The Macro US Housing View! (Future Lab Luncheon) - 5 Star Conference 2014, Dallas TX

Rick Sharga, Exec VP, Auction.com

6.1% unemployment for the nation now.  We have just recovered since 2009.  Ironically, labor force participation is dropping off due to the aging population of baby boomers.  Also unemployment is still high.  When adding labor force participation, it creates a 10% drop in labor force.

Recipe for a Stable Housing Market
Len Kiefer, Economic Research Director & Deputy Chief Economist Freddie Mac

Due to the weak recovery, the labor force dropping, and the unemployment rates, we will have a difficult time recovering.  Jobs are still also recovering and causing the growth to stagnate.

Four indicators of a stable housing market
1. Purchase applications - solid home sales that match demographics
2. Payment to Income - Mortgage payment in line with income
3. Current on Mortgage - few defaults, less foreclosures
4. Employment - low unemployment, more jobs, rising salaries and wages

Multi Indicator of Market:

1. people looking to buy homes
2. people who can make their mortgages
3. what is the employment situation

Housing applications have slowed down considerably and falling.  So far there has been a weak economy, little tough, jobs, income and wages low.

Entrepreneurs are going to be the next wave to assist us in moving forward with the recovery.  Once job growth and pricing go up, it will begin to recover around 2016 at the earliest.

Current State of the SF Housing market and how Millennials could revolutionize Real Estate
Nela Richardson, PhD, Chief Economist, REDFIN

Moving forward, we will recover slowly.  Median price $285k for US, investors are moving away and traditional market moving in.  Patience and less willingness to chase inventory is happening.  A bump in inventory has caused a slow down and helping to satisfy the buyer market.

The price range of properties on the market right now, 28% increase in $130,000 to 375,000 and 16% up in $375k or more.  Home prices have gone up since several years ago.

36% increase in pricing since 2009 which deflates the ability for first time home buyers to be in the market.

Still a lot of investors in the market of all types.  Homes are becoming the commodity of the future! 32% of US are cash buyers right now.  Cash is still king!

The mix of mortgages and cash is interesting.  There are a lot more people using cash and not loans.

The flipping market peaked in 2013.  There are many advantages still yet to flip massive allotments of properties in a servicing manner.

The millennial's have the ability to change the market.  92% of milennials want a home!  Don't want debt, school debt, not sure about American Dream and getting their money back, don't want to be tied down to a mortgage.

Ronald Witten, President, Advisors LLC

Why more renters?  2013 to 2014 huge rise in renters, vacancy rates are 5% or lower nationally.  A lot more demand is coming, not enough rental spaces and we need more space for them!

Growing pool of adults moving into rentals.  The prediction will be to grow over the next 30 yrs. 

There is decline in home ownership from 69% to 65% from 1994 to 2014.  Age is also dropping.  Part of the reason for renting is lack of marriage.  Marriage is happening later in life.

36.5% of market are SFR rentals in the US.  Rentals are an important part of our market in getting people helped.

The big question is are we overbuilding?  We are building more than normal.  Apartment starts huge, we don't have enough builders to satisfy.

Apartments start rise in Austin, Dallas, San Jose, San Francisco, Atlanta, Salt Lake City.
Rents are going up, its a golden era for apartments right now!

All in all we are in a stagnant economy, there will need to be innovative and creative changes in the real estate market place to continue the growth and shift in the American Dream.