2021 NAR Real Estate Forecast Summit

2021 NAR Real Estate Forecast Summit

Dec 16, 2021
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On December 15th, 2021, NAR held a virtual economic and real estate summit that provided a year-end review of 2021 and outlook on the real estate market and the economy for the year to come.

Hello, and thank you for coming. I'm Leslie Rouda Smith, the 2022 President of the National Association of REALTORS®. Welcome to NAR's fourth, quarterly real estate forecast summit of the year. 2021 has certainly been a year unlike any other. What will 2022 bring? Well, we are here today to look into the future. We don't have a crystal ball, but much of the success REALTORS® had in 2021 is thanks to insights from rigorous economic research and analysis. So, today the National Association of REALTORS® brings together the country's top economists, and experts in housing, commercial real estate, and the market. You'll hear exclusive findings and predictions on the real estate market you can't get anywhere else. If you want insight into the industry that drives nearly one fifth of America's economy, you are in the right place.

One thing we already know about next year is that our country's inventory shortage, and the resulting housing affordability crisis will still be acute. There are now anywhere from 5 to 6.8 million housing units missing from housing inventory. Housing prices and rents are rising sharply as a result. It's Economics 101, the law of supply and demand.

Building all types of new housing must be an essential part of any national infrastructure plan. Reaching the necessary level of inventory calls for a significant long-term commitment from policy makers, and those of us who partner with them to chart the path forward. Let's keep that in mind, as we go over today's material.

In the audience today, we have REALTORS®, state and local association staff, housing industry experts, representatives from federal agencies and in Congress, and the media. Here are a few highlights of what we'll cover today. We'll hear in-depth analysis on both the residential and commercial markets to better understand trends and where the market is headed in 2022.

We'll hear details from NAR's new profile of home buyers and sellers, courtesy of our topnotch research team. They have created real estate's definitive guide on home buyer and seller trends. We'll do a deep dive into home buyer preferences, demographics, and challenges with the industry's leading analysts. We'll examine the challenges and risks facing the real estate history, and discuss the impact of public policy on all of these matters. And, of course, we'll hear an economic forecast from our chief economist, and one of the most trusted voices in the industry, Dr. Lawrence Yun.

Before I turn it over to the experts, a few housekeeping items, the summit is being recorded, and the full recording will be posted on the NAR website. Also, emailed to everyone who registered to attend. The PowerPoint slides our team will use today will also be posted online to the same site.

With that, let's get started. I hope you enjoy the 2021 Real Estate Forecast Summit.

Great. Hello everyone. And thank you, NAR president Leslie Rouda Smith. We are waiting, I guess, in about an hour what the new monetary policy decision will be as step will be announced soon, but also we greatly appreciates what Leslie has done last week testifying in front of Congress on the importance of the Veterans Affairs mortgages. Certainly, important for our veterans and men and women in uniform protecting this great country. And also, I want to thank the sponsor of this year's event, the Center for REALTOR® Financial Wellness. We, certainly, want to ensure that the healthy real estate market also translates into healthy financial condition for REALTOR® members.

We're going to kick off with a keynote speech by Todd Richardson. Todd Richardson is the Deputy Assistant Secretary for Policy Development and Research at HUD. We all know the importance of HUD in the great housing market arena. And there, he has the research team, with approximately 145 staff members, doing funding allocation formulas, neighborhood stabilization. His work has been instrumental in recent some disaster events related to Hurricane Katrina, Hurricane Sandy. So, now, I want to turn over to the keynote speaker, Deputy Assistant Secretary Todd Richardson,

Lawrence, thanks for having me and for that introduction. It's great to be with you today.

I'm happy to send along greetings on behalf of Secretary Marcia Fudge and Deputy Secretary Adrianne Todman. They are a great combination at HUD, both have been challenging folks at my level to be more and to think outside of the box, and to be less bureaucratic.

We had a housing affordability crisis before the pandemic. And as some of the later speakers are likely to show, the pandemic has made that problem worse. To solve this requires innovative and out-of-the-box thinking. It also requires that we understand what is going on. And that is where all the later panels are helpful.

I'm going to go over what we're doing at HUD to address the ongoing housing shortage. And how the Build Back Better plan that's pending in Congress plays into that. So, let's first talk the demand side. With the tight housing supply these days, we've heard about instances where you have cash buyers jumping in front of potential homeowners that just needed a little help getting their down payment together. So, the Build Back Better plan has an important program aimed at just that population called the First Generation Down Payment Assistance Program, which has more than 13 billion in formula based grants, competitive grants, and housing counseling. Plus another parallel program with home buyer loan subsidies for the same population. Since those are brand new programs, it will take some time to get them up and running. But $13 billion will clearly go a long way towards helping people who just need a boost to get over the final hurdle to home ownership. Another big increase is $22 billion in new funding for housing vouchers, including a significant percentage of that aimed at addressing homelessness and domestic violence. For folks eligible for housing assistance rents are, certainly, outpacing their income growth. So, subsidy needs are greater than ever.

I don't need to tell this group that our problem right now is supply. The number of homes vacant for sale or rent has plummeted during the crisis. We already had been struggling before the pandemic to only eight units of net new housing supply to 10 additional occupied housing units. My read on the housing vacancy survey data of the last two years is that even with increased production of housing, there have been less than six net new additions to the housing inventory for 10 additional occupied housing units. We've been tapping into the vacant inventory for some time now, but there are reasons we have a lot of vacant units off market. And clearly moving them onto the market is driving up the cost of housing quickly. We need more new housing production to meet demand.

Thankfully, Build Back Better also has several major investments on supply side to help get a handle on the rising cost of housing. That'll help both home buyers and HUD itself since when housing costs less HUD demand side assistance can go further, and help more families in need.

Couple of programs that will have money in the hands of grantees relatively quickly, I call these the fast programs of Build Back Better are the Housing Trust Fund, which is going to get 15 billion, which would get $15 billion. And the Home Program, which is currently projected to get $10 billion. Those are substantial new resources for state and local governments to support new construction and related projects, which we all know are badly needed.

One BBB program that I think NAR will be particularly interested in is called Unlocking Possibilities and nearly $1.7 billion. This is a new competitive program, which means it will probably be slower money in terms of implementation, but it will award flexible grants to jurisdictions that take steps to reduce unnecessary barriers, reducing affordable housing, and expand housing choices for people with lower and moderate incomes. I'm sure you are acutely aware are having serious trouble right now with land and labor. This program might help with the land problem. It will fund planning that will help localities improve their development rules in ways that allow more housing. I like to think of this as planning money so local governments can both figure out how to unlock more land, including for higher density development, and to support implementation of what they come up with.

Given time constraints, I won't get into a lot more detail, but I'll just note that there are some other comparatively smaller programs than BBB that help on the supply side, like a half billion dollars in CDBG for manufactured housing and some amount for community land trust. Now, of course, I say all this Build Back Better is still subject to change, but here at HUD, we've been preparing for it as if it's going to happen, so we're ready for new dollars and new programs.

After going through all that funding, I want to draw a distinction between the response to the COVID Recession versus the Great Recession. As you know, the Great Recession was marked by a financial crisis, focused on reckless mortgage lending, followed by a more modest fiscal policy. This time around, we have been much better at keeping people housed and employed. With COVID, we saw a substantial fiscal response and stronger mortgage standard of the last decade that have led to homeowners with substantial home equity and an MMI fund with substantial capital. Just last week, in its annual report, we saw that the MMI improved its capital ratio two more points to 8%.

Nevertheless, there is great uncertainty given the ongoing pandemic. There is still a lot of borrowers, particularly in FHA that remain in forbearance. I think that forbearance and partial claim policy has been hugely successful, but a strong labor market is vital to making sure those borrowers can resume payments. Going forward, the question will be how to best deploy our resources after this uncertainty is resolved?

Now, I'm going to switch gears here to make a little public announcement. We all saw this past weekend the terrible tornadoes in Kentucky. Every few weeks to months, a natural disaster somewhere in the United States will headline newspapers across America. Those disasters are devastating to hundreds, or thousands of households. Less well known are the data across my desk. HUD is in the unmet needs business. After insurance, after FEMA and SBA, HUD provides funding for local communities to fill gaps for long-term recovery through a program, we call CDBG Disaster Recovery.

This is supplemental funding to our regular budget. We push it out by formula. And my office develops a formula based on unmet needs. With these data, I see a significant number of homeowners not insured, or inadequately insured for the damage they have received. In 2020, the data I have, showed 18,000 homeowners with serious damage to their home who were without insurance for the damage they incurred. In 2017, Hurricane Harvey alone had over 50,000 uninsured homeowners with serious damage. Mostly because many lived outside of the 100 year floodplain.

I won't go into the details here, but all of the research, I see shows that not being insured for the damage incurred results in very slow recovery and effectively wealth reduction. I think it would be cool if folks understood that they might consider a bit more insurance, not just the required insurance to protect their homes. I personally buy flood insurance, for example, even though I'm not even close to a flood risk area. So, that's the end of my public service announcement.

One last thing before I close, I'd like to shout out NRA's leadership on the Black Homeownership Collaborative that aims to create 3 million net new Black homeowners by 2030. I know Secretary Fudge was in Cleveland this past June to participate in the launch of that initiative that will be so critical to addressing longstanding equity issues in home ownership. HUD is also part of a new interagency task force on property appraisal and valuation equity that's aimed at addressing unjust situations. We have the same property being valued differently, depending on the owner's race. We also have been doing research and consumer reporting to see if there are new ways that could help the millions of people, often the minority communities, that have little or no credit history in our essentially credit and visible, which makes home ownership that much harder. And finally, HUD is working to implement the president's executive orders aimed at making sure equity is an integral part of HUD policy and decision making.

So, as noted in the beginning, HUD's secretary wants innovation. I want to close on the topic of innovation during this crisis. One innovation has been exponential rise in the availability of fast data. FinTech companies have opened their data safes and are producing all sorts of interesting and useful data for us to see what's going on in real-time. The Census Bureau's Pulse Survey has been enormously useful producing survey data results from a massive sample, not one year from when it was collected, but one week. I'm looking forward to hearing the other folks on the panel because I'm sure many of them have innovative new analysis using these incredibly powerful data sets.

And with that, I'll hand it over to Lawrence and I look forward to hearing what he and your panelists have to say. Thank you.

Thank you very much Deputy Assistant Secretary Richardson for the policy priority at the HUD. Certainly, the country is facing a housing shortage, so the focus on supply, as well as on the affordability is certainly important.

For the audience, the way the summit will be run is the following. For the next 10 minutes, I will provide how the year has fared and what I anticipate will be happening next year, along with the consensus forecast from this year's panelists, which we have 15, and also past years' panelists. So, they're all engaged. Every year we try to bring a new set of speakers. And then, we will go into panel discussion given the limited timeframe, it will sound as fast paced. So, please bear in mind.

So, let me go into the data for this year and what we can anticipate next year. So first, as I try to move the slide with my clicker, hopefully it's advancing... Since it is not advancing through my clicker, I will ask the person to go ahead advance the slide for me. If you can upload this slide.

I'm here in Washington, DC. Today's weather, very nice for winter. So, as they are uploading the slide, please bear with me. And it's about 55 degrees outside, sunny day so... We're waiting for the slides to come in.

Well, I know some data off my head, so let me go ahead and begin. So, as we know that 2020 last year, when the ugly virus reached the American shores, it flipped our life upside down. But one positive silver lining is that real estate really took off. So 2020, amazingly, even with high unemployment, home sales actually grew. And then, we had the multiple offer situation.

And let me see if the PowerPoint now works. So... next slide please.

Okay so, let me first start with the economy. So, the unemployment rate that was recently released shows that we are at 4.2% unemployment rate, which matches March 2020 right before the virus arrived. So, the economy is implying that we are back to normal. Or at least the unemployment rate component of the economy. But the next slide shows that rather than count the number of people who are unemployed, if we look at people with jobs, how many people have jobs? We are not back to normal. We are still shy by 4 million jobs. With each passing month, more jobs are being created. In the past couple of months, somewhat light disappointing in terms of job creation number, even though it's positive, but we are not back to normal.

And next slide shows the clear variation among states. We have only four states today with more jobs now compared to March 2020, before the pandemic occurred. So Idaho, Utah, Arizona, the mountain region state, along with Texas, if we round up that small decimal points. So, it's positive. Then, you see the remainder states, which are negative, which means that they're not back up to is normal yet. The lighter color shaded area is showing that decline right now is very minimal. So, in a few months, say in Georgia, Alabama, or the Carolinas it looks to turn positive in a month or two. The darker shaded area is showing larger employment decline compared to other states. Particularly say Hawaii, New York, Alaska, they are down more deeply compared to the rest of the country. Next slide.

Now, let's go into the housing numbers. So pre-pandemic is the first half of this chart, which shows that, in hindsight, not that interesting. Little increase here, little increase there. The second half of the chart is what has happened since the onset of the pandemic. Not only did the interest rate decline, which is a big factor for home sales, but people are saying, "Pandemic itself, I need a larger size home." Office workers ability to work from home, they're leaving the apartment and going into single family housing, or single family rentals. So, we have seen a surge in home sales activity post pandemic.

Next slide shows the annual numbers. So, we still are counting up the November figures and December figures. But once all the data are in 2021 will be the best annual home sales all the way since 2006. So, this will be the best in 15 years or 16 years, I'm not sure how to do the math year, but best since 2006. So last year was terrific. This year actually outdid last year.

Next slide shows the newly constructed home sales. New home sales by the builders are about 10% of the market. So, they're not a major force, but they're an important source of supply. And in 2021, interestingly, it actually declined after a good number in 2020. Part of that explanation is what the Deputy Director Secretary Richardson mentioned about some of the restriction zoning law that prevents home builders from getting into the market, which is the reason why we are working with members of Congress, the administration of HUD to ensure that we get more supplies, so the builders can build more homes. And the container ships out in the ocean unable to unload those doorknobs, window frame that has also hindered some of the new home sales. The demand is there, but supply is not coming through. Next slide.

In the meantime, medium prices have soared all-time high, certainly, very good news for homeowners. Next slide.

And as we looked at which market has a potential for solid growth next year, clearly, outperforming the rest of the country. And we have identified these 10 hidden gem markets. And the way to think about this market is Austin, Texas is not included because Austin had a phenomenal year in 2021. And it's hard to repeat such a strength going into next year. So Austin, Texas is not included nor Salt Lake City. So, what are some hidden gem that fundamentals would say that they should have done well this year, but they had a decent showing, a good showing, but not a great showing, which means that there is a room for growth. Many, essentially, all are in the Southern states. So, as you can see on the chart Tucson, Arizona, Daphne-Fairhope, Alabama, Palm Bay, Florida. So, you can read it on the list. So, we have identified this top 10 as being the potential to outgrow compared to the rest of the country.

Now as we go into the inflation, we all know the painful inflation numbers. Next slide.

So, we asked the participants what they anticipate regarding 2022 real estate outlook? Would the inflation calm down? And the consensus is yes, it will go down to about 4% inflation. Now, by historical standards that is still high. 2% will be ideal inflation rate. So, 4% forecast for next year will be double the ideal rate, but it's beginning to dissipate from current strong 6.8%.

What about home price appreciation? Our consensus forecast is indicating that prices will rise by 0.7%. Again, no worry of home price decline other than I believe one member in our panelist. And then, we believe that that Federal Reserve will be raising interest rate two times next year. I know they're coming out with their statement in a few minutes, but we believe that two times likely next year. Next slide. Just on the distribution of the forecast is that many people believe the Federal Reserve will increase interest rate only one time. Many people believe two times. So, that is the consensus, but you see that one person has believed that interest rate could actually rise four times next year. And next slide is the expected home price change. Most people believe that it's going to be between 5 and 8%, but there are two individuals who believe that prices will rise at 12%. I mean another double digit rate of price appreciation. So, this is what our panelists are believing, but as you can see, we have two panelists also believing that prices would decline next year. Next slide.

So, the panelists, I mean, you can read it at your leisure, but thank you for listening on what has happened, and what we are anticipating on a consensus basis. Next slide. And now, we are going to go into a panelist discussion first, on the housing market.

So, let me introduce who we have here for the housing market outlook. We have Dr. Ken Johnson, who is a associate dean at Florida Atlantic University. He had been a REALTOR® in his past life, but now studying the real estate market carefully. We purposely invited Dr. Johnson in because he believes that the home prices may be too high.

We also have Lesli Gooch, Dr. Lesli Gooch, who is representing the Manufacturer Housing Institute with the modular housing and manufacturer housing be solution to affordability prices that we have. We also have from the U.S. government, Federal Housing Finance Agency, Naa Awaa Tagoe, who is the Acting Deputy Director, the Division of Housing Mission and Goals. And, finally, we have Danielle Hale who is the Chief Economist for realtor.com. You can see all the inventory data coming from the realtor.com.

So, what I want to do in this panel, in this 25 minute panel is to give opening remark statement by each of the panelists. And then, from their remark we will have a good discussion. So, let me start with Dr. Johnson, who believes that prices are too high. What is your opening statement?


Glad to be here, everybody. Thank you, Lawrence. As Lawrence said, I am a former real estate broker. I practiced from the early '80s to through the mid '90s. And left and shuttered my business and went back to school to pursue a PhD in finance. My research is all related to housing and housing markets. And I do think some markets are significantly overpriced at this time...

Some markets are significantly overpriced at this time. Most however are not as overpriced as they were 15 years ago. So we're going to get a mixed bag results. Interest rates are going to rise. And once they rise, we're going to see prices moderate somewhat, but the effect around the country will not be uniformed and most of this effect will be driven by expected population growth. And I'll give two quick examples. And not that I'm picking on Detroit, but Detroit has had a significant run up in prices. However, they're effectively 48%, close to 48% above where their long term pricing trends suggest they should be.

When we look back 15 years ago, that number was more like 23%. They also have an expected population growth of less than 1% in the next 10 years. Miami, on the other hand, where I am now in Southeast Florida, 15 years ago, we saw pricing premium in the market of roughly 80%. Houses we're selling on average for 80% more than their long term pricing trend suggested.

Today that number is more like 18%, and we are expecting almost 14% population growth in the next 10 years. The results for Southeast Florida and Detroit should be different, both will experience the moderation and prices. And I think Detroit will see a tougher time in the housing market if you will, because they are significantly above their long term pricing trend and much more so than in the past. Thanks.

Dr. Lesli Gooch. Now I'm going to turn that over to you. So, what surprised you in 2020 or 2021, or how do you see 2021 or how do you see the manufacturing housing being an important source of supply?

Thank you so much, Dr. Yu and thank you everyone. I appreciate the opportunity to talk with you all today about manufactured housing. We all know in the introductory remarks as the evidence, there is a huge need for a supply of entry level homes in this market.

And we believe that today's manufactured homes can fill that supply shortage. What we saw in 2020 and 2021 is that more people are looking for a place to call their own, while rents were increasing, there was a significant demand for people to have their own four walls and to have their own home with their own outdoor space for work and other things.

And so in the manufactured housing area, we are producing homes like the ones you see behind me that people really are excited about and want to call their first home. Where we are, we have home features that consumers want. We are the only type of housing that is built to a federal building code. And this covers health, safety, energy efficiency and durability. For the first time since '06, we are at a place where we expect to construct over 100,000 homes this year.

So we're excited about the consumer demand. We're excited about the opportunity that we have to bring quality home ownership opportunities to more and more consumers. We are also excited about some research that was recently done by LendingTree, about how the homes appreciate in value. We have to overcome that stigma.

When you look at the quality of our construction, some people think that we're talking about grandma's trailer and that's clearly not what we are producing today, but also LendingTree did an analysis, which was in REALTOR® Magazine that showed from a five year period, 2014 to '19 the median value of manufactured homes increased by 40%, which is six points more of an increase than what we saw in the site built market.

So there's a real consumer demand. MHI has done research of consumers who live in our homes. People love living in manufactured homes. And so the COVID impact, it's driven demand or poised to help address the supply shortage and we are building homes that are quality and resilient, and people should take a look at, and I look forward to talking more about manufactured housing as this goes on. Thank you, Dr. Yu.

Now to Director Tagoe, who works at the FHFA Washington DC, filled with acronyms, but our members are clearly aware of the importance of Fannie and Freddie. So FHFA regulates Fannie Mae and Freddie Mac and Director Tagoe looks at the housing goals mission. So whether you want to talk about that. We had President Biden nominate Sandra Thompson as the head of the FHFA, and we'll see how the confirmation process moves along there, so your opening remark.

Thank you. Really appreciate you inviting me to be part of this panel. And I'm going to take a slightly different perspective and just talk about what we are focused on for Fannie Mae and Freddie Mac for next year, the priorities that FHFA has established for them. So of course, the context as a number of people have mentioned is very rapid house price appreciation. We're seeing from our HPI index, that house prices are at historic levels.

We also monitor kind of increases in rental rates. We see very sharp increases in rental rates this year after the decline over the pandemic. So we are very concerned about affordability. And so our focus for the enterprises next year is to continue to support, really provide robust support for that section of the market for affordable homes and doing it in a sustainable way.

So part of that is one of our major ways of communicating our vehicle for communicating about priorities is our conservatorship scorecard for Fannie Mae and Freddie Mac. We have two priorities next year. The first is really ensuring sustainable, equitable access to both home ownership and rental housing. And the second is operating the business in a safe and sound manner.

And under that first objective of sustainable and equitable housing, we're looking at a number of items, some of which would have to do with things like improving just modernization and efficiency. So things like appraisal modernization. Learning from some of the flexibilities that were put in place during the COVID pandemic.

These are things we want to leverage going forward to make it more efficient to get people into homes. We're also looking at a focus on small balance mortgages for both purchases and refinances that we increase the conforming loan limit. So we expect that much higher balance loans will also to come through, but we are also trying to provide support for some of the smaller balanced mortgages that are used in particular, in rural areas and other places. But we also have a focus on supply. It has been mentioned that the very tight supplies is driving the house prices it's one contributor. So one of the things we've asked the enterprises to low look at are just a number of different ways to address this housing supply issue.

One of which is with you are familiar probably with our low income housing tax credits that we have a cap. We have a certain amount that the enterprises can invest in low income housing tax credits every year. This year that cap was $500 billion and next year we're going to go up to $850, because we think that, that will allow the enterprises to provide support for a key source of affordable rental housing. We also held a listing session on accessory dwelling units, very large listing session. We think that this is in another way to increase supply, probably ADUs are our accessory units that are placed in a home or attached to a home and we think that, that will also allow the enterprises to support the market.

So these are some of the things we're thinking about on the supply side, the number of others which test and learn. We just talked about manufactured housing. That's one of those, that's also on our radar to think about innovative ways to expand supplies. So we will be working with the enterprises next year and monitoring their execution of our scorecard objectives. Thank you.

Well, thank you director Tagoe and on behalf of our members, we want to thank FHFA for raising the long limit, something our members have clearly said with rising home prices, people do not want to be placed in a jumbo loan and pay higher interest rate or come up with 20, 30% down payment to get a loan. So that has certainly provided some relief in the high cost of regions.

Now, I want to turn it over to Danielle Hale, who has been the realtor.com economist for several years, and she has really grown and now she has become very prominent in the unique research that they are providing. You saw some of the markets that we believe will sort of perform well in 2022. You may have some different ideas, but I'm going to give you a chance to just lay it out there. Danielle.

Thanks, Lawrence. Yeah. So I think like a lot of the panelists today, we are concerned about the inventory shortage and so I'm happy to hear that there's lots of innovative ways to address that. I will say that's one of the things that we are optimistic about in our forecast. It's not going to be a huge change, but we do expect to see inventories bottom and start to increase moving into 2022. That will mean the housing market remains competitive for home buyers, but the trend will begin to shift. Builders have made incredible progress. There's still more to be done, but we see things shifting in a positive direction. We still got a substantial amount of demand and so that's going to help propel home sales into 2022.

If you look at young people, there are more than 45 million people in the 26 to 35 year old age group, which is a key age group when we think about household formation and first time home buying. And so we think that's really going to power strong demand for housing in the future. In addition to all the needs that were recognized as a result of the pandemic, we think that the suburbs are going to continue to draw an outsized amount of interest. This is a trend that was ongoing even before the pandemic and was accentuated by the pandemic, which is a good thing because builders do have an easier time of meeting the needs for affordable housing in the suburbs than in the more crowded and densely populated urban areas.

One of the challenges that we are watching is affordability. So we do expect home prices to rise. We do expect mortgage rates to rise. That's going to mean that housing costs for potential home buyers go up and that's particularly impactful for first time home buyers who don't come in with acuity from a previous home ownership experience. So that is going to be a challenge, that shift to the suburbs I think is going to really help a lot of potential first time buyers get into the housing market and shifting to the suburbs in some cases means, further away from downtown, what we think of as the suburbs.

It also, in other cases may mean shifting to another metro market entirely. Lawrence showed that the unemployment rate is essentially back to normal. We expect it to continue to drop into 2022. And that means even though payroll jobs aren't back to where they were before. The labor market is competitive from the perspective of firms who are trying to hire, that means they need to do what they can to attract and retain talent. And we think that means there's going to be a considerable amount of flexibility the workers have with respect to where they can work. And that's going to be helpful for the housing market as households are trying to figure out how they can afford housing and everything else in their budgets as well.

So as far as the markets that we expect to do well, our markets to watch in 2022 are our top markets are a little bit further north of NAR. So we think we're still going to see a lot of activity in the Mountain west states, Salt Lake City, Boise, Idaho, but it's not just in the Mountain west. We also expect to see pockets in New England and the south, and also in the Midwest where affordability really creates a strong incentive for home ownership and not just an incentive, but the ability for people to make that leap in home ownership.

And in addition to the fact that there are large numbers of young households that are going to drive that demand, there's also going to be the push factor from the rental market. We expect rents to continue to rise. And in 2022, we think they'll outpace home price growth. So that's going to be a strong factor for people to grapple with rising housing costs, but at least once they get into the housing market, they can lock in that monthly payment instead of continuing to see it rise if they stay in the rental market. So with that, I guess we'll turn to the discussion.

Okay, great. So let me turn to Lesli, because we first know the supply chain disruption, container ships unable to unload and manufacture housing actually requires many supplies to come in. And then we have this incredible labor shortage. Informal rate is low and the job market is not back to normal. So total job is not there, but many people have left the labor force. So from the manufacturing housing production perspective, can you handle increased demand? Would you be able to adequately supply or what are some issues that you are facing related to, or are people having a good year in terms of the manufacture housing industry?

Well, our factories are doing well this year, our home construction facilities, however, just like in the home construction the site built market, we are experiencing labor shortages and challenges with supply chain. The thing about manufactured housing that's helpful is that we are in that factory controlled environment. And so we're very efficient in the use of our materials, but given the demand, you've got that perfect storm of demand mixed with the labor shortage and some slowdowns in the supply chain.

We do have a backlog our home building facilities. We are looking at opening more, you'll see more come online. And so we are working to meet that demand, but there has been a backlog at the factories six months for some. And so that is definitely a headwind that we're working to overcome with this administration.

Absolutely. And let me just touch on that. So given today's work from home flexibility, even in the case where COVID disappears, I think we will not return to office in the normal way. So there would be a demand for larger space, meaning that apartments offer small space, but manufacturing housing affordability along with larger space. Are your industry preparing for this growth from this work from home flexibility?

That's where much of our demand is coming from. And the other thing that I want to make sure that I point out to you about our homes is that the homes have today's features. So when you talk about a smart home and the things that people need to work from home, that's what we offer. Oftentimes in the conversation about affordable housing supply, we're talking about very old homes that have been refurbished or rehabbed. The thing that we can offer that's really driving consumer demand is that this is a brand new home with the features that today's consumers need. And so that's definitely been driving the interest in our homes.

Director Tagoe now going into the financing of affordable housing, which manufacturing housing clearly provides. So you are indicating that Fannie and Freddy possibly could provide some funding, that would require having a home along with the title to the land or what is your vision regarding financing of the affordable housing through manufacturer?

Yes that's right. So right now we are not looking at personal property. This would be with a title to the land. So that's what they've had in place before. And I think one enterprise Fannie Mae had broader credit policies for those types of loans Freddy is now matching Fannie's policy. So that will increase the ability to deliver those loans to the enterprises.

Because our members are clearly interested in the business opportunity. We know that some of the commercial developers provide a land and lease the land space for people who want to have the modular housing there and pay the rent on the land use. Lesli, you had your hand up just to finish up on this topic.

Yeah. I just wanted to point out a couple things. First of all, about 75% of our homes are financed as personal property. And there are a lot of reasons for that. The beauty of manufactured housing is the application of it. You can actually place it on private land that's already owned and only take a loan on the home portion of that. You can also put... It's a hybrid home ownership model.

A home can be placed in what we call a land lease community, where you're leasing the land, but you have all of the flexibilities of owning your own home. And so we love that there are these options out there. And so we do think that the government financing programs should support these options. We are pleased that the Biden administration has announced that the FHA Title 1 Program for personal property loans is an area of a priority for them.

They've made some updates to that program for personal property loans so that people can do what we see in the market, which is take the loan on the home, but not encumber the land. The other thing is on for Fannie Mae and Freddie Mac for the houses behind me, which are called CrossMod homes. Those homes can be financed through the choice home program with Freddie Mac and MH advantage program with Fannie Mae. As long as they have the features that make them indistinguishable from site built homes, they don't have that loan level price adjustment. Those are homes where you have to have the land and the home encumbered together. We do see CrossMod homes going in land lease communities as well, which was very exciting to give consumers entry level consumers more options for ownership. But we would call on the government programs to follow FHA in making sure that personal property loans for affordable manufactured homes are a part of what is being supported by the government. So thank you for that opportunity.

Ken Johnson. So you create the rent home price index ratio and then based upon that, you say in certain markets, it's better to rent, in other markets it's better to buy, but rents are rising very strongly. So does your index account for what the rents would be 2, 3, 4, 5 years from now while people who are buying a home they're at a fixed payment? Unmute.

Thank you, Lawrence. So yes, we do have a couple of indexes that are out there and one is a buy versus rent index and we do account for the growth in rents through time. So we try to have a horse race between wealth creation by way of renting and reinvesting monies that would've otherwise been invested in home ownership. And then you would on the other hand rent and, excuse me, buy and build equity. So which way do you actually invest in the stock market and bond market and rent, or do you own and build equity. So which way creates more wealth?

The truth of the matter is, the differences are pretty small, either way. The third option is to rent and spend the extra of money on beer and cookies. We don't recommend that, but renting and reinvesting on average wins around the country. So in particular, when we're at this near the peak of the current cycle, it doesn't always seem wise. And I keep in mind, I said, doesn't always seem wise to buy near the top of the cycle when you could be renting and reinvesting, both are forms of savings. You have to think of yourself as a buyer. Do you have that monastic discipline to continuously put that money aside and invest it? Are you comfortable doing that?

We're not against home ownership. Just pick one of those two, either way you're saving. So it's something that we've been talking about for years. I have some interesting conversations with former real estate broker friends of mine, and it usually results in a draw, I can tell you that. The other thing I would add change in discussion, just a little, I disagree a little bit with Dr. Hale. Our data is starting to show a real estate downturn in the premiums in the west. So I tend to think that we're going to see the slow down starting in the Western United States. And finally, I was really pleasantly shocked and surprised to see if you could tell by my accent that I'm from the south and I'm from Alabama and two of Lawrence's top 10 markets are actually in Alabama. So that was kind of shocking to me, so.

Well before turning to Danielle for her to counter our argument, just focusing on Ken Johnson for a sec. So based upon some markets which you believe is overpriced, and our members are seeking inventory, please list your home. Would you advise some homeowners to say, "Go ahead and list your market and be a renter for a few years?"

That's a hard question to answer because my wife and I face that question here in Southeast Florida and I'm like, "Honey, yes. If we sell our home, what the heck are we going to move to?" So it is a game of musical chairs and you don't want, when the music stops, you don't want to be without a place to either rent or own. So we've chosen to move to the sidelines and we're just going to say, we're going to continue to own our home.

So we're again, we're seeing rapid appreciation, but all, but a few cities, this isn't unprecedented and it's the second wave of, in my opinion, it's the second wave of the crisis that started 15 years ago. If you ever drop a big rock into a lake, it creates concentric rings going out and they get smaller and smaller, and we've been expecting something like this for a number of years, this time around on average just is not going to be as bad as the last time around, nowhere near as bad. But we already-

Are we certainly invited Ken to provide his perspective because consensus system are actually six, 7% price appreciation nationwide, but we want to have a divergent perspective. We have 60 seconds remaining. I'm going to give Danielle on where she sees inventory actually beginning to turn around or why she still have a confidence in the rocky Mountain States.

Yeah. So we do still have confidence in those Mountain west states because they're still attracting a lot of people to those markets. And I know that they've seen prices run up pretty substantially in many cases, but they remain relative to the areas that people are fleeing, namely, California, quite affordable by those prospects. And so as long as that flexibility for people to keep a bay area salary and relocate to the Mountain west remains, I think we'll see the Mountain west do really well.

Okay, great. So I want to thank the panelists for the insightful discussion. REALTORS® are always interested in new business opportunity and even sharing some data with their clients. Manufacture housing with the REALTORS® being engaged in this business growth opportunity while it remains to be seen. But thank you for the panelists. And now we will go into the next session on the home buyer preference and demographic trends.

Thank you guys.

All right. Great. I am excited to share the latest data from the profile of home buyers and sellers, and really show how demographics have been shaping, who's entering the home buying market today. The first thing I'm going to talk about is age, because we just can't get around talking about generational warfare. That really is happening today in the housing market, a lot of boomers owning onto this housing wealth rate now and have the acuity as sellers are just holding onto their homes, like Ken Johnson was talking about and just not planning on moving. So he is holding onto it with his wife and that's creating an inventory crisis as well as we know people are holding onto homes for longer periods of time.

I will say that millennials are the largest generation of buyers today. I'm going to show you some data on why that trend is going to continue and only increase. So as we look at the first slide here, what we can see is the generations among us. And we can see the age of the population in the U.S. right now. Everyone from our centurions over 100 years old to our little babies that were born this year. And what I'm showing you is in the blue here are the millennials, the generation that everyone is incessantly talking about and for good reason and housing market.

This red bar here, this indicates the median age of a first time home buyer, which is 33. And it has been 33 for the last three years in the data that we have. And behind that, what we can see is that for about five more years there is a very large population of potential buyers who are aging in to what has traditionally been the first time home buyer age category of about 28 to 33 years old.

And these young adults are ready to enter home ownership. They have a lot of headwinds against them, such as low inventory and rising prices that was just talked about and student loan debt, but they're trying to enter into the housing market. So there's about 23 million of them who are ready to go and enter in. So this is a generation to watch and look for, for the next upcoming few years.

When we look at the first time home buyers share, what we know is that in the last year, there actually was a slight uptick. And this is likely because of this growth in young adults. Also, a lot of people moved home during the pandemic. A lot of people were able to save up for a down payment by living at home with mom and dad, and that gave them the opportunity to enter home ownership that way, pay down their student loan debt. A lot of people in increased share this year actually did have down payment assistance from mom and dad as well. So that's another opportunity. Maybe you're not living at home, but that gives them an opportunity to enter home ownership.

When we look at the age of home buyers, overall, what we can see here is that first time home buyers pretty flat, they do enter in that age category that I talked about. What's important here on this chart though, is repeat buyers. The median age of a repeat buyer has increased drastically in the last 40 years. So we even looked back at the 1980s. It was just 36 years old, today it's 56. And that means that, that repeat buyer they're likely taking on a mortgage later in life when they're thinking about retirement is pretty close. They can see it on the horizon, but they're taking on that mortgage because they're working longer. They're living longer. They're feeling healthy to do that.

That is crunching the inventory though, because instead of thinking, oh, well, I will move perhaps into a nursing home or assisted living. No one wants to do that anymore. So everyone is saying, I'm going to age in place, as they buy homes later in life, or I'm going to stay here for a very substantial period of time and that's going to change the inventory as well for available homes to purchase.

When we look at another trend here, it's multi-generational buying. We did see that it increased pretty dramatically at the beginning of the pandemic to 15% of all buyers purchasing multi-generational homes. This has reverted back to the historic norm of about 11%. If we had more minority buyers, which we really are lacking right now in the home buying market, if we had more minority buyers coming in, we likely would see this number increased because they are more likely to purchase multi-generational homes.

The next turn I want to talk about here is one of my favorites. It's looking at the drop in birth rates that we have had in the U.S.. We are at 100 year low, and I'm guessing that some of the demographers and researchers who are in the next panel will talk about this, but this is a trend that accelerated during the pandemic.

We expected this big baby boom, we didn't have it. And so with that, what we see is for home buyers, this trend is mirrored. Back in the 1980s, 58% of buyers had a kid under the age of 18 in their home, today it's just 31%. And so we continue to see that drop. And that has some implications for the type of home that someone wants, where that home is located, in that perfect school district. That's off the table because you don't have a kid in tow.

The other thing that we see here is that having a child or having a second child often an impetus to purchase a home, need a larger home in that perfect school district, or actually an impetus to sell because you're downsizing and all of those factors then are removed. The next trend to show you here is the drop in marriage rate. So back in the 1960s, more than 70% of American adults were married, today just about half of American adults are married. And that trend is really mirrored here as well among first time home buyers. And what we see here is that back in the 1980s, 75% of buyers, first time home buyers were married couples and today it's just half.

On the flip side of that, what we see is a rise in singles in the market, especially single women really killing it in that real estate market, making financial sacrifices, but getting in there, we also see a rise in unmarried couples and we see a rise in a roommate. So people pooling their funds in different ways to enter home ownership and really valuing home ownership and saying, I don't want to rent anymore, I...

... and really valuing home ownership and saying, "I don't want to rent anymore. I want to take advantage of low interest rates. I want to be able to enter, but maybe I do have to pull my funds with someone else to be able to do that." So, a golden girls phenomenon, essentially. The last thing that I'll say here, and this is not demographics, but this is incredibly important. When we look at the profile home buyers and sellers, how in the world does the agent relate to this? And what we see is that buyers are saying they want an agent. They value an agent. They want to use someone that they trust, is honest, has a great reputation and will help them navigate this transaction in this very complex and complicated market. And we see this, especially, even for youngest buyers, they are using agents at higher rates.

And if we look at sellers, what we see here is that sellers want an agent by their side. They want someone to give them a competitive price, sell within that specific timeframe and find the qualified buyer for their home. FSBOs For Sale by Owner, it's just 7% of the market at a historic low today. iBuyers, it's a statistical zero. We just don't see it in the data for people who want to go on and buy another home. So, those are some top highlights from the report. You can grab it as a member for free under right tools right now it is available to all members, but I'm going to scoot along and I'm going to intro the incoming panel here, which I'm really excited to do. Joining us today, we have a lot of demographers and researchers. The first person I'm going to call up is Andre Perry. He's with Brookings Institute, and that's going to be great.

We also have Issi Romem who is going to be joining us. He is from MetroSight and from U.C. Berkeley. Many of these researchers having two designations of where they are from. Richard Fry from Pew Research Center, Lori Trawinski from AARP Public Policy Institute, and Vanessa Perry also from Urban and from the George Washington University School of Business. So, thank you everyone. And with that, I'm going to start with Andre Perry. So, what in the world are we doing with demographics right now? You just authored a great paper that looks at race and it looks at home buying and equity that's earned. I'm not sure if you want to touch on that, or if you want to just want to talk about the 2021 real estate market and what we have in store for 2022.

Yeah. And we actually saw some bright spots, a few bright spots that really exemplify what we can do with policy to increase home ownership and increase wealth in this country. During the first couple of quarters, as with many millennials, we saw a spike among black millennials, particularly black women purchasing homes. And certainly as you men mentioned, people were able to save more. People were not using their discretionary income for bars and clothing and such, but something else occurred that really... That positively impacted black people and that was the freezing of the student loans. And you started to see people actually take advantage. And I just wanted to say that because it's still the wealth gap that really throttles black people's ability to purchase homes. You hear time and time again, that families simply do not have the down payment that generally comes from intergenerational wealth.

And so, my work is... And I'll just briefly touch on this. My work really not only looks at improvement conditions for potential buyers, but it looks at the wealth that's been extracted from current homeowners. And so we did a study a few years back that is now getting a lot of attention. We looked at home prices in neighborhoods where the share of the black population is 50% are higher and compared than to areas where the share of the black population is less than a percent. And we control for those variables that people say are the reasons why, what people generally see is that 50% difference between homes in black neighborhoods and white neighborhoods broadly.

And so, we control for education, crime, walkability, all those Zillow metrics that we've found at homes in black neighborhoods are underpriced by 23%, about 48,000 per home. Cumulatively there's a loss about 156 billion. That 156 billion just to put some numbers around it that would've financed more than 4 million black owned businesses based upon the average amount black people use to start the firm's 8 million, four year degrees. I mean, it's a big number. And so, not only must we improve the conditions for potential buyers, we must also make sure that we restore the wealth in current homeowners because black families simply are not accruing the wealth from their investments in the same ways. So, I'll leave it there.

Right. That was a great place to start. So, Issi Romem, I'm going to turn it over to you for some opening remarks too.

Okay. I am going to take a bit of a longer view than just 2022, I'll start off by talking about remote work. I think if you free to talk a year and a half ago, everybody would've been clearly aware that a good chunk of society had switched to working from home and the questioning would be to what extent will things revert? Will they go back to 2019 norms or will people work at home forever or somewhere in between? I think today, it's pretty clear that we're not going back to 2019 and remote work is here to stay. It's not quite clear to some to what extent, to what degree. And it's not clear in what form and what I mean by that is that different forms of hybrid work are emerging and they're often more complicated than just X days per week come in the office. All that means that people's tolerance for longer commutes within the Metro for living farther out are higher. When you only need to go in once every X. There's also some more appetite for living in truly distant destinations, but that is, I think, more hype than actuality. And I say that for two reasons, the one is the prevalence of hybrid work that requires you to be in the same Metro. And the other is that employers aren't stupid. They are adjusting wages for all, but the very best talent. And they're paying less for people who go and live far away, that extends a pre pandemic trend of construction and movement to the suburbs picking up steam again, since the great recession, I'll just temporal that by saying that remote friendly jobs are a minority of jobs, even in the bay area and Washington areas, which are the most educated in the country, only just north of 40% of jobs are potentially friendly. And that's typically around 30% in the average U.S. metro.

Different trend to watch out for is legislation. So, for three or four decades now, we've been basically more and more protective of our single family areas and making them untouchable for development. That is beginning to change. There's been new in a few places in the country, but notably in California starting about three years ago, but picking up steam this past year, and that means that in the next decade and even more so in the decade to follow, we're going to start seeing suburbs start densifying. This begins with ADUs and with duplex and fourplexes and will likely continue from there, but we're going to start seeing the expensive coastal cities able to produce more housing and especially missing middle type housing that just doesn't get built today. The construction and financing ecosystems around that still need to evolve.

And there was a hint of that in what the lady from the FHFA said earlier, different trend is the silver tsunami, but that's related. So, we're going to start seeing baby boomers reach the ages where they must move into an old age home, or where they pass away and do release homes into the market, not as repeat buyers. And that is going to present a huge opportunity for folks building ADUs and developing more densely to come in and act. More than that, it means that renovation is going to be a much more important factor than it has been over the coming decade.

Last factor I want to talk about is the tech speed up. So, there's not a shortage of homes for sale. Lawrence was shown earlier there were more home sales this year than in any year recently. What there is a shortage of is homes for sale at any given moment. And that's because homes are flying off the shelf very fast, and that is largely due to tech speeding up the process in all kinds of different ways, as simple as being able to shop on Zillow and as complicated as doing different parts of the process remotely, or without human touch that imbalances the market. It means that from a situation of having three buyers for every two sellers, you switch to having two buyers for every one seller, which is a more imbalanced ratio. The same would be true in a buyer's market the other way around, but that exacerbates everything and makes housing prices rise faster.

And that's going to persist even when the pandemic is forgotten. And that will act against market cooling to some extent, truly last note things to watch, institutional buyers are buying up a bigger share of properties every year. They're not big enough to be a factor are in driving housing prices yet, but keep an eye for that. The third is, we've just... Sorry, the last is, we've just had a few years of very low international in migration due to the previous administration. And more recently due to the pandemic, that's a big driver of population growth, and we need to keep an eye up for what that does.

Great, Issi, you gave us a lot to chew on there and I don't have enough time to follow up on every single thing. So, I'm excited to move on to Richard Fry. And I know that we're going to get back to Andre and Issi there was some follow up questions. So, Richard, you go up next.

Good afternoon at the Pew Research Center, we've been interested in the impact of the pandemic on geographic mobility. And aside from our own polling, we have examined the recently released Census Bureau data on moving. Every March since 1948, the Census Bureau has asked its one year migration question, "Did you reside at the same address one year earlier?" Non movers include both those who didn't move as well as those who move, but then returned to the same house. So, Census Bureau is picking up more permanent moves. Now the pandemic messed up the data collection in March, 2020.

So, I can't compare 2020 to 2019, but what I can compare is, I can compare moving during 2020 to the years before 2019, a 20% [Spiro] data in 2020, 26.5 million Americans one year or older moved domestically, that is they move from one U.S. address to another. That is the lowest number of domestic movers on record back to 1947. As the percentage, 8% of the population moved domestically during 2020. In 2018, 9% move. And back in the 1960s, routinely one in five Americans or 20% of the population moved. So, geographic mobility has been steadily falling and the pandemic does not appear to have interrupted the trend.

Age wise, young adults are the most likely to move. And so, the aging of the population is contributing to the decline in residential mobility, but just looking at young adults or any particular age group, domestic mobility is falling, the decline is not well understood but it could be the case that the rise of two income couples is contributing to the fall in Americans moving. It's harder to move when both partners have to land a new gig effectively. Allow me to talk briefly about tons of moves. Most moves are short, that is the movers stay within the same county. Of the 26.5 million moves in 2020, 15.8 million were in the same county, but both same county moving rates and moving to a different county mobility rates, both of them were at a record low in 2020.

Now the Census Bureau also publishes information on moves involving a change in community type that is moving from say, a central city to the suburbs or a central city to a rural area. So, this is a smaller set of moves in terms of sort of moves and involved someone changing their community type, that was about 8.8 million moves in 2020. And just to give some examples in 2020, about 4.9 million movers moved out of central cities, that outflow out of central cities was less than in the years immediately proceeding the pandemic.

So, it doesn't appear in 2020, it might have been true in certain cities, but as a general statement, it doesn't appear that there was a mass exodus out central city areas to either suburbs or rural areas. Similarly in 2020, there was about 5.1 million moves into suburban areas from either central cities or rural areas. That suburban inflow in 2020 was also less than the inflow that we observed during the pre pandemic years of 2017, 2018 and 2019. So, the basic to sum up here as best we can tell Census Bureau data, at least nationally in 2020 domestic migration was down and all the flows into and out of either central cities or suburban areas or rural areas, all those flows involving the change of community type, they were down, not accelerating according to the Census Bureau data. So, I'll leave it at that.

Thank you, Richard. I think that this is a common theme with lots of these trends, is that the pandemic accelerated preexisting trends that we saw in the before times, but it only seems to be ramping up right now, whether that's flexibility at work for a select few or whether that's migration trends, whether that's inequity in the housing market. We're seeing a common theme here of what has happened during the pandemic. So, Lori Trawinski, AARP Public Policy Institute. I want to throw it to you because I'm excited about what trends we're seeing here and what could be accelerating as well.

Sure. So, thank you very much. One of the things I wanted to mention is that home ownership rates tend to increase with age and that has been the case for many years. So, it's not a new phenomenon that higher percentage of older people own their homes than younger people. And I will also add that for all age groups, the home ownership rates peaked in 2004 and no other age group has reached the level of home ownership rates that existed since that time. One of the things that I look at in my role at the Public Policy Institute is mortgage foreclosures, in the aftermath of the great recession we did see tremendous home loss for people of all ages, but for people over the age of 50 facing foreclosure, facing home loss, you have less time to recover from that kind of a financial calamity.

So, looking ahead to 2022, one of the things that we're concerned with would be the potential for more foreclosures as a result of the pandemic. Now, as of October, 31st it's my understanding around 1 million loans were in forbearance. So, these loans were protected from foreclosure action at that time, but we do know that the forbearance periods will be coming to an end. What's different this time versus the last recession is we have many more opportunities to help borrowers stay in their homes because of... I am hoping better modification programs and more outreach to borrowers to help them get current. And we've also heard today that the unemployment situation has improved and that often also is correlated to the ability obviously for people to pay for their mortgages. So, I think that we still need to be concerned about being sure that we can help borrowers who are currently in forbearance.

We need to... And especially for older homeowners in the last recession, we did see people over the age of 75 and older losing homes at a pretty good clip. The last time I looked at my foreclosure data as of 2019, the 75 plus actually had the highest foreclosure rate of borrowers over the age of 50. So, it's that older age bracket that seemed to struggle. And so, I think it's definitely an area that we want to pay attention to. The final point I would make is that when you look at mortgage debt outstanding, it accounts for the highest type of debt for most people except for the very youngest age groups. And some of that is a reflection not of people buying homes at older ages, but of people refinancing existing mortgages and using that home equity for other purposes. And as a result of that, we see more and more people carrying mortgages into retirement. And we see higher levels of mortgage debt as people age. So, these are trends that are different from what we would see 30 years ago. And I think it warrants our attention to make sure that as people are aging, that they can continue to pay the debt that they have accumulated.

Thank you so much, Lori. I think that those are really interesting points and certainly people carrying on mortgages later on in life is certainly happening and certainly something that we're seeing, especially as people say, "I want to age in place and I'm holding onto this mortgage for an extended period of time." Obviously they're earning equity right on this very positive home equity environment, but then what happens? So, Vanessa Perry, I want to round it out with you from the Urban Institute and George Washington University. So, I'll turn it to you.

Great. Thank you. And I will keep it brief, but I just want to mention a couple of things and underscore a couple things that have already been said while the media is sort of touting the hotness of the housing market I remain concerned about opportunities to narrow the home ownership gap and opportunities for historically disadvantage households and communities. And I want to acknowledge that there has been a lot of forward movement collaborative among regulators and the industry, and I'm excited about that. The fact is we're still in a pandemic, which has had well documented and really negative effects on many households of color in many ways. We have these skyrocketing house prices that have put an additional strain on the supply, and we can't forget the extent to which the supply actually affects the sort of demand and these demographic issues.

The supply... The house prices, I think it's worth emphasizing the role of neighborhood racial segregation and exacerbating these prices and the resulting differential access to resources and the biases in neighborhood valuation processes and in home values. At the same time, there are significant challenges that are barriers actually to access to mortgage credit for black and brown home buyers, particularly because of the restrictive underwriting requirements and risk based pricing policies in the conventional market in particular, although they're not alone. And these factors also have kind of a chilling effect on demand for home ownership. One of the things I'm particularly excited about and looking forward to working more on in the coming year, I even know these things don't happen overnight, is pushing for ways to specifically address these challenges, and I'm particularly hopeful about the prospect of special purpose credit programs, and to be able to develop those in a scalable way that can be targeted based on individual characteristics of disadvantage and place based characteristics of disadvantage and others. So, thanks, I'll stop there and very, very glad to be able to be here today and hear all these insights.

Vanessa, thank you so much. And I think you brought up unique challenges as well, but where you left it here actually was what people can do? And specific policy recommendations. We have about five minutes left on this panel. So, I'm going to do a quote unquote lightning round here. I want each of you, you each brought up unique challenges in the housing market, whether that was mobility or potential foreclosures to think about how can the REALTORS® who are tuning in here, how can they take these issues and really do something in their communities, on the street as they work with clients, what can they do to really help bridge the gap between the issue that you said, and as a practitioner on the ground? So, Andre we'll go the same way around the circle. Andre you're up first.

Yeah. First and foremost, I think that as it was mentioned by my sister Perry with no true relation, but there's a lot of regulatory change in movement happening. And I would encourage REALTORS® to be a part of that. I've been immersed in the appraisal issues, racial disparity issues there, and the appraisal Institute, the appraisal foundation, they're owning this issue and really facing it. And so, I think, in a broadly speaking, we have to look internally to say, "Hey, what can we do?" And specifically, I will say that the fair housing initiative program that we need to be funded if we can do these kind of tests that individuals are doing around appraisals, instead of individuals doing it. We should have fair housing action centers doing it. And that can be funded to the fair housing initiative program, but that's underneath the build back, better acted as it stands right now. So, but in a nutshell, I'd just say, take ownership of these racial issues and we can move forward together.

Right. Issi you next.

Thanks. So, I'm going to push the end because for those REALTORS® who live in the expense of coastal cities, we are on an unsustainable track in terms of housing price appreciation. We can't expect housing prices to continue rising the way they have over the lifetimes that we've lived through and still expect people to be able to buy homes and still expect our kids and our grandkids to live near us if we live in those areas. In order to fix that, we have to shift from the current mode of not allowing our cities to sprawl and not allowing ourselves to build more densely in the cities either. And the better solution there is to densify, not revert to sprawling, and that needs to be allowed to happen. Nobody likes it in their house, near their house in their area, but you got to remind people that that's necessary.

And we know what the alternative is. If you want to see what happens when you let this kind of situation persist forever, you get what I call Manhattanization, a situation where something like 10% of homes are owner occupied by people who are exorbitantly wealthy, and everybody else rents. And we already see the coastal areas in this country going in that direction. You see renter shares of the population rising. We are headed in that direction, especially in California. And we just have to build so sympathize, even if you don't like seeing your neighbors get a second story window that can look into your backyard. It's for the better good.

All right. And Richard, what are your solutions for mobility and the other challenges you brought up, should everyone get a divorce? And then they can just get their own jobs somewhere else? I'm not sure... What are your solutions here?

Yeah, I'm speaking personally here, not on behalf of the Pew Research Center, since we're getting into policy questions. I agree with Issi that long term, I think there are some issues on the housing demand side, but at least right now in the current frame of mind, it's sort of clear nationally that housing inventory and housing supply issues sort of are what everybody is more focused on. And so, I think, particularly in Metro areas, I think issues of sort of what the board of supervisors doing and zoning issue and zoning more for denser building is an area of concern. And so, that's sort of where I would emphasize, we probably do need more dense building revised sort of rezoning laws in many communities to alleviate as well as affordable dwelling units in order to alleviate some of the supply issues.

Right. Thank you. And Lori.

So, one of the things I would like to see more of is better access to housing counseling for current borrowers. So, we often see people losing their homes in a foreclosure. In the last crisis, we saw underrepresented communities suffering a great deal because they became victims of subprime loans. And I think better access to housing counseling so that people can sustain home ownership once they've attained it, would be a really great thing. And to the extent the REALTORS® could support that, it would be a good thing.

All right, great. Thank you. And Vanessa.

Thanks. One of the great things about REALTORS® is that they're out there on the ground working with prospective home buyers every day. And so, no one knows better about sort of the local needs. And I mentioned earlier special purpose credit programs, but one of the great features of the ability to create these programs is for them to be tailored to local needs. So, I would hope that our REALTORS® would work with their local lenders and housing authorities and other parties to be able to design programs in ways that best serve the needs of their local areas.

Well, I have to thank all of you so much for doing panel. I think you guys all brought so much unique insights here and each brought so many unique differences as well. So, thank you all so much. And with that, I'm going to turn it back to Lawrence Yun. He'll be leading the Commercial Panel.

Thank you, Jessica, for leading that panel and demographics and the housing preference. Now the final 25 minutes will be on commercial real estate, but first the Federal Reserve did make an announcement during this part a few minutes ago, to say they believe that it will be three rate hikes in 2022, they are scaling back the mortgage purchase bond purchase program. So, the combination of the likely three, our consensus was two rate hikes next year, but two or three, along with scaling back on the mortgage back security purchase means that mortgage rates will be ticking higher. My best forecast is that maybe 3.7% by this time next year from current around 33.1. So, one is looking at 60, 70 basis point upward move on mortgage rates, the reasoning behind why they believe that mortgage rates, they will be raising interest rate is inflation, to contain inflation. And to this area, I want to turn to our commercial panels rather than do the all the people introduction. I'm going to go into one person and then go into the next, just to save on the time. So, I want to first start with...

To the next, just to save on the time. So I want to first start with Caitlin Sugrue Walter. Dr. Walter, where you see the multifamily housing council apartment sector. And we have seen the rents beginning to really tick higher. Some of our members are certainly involved in the multifamily apartment sector, but based on the trend on the rents, that's going to push up the overall consumer price inflation. And that may further panic the federal reserve to maybe raise interest rate four times next year. How do you see the rents trending currently or what's missing in some of the headline information regarding apartment rents? So Dr. Walter.

Sure. So first of all, thanks for having me and just to set the stage largely what I'm going to talk about a lot are investment grade apartments. So not the small mom and pop, maybe triplexes or duplexes. We tend to look at the bigger rental universe. So I think the big thing that's missing when we hear about the rent headlines is that what time horizon is being compared. We saw a lot of rent declines, particularly in urban areas during the pandemic's height in 2020.

So a lot of these increases that you're seeing highlighted in the news media are really these year over year increases. Similar issues to what we see with when CPI is reported that compared to the 2020, particularly when rents were falling, these rent changes look very high. That being said, we are still see rent growth and real page one of the data providers we use a lot, they reported 0.4% rent growth from October to November. And looking at that fourth quarter's typically when we see rent declines, people don't want to move when it's cold, that kind of thing.

So it is notable that we are seeing some rent increases and we are suffering from a lot of the same problems that you all are suffering from on the single family side, we don't have enough apartments, just like we don't have enough single family houses and it's expensive to build them. So all these things, the price increases that impact the consumer they're also impacting the operator. So I think we're still going to see some rent increases. We try not to forecast at [inaudible] but I think we'll see some rent increases, but probably some moderation there.

Great. So we know that apartment sector is coming around strongly because the job gains again with each passing month, more jobs and many younger people, I mean, they're not in a position to buy, so they are renting vacancy rates declining. But one sector that has outpaced the multifamily is the industrial warehousing.

The sector has been just booming and pandemic certainly accelerated the upward movement. We have invited James Bries, who is the senior director and global head of logistic research from CB Richard Ellis, CBRE. And what's happening on the industrial or is the money coming in so strongly that there is really little return out? Cap rates having dropped to historically low levels? How do you see it?

Yeah. So industrial has been performing really well the last decade from an occupier demand standpoint. But what we've seen the last 12 months has been mind-blowing over the last 12 months one billion square feet of industrial warehouses has leased. That's 300 million and square feet higher than the previous record. And we're seeing demand for a lot of reasons, but four major reasons.

One is we're buying more online. Second quarter 2020, we were all stuck at home and we started buying online and most of the consumers that started buying online continue to buy online. And this is requiring more warehouses and more locations to service this online consumer group. Number two is inventory control. We ran out of things in 2020 for a variety of manufacturing and logistical reasons. And so retailers don't want this to happen again.

So, they are leasing more space to hold more inventory, or they're asking their wholesalers or third party logistics providers to do that. And that's one of the reasons why transportation costs are up so much. And one of the reasons why we're seeing all these delays in ports, but it's demand, but most of the reason is to fill up these warehouses. And there's a need for supply chain diversification. There's more manufacturing going on in the U.S.

There's big demand in Southwest, Mountain West, Southeast, where there's a lot of population growth. And so this is increasing rent. This is lowering vacancy rates to all-time lows. This is creating the situation where there is record low cap rates. I think the big story is that every market is seeing very low cap rates. The bifurcation between core markets and secondary markets or emerging markets has essentially disappeared.

There's the same cap rates in Southern California as there is in Phoenix. So, there's this huge demand for industrial. It's very safe product type. Most investors, especially institutional investors are willing to handle these low cap rates because of the projection for rent growth going forward. So overall really strong markets, very little headwinds. We need to watch inflation if that starts affecting retail sales significantly so far, it hasn't.

Labor is a big issue in industrial and labor shortages, but we're seeing a big pickup in automation, which is increasing demand for first generation space. There's 450 million square feet of industrial space under construction. 40% of it's already been leased. So despite all this demand really low cap rates, there's just institutional capital really flowing into this market right now.

Well, let me stick with James for a second. Before I go into retail and Deborah Weinswig on the industrial sector, because the rents are rising such a strong sector yesterday we saw the report on the producer price index, not the consumers, but the pipeline pressure. So with the rents rising on the warehousing, surely the producer must be passing on this cost over to the next level and hence there will be continuing pressure on inflation, consumer price inflation. Do you see the rents on the warehouse continuing to increase, which will further pressure the consumer price inflation?

I think what's interesting about rent that a lot of people don't know is if you look at supply chain costs, the total cost to get your product from the original point, all the way to your home rents only make up 6% of that, where transportation costs make up 50% of that, the cost to transport it. So, the cost to transport it is affecting the price of goods much more than rents. And what we're seeing is that more occupies are leasing more stay to actually lower their transportation costs.

Yeah, we are seeing those increased costs being transferred over to the consumer in some instances. But if you look at inflation and you start going product by product, a lot of inflation is in things like used cars, gasoline, hotel, things like that. It's not in the stuff that's typically stored in warehouses.

If there isn't much inflation and typical food and beverage, dry bulk in clothing, those are the things where prices haven't gone up that much yet. And retail sales are still really strong. Now, like I said, if it continues long term, then they're might be some sort of an issue. But internally we think this is a transitory item. It's a supply demand item. Once manufacturing fully gets going in China and other parts of Asia, we diversify supply sources. Inflation may go down in the second half of 2022, but if it goes a long way, yeah, that's a big head one for the sector.

Let me turn to the retail sector. So Deborah Weinswig, who is the CEO and the founder of Coresight Research, again, all the bios are in our website. You can look at their detail bio. So the consumer spending has been holding on very nicely. People's said people are flushed with cash because of the stimulus checks and the residual, the job market is tight. The brick and mortar retailers specifically. So not online purchase, but going out onto the street brick and mortar retailers, they need to be more engaging in 2022. You say, expand upon that.

Yeah, I think that's a very good point. And so this idea that not only are we in a bit of an attention deficit, because there's so many opportunities and so many places to not only spend our time, but also our energy. And what we've seen really, I think is that retail has come to life in new ways. And so whether that is BOPUS curbside pickup, but also the physical store has come alive in a new way.

And that is through live streaming live commerce. And this idea that the store can reach not only one to one in a very concierge type of way, that's democratized, but all also one to many. And I think that consumer expectations are rising, but we're also seeing engagement and returns are reducing the more that we're seeing that one to one and also one to many selling.

So the retail sector, I mean, one of the fun item is innovation technology. Amazon, we think of as the warehouse and online delivery, but interestingly in their headquarters in Seattle or the Seattle Metro Market, where the headquarters is located, their second headquarter nearby here in Arlington Virginia.

They're beginning to test out, possibly at least in Seattle, what you call non-cash payment retail stores. You just go in, I mean, so now Amazon is becoming brick and mortar. You show your ID or some kind of scan, and then you just pick up stuff and you go home. And at the end of the day, they said, "You took this and we're going to charge you $80." Is this something that you foresee on many richer shops?

It's interesting having spent the bulk of the last decade in greater China and this whole idea of just walk out through many different formats existed. And it really took a lot of friction out. If you think about it, when you're paying and you're declined or you're short or whatnot, and also just the time.

So, you're waiting in line, then you get up to pay, then you've got to check out. But this idea that you can really take what you need and go also drives frequency of visit. And in some cases, unplanned purchases, I think that's happening, but I actually think I'm going to push the conversation into what I view as another channel.

So we've got brick and mortar. It's called physical. We've got digital through eCommerce. We have live streaming, live selling, live commerce, but we also now have instant commerce. And so I can get anything pretty much in any city, right? Like go plus in a thousand cities and the last city they came to was New York. So, it wasn't starting in major metropolitan areas, but this idea that I can get anything in 30 minutes. And because they have basically dark stores. In urban, well, close to the consumer is the right way to really put it.

They're all very hyper local. And so somebody, 40 blocks south of me has a completely different offering when they go to their [inaudible] versus myself. And I think that what this ultimately does is drive more sustainability because we're not buying the big purchases that, especially on the consumable side that only have a certain amount of shelf life. We literally can buy what we need that day 30 minutes before if you think about it.

And I think that we're starting to look at consumption in different ways. And I think this is also right... Yeah, it's like the Uberification of getting your groceries. You can watch the person and you start to develop a personal relationship with them as well. And so I feel like that's another new way that we might see commerce come to life.

Let me turn to the hotel and lodging an industry that has been heavily impacted from pandemic, less travel, certainly less business travel. NAR recently completed our annual meetings in San Diego, California, where we had 10,000 REALTORS® come to town, obviously hotel demand needs. So during the time that I was there it seemed packed, but when I asked these staff there, they said, "Next week is going to be pretty empty the following week."

So going to the Hotel And Lodging Association Matt Carrier, who is looking at all the research angle, which Metro Market are you seeing a pickup in hotel industry? Is it a convention business dependent? Are the business travel returning or are people working from home? So they say, "Look, I'm going to work in Miami. I am going to work and rather than get an Airbnb, I want the hotel amenities." How do you see it?

Yeah. Thanks, Lawrence. And thanks for having me really appreciate the opportunity to share what's going on in the hotel space. So, at a high level, we just to take last week as an example, we're still down compared to 2019 at an overall industry level. So we were down on a revenue basis, roughly 3% to 2019 last week, 9% the week before that. It's been hovering in that flat to minus 10% range.

Sands Thanksgiving, which was actually better than 2019, but you hit on exactly a really important point there, which is that while it averages out that way for the entire of the industry, if you look at, let's say the top 25 largest hotel markets that last week was actually down around 13% on a revenue basis. And outside of that was up roughly 7.3%.

And the bulk of our workforce, the bulk of our revenue and things like that come from those bigger markets, which are gateway cities that are reliant on business, travel conventions, things like that. The exceptions to that rule within those are the places you would think your Tampa, San Diego's a fantastic example. Miami warm weather, leisure destination markets, because we haven't seen business travel come back yet in the way that we would like, and the industry makes the bulk of its revenue from meetings and events and business travelers.

So those markets that are very highly dependent on that, your DC, San Francisco, Chicago, Boston, those markets are still in the minus 25 to 30% revenue range compared to 2019. So while at a high level, and on an average, it looks like the industry is approaching back to normality. And our projections from STR who's in an industry resource puts us back to normal on a nominal basis or back to where we were in 2019 on a nominal basis in 23. And then 25, when you adjust for inflation, obviously, depending on where that goes, it's really so market dependent.

It's not a rising tide lifting all boats it's in certain markets you're really able to make hay, but elsewhere where you're really reliant on those business travelers and who knows when a real return office is going to happen, it's a lot more variable. And then we just don't know what's going to happen with Omicron yet. We saw huge impact to our industry with Delta. We don't think that this is probably going to be quite as negatively impactful as that, but it's certainly a headwind that we're going to face.

Let me stick with Matt. So, certainly you want to see higher occupancy at hotel and lodging, but assume that somehow the travel returns, but don't you have a labor shortage. It's hard to find those cooks to work in the kitchen, the cleaners because there's labor shortage everywhere it seems like. So how would you handle the capacity situation?

Yeah, there's a huge labor shortage. We're short as an industry pre pandemic we employed around 2.3 million people directly on property at hotels. And we're still around 300,000 short. If you look at the BLS data compared to where we were pre pandemic, and some of that is a function of a lack of demand, but there's certainly a huge component of that. That is just an inability to attract folks to come back.

We've been channeled by the fact that the hotel industry's traditionally been seen and has been a steady source of employment with upward mobility. And then obviously we've been hugely disrupted by the pandemic, which led to a lot of very unfortunate layoffs and things like that. So we've had trouble bringing people back and we're competing with, I think, different industries for workers than probably we were beforehand.

So, what we're doing as an association to try to help with that is we're in the midst of launching a nationwide marketing campaign to inform folks about the industry pays very well. These are steady jobs that are coming back. There is a lot of upward mobility here. It's a great industry to work in. If you look at the BLS data on average, we pay more than $20 an hour, but not everyone knows that. So it's really a huge issue for us.

And we have a lot of owners across the country just from talking to them anecdotally that are, you might have a hundred room hotel, but you'll only sell 75 because you can't get housekeepers to turn the rest of them. So it is artificially deflating a little bit this recovery that we're looking at. So it's a huge challenge for us that we're certainly very focused on as an association.

The office sector, let me turn to Rebecca Rockey, who covers actually all sectors of the commercial real estate, but I want Rebecca to focus a little more on office at the moment who is the global head of analysis and forecasting at Cushman Wakefield. So I am here in DC office, but when I came in, I mean, there's not a traffic, so obviously many office building here in DC is fairly empty. And I'm sure it is similarly in other major cities. So Rebecca, how do you see the office market playing out?

Sorry about that, can you hear me now?


Yeah. Okay, good. You I think what's stands apart for the office sector, even in contrast to hotel and retail which have faced also challenging times not just in the pandemic is that office is actually still going through its correction. The recovery on a pure fundamentals basis has yet to begin. What I mean by that is we're still recording negative absorption. They can see it's still rising.

And to put that in perspective in prior recessions, we've shed about a hundred million square feet per recession in absorption. And we're now already at 179 million. So a factor of almost 1.8 above what we've seen in the past. And we still think there's more to come into the first half of next year. So I think that masks a lot of bifurcation, important nuance in the market.

And I would highlight a few things. One is that the headline fundamentals are still correcting, but we are seeing the green shoots emerge that are setting the stage for that recovery to begin really in the second half of next year. So, we are seeing leasing activity pick up. We are seeing that in general suburbs have really been fairly resilient in what has happened. And in all of the new leasing activity, we're seeing that it's generally around its historic share.

So, said differently are companies following people out to the suburbs and imitating those migratory patterns we've seen? No, not really. There's no evidence. In fact, we've seen some of the opposite where occupiers are saying the central core, the urban core is going to be even more important especially if I have people coming in less often and maybe they're commuting longer distances, I want to be in more of a central location.

And then last but not least, I would say there is also a bifurcation in quality. I call it the best verse, the rest, namely, because even within class A, we see that it is the newest and the shiniest product that is performing bidding wars, rent appreciation in very healthy, 90, 95% occupancy rates. And then there's the rest of the market where rents are falling. We're still going through that process on an effective basis. We're mainly through it, but we know that that transition is really going to happen next year. It's a complicated time in the office market.

We have only final three minutes. So I would like to pose this question because it seemed like commercial real estate is somewhat mixed, very strong in multifamily and the logistics warehouse while there's some vacancies in the hotels office space and some retail, I mean, retail, all this coming back. Is there an opportunity for repurposing properties, say maybe warehouse space in a shopping mall or a multifamily housing unit in an office, or is that transition truly difficult or requires a substantial federal support dollars to happen? Caitlin is any of your members consider, are looking into empty office spaces to convert?

Yeah. I mean, these are all concepts that I think have been banded around for quite a while. You look at places like Richmond that have long time used old warehouses turned into nice loft departments, but yeah, obviously the more federal dollars available better because it is so costly to build.

And particularly again, what we see similar to single family for sale, it's the middle and the lower starter units that are the hardest to build and are the most needed. So any type of as assistance is really going to incentivize developers to really get going on that. But yeah, by looking at warehouses parking garages, all sorts of buildings.

Matt, some of your members considering selling the hotel units to convert it into multifamily units.

So, we're seeing some of that, but one thing that I didn't hit on in my earlier point is that the but we're not seeing as much of that maybe as you would think the hotel transaction market is I didn't just described as frothy, which I think is very accurate. We've seen more portfolio transactions through the first three quarters of this year than we saw through all of 2019. There have been more hotel M&A acquisitions than the were 10 times more this year than there were in all of 2019. So the transaction market there is very strong.

I think there's a stat that around maybe 10% of that, or so is these conversions into alternate use, but there's a lot, I think of bullishness in the investor community around the longer term future of these hotel assets, which they just didn't from a value perspective, take nearly the hit that the operational business did throughout the pandemic. The fundamentals there stayed quite strong. So there's some of that, but not as maybe I would've predicted a year and a half ago.

30 seconds James. Are you seeing some interest along the logistics centers to go into some empty shopping malls?

Not malls. Malls are really difficult with zoning with conversion. They're very expensive with standalone retail, some. They're a little bit easier to get trucks in and out of there's a little bit more willingness to convert at the city level. What we're seeing the most of is conversions from old warehouses to new warehouses. That's the easiest thing to do. Raising roofs, adding doors, those kind of things. That's what's really happening the most. There's a lot of talk about retails industrial conversions, but it has to be the perfect situation for that actually to happen.

My regret is we just don't have enough time. I know we can discuss so many interesting things. Deborah is ready to pinch in on all the tech innovation on the retail and Rebecca, I mean her specialty area, you should go to her website. She oversees everything, not only the office sector, but on the forecast on the vacancy. So a great topic that we could clearly spend more time on, but we have run out of time. So I will in the commercial real estate panel here now for the closing remark is from our NAR CEO, Bob Goldberg.

And I want to thank him immensely for coming up with the idea of having real estate summit, he and several of NAR leadership team. I recall Bill Brown from California, Charlie Oler, from New Jersey to say that it will be a great thing to do a wrap up of what happened during the year and provide some outlook for REALTOR® members about what to anticipate.

So I want to give again great appreciation for Bob Goldberg for providing the resources to have this summit. And also again, want to thank the sponsor center for REALTOR® financial wellness, because of course, as business person, we all know the importance of the sponsorship in getting it done. So with that, now I am going to turn over for the final remarks from NAR CEO Bob Goldberg.

Thank you for the kind introduction. Hi everyone. I'm Bob Goldberg, and I want to thank each of you for joining us this afternoon for NAR's third annual real estate forecast summit. Although we're closing this year's event, we hope to continue engaging with you on the issues that we focused on here today. Our research team does such a wonderful job capturing the numbers, stats, and figures that illustrate how important this industry, our industry is to the nation.

Real estate of course drives America's economy. Not only does it account for nearly one fifth of the U.S. gross domestic product, but housing helps form the fabric of our communities, our families, and each of our lives, given everything you've seen here today. So much work remains in front of us, particularly as it relates to increasing the supply of safe, affordable housing in this country.

As you've heard NAR research from earlier this year found that the U.S. is facing a housing shortage of roughly six million units. In response NAR continues to work closely with lawmakers in DC, as we search for policies that will incentivize housing development, ease persistent supply chain constraints and ensure housing as part of a comprehensive national infrastructure strategy, NAR alongside our 1.5 million members serve consumers in every U.S. zip code.

And we work tirelessly to support a fair, equitable housing market in every neighborhood. We look forward to furthering these critical conversations in the months ahead, and we hope you will continue to use our research team as a resource in whatever way possible. So thank you again for attending today. And we look forward to seeing you all back at this event in person, hopefully at this time next year. Have a wonderful rest of your day and enjoy the holidays.

Window to the Law is a monthly video series that provides valuable risk management tips and information to help real estate professionals navigate legal issues facing the real estate industry.
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