Top markets for affordable renovated housing inventory

Despite the rapidly deteriorating affordability, there is some hope for homebuyers in the form of renovated homes: properties that have been rehabbed into move-in ready condition after being purchased at auction.

HousingWire Magazine: December 2021/ January 2022

AS WE ENTER A NEW YEAR, let’s look at some of the events that we can look forward to in 2022. But what about what’s next for the housing industry?

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This webinar will be a discussion on understanding what’s to come in the future of mortgage lending by analyzing past trends in the industry, evolving consumer behaviors and demographics of the industry’s production capacity.

Logan Mohtashami on Omicron and pending home sales

In this episode of HousingWire Daily, Logan Mohtashami discusses how the new COVID variant, Omicron, will impact inflation and whether or not it will send mortgage rates lower.

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What is the next step for NAR?

Updates on the DOJ investigation, iBuying, commissions and more

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In this Q&A, Senior Real Estate Reporter Matthew Blake gives HW+ members the inside scoop on what happened at NAR‘s annual conference. Blake breaks down his biggest takeaways from the conference as well as what realtors should expect from the NAR agenda next year. The Q&A was hosted in the HW+ Slack channel, which is exclusively available to members. To get access to the next Q&A, you can join HW+ here.

The following Q&A has been lightly edited for length and clarity.

HousingWire: To begin, what was the biggest news from the conference?

Matthew Blake: Of course! My biggest concern in 2021 was that home prices would take off in an unhealthy way, even after what happened in 2020. Since I didn’t believe in the Forbearance Crash Bro premise, this was the number one concern.

I think the biggest news was that NAR’s board passed three of the four planks that were part of the consent decree they hammered out with the U.S. Justice Department back in November 2020, and that DOJ withdrew from in July these were all regarding buyer’s agents being more transparent on how much they get paid (The one, arguably smaller, plank that did not make it through regarded lockbox access for non-MLS participants).

I think there were some questions at the conference: were these passed to appease DOJ? or because this is what NAR’s 1.5 m agent members want? I guess NAR would partly respond to that by saying they represent agents and consumers.

HousingWire: To add on to that, what were you surprised by there, or what storyline did not anticipate?

Matthew Blake: I was surprised a bit by how contentious the buyer’s agents transparency measures were, specifically the disclosure of an agent’s expected commission rate that was treated as a faith accomplished by people I had talked to before the convention, but there was heated debated about it in the MLS committee meeting and to a lesser extent the Board meeting.

Who was there and who wasn’t was also surprising. There were so many mortgage companies there, and CoStar had a huge presence. Meanwhile, giant real estate companies like Compass and eXp had a very limited presence, as did Zillow and Redfin.

HousingWire: Since the annual conference had at least 10,000 participants physically there. That’s a lot of people in one space, but it’s also a tiny percentage of NAR’s 1.5 million members. To expand on your last comment, what was the profile of people and exhibitors there and why was it important for you to highlight?

Matthew Blake: NAR has so many members, so in a sense, it really was a tiny turn out — So who was there, according to one agent I talked to, was “people selling something at a booth, people in leadership or a committee, or people who want to be in leadership” for some agents, being active in the NAR and, say, running for treasurer eventually is really important.

For others, NAR is just a huge institution, not unlike a government body, and they choose to have limited interaction with it. As for the exhibitors, it was crazy how many were really tangential to the bread and butter of real estate agents. Not just mortgage companies, but businesses selling mold removal, home security systems, gifts for friends who become homeowners.

HousingWire: This is a little off-topic but still a very relevant issue in the NAR community so I have to ask, was there any clarity on DOJ’s investigation of NAR – Did you get a sense, for example, of how long the investigation might last, or whether NAR might sue DOJ, and how important/not important it is to members and leadership?

Matthew Blake: It seems like a long and bitter fight ahead. NAR did not announce anything specific, but general counsel Katie Johnson spoke to me and claimed DOJ does not have its act together, and is not communicating what it wants.

It can’t be emphasized enough how different this is from prior DOJ investigations, which by comparison seemed almost NAR authorized. This is really seen as an attack on how agents do business.

So it is important to membership, they don’t discuss it in the day-to-day but it’s in the back of their mind. The system of now — where a home-seller pays the commission of both the seller and buyer’s agent — may change in the coming year or two.

HW+ Member: In your podcast episode on NAR with Lisa Dunn (which has been a great interview!), you mention the huge presence that CoStar and Homesnap had. It’s clear that they wanted agents to know they’re making a play. What do you think they wanted agents to take away and why was this timing interesting?

Matthew Blake: Right, CoStar spent unearthly sums of money to cordon off an expensive area of downtown San Diego for a Saturday night block party. I think they are trying to go after the business of Zillow, as a home listings platform/research service/and lead generator for agents.

Zillow is obviously reeling after the wind down of its iBuying. CoStar is, in a sense, the Zillow of commercial real estate, and, with Homes.com, they want to be either more of a consumer-facing site for residential or a lead gen alternative for agents. But we’ll see. CoStar is a company that can aggressively expand, but, block party aside, they still have a pretty limited presence in residential real estate.

HousingWire: Speaking of Zillow, leading up to the conference, the talk was Zillow exiting iBuying. What was the scuttlebutt about that at the conference?

Matthew Blake: I think agents have been frustrated with Zillow generally. So there was some proverbial grave dancing about them exiting iBuying. But overall it was a surprisingly small part of the conversation there the bigger picture issues seemed DOJ and racial bias in real estate. The question of self-styled tech companies disrupting real estate was not of top of mind, for not totally clear reasons.

HW+ Member: What can be said for the other side of the spectrum, for agents who seem to be alienating themselves from NAR — where is that coming from?

Matthew Blake: Well, I think a lot of agents simply don’t strongly identify with NAR, the same way that every hotel worker might not have strong feelings either way about the Service Employees International Union, or a writer might not feel strongly about the Writer’s Guild of America. But there are a faction of agents who believe NAR is not changing enough, and, in realms like enforcing Multiple Listings Service policies and safeguarding this one specific commission structure, is being strident at its own peril.

No organization, arguably, has done more for protecting its members amid technological change in the labor market. But there’s a question of whether that success will last, especially now with the DOJ investigation and numerous companies claiming to be modernizing real estate

HousingWire: I think to end in a strong note, we are all wondering does NAR know how to throw a convention?

Matthew Blake: They know how to make money from throwing a convention! No morning continental breakfast spreads or hot eggs! No NAR-provided cocktails or buffet lunches! As a journalist, it was a nightmare! But I do think, kind of seriously, that it shows the discipline and order of the organization. All that extraneous stuff was paid for by NAR affiliate companies. NAR throws a convention to collect more money that it uses to preserve the policies it has held in place for decades.

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