’s going. There’s all these applications, and that really involves building and having a custom Chatbot.
Susan Vanech: I want to create the content to educate the butler. So, kind of leapfrogging over what’s more exposed to the typical agent through ChatGPT. Using the AI Butler, doing exactly what Richard just said, which is adding another layer of service to that end user, and giving them the ability to engage and participate in a more human way, even though it’s through the use of this artificial intelligence. It’s about merging and bridging what we each as humans have contained within us, but having this bot that’s able to communicate on our behalf.
The RealTrending podcast features the brightest minds in real estate. Every week, brokerage leaders, top agents, team leaders, and industry experts share their success secrets, trends, and lessons learned navigating this ever-changing industry. Hosted by Tracey Velt and produced by Elissa Branch.
Today’s RealTrending features Rich Hopen, broker-associate of Compass and co-founder of REAL-E in New Jersey and Susan Vanech, broker-associate of Compass and founder of Compass Coastal in Connecticut. Hopen is a self-taught expert in all things ChatGPT and artificial intelligence and built an AI-powered listing chatbot. Vaneck used that chatbot to market a multi-million dollar property.
Today, they discuss the power of AI in real estate marketing, what the future holds, how they are embracing AI in their businesses and what trends they are seeing. Hopen is the editor of the e-newsletter: The AI Daily Brief where he discusses the latest trends in AI and how to apply them.
Here is a small preview of today’s interview with Susan and Rich. The transcript below has been lightly edited for length and clarity:
Tracey Velt: There’s a lot of controversy there over ChatGPT. You’ve heard Elon Musk talk about the necessity to have some controls on it before it’s too late. So talk to me a little bit about that and the possibilities for AI in real estate
Rich Hopen: It’s hard to look at the news and not see someone take a position on AI. It basically ranges from this advanced technology that’s going to solve huge macro issues, and then the other end of the spectrum is that we shouldn’t unleash this thing. It’s going to destroy the human race. But one thing that everyone agrees with is that it’s a very advanced and powerful technology. It’s hard for me to really come up with any industry that’s not going to be impacted in a major way. You have a small percentage of agents that are leaning into this tech. They’re using it to generate content. And then you have a really small percentage of agents like Susan, that are getting way ahead of that and asking where it’s going. There’s all these applications, and that really involves building and having a custom Chatbot.
Susan Vanech: I want to create the content to educate the butler. So, kind of leapfrogging over what’s more exposed to the typical agent through ChatGPT. Using the AI Butler, doing exactly what Richard just said, which is adding another layer of service to that end user, and giving them the ability to engage and participate in a more human way, even though it’s through the use of this artificial intelligence. It’s about merging and bridging what we each as humans have contained within us, but having this bot that’s able to communicate on our behalf.
The RealTrending podcast features the brightest minds in real estate. Every week, brokerage leaders, top agents, team leaders, and industry experts share their success secrets, trends, and lessons learned navigating this ever-changing industry. Hosted by Tracey Velt and produced by Elissa Branch.
Hello! Here’s an awesome post from my friend Emma. As you know, we recently downsized and we now live in our RV. Life is awesome!
In August of 2015, we returned from 15 months of travel through Mexico and Europe with our young son.
We saved hard throughout my pregnancy and were able to fund 15 months of travel with our savings.
However, eventually our savings ran out and we had to go home. Although the savings account was decimated, my attitude to life was completely altered.
I was hooked and wanted to make travel a core part of my everyday lifestyle. I came up with a slightly crazy goal of chasing the summer around the world, traveling for months at a time – between hemispheres, across oceans. Cruise ships. Train travel. Driving an RV across the US.
Wherever we wanted to go.
I knew we’d have to make huge changes to our life to pull it off but I was determined. Not only would we need to drastically reduce our expenses, we also had to build a business that was online so we could work on our own terms – and get paid regardless of where we were in the world. However, after time away from the workforce our retirement savings had suffered and we were moving back to a large mortgage which required a stable paycheck. Returning to an office job, whilst putting our son in daycare, in order to pay a large mortgage sounded like the complete opposite of my dream.
Not one to easily accept defeat, I kept thinking and reflecting. The solution came whilst my husband and I were discussing our return home over a cafe con leche in Spain. We always assumed we’d move back into the large bungalow we’d lived in before departing for our trip. The bungalow was rented out whilst we traveled and all of our belongings were in storage. However, after almost a year of living out of suitcases the thought of unpacking all of our stuff was overwhelming.
We knew that we could live a simpler life, as we’d been very happy traveling with minimal possessions.
We own a smaller, 2 bedroom 860 sq/ft townhouse that was purchased as a rental investment property. I suggested to my husband that we could move to the smaller property and keep the renters in the larger house. After all, the smaller house was still bigger than almost every hotel room and vacation rental we had stayed in.
After some number crunching, we decided to try living smaller and we’ve discovered it suits our lifestyle perfectly.
Here’s why:
Drastically reduced expenses
All of our core bills have been slashed – we now have a lower monthly mortgage payment, lower property taxes, and much lower utility bills.
This combined with increased income from rent on the larger house nets us over $1000 per month. That means we can afford to maintain our lifestyle on my husband’s income, allowing me the financial breathing room to build the business without the pressure of needing to bring in an income right away.
Related: How To Live On One Income
Potential Airbnb rental
One of the ways we plan to fund our travels is by renting out our house on Airbnb when we travel.
An older, larger house in the suburbs isn’t as appealing to guests as a more compact and well-serviced property, close to public transit and beaches. The house will need a full renovation – including a new kitchen, bathroom and dining room conversion – to be up to vacation rental standard but the work is not super-urgent. We can live with it until my business is bringing in more income.
Reduced cleaning time
Any person will tell you that trying to get stuff done – like build a business – with small children around is difficult. I want to spend nap time working on my business, not cleaning up.
Thankfully, I can now vacuum 80% of my house from one socket. We only have one (teeny tiny) bathroom to clean. Less time cleaning means more time working on my business. Saving time is as important as saving money for me right now.
Forced minimalism
We’ve actively decluttered by reducing our belongings down to the essentials and those which give us joy. It’s a work in progress but eventually, we hope to get to the stage where our personal belongings are able to be packed up in a day – and stored securely – so we could take off travelling and leave just the core essentials for Airbnb guests.
I’m committed to donating one bag of items to charity and listing one item of value for sale online each week. So far, I’ve made over $200 getting rid of stuff we don’t need.
Better neighborhood
Often smaller accommodation is found in more densely populated areas with better local services. This is certainly the case for us. We purchased the smaller property for $30,000 less than the cost of our larger suburban property.
Our new neighborhood is close to all amenities and is an employment centre with a lot of manufacturing and services. We have everything we need within walking distance which means we walk a lot. To the supermarket, the playground, preschool. This saves money on gas and other car expenses and is better for our health.
No long commute
We targeted the surrounding area when hunting for jobs for my husband and were successful in finding a position a ten minute bike ride away.
This is great because he gets home sooner which gives me more time to work on the business while he wrangles the boys. Plus, we can remain a one-car family which helps to keep our expenses down.
Our dream life is now within reach
I have a dream of chasing the sun around the world. That means we’d like to be able to travel internationally for at least three months of every year.
With two adults and two kids to pay for we require a travel fund of approximately $15,000 per year. To make that happen, we need to create a location-independent business and have our house generate income whilst we travel.
By downsizing our house and slashing our expenses, we’ve been able to align our financial reality with our dreams. I’m so excited to put this plan in motion and I’m hopeful a lifetime full of travel will be worth the tradeoff of having to share my (only) bathroom with three boys for the next 18 years.
Author bio: Emma Healey is a mother of two. She writes about living well in small spaces with kids on her blog Little House, Lovely Home.
Are you interested in downsizing? Why or why not? How much money could it save you?
Save more, spend smarter, and make your money go further
So far in our home buying series, we’ve covered some of the basics that you need to know if you want to buy a home. In Chapter 2, we went over important resources for first time home buyers. In this third chapter, we’ll go over the basics of how to save for a house.
Buying a home can be a long and arduous journey, but having a stable place to live that’s all yours will make it all worth it. But before you can make an offer on a house, you need to learn how to start saving for a house.
When you buy a home, you’re making an investment in yourself and your future. You’re building financial stability, equity, and experience. You have a place to call your own and you can customize the space just how you want. Yet, you might be wondering how to get to that point
This is why saving up is so important.
There are some upfront costs to owning a home—primarily making a down payment. Find out how much you should budget using a home loan affordability calculator and figure out how to save the amount you need. After all, the best way to save for a house is to formulate a budget that helps you work towards your saving goals step by step. Soon enough, you’ll be turning the key and stepping into a home you love.
Step 1: Calculate Your Down Payment and Timeline
When figuring out how to save for a house, you may already have a savings goal and deadline in mind. For instance, you may want to save 20 percent of your home jumbo loan cost by the end of the year. If you haven’t given this much thought, sit down and crunch the numbers. Ask yourself the following questions:
What is your ideal home cost?
What percentage would you like to contribute as a down payment?
What are your ideal monthly payments?
When would you like to purchase your home?
How long would you like your mortgage term to be?
Asking yourself these questions will reveal a realistic budget, timeline, and savings goal to work towards. For instance, say you want to buy a $250,000 house with a 20 percent down payment at a 30-year loan term length. You would need to save $50,000 as a down payment and, at a 3.5 percent interest rate, your monthly payments would come out to be $898.
How much you need to save also depends on the type of loan that you use to purchase your home. For example, conventional loans and FHA loans require you to make a down payment, but some government sponsored loans do not. Before you can buy a house, it’s important to educate yourself on the differences between FHA vs. conventional loans. FHA loan requirements are different from conventional loan requirements, so you need to figure out which is a better option for you.
Step 2: Budget for the Extra Expenses
Just like a new rental, your home will have fees, taxes, and utilities that need to be budgeted for. Homeowners insurance, closing costs, and property taxes are a few examples of cash expenses. Not to mention the cost of utilities, repairs, renovation work, and furniture. Here are a few more expenses you may have to save for:
Appraisal costs: Appraisals assess the home’s value and are usually ordered by your mortgage lender. They can cost anywhere from $312 to $405 for a single-family home.
Home inspection: A home inspection typically costs $279 to $399 for a single-family home. Prices vary depending on what you need inspected and how thorough you want the report to be. For instance, if you want an expert to look at your foundation, there will likely be an additional cost.
Realtor fees: In some states, the realtor fee is 5.45 percent of the home’s purchase price. Depending on the market, the seller might pay for your realtor fee. In other places, it might be more common to contract a lawyer to look over your purchase agreement, which is usually cheaper than a realtor.
Closing costs: Closing costs are typically about 3% to 6% of the house’s price. Some closing costs may be negotiable with the seller but others will fall solely on your shoulders as the buyer.
Step 3: Maximize Your Savings Contributions
Saving for a new home is easier said than done. To stay on track, consider creating a savings account that has a high yield if possible. Then, check in on your monthly savings goal to set up automatic contributions. By setting up automatic savings payments, you may treat this payment as a regular monthly expense.
In addition to saving more, spend less. Evaluate your budget to see what areas you could cut down or live without. For instance, creating your own workout studio at home could save you $200 a month on a gym class membership.
Step 4: Work Hard for a Raise
One of the simplest ways to boost your savings is to increase your earnings. If you already have a job you love, put in the extra time and effort to earn a raise. Learning new skills by attending in-person or virtual training seminars or learning a new language could increase your earning potential. Not only could you land a raise, but you could add these skills to your resume.
Sometimes, putting in the extra effort doesn’t always land you a raise, and that’s okay! When getting a raise is out of the question, consider looking at other opportunities. Figure out which industry suits you and your skillset and start applying. You may end up finding your dream job, along with your desired pay.
Step 5: Create More Streams of Income
Establishing different income streams could help your house savings budget. If one source of income unexpectedly goes dry, having other sources to cut the slack is helpful. You won’t have to worry about the sudden income change when paying your monthly mortgage.
For example, creating an online course as a passive income project may earn you only $5 this month. As traffic picks up, your monthly earnings from this project could surpass your regular monthly income. To create an abundant financial portfolio, there are a few different steps you can take:
Create an online course: Write about something you’re passionate about and share your skills online. Sell your digital products on Etsy or Shopify to earn supplemental income.
Grow a YouTube channel: Start a YouTube channel and share your skills to help others within your industry of expertise. For instance, “How to start a YouTube channel” could be its own hit.
Explore low-risk investments: From CD’s to money market funds, there are a few types of investments that could grow your cash with minimal risk.
Step 6: Pay Off Your Biggest Debts
Another way that you can start saving for a home is by paying off your debts. Before taking on more debt like a mortgage, it’s important to free up your credit usage. Credit utilization is the percentage of available credit you have open compared to what you have used. If you have $200 in debt, but $1,000 available on your credit card, you’re only using 20 percent of your credit utilization.
A higher credit utilization could potentially hinder your credit score over time. Not only can paying off debt feel satisfying, but it could also increase your credit score and prepare you for this next big purchase.
To pay off your debts, create an action plan. Write out all your debt accounts, how much you still owe, and their payment due dates. From there, consider increasing your payments on your smallest debt. Once you pay off your smallest debt in full, you may feel more motivated to pay off your next debt account.
Keep up with these good habits as you take on your mortgage account.
Another factor that mortgage lenders will look at when determining your eligibility for a loan is your debt-to-income ratio. Your debt-to-income ratio measures your gross monthly income compared to your total monthly debt payments. This number will affect how lenders determine how much house you can afford because it will tell them whether you have enough income to cover your new mortgage payments and any existing debts.
So before you consider buying a home, make sure you calculate your debt-to-income ratio.
In addition to your debt-to-income ratio, lenders will also look at your residential mortgage credit report, which is a comprehensive study of all your credit reports. You should look at your credit report before you apply for a mortgage so you can figure out if you need to increase your credit score.
Step 7: Don’t Be Afraid to Ask for Help
Whether you’re touring homes or want help adjusting your budget, don’t hesitate to ask for help. If you’re trying to figure out what your budget should look like, research budgeting apps like Mint to build a successful financial plan.
If you’re curious about additional mortgage expenses, your budget, or investment opportunities, reach out to a trusted professional or utilize government resources. Not only are they able to help you prepare for your next big step, but they could also help you and your finances in the long term.
Getting help, whether it’s from a realtor or a financial professional, can help you secure your dream home at a price you’re comfortable with. Realtors can help with everything from finding you a home to negotiating the price of the home, so don’t be afraid to ask for help. You probably need it more than you think.
Saving for a house can be an intimidating process, so you also shouldn’t be afraid to ask questions. There are many important questions to ask your mortgage lender, like the difference between pre-qualified and pre-approved or the credit score you need to buy a house. Asking the right questions could end up saving you thousands of dollars with your mortgage, so go ahead and ask away.
Step 8: Store Your Savings in a High Yield Saving Account
While you may have a perfect budget and a home savings goal, it’s time to make every dollar count. Before you add to your account, research different savings accounts and their monthly yields. The higher the yield, the more your savings could grow as long as your account is open.
Also consider the effects of inflation on home prices, home appreciation, and interest rates. As inflation rises, so do home prices. This means it’s even more important to have a sufficient amount of money saved up so you can manage a bigger down payment and pay less in interest over time.
In Summary: Set Your Goals and Get Started
When saving for a house, you may want to consider having a plan in place. By following the above tips for saving for a house, you can be more prepared to buy your dream home. To summarize, here are some of the key elements to remember when it comes to saving for a home:
First, set a savings goal to match your estimated down payment and mortgage monthly payments. Then consider adding your contributions to a high yield savings account to grow your money over time.
Don’t forget to budget for extra mortgage expenses like appraisal costs, home inspections, realtor fees, or closing costs. Keep in mind, your monthly utilities and fees may also be more expensive than your current living situation.
Prepare for the additional costs by increasing your earning potential and optimizing additional income stream opportunities.
Free up your credit utilization by paying off as much debt as possible before buying a house. Keep up these good habits throughout the length of your mortgage term.
When you purchase a home, you’re building a piggy bank for your future. Every month you pay your mortgage, you pay part of it to yourself because you own the home. Instead of paying rent to someone else, you reap your own investment when you sell. Most importantly, though, you’ll have a place that’s truly your own.
So now that we’ve covered various tips for saving for a house, you hopefully feel more prepared going into your home buying journey. In this series, we’ll be going over first time home buying resources, steps to buying a house, and more. If you’re interested in learning more about the home buying process, continue reading on to Chapter 4 in the series, which covers what credit score is needed to buy a house.
Save more, spend smarter, and make your money go further
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Chapter 02: Resources for First Time Home Buyers
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