1 00:00:02,200 --> 00:00:06,800 Speaker 1: This is Masters in Business with Barry Ridholts on Boomberg Radio. 2 00:00:07,240 --> 00:00:10,960 Speaker 1: My special guest today is Jonathan Miller. He is president 3 00:00:11,039 --> 00:00:14,240 Speaker 1: and CEO of Miller Samuel. The firm is best known 4 00:00:14,320 --> 00:00:17,440 Speaker 1: for supplying data and analytics to the real estate industry. 5 00:00:17,800 --> 00:00:20,200 Speaker 1: Anytime you see a report from one of the major 6 00:00:20,440 --> 00:00:24,160 Speaker 1: real estate brokers showing houses that are on the market 7 00:00:24,200 --> 00:00:26,320 Speaker 1: for how long, what the state of the market is, 8 00:00:26,680 --> 00:00:29,080 Speaker 1: the odds are that Jonathan is the man behind that. 9 00:00:29,560 --> 00:00:33,800 Speaker 1: Jonathan Miller, Welcome to our Shelter in Place version of 10 00:00:33,920 --> 00:00:37,360 Speaker 1: Masters in Business. Very glad to be here and getting 11 00:00:37,360 --> 00:00:41,240 Speaker 1: a break from the self quarantine. Talking to another human 12 00:00:41,240 --> 00:00:44,440 Speaker 1: being is always nice. So let's talk a little bit 13 00:00:44,479 --> 00:00:48,520 Speaker 1: about what's going on. We're recording this the last week 14 00:00:48,600 --> 00:00:52,720 Speaker 1: in March. Uh. Normally this is the time of year 15 00:00:52,880 --> 00:00:56,360 Speaker 1: when we would see a ton of new real estate 16 00:00:56,400 --> 00:01:00,920 Speaker 1: listings and open houses and really the kickoff of the 17 00:01:01,000 --> 00:01:06,840 Speaker 1: spring selling season. How's the real estate market? Yeah, it's uh, 18 00:01:06,880 --> 00:01:11,400 Speaker 1: you know, it's interesting. The fact is there's very little 19 00:01:11,760 --> 00:01:14,760 Speaker 1: data to test the water, so to speak. Really the 20 00:01:14,800 --> 00:01:18,000 Speaker 1: only thing we're seeing right now that is in real 21 00:01:18,040 --> 00:01:22,800 Speaker 1: time because real estate generally is a much slower moving 22 00:01:23,319 --> 00:01:27,399 Speaker 1: type of asset class is the change in patterns of 23 00:01:27,520 --> 00:01:33,959 Speaker 1: listing inventory. So, for example, in Manhattan, for basically since 24 00:01:34,000 --> 00:01:38,679 Speaker 1: the beginning of time, inventory arises from year end of 25 00:01:38,720 --> 00:01:41,200 Speaker 1: any given year, whether it's a weak or strong market, 26 00:01:41,440 --> 00:01:45,480 Speaker 1: through the end of March, and over the last five 27 00:01:45,600 --> 00:01:51,120 Speaker 1: years it's averaged about a ten percent increase plus or 28 00:01:51,120 --> 00:01:54,120 Speaker 1: minus a couple percent every year, and this year it's 29 00:01:54,200 --> 00:01:58,880 Speaker 1: down nine. So we're not seeing people put properties on 30 00:01:58,920 --> 00:02:01,520 Speaker 1: the market, and that literally is one of the only 31 00:02:01,600 --> 00:02:04,280 Speaker 1: valid data points right now in the housing market, at 32 00:02:04,360 --> 00:02:10,120 Speaker 1: least in New York. We're seeing stories about contract activity, 33 00:02:10,240 --> 00:02:15,760 Speaker 1: but that's actually misleading because contracts typically, I think when 34 00:02:15,840 --> 00:02:18,959 Speaker 1: people think of a contract, they think of you know 35 00:02:18,960 --> 00:02:21,760 Speaker 1: when Byron sellers sort of shake hands and you know, 36 00:02:21,960 --> 00:02:25,800 Speaker 1: boom um, that's the that's the contract. But the reality 37 00:02:25,960 --> 00:02:29,799 Speaker 1: is the contract data that we're seeing now represents two 38 00:02:29,800 --> 00:02:32,760 Speaker 1: to three weeks ago. An offer is made, it's accept 39 00:02:32,800 --> 00:02:38,400 Speaker 1: by the seller, and then you have um or vice versa, 40 00:02:38,880 --> 00:02:40,800 Speaker 1: and then it goes to the attorneys and takes a 41 00:02:40,840 --> 00:02:43,679 Speaker 1: couple of weeks. So I really think next week or 42 00:02:43,680 --> 00:02:45,760 Speaker 1: the week after is where we're going to start seeing 43 00:02:46,160 --> 00:02:51,640 Speaker 1: the real slowdown in activity. So real estate on a 44 00:02:51,680 --> 00:02:55,200 Speaker 1: big lag. Well last week I saw a really amusing 45 00:02:56,000 --> 00:02:59,880 Speaker 1: article on Bloomberg News. People are still putting their mansion 46 00:03:00,120 --> 00:03:03,720 Speaker 1: on the market, And is that really going on or 47 00:03:03,840 --> 00:03:06,600 Speaker 1: is that still part of the leg that might have 48 00:03:06,639 --> 00:03:09,760 Speaker 1: been happening in February and the beginning of March. But 49 00:03:09,919 --> 00:03:14,239 Speaker 1: it's listenings have dropped off, the things have dropped off, 50 00:03:14,280 --> 00:03:17,360 Speaker 1: at least in you know what we're seeing when you 51 00:03:17,400 --> 00:03:20,600 Speaker 1: look at January and February this year after at least 52 00:03:20,600 --> 00:03:23,120 Speaker 1: in New York Metro. It's been a it's been a 53 00:03:23,160 --> 00:03:26,880 Speaker 1: tough couple of years with the onslaught of new taxes 54 00:03:26,960 --> 00:03:32,240 Speaker 1: beginning with the two thousand eight eighteen and then into nineteen, 55 00:03:32,320 --> 00:03:35,720 Speaker 1: all kinds of headwinds for housing. And then there was 56 00:03:35,800 --> 00:03:39,840 Speaker 1: someone referring to the change in the salt deductions salt tax. 57 00:03:40,280 --> 00:03:45,080 Speaker 1: We had the rent law, which punished you know, landlords, 58 00:03:45,120 --> 00:03:48,640 Speaker 1: which is primarily what investors are. We also saw an 59 00:03:48,680 --> 00:03:52,520 Speaker 1: increase in the mansion tax transfer tax. So there's a 60 00:03:52,520 --> 00:03:56,680 Speaker 1: lot of headwinds, you know, to use that phrase, our word, 61 00:03:56,880 --> 00:04:02,480 Speaker 1: and now um we have this we saw an upticking sentiment. Um, 62 00:04:02,520 --> 00:04:05,440 Speaker 1: a lot more offers are being made and all that 63 00:04:05,600 --> 00:04:08,840 Speaker 1: is sort of out the window because we have a 64 00:04:08,960 --> 00:04:12,720 Speaker 1: new sort of milestone to grapple with in the market, 65 00:04:12,760 --> 00:04:16,839 Speaker 1: and that's the uncertainty of the virus. You know. It's interesting, Um, 66 00:04:16,880 --> 00:04:20,360 Speaker 1: A lot of comparisons have been made to other seminal 67 00:04:20,400 --> 00:04:25,000 Speaker 1: events in real estate, like the UH nine eleven moment um, 68 00:04:25,040 --> 00:04:28,159 Speaker 1: like the Lehman moment, and they're all very different in 69 00:04:28,360 --> 00:04:31,479 Speaker 1: scale and you know, and what actually occurred. But what's 70 00:04:31,520 --> 00:04:35,000 Speaker 1: a little different this time is that in those prior 71 00:04:35,080 --> 00:04:39,800 Speaker 1: to moments UH, there was actually another a new day, 72 00:04:40,279 --> 00:04:43,000 Speaker 1: And the further you got away from that moment, you 73 00:04:43,080 --> 00:04:47,200 Speaker 1: could you could sort of process it the tragedy and 74 00:04:47,320 --> 00:04:51,160 Speaker 1: start thinking about the future. Right now, we don't know 75 00:04:51,279 --> 00:04:55,160 Speaker 1: other than anything other than it's got further to go, 76 00:04:55,279 --> 00:04:57,080 Speaker 1: and we don't know how much further it has to go. 77 00:04:57,200 --> 00:05:02,240 Speaker 1: So there's there's definitely a grain at to the outlook. 78 00:05:02,560 --> 00:05:06,280 Speaker 1: So one little ray of sunshine amongst all this negativity. 79 00:05:06,440 --> 00:05:10,000 Speaker 1: The FED took rates down to zero. That has to 80 00:05:10,040 --> 00:05:13,159 Speaker 1: be good for mortgage rates or not. Tell us what's 81 00:05:13,160 --> 00:05:17,040 Speaker 1: going on with mortgages. Well, if you look at Freddie 82 00:05:17,080 --> 00:05:22,760 Speaker 1: Mac's thirty over the last thirty days, fixed UH mortgage 83 00:05:22,839 --> 00:05:25,800 Speaker 1: rates actually are a little bit higher now than they 84 00:05:25,800 --> 00:05:28,680 Speaker 1: were at the end of February. And and one of 85 00:05:28,680 --> 00:05:34,560 Speaker 1: the reasons is just capacity. That many lenders UM laid 86 00:05:34,600 --> 00:05:38,120 Speaker 1: off a large amount of processing staff six or nine 87 00:05:38,120 --> 00:05:41,200 Speaker 1: months ago when there wasn't much action going on in 88 00:05:41,480 --> 00:05:44,440 Speaker 1: UM you know, changes in rates and there's some stability. 89 00:05:45,200 --> 00:05:49,320 Speaker 1: In addition, especially on the in the refi world, there's 90 00:05:49,360 --> 00:05:53,640 Speaker 1: a tremendous concern about liquidity. In other words, you know, 91 00:05:53,720 --> 00:05:59,960 Speaker 1: when you have escalating layoffs, rising unemployment and people will say, 92 00:06:00,040 --> 00:06:02,400 Speaker 1: you know, in the middle of their application and lose 93 00:06:02,440 --> 00:06:07,240 Speaker 1: their job, that is a much different risk profile than 94 00:06:07,400 --> 00:06:10,040 Speaker 1: if we were in the conditions we were, you know, 95 00:06:10,320 --> 00:06:14,080 Speaker 1: a couple months ago. So UM the low rates in 96 00:06:14,160 --> 00:06:17,279 Speaker 1: many ways have fallen on deaf ears in the housing market. 97 00:06:17,440 --> 00:06:21,520 Speaker 1: Initially got everybody excited that it would help housing run 98 00:06:21,640 --> 00:06:26,039 Speaker 1: through this crisis. But I think it's have It will 99 00:06:26,120 --> 00:06:30,039 Speaker 1: have limited effect, certainly better than not doing it, but 100 00:06:30,680 --> 00:06:33,720 Speaker 1: not not much tangible evidence that it's going to make 101 00:06:33,760 --> 00:06:37,480 Speaker 1: a difference. I was kind of fascinated, Jonathan by something 102 00:06:37,680 --> 00:06:42,800 Speaker 1: I read about on your weekly newsletter, and I was 103 00:06:42,920 --> 00:06:47,880 Speaker 1: very surprised to read that brokers are now hiding the 104 00:06:47,960 --> 00:06:51,719 Speaker 1: number of days that houses have been on the market 105 00:06:52,200 --> 00:06:57,200 Speaker 1: from buyers. What is that about? Why would anyone imagine 106 00:06:57,839 --> 00:07:02,039 Speaker 1: that that is helpful to buyers? And shouldn't we be 107 00:07:02,160 --> 00:07:06,640 Speaker 1: in favor of more transparency in these transactions? Well, Barry, 108 00:07:06,680 --> 00:07:09,120 Speaker 1: you hit it on the head that we should be 109 00:07:09,200 --> 00:07:14,400 Speaker 1: in favor of greater transparency. What the real estate community 110 00:07:14,440 --> 00:07:18,040 Speaker 1: of the brokers have been grappling with um in many 111 00:07:18,120 --> 00:07:21,840 Speaker 1: markets is that things have slowed down before we came 112 00:07:21,880 --> 00:07:25,720 Speaker 1: into this crisis in certain segments in the market, and 113 00:07:26,200 --> 00:07:29,520 Speaker 1: they've been dealing with anxious sellers and then we have 114 00:07:29,640 --> 00:07:34,480 Speaker 1: this crisis, and you know, it's being presented as let's 115 00:07:34,520 --> 00:07:39,640 Speaker 1: give the sellers a break, and let's essentially there's no 116 00:07:39,680 --> 00:07:42,720 Speaker 1: other word for it, but hide the calculation for days 117 00:07:42,760 --> 00:07:45,720 Speaker 1: on market. On some list sites, like in New York, 118 00:07:45,840 --> 00:07:49,840 Speaker 1: Street Easy, which is owned by zillo Is, announced that 119 00:07:49,880 --> 00:07:53,560 Speaker 1: they will be hiding days on market. Same thing with 120 00:07:53,640 --> 00:07:56,080 Speaker 1: the Real Estate Board of New York, which is somewhat 121 00:07:56,120 --> 00:08:00,960 Speaker 1: of our local multiple listing system. And we hear here 122 00:08:00,960 --> 00:08:03,080 Speaker 1: of this in other parts of the country, but other 123 00:08:03,160 --> 00:08:06,800 Speaker 1: parts aren't. The problem is with this is that it 124 00:08:06,960 --> 00:08:09,520 Speaker 1: ignores I mean, last time I checked that there's a 125 00:08:09,560 --> 00:08:13,240 Speaker 1: buyer and a seller in each transaction, and the buyer 126 00:08:13,560 --> 00:08:17,440 Speaker 1: is essentially this data is being hidden from them. The 127 00:08:17,560 --> 00:08:21,880 Speaker 1: problem is, or actually the the you know, what's actually 128 00:08:21,920 --> 00:08:24,920 Speaker 1: happening is the raw data, like the listening dates, things 129 00:08:24,960 --> 00:08:27,200 Speaker 1: like that are not being hidden. But when you open 130 00:08:27,240 --> 00:08:30,160 Speaker 1: and look at a listing, it instead of saying, you know, 131 00:08:30,400 --> 00:08:32,880 Speaker 1: on the market a hundred eight days, it'll just be 132 00:08:32,960 --> 00:08:37,239 Speaker 1: blank or not or hidden. And to me, that breeds 133 00:08:37,280 --> 00:08:41,440 Speaker 1: that will breed future distrust between the consumer and the 134 00:08:41,480 --> 00:08:44,920 Speaker 1: real estate community. And I think that the actual reason 135 00:08:44,960 --> 00:08:47,920 Speaker 1: they're doing it, having talked to many agents about this 136 00:08:48,400 --> 00:08:50,480 Speaker 1: over the last couple of weeks because I've sort of 137 00:08:50,520 --> 00:08:54,240 Speaker 1: been sparring with the community about this specific topic, is 138 00:08:54,280 --> 00:08:58,240 Speaker 1: that the actual motivation is really not to help the seller. 139 00:08:58,320 --> 00:09:02,239 Speaker 1: It's to really help the real estate agent keep the listing. 140 00:09:02,320 --> 00:09:06,120 Speaker 1: In other words, um, you know, consumers don't want to say, hey, 141 00:09:06,160 --> 00:09:07,840 Speaker 1: you know, I'm going to take my home off the 142 00:09:07,840 --> 00:09:10,000 Speaker 1: market because nothing's going to happen for the next two 143 00:09:10,040 --> 00:09:13,520 Speaker 1: or three or four months, and they're uh, and the 144 00:09:13,600 --> 00:09:16,480 Speaker 1: real estate agent is worried that they're going to lose 145 00:09:16,520 --> 00:09:19,319 Speaker 1: the listing when they come back on the market. Somebody 146 00:09:19,320 --> 00:09:22,400 Speaker 1: else might get it, and that's not good for the market. 147 00:09:22,520 --> 00:09:26,400 Speaker 1: You can't cherry pick data. So Jonathan, why not a 148 00:09:26,440 --> 00:09:30,560 Speaker 1: more targeted solution than not reporting this? Why not just 149 00:09:30,800 --> 00:09:34,240 Speaker 1: toll days on the market for I don't know, ninety 150 00:09:34,320 --> 00:09:40,439 Speaker 1: days until the coronavirus theoretically passes. Let's say this crisis 151 00:09:40,520 --> 00:09:43,320 Speaker 1: is over in ninety days and then we all go 152 00:09:43,400 --> 00:09:46,199 Speaker 1: out and and you know, start rates a law, and 153 00:09:46,240 --> 00:09:49,240 Speaker 1: we start buying up houses. Um, you know, as a nation. 154 00:09:49,840 --> 00:09:53,560 Speaker 1: The reality is that every house that was on the 155 00:09:53,600 --> 00:09:57,040 Speaker 1: market in this period has an additional ninety days added 156 00:09:57,080 --> 00:10:01,360 Speaker 1: to the days on market. The consumer is not open there. 157 00:10:01,400 --> 00:10:05,160 Speaker 1: They are going to understand that we just came out 158 00:10:05,200 --> 00:10:08,200 Speaker 1: of this. So to me, it's it's a lot about nothing. 159 00:10:08,360 --> 00:10:11,440 Speaker 1: It's not going to help stimulate sales activity, and it 160 00:10:11,800 --> 00:10:14,559 Speaker 1: endangers the idea of people coming back in because they're 161 00:10:14,559 --> 00:10:17,840 Speaker 1: going to say, well, are these numbers real now? Are 162 00:10:17,880 --> 00:10:21,319 Speaker 1: they being tweaked? Um? I just think the whole idea 163 00:10:21,400 --> 00:10:24,360 Speaker 1: is a bad idea. So what's going on in the 164 00:10:24,440 --> 00:10:29,600 Speaker 1: world of appraisals? How are people doing appraisals on either 165 00:10:29,720 --> 00:10:35,320 Speaker 1: refies or new purchases If everybody is socially distancing, right, 166 00:10:35,760 --> 00:10:40,240 Speaker 1: It was quite astounding up until a week ago, prior 167 00:10:40,280 --> 00:10:44,680 Speaker 1: to the last week, when there was an announcement by 168 00:10:44,720 --> 00:10:48,440 Speaker 1: f h f A, which is the regulator over Fannie 169 00:10:48,440 --> 00:10:52,360 Speaker 1: and Freddie UH, and there were some standards being set 170 00:10:52,480 --> 00:10:57,760 Speaker 1: for allowing praisers when mortgages are done, not to physically 171 00:10:58,000 --> 00:11:02,000 Speaker 1: inspect a property if they're in danger, and we were 172 00:11:02,080 --> 00:11:06,599 Speaker 1: getting for a couple of weeks we stopped inspecting interiors 173 00:11:06,600 --> 00:11:11,280 Speaker 1: of properties in New York prior to AMA the Governor's 174 00:11:11,440 --> 00:11:16,600 Speaker 1: um shut down or cars I shut down UH and 175 00:11:16,760 --> 00:11:21,280 Speaker 1: because I I just couldn't put my staff in harm's way. UH. 176 00:11:21,640 --> 00:11:25,840 Speaker 1: We had a couple of close calls, and it seemed crazy, 177 00:11:26,440 --> 00:11:29,560 Speaker 1: especially when it became apparent that you don't have to 178 00:11:29,679 --> 00:11:32,920 Speaker 1: be you don't have to be symptomatic to be a carrier. 179 00:11:33,040 --> 00:11:36,040 Speaker 1: So not only are we putting our staff in a 180 00:11:36,080 --> 00:11:40,079 Speaker 1: harm's way to do an inspection on a mortgage appraisal, 181 00:11:40,280 --> 00:11:43,360 Speaker 1: but we're also putting the homeowner or the occupant of 182 00:11:43,400 --> 00:11:46,520 Speaker 1: the home in danger. So that seemed out of the question. 183 00:11:46,960 --> 00:11:50,800 Speaker 1: So there was a stalemate, and across the agencies and 184 00:11:50,840 --> 00:11:55,280 Speaker 1: the mortgage spectrum, appraisers were rapidly growing numbers pushing back 185 00:11:55,320 --> 00:11:59,839 Speaker 1: on being forced to do appraisals interior inspections, and so 186 00:12:00,760 --> 00:12:04,280 Speaker 1: essentially what is coming out of all this pushback is 187 00:12:05,040 --> 00:12:08,840 Speaker 1: that there are different types of alternatives, something that my 188 00:12:08,960 --> 00:12:11,560 Speaker 1: firm is doing a lot of in New York because 189 00:12:11,559 --> 00:12:14,800 Speaker 1: our risk to our praisers are going on public transportation. 190 00:12:15,240 --> 00:12:18,520 Speaker 1: It's not that they're in a car insulated driving up 191 00:12:18,559 --> 00:12:21,000 Speaker 1: to the curb. You know, that's really not an option 192 00:12:21,040 --> 00:12:24,000 Speaker 1: to New York as it might be in the suburbs. 193 00:12:24,040 --> 00:12:27,120 Speaker 1: So that what's happened is there's been these solutions that 194 00:12:27,200 --> 00:12:31,760 Speaker 1: are evolving and now we're you know, we're doing essentially 195 00:12:31,840 --> 00:12:34,199 Speaker 1: what they're called desktops or you're sitting at your desk 196 00:12:34,720 --> 00:12:37,680 Speaker 1: and it is and we're actually getting photos from the homeowner. 197 00:12:38,360 --> 00:12:44,800 Speaker 1: Um all this is less than a full tear inspection 198 00:12:44,880 --> 00:12:48,120 Speaker 1: by a professional. But but the idea, and I think 199 00:12:48,200 --> 00:12:52,360 Speaker 1: government's thinking is that it helps liquidity, keeps things moving forward. 200 00:12:52,960 --> 00:12:57,880 Speaker 1: What they're not is there not on cash out reef 201 00:12:57,960 --> 00:13:03,080 Speaker 1: finance and they're not waiving the interior inspection requirement, so 202 00:13:03,160 --> 00:13:07,560 Speaker 1: that that makes it all problematic. Um and you know, 203 00:13:07,600 --> 00:13:11,880 Speaker 1: the second this gets out of you know, um, if 204 00:13:11,920 --> 00:13:16,000 Speaker 1: this became mainstream where we could do um no inspections 205 00:13:16,080 --> 00:13:20,880 Speaker 1: for reefs. I can only imagine the fraud and the 206 00:13:20,080 --> 00:13:24,640 Speaker 1: um the predatory lending that would simply explode UM. And 207 00:13:24,679 --> 00:13:26,719 Speaker 1: so I don't think you're going to see as much 208 00:13:26,760 --> 00:13:29,480 Speaker 1: of that in the solution, simply because the emphasis is 209 00:13:29,480 --> 00:13:32,880 Speaker 1: on the sales side, not the reef buy side. Quite fascinating. 210 00:13:33,240 --> 00:13:36,640 Speaker 1: Let's talk a little bit about real estate in the 211 00:13:36,800 --> 00:13:42,000 Speaker 1: time of pandemic. What can we do virtually? Can can 212 00:13:42,040 --> 00:13:44,960 Speaker 1: we use face time to inspect the house? Can you 213 00:13:45,040 --> 00:13:49,960 Speaker 1: do these virtual three D showings? Or is real estate 214 00:13:50,040 --> 00:13:53,240 Speaker 1: one of those things that you literally have to get 215 00:13:53,280 --> 00:13:56,240 Speaker 1: into the space and look around and see what's going 216 00:13:56,280 --> 00:14:02,640 Speaker 1: on yourself. So I think that virtual all is clearly 217 00:14:02,679 --> 00:14:06,800 Speaker 1: growing to be a an option for many during this crisis, 218 00:14:07,160 --> 00:14:11,240 Speaker 1: But I don't think that it goes mainstream. I think 219 00:14:11,240 --> 00:14:14,880 Speaker 1: it's more on the margin, uh, And I think because 220 00:14:15,240 --> 00:14:17,560 Speaker 1: of the human element of you know, the sort of 221 00:14:17,559 --> 00:14:20,640 Speaker 1: the passion around housing, I think it's it's a lot 222 00:14:20,720 --> 00:14:24,840 Speaker 1: harder to convince many people with their largest asset UH 223 00:14:25,040 --> 00:14:28,000 Speaker 1: in play here to just do a sort of an 224 00:14:28,080 --> 00:14:32,480 Speaker 1: all digital. However, that's the thinking now, and uh, you 225 00:14:32,520 --> 00:14:36,560 Speaker 1: know that may change if this goes long enough. Uh, 226 00:14:36,560 --> 00:14:39,160 Speaker 1: this crisis goes long enough. One of the things that 227 00:14:39,240 --> 00:14:42,880 Speaker 1: has been really problematic that I think will will benefit 228 00:14:43,160 --> 00:14:49,800 Speaker 1: from the virtual phenomenon would be actual closings. Uh. You know, 229 00:14:49,880 --> 00:14:52,840 Speaker 1: you can be in a state like Maryland where you 230 00:14:52,880 --> 00:14:57,560 Speaker 1: can do closing almost entirely on a single iPad, and 231 00:14:58,040 --> 00:15:00,240 Speaker 1: you go across the line to save orge in you 232 00:15:00,480 --> 00:15:05,000 Speaker 1: and it's you know, you're signing papers that say you 233 00:15:05,120 --> 00:15:09,280 Speaker 1: signed another paper. You know. The tremendous um you know, 234 00:15:10,000 --> 00:15:13,120 Speaker 1: tremendously inefficient, and I think there's gonna be a lot 235 00:15:13,120 --> 00:15:15,360 Speaker 1: of clean up of that. One of the things we're 236 00:15:15,360 --> 00:15:19,040 Speaker 1: seeing in the appraisal industry or the valuation in general, 237 00:15:19,640 --> 00:15:24,680 Speaker 1: is something that we call curbside appraisals. And the idea 238 00:15:24,960 --> 00:15:29,080 Speaker 1: is that you you know, if you're in the suburbs, 239 00:15:29,200 --> 00:15:31,320 Speaker 1: the appraiser drives up to the front of the house. 240 00:15:32,040 --> 00:15:36,000 Speaker 1: Uh they can, you know, there's nobody around. This social distancing, 241 00:15:36,080 --> 00:15:38,760 Speaker 1: they can kind of walk around the exterior of the property. 242 00:15:38,920 --> 00:15:42,160 Speaker 1: They physically uh you know. And a friend of mine 243 00:15:42,160 --> 00:15:45,680 Speaker 1: actually just wrote about this in California, he's already doing 244 00:15:45,680 --> 00:15:48,760 Speaker 1: it where you call the homeowner on face time and 245 00:15:48,760 --> 00:15:51,880 Speaker 1: then they literally walk you through the house, you point, 246 00:15:52,440 --> 00:15:55,360 Speaker 1: you know, asked him to point in certain directions and 247 00:15:55,520 --> 00:15:57,720 Speaker 1: make sure that you can see things. And then while 248 00:15:57,720 --> 00:16:01,880 Speaker 1: you're doing it, because you can't capture the video with FaceTime, 249 00:16:01,920 --> 00:16:04,360 Speaker 1: and you know, I'm sure there will be alternatives or 250 00:16:04,400 --> 00:16:08,280 Speaker 1: there is an alternative. Um, they're just doing screenshots of 251 00:16:08,360 --> 00:16:11,680 Speaker 1: the video screen that they're they're viewing the house on 252 00:16:12,160 --> 00:16:14,680 Speaker 1: to capture it so that when they deliver the report 253 00:16:14,720 --> 00:16:17,479 Speaker 1: to the client, whether it's a lender or a private individual, 254 00:16:18,320 --> 00:16:23,280 Speaker 1: that there's some digital reference, visual digital reference to the 255 00:16:23,320 --> 00:16:25,600 Speaker 1: interior of the home. And I think this is going 256 00:16:25,680 --> 00:16:30,560 Speaker 1: to play out significantly after this aftermath, in the aftermath 257 00:16:30,600 --> 00:16:34,400 Speaker 1: of all this. So so that makes sense for appraisals, 258 00:16:34,440 --> 00:16:36,560 Speaker 1: and that certainly makes sense to be a little more 259 00:16:36,680 --> 00:16:41,560 Speaker 1: virtual and efficient on closings. But I keep coming back 260 00:16:41,600 --> 00:16:45,960 Speaker 1: to the issue of how every piece of property is unique. 261 00:16:46,360 --> 00:16:51,640 Speaker 1: Photographs don't really capture a neighborhood, the unique view of 262 00:16:51,680 --> 00:16:55,280 Speaker 1: a given property, the feel you get when you walk 263 00:16:55,320 --> 00:16:59,720 Speaker 1: into certain houses. There are certain certain architecture that just 264 00:17:01,120 --> 00:17:03,960 Speaker 1: the right energy, the right vibe, and sometimes you walk 265 00:17:03,960 --> 00:17:07,800 Speaker 1: into a house that looks spectacular online and in your 266 00:17:08,359 --> 00:17:16,159 Speaker 1: immediately recoil is just something off about everything. So the 267 00:17:16,200 --> 00:17:20,119 Speaker 1: smell you know, which you know we can run into 268 00:17:20,200 --> 00:17:24,280 Speaker 1: two or you know your next to um, you know, 269 00:17:24,359 --> 00:17:27,960 Speaker 1: you have a property out the rural area and there's 270 00:17:28,000 --> 00:17:32,520 Speaker 1: a tremendous odor from the farm coming you know, coming 271 00:17:32,560 --> 00:17:36,040 Speaker 1: from your neighbor. I mean, there's all kinds of problems 272 00:17:36,400 --> 00:17:41,800 Speaker 1: with you know, going completely virtual. That's why I'm very skeptical, uh, 273 00:17:41,960 --> 00:17:46,439 Speaker 1: that that it replaces the in person experience. And I 274 00:17:46,480 --> 00:17:50,720 Speaker 1: know the appraisal industry itself is very worried that banking 275 00:17:51,440 --> 00:17:55,199 Speaker 1: will just go all virtual and then worry about the 276 00:17:55,240 --> 00:18:00,240 Speaker 1: consequences later in terms of collateral valuation UM. And you 277 00:18:00,280 --> 00:18:02,560 Speaker 1: know that I'm not that worried about that, but I 278 00:18:02,600 --> 00:18:05,560 Speaker 1: certainly is a concern. And for homeowners, I just have 279 00:18:05,600 --> 00:18:09,440 Speaker 1: a hard time processing. And maybe that's just me of 280 00:18:09,440 --> 00:18:12,520 Speaker 1: of you know, a first time buyer just buying something online. 281 00:18:12,720 --> 00:18:15,639 Speaker 1: You know, that's challenge enough with car doing it the 282 00:18:15,680 --> 00:18:18,720 Speaker 1: first time. UM. But you know, the house, I think 283 00:18:18,960 --> 00:18:22,760 Speaker 1: is is a little bit more. There's more intangible. There 284 00:18:22,760 --> 00:18:25,760 Speaker 1: can be little doubt about that. And we haven't even 285 00:18:25,760 --> 00:18:30,879 Speaker 1: talked about inspections where someone literally has to come and 286 00:18:31,400 --> 00:18:33,800 Speaker 1: look at the foundation, look at the roof, look at 287 00:18:33,800 --> 00:18:37,760 Speaker 1: the plumbing, the electrical system, or all the machinery. How 288 00:18:37,800 --> 00:18:41,800 Speaker 1: can you do possibly do that virtually you can't, or 289 00:18:43,000 --> 00:18:46,320 Speaker 1: anything you do is something less than an inspection. And 290 00:18:46,480 --> 00:18:50,919 Speaker 1: the something less could be a little less or dramatically less. 291 00:18:51,160 --> 00:18:54,840 Speaker 1: And and that's the problem. Um. You know, one of 292 00:18:54,880 --> 00:18:59,320 Speaker 1: the things that if, if, the if, this carries on, Um, 293 00:18:59,480 --> 00:19:03,280 Speaker 1: this cry this carries on longer than anybody thinks. And 294 00:19:03,320 --> 00:19:07,800 Speaker 1: we have a severe economic you know, meltdown or whatever 295 00:19:07,840 --> 00:19:11,320 Speaker 1: you want to call it going forward. Uh, there's gonna 296 00:19:11,320 --> 00:19:15,720 Speaker 1: be a tremendous amount of clean up on the other 297 00:19:15,800 --> 00:19:20,439 Speaker 1: side in terms of foreclosures and workouts, and you know, 298 00:19:20,520 --> 00:19:23,920 Speaker 1: properties that shouldn't have been purchased for what they were 299 00:19:23,920 --> 00:19:28,440 Speaker 1: purchased because the property is not what it appears. You know, 300 00:19:28,520 --> 00:19:30,680 Speaker 1: I think that there's a lot of concern about that. 301 00:19:31,040 --> 00:19:34,040 Speaker 1: I just have to share a funny story with you. 302 00:19:34,040 --> 00:19:37,760 Speaker 1: You've been to my house. I've been here almost six years. 303 00:19:38,320 --> 00:19:41,480 Speaker 1: When when we first saw this house online. There's a 304 00:19:41,480 --> 00:19:44,440 Speaker 1: whole long story I'll spare everybody, but I had set 305 00:19:44,520 --> 00:19:48,640 Speaker 1: up a Zillo alert. I want a contemporary house either 306 00:19:48,760 --> 00:19:51,639 Speaker 1: near the water or near the woods, with the master 307 00:19:51,760 --> 00:19:53,879 Speaker 1: bedroom on the ground floor, the laund room on the 308 00:19:53,880 --> 00:19:56,960 Speaker 1: ground floor, and I wanted it to be contemporary. And 309 00:19:57,000 --> 00:20:00,239 Speaker 1: I kept on getting these crazy thirty million all our 310 00:20:00,320 --> 00:20:03,879 Speaker 1: mansions in East Hampton. To find a regular house like 311 00:20:03,960 --> 00:20:07,400 Speaker 1: that was rare. Lo and behold, our house in Locust 312 00:20:07,440 --> 00:20:10,919 Speaker 1: Valley pops up, and we go to see the house, 313 00:20:11,200 --> 00:20:14,560 Speaker 1: and every time we go to visit the house, the 314 00:20:14,680 --> 00:20:19,920 Speaker 1: owner is cooking something. They're frying bacon there, they're they're 315 00:20:20,040 --> 00:20:24,439 Speaker 1: baking muffins or cookies. I mean, we visited the house 316 00:20:24,800 --> 00:20:28,199 Speaker 1: seven or eight times, and no matter what time of 317 00:20:28,240 --> 00:20:32,720 Speaker 1: the night or day, stuff was being cooked. And we 318 00:20:33,040 --> 00:20:36,879 Speaker 1: get the engineers report and it says part of the 319 00:20:36,960 --> 00:20:39,600 Speaker 1: roof has been replaced. It's a contemporary house with a 320 00:20:39,600 --> 00:20:43,840 Speaker 1: flat roof. Of course, flat roofs are big pain in 321 00:20:43,840 --> 00:20:47,919 Speaker 1: the neck. And uh, the engineer says, this was repaired. 322 00:20:48,080 --> 00:20:50,600 Speaker 1: You should and the house is thirty years old, you 323 00:20:50,640 --> 00:20:53,840 Speaker 1: should plan on replacing the roof sooner rather than later, 324 00:20:54,160 --> 00:20:56,960 Speaker 1: because it's gonna be a problem. Lo and behold, we 325 00:20:57,040 --> 00:20:59,760 Speaker 1: moved into the house and within a week you could 326 00:21:00,000 --> 00:21:02,879 Speaker 1: smell the mold. You could smell mold is really the 327 00:21:02,880 --> 00:21:06,879 Speaker 1: wrong word. You could smell the dampness from the leaking roof, 328 00:21:07,440 --> 00:21:10,800 Speaker 1: and fast forward three years later we replaced the entire 329 00:21:11,520 --> 00:21:15,920 Speaker 1: roof of the house. It was not inexpensive. The smell 330 00:21:16,200 --> 00:21:19,400 Speaker 1: was the frying bacon. That was the hint they were 331 00:21:19,440 --> 00:21:25,520 Speaker 1: covering something up. Well. I I had an experience probably 332 00:21:26,280 --> 00:21:30,200 Speaker 1: UH probably ten years ago in a litigation where the 333 00:21:30,400 --> 00:21:34,919 Speaker 1: retail UH store This is a condominium in Manhattan, and 334 00:21:34,960 --> 00:21:39,080 Speaker 1: the retail store at at the street level was a 335 00:21:39,160 --> 00:21:45,040 Speaker 1: Starbucks and they had Landhord had incorrectly vented UH the 336 00:21:45,480 --> 00:21:48,960 Speaker 1: exhaust FM from the store and it was getting It 337 00:21:49,040 --> 00:21:54,320 Speaker 1: was the smell of like Jamaican blue Mountain um Bold 338 00:21:54,440 --> 00:21:59,399 Speaker 1: coffee was of the air in the apartment right above it. 339 00:21:59,440 --> 00:22:03,360 Speaker 1: You could you could hardly think of anything else and 340 00:22:03,600 --> 00:22:08,240 Speaker 1: imagine trying to litigate that virtually, It's it would be impossible. 341 00:22:08,720 --> 00:22:11,000 Speaker 1: I want to talk a little bit about what the 342 00:22:11,040 --> 00:22:16,160 Speaker 1: marketplace is going to look like after UM we get 343 00:22:16,200 --> 00:22:19,840 Speaker 1: through this coronavirus. I'm assuming one day this will pass 344 00:22:20,320 --> 00:22:23,720 Speaker 1: and things will start getting back to normal. What is 345 00:22:23,760 --> 00:22:27,080 Speaker 1: that gonna look like? And how dependent is it on 346 00:22:27,200 --> 00:22:31,399 Speaker 1: how severe and long lasting our lockdown is? So I 347 00:22:31,440 --> 00:22:35,560 Speaker 1: think the future is highly dependent on how long the 348 00:22:35,680 --> 00:22:39,480 Speaker 1: lockdown lasts. You can imagine if the longer that the 349 00:22:39,520 --> 00:22:43,600 Speaker 1: lockdown lasts, the more damage to our economy occurs, even 350 00:22:43,640 --> 00:22:48,200 Speaker 1: with the stimulus money that's you know, coming coming out. 351 00:22:48,880 --> 00:22:53,880 Speaker 1: The problem is that if this runs very long, you're 352 00:22:53,920 --> 00:22:57,399 Speaker 1: going to have a much higher unemployment rate, and in 353 00:22:58,240 --> 00:23:01,719 Speaker 1: theory then that cuts down on potential purchasers for properties. 354 00:23:02,040 --> 00:23:04,879 Speaker 1: You know, one of the if it's a short window 355 00:23:05,040 --> 00:23:07,800 Speaker 1: and you know, there's a greater probability that you know, 356 00:23:08,040 --> 00:23:12,520 Speaker 1: the market recovers quickly, but we have no way of knowing, 357 00:23:12,760 --> 00:23:18,240 Speaker 1: and they're literally at this moment, there is virtually no 358 00:23:18,720 --> 00:23:22,040 Speaker 1: data that reflects you know, in a in a large 359 00:23:22,440 --> 00:23:27,080 Speaker 1: you know, something that's available and clean and speaks to 360 00:23:27,119 --> 00:23:31,000 Speaker 1: the whole market. So longer the crisis the damage, the 361 00:23:31,080 --> 00:23:34,240 Speaker 1: bigger the hit to the housing market. Let's let's take 362 00:23:34,280 --> 00:23:39,199 Speaker 1: a reasonable scenario. Let's say the lockdown is two months 363 00:23:39,800 --> 00:23:43,840 Speaker 1: and sometime by the middle of May, we start crawling 364 00:23:43,880 --> 00:23:48,560 Speaker 1: out from our shelter in place and social distancing and 365 00:23:48,680 --> 00:23:53,000 Speaker 1: things get back to normal more or less. What sort 366 00:23:53,040 --> 00:23:55,760 Speaker 1: of real estate market are we looking at? Then? Do 367 00:23:55,880 --> 00:23:59,920 Speaker 1: we resume the spring selling season or do we lose 368 00:24:00,080 --> 00:24:04,639 Speaker 1: half the season? What? What happens. Then I think then 369 00:24:04,760 --> 00:24:09,040 Speaker 1: at that point the spring selling season has essentially passed 370 00:24:09,119 --> 00:24:12,760 Speaker 1: us by, because I don't think it's the market is 371 00:24:12,760 --> 00:24:16,080 Speaker 1: going to snap up like you know, flipping a switch. Um. 372 00:24:16,240 --> 00:24:20,960 Speaker 1: What you might see is the market being pushed to 373 00:24:21,119 --> 00:24:25,080 Speaker 1: the fall. You know. I think of an annual housing market. 374 00:24:25,119 --> 00:24:27,800 Speaker 1: I always describe it as a two hump camel spring 375 00:24:27,800 --> 00:24:31,280 Speaker 1: and fall, and the spring humping much larger than the 376 00:24:31,320 --> 00:24:35,760 Speaker 1: fall hump. We could very well see a big fall 377 00:24:35,880 --> 00:24:38,760 Speaker 1: of you know, a large release of pent up demand 378 00:24:39,480 --> 00:24:44,520 Speaker 1: if unemployment doesn't surge out of control. I mean, that's 379 00:24:44,520 --> 00:24:48,040 Speaker 1: really you know, the the liquidity of being able to 380 00:24:48,040 --> 00:24:51,480 Speaker 1: make payments on mortgages and all that is really kind 381 00:24:51,480 --> 00:24:54,680 Speaker 1: of determines that. Um. The other thing is, I think, 382 00:24:54,720 --> 00:24:59,320 Speaker 1: what this what is maybe a silver lining in the 383 00:24:59,359 --> 00:25:03,760 Speaker 1: sense that in markets that have been deteriorating over the 384 00:25:03,840 --> 00:25:06,520 Speaker 1: last couple of years, and that's certainly excuse to the 385 00:25:06,640 --> 00:25:10,600 Speaker 1: higher end, higher end markets and not uh sort of 386 00:25:10,640 --> 00:25:16,160 Speaker 1: lower priced or mid range type markets, um, higher end markets. 387 00:25:16,200 --> 00:25:18,399 Speaker 1: You the problem has been is that sellers have been 388 00:25:18,440 --> 00:25:23,040 Speaker 1: anchored to you know, the market conditions several years ago. Uh, 389 00:25:23,080 --> 00:25:27,760 Speaker 1: And this, in my view would clearly accelerate their their 390 00:25:27,840 --> 00:25:32,560 Speaker 1: ability to see the market as it is as opposed 391 00:25:32,560 --> 00:25:35,000 Speaker 1: to the way it was. And the reason I see 392 00:25:35,040 --> 00:25:38,440 Speaker 1: that is, um. You know, anytime you have an economic 393 00:25:38,560 --> 00:25:42,320 Speaker 1: van of milestone, UM, the consumer starts to you know, 394 00:25:42,359 --> 00:25:46,880 Speaker 1: you're unable to look before the milestone occurred at some 395 00:25:46,960 --> 00:25:50,000 Speaker 1: sort of basis of rationale for you know, what you 396 00:25:50,000 --> 00:25:52,760 Speaker 1: think your home is today? Um. And I think there's 397 00:25:52,760 --> 00:25:55,439 Speaker 1: gonna be a lot of that going on. UM. And 398 00:25:55,480 --> 00:25:58,720 Speaker 1: I think, my gut if we're talking about May, and 399 00:25:58,880 --> 00:26:03,400 Speaker 1: that feels incredibly optimistic, just in the context of the 400 00:26:03,520 --> 00:26:06,399 Speaker 1: virus and how it will spread. It seems like the 401 00:26:06,560 --> 00:26:09,480 Speaker 1: earliest would be something more in the lines of July 402 00:26:10,240 --> 00:26:15,160 Speaker 1: and you mentioned the tendency of sellers to be behind 403 00:26:15,240 --> 00:26:18,439 Speaker 1: the market. We saw something very similar, uh in the 404 00:26:19,040 --> 00:26:21,439 Speaker 1: early to mid two thousands as we headed into the 405 00:26:21,480 --> 00:26:27,639 Speaker 1: financial crisis. Sellers always seem to be remembering the peak 406 00:26:28,280 --> 00:26:30,520 Speaker 1: of the market, but they don't seem to recall the 407 00:26:30,560 --> 00:26:35,120 Speaker 1: recent drop. Is that just a persistent quality of real 408 00:26:35,280 --> 00:26:39,320 Speaker 1: estate that that people want to get the top and 409 00:26:39,320 --> 00:26:42,520 Speaker 1: and they not paying attention to what is actually taking 410 00:26:42,560 --> 00:26:46,240 Speaker 1: place within their local market, especially in a multi family market. 411 00:26:46,320 --> 00:26:49,159 Speaker 1: You know, in the city where you might have properties 412 00:26:49,200 --> 00:26:52,240 Speaker 1: in the same unit line. You know you own fifteen, 413 00:26:52,560 --> 00:26:55,440 Speaker 1: you know twenty a sold three years ago for X, 414 00:26:55,960 --> 00:26:58,040 Speaker 1: so you want to be five or ten percent more. 415 00:26:58,080 --> 00:27:00,919 Speaker 1: This is very common. Even though I missed, you know 416 00:27:01,000 --> 00:27:03,359 Speaker 1: that there was some sort of you know, downturn in 417 00:27:03,359 --> 00:27:05,720 Speaker 1: the market there. You know, they're looking at public record 418 00:27:05,720 --> 00:27:08,760 Speaker 1: and saying, well, that's the last sale. And the problem 419 00:27:08,800 --> 00:27:12,199 Speaker 1: with that is that it takes seller that's anchored to 420 00:27:12,240 --> 00:27:16,200 Speaker 1: the wrong number UM one to two years at least 421 00:27:16,240 --> 00:27:20,560 Speaker 1: in my observation, to d couple or d anchor from 422 00:27:20,600 --> 00:27:24,560 Speaker 1: that incorrect number not feel like they left money on 423 00:27:24,600 --> 00:27:28,920 Speaker 1: the table at the closing. And now we have and 424 00:27:29,400 --> 00:27:32,240 Speaker 1: we and I think that's one of the reasons why 425 00:27:32,280 --> 00:27:36,400 Speaker 1: in New York anyway, we saw this upticking sentiment in January, 426 00:27:36,400 --> 00:27:40,520 Speaker 1: because the sellers just went through two difficult years in 427 00:27:40,560 --> 00:27:43,720 Speaker 1: the market with all the new taxes, and this seems 428 00:27:43,720 --> 00:27:49,639 Speaker 1: to be a fresh start entering. And now that's that's gone. 429 00:27:49,880 --> 00:27:54,400 Speaker 1: So you mentioned taxes as suppressing um the real estate 430 00:27:54,400 --> 00:27:57,120 Speaker 1: market the past couple of years. What about this two 431 00:27:57,200 --> 00:28:00,359 Speaker 1: trillion dollar bail out. I keep reading about all of 432 00:28:00,400 --> 00:28:04,760 Speaker 1: these goodies sprinkled throughout that are going to help either 433 00:28:04,840 --> 00:28:09,320 Speaker 1: real estate developers or real estate investors. But what's in 434 00:28:09,400 --> 00:28:12,720 Speaker 1: this bailout package for the benefit of real estate. Well, 435 00:28:12,760 --> 00:28:17,399 Speaker 1: I think there's UH. They'll be hopefully from what I 436 00:28:17,400 --> 00:28:21,320 Speaker 1: can tell, will be some relief for landlords. Um. The 437 00:28:21,840 --> 00:28:25,720 Speaker 1: problem with UH, and this is something I'm not clear 438 00:28:25,800 --> 00:28:29,280 Speaker 1: is in the bailout is that a large portion of 439 00:28:29,320 --> 00:28:33,400 Speaker 1: the real estate community are independent contractors and they therefore 440 00:28:33,400 --> 00:28:38,840 Speaker 1: not eligible for unemployment. So this could be a real problem. 441 00:28:38,880 --> 00:28:41,720 Speaker 1: I think anything coming into the economy is going to 442 00:28:41,800 --> 00:28:45,880 Speaker 1: be helpful. I just don't know if it's soon enough 443 00:28:46,800 --> 00:28:51,240 Speaker 1: to help small, you know, small independent contractors that are 444 00:28:51,240 --> 00:28:55,440 Speaker 1: going to really be challenged financially over the decks two, three, 445 00:28:55,520 --> 00:28:59,560 Speaker 1: four months, Jonathan, Who are independent contractors? Do you mean 446 00:28:59,640 --> 00:29:04,240 Speaker 1: real estate at agents, appraisers and sectors or agents, real 447 00:29:04,320 --> 00:29:08,880 Speaker 1: estate and age, sent home inspectors. A large the majority 448 00:29:08,920 --> 00:29:13,720 Speaker 1: of appraisers, people that are servicing their real estate industry, 449 00:29:14,160 --> 00:29:17,760 Speaker 1: of vast majority, you know, with the exception of executives, 450 00:29:17,880 --> 00:29:22,680 Speaker 1: tend to be independent contractors. So they're very much at risk, 451 00:29:23,200 --> 00:29:28,200 Speaker 1: UM in going forward without some sort of help. I 452 00:29:28,240 --> 00:29:32,200 Speaker 1: know there have been attempts to lobby to put this 453 00:29:32,240 --> 00:29:34,720 Speaker 1: in but I'm not clear whether that's included in this 454 00:29:34,960 --> 00:29:42,160 Speaker 1: UH stimulus package. Quite interesting. So so based on without 455 00:29:42,280 --> 00:29:45,880 Speaker 1: guessing whether this last till May or July or beyond that, 456 00:29:46,360 --> 00:29:51,160 Speaker 1: just based on what you've seen January February March, what 457 00:29:51,360 --> 00:29:53,600 Speaker 1: is the next thirty to ninety days in the real 458 00:29:53,720 --> 00:29:57,960 Speaker 1: estate market look like. Well, first of all, I think 459 00:29:58,480 --> 00:30:00,600 Speaker 1: all the research that's going to them out at the 460 00:30:00,720 --> 00:30:03,600 Speaker 1: end of the you know, the completion of the first quarter, 461 00:30:03,640 --> 00:30:08,040 Speaker 1: it's not going to be very reflective of the conditions 462 00:30:08,080 --> 00:30:10,320 Speaker 1: that have actually changed on the ground because of the 463 00:30:10,400 --> 00:30:14,200 Speaker 1: lag because this crisis is measured in days, not weeks 464 00:30:14,280 --> 00:30:17,440 Speaker 1: or months and UH and so so I think there'll 465 00:30:17,480 --> 00:30:20,760 Speaker 1: be somewhat of a false positive in terms of you know, 466 00:30:20,920 --> 00:30:25,040 Speaker 1: data that that describes the conditions of the market. I 467 00:30:25,080 --> 00:30:29,320 Speaker 1: think what you're gonna have is, AH, this period of 468 00:30:29,360 --> 00:30:32,080 Speaker 1: act in activity is going to see listings removed from 469 00:30:32,120 --> 00:30:35,800 Speaker 1: the market. We're going to have a tremendous amount of 470 00:30:36,000 --> 00:30:39,680 Speaker 1: pent up demand built by those that build up that 471 00:30:39,720 --> 00:30:42,440 Speaker 1: we're intending to buy, that you know, are not worried 472 00:30:42,440 --> 00:30:45,920 Speaker 1: about their job. And assuming that rates stay low, you know, 473 00:30:46,040 --> 00:30:50,480 Speaker 1: you could see some sort of release of any any 474 00:30:50,560 --> 00:30:54,840 Speaker 1: kind small, medium, large, but some sort of release once 475 00:30:55,000 --> 00:30:59,160 Speaker 1: the quote unquote coast is clear the other there's been. 476 00:30:59,720 --> 00:31:03,880 Speaker 1: It's funny. I I'm on my blog. I wrote sort 477 00:31:03,920 --> 00:31:06,800 Speaker 1: of a list of things that you might change after 478 00:31:06,840 --> 00:31:09,320 Speaker 1: the crisis is over, and one of them is I 479 00:31:09,360 --> 00:31:12,760 Speaker 1: would think that everybody that's cooped up in an apartment 480 00:31:13,000 --> 00:31:17,520 Speaker 1: or a house UH is starting to think about something 481 00:31:17,720 --> 00:31:20,400 Speaker 1: a larger space in the future, whether they carried out 482 00:31:20,480 --> 00:31:24,040 Speaker 1: or not. H It certainly UH provides a little oxygen 483 00:31:24,120 --> 00:31:26,240 Speaker 1: for the real estate community to think about the future. 484 00:31:26,600 --> 00:31:32,000 Speaker 1: We were just having that very identical conversation about how 485 00:31:32,120 --> 00:31:36,360 Speaker 1: your house is laid out and whether or not the 486 00:31:36,400 --> 00:31:38,640 Speaker 1: structure of your home is going to lead to either 487 00:31:38,680 --> 00:31:42,760 Speaker 1: a baby boom or a divorce tsunami after this is over. 488 00:31:43,320 --> 00:31:45,760 Speaker 1: If you're in a sort of compact space that's on 489 00:31:45,800 --> 00:31:49,120 Speaker 1: a small footprint and and rises off of that, there's 490 00:31:49,120 --> 00:31:51,840 Speaker 1: really nowhere in the house to hide. If you're on 491 00:31:51,920 --> 00:31:56,400 Speaker 1: sort of a longer piece of design with a little 492 00:31:56,400 --> 00:32:01,520 Speaker 1: more um acreage in your backyard, well you have a 493 00:32:01,560 --> 00:32:05,040 Speaker 1: place you can go and escape from your significant other, 494 00:32:05,240 --> 00:32:09,160 Speaker 1: just just for a break, for a little bit. I'm 495 00:32:09,200 --> 00:32:13,560 Speaker 1: really gonna I'm really curious to see how our divorce 496 00:32:13,560 --> 00:32:16,760 Speaker 1: infrastructure is set up and what sort of a wave 497 00:32:16,840 --> 00:32:19,880 Speaker 1: of all Right, that was thirty years of marriage in 498 00:32:19,920 --> 00:32:22,600 Speaker 1: three months. I'm out. I wonder what sort of stuff 499 00:32:22,640 --> 00:32:25,400 Speaker 1: we're gonna see following that. I know you have a 500 00:32:25,480 --> 00:32:28,000 Speaker 1: large house with a lot of places you can hide. 501 00:32:28,360 --> 00:32:31,960 Speaker 1: You know, my house is set up like a railroad flat, 502 00:32:32,120 --> 00:32:34,640 Speaker 1: so it's much longer than it is wide or deep. 503 00:32:35,080 --> 00:32:37,720 Speaker 1: So if we're on the opposite ends of the house, 504 00:32:38,520 --> 00:32:41,040 Speaker 1: you can't even yell to each other, you can't even 505 00:32:41,040 --> 00:32:43,880 Speaker 1: hear anything. That's actually what my my wife and I 506 00:32:43,920 --> 00:32:46,640 Speaker 1: are in that same arrangement. We both are home offices, 507 00:32:46,640 --> 00:32:49,760 Speaker 1: are on opposite ends the house, and then we meet 508 00:32:49,960 --> 00:32:52,479 Speaker 1: in the middle in the kitchen and have meals together. 509 00:32:53,520 --> 00:32:56,040 Speaker 1: I mean, I'm simplifying it a bit, but but it 510 00:32:56,200 --> 00:32:59,920 Speaker 1: it kind of works that we've been doing the same thing. 511 00:33:00,080 --> 00:33:03,200 Speaker 1: We We try and meet every day for breakfast today thirty, 512 00:33:03,400 --> 00:33:07,400 Speaker 1: lunch for twelve thirty, Happy hour at five thirty, and 513 00:33:07,400 --> 00:33:10,920 Speaker 1: then dinner at six thirty, and and depending on the weather, 514 00:33:11,120 --> 00:33:13,840 Speaker 1: will either take the dogs out for walk the two 515 00:33:13,880 --> 00:33:16,800 Speaker 1: of us. Last week it was sixty five degrees. I 516 00:33:16,840 --> 00:33:20,480 Speaker 1: took the convertible out for ride we went for. So 517 00:33:20,760 --> 00:33:23,760 Speaker 1: we're keeping a little bit of a schedule with both 518 00:33:24,080 --> 00:33:29,160 Speaker 1: alone time and together time. And uh, I've been talking 519 00:33:29,200 --> 00:33:32,720 Speaker 1: to friends who have some of my employees who recently 520 00:33:32,760 --> 00:33:35,880 Speaker 1: got married. And man, let me tell you, this is 521 00:33:35,880 --> 00:33:38,400 Speaker 1: a baptism of fire. It's there's one thing to have 522 00:33:38,480 --> 00:33:41,080 Speaker 1: a date that lasts a couple of hours. It's another 523 00:33:41,080 --> 00:33:43,480 Speaker 1: thing to have a date that starts in March and 524 00:33:43,640 --> 00:33:46,600 Speaker 1: ends in July. I mean, you really find out if 525 00:33:46,600 --> 00:33:50,200 Speaker 1: you're compatible. Some going to really learn about their partners 526 00:33:50,720 --> 00:33:54,200 Speaker 1: and uh, and we actually, you know, in all seriousness, 527 00:33:54,280 --> 00:33:58,440 Speaker 1: we're expecting um, just from feedback. We have a large 528 00:33:58,480 --> 00:34:03,440 Speaker 1: part of our practice are uh legal support services. The minority, 529 00:34:03,680 --> 00:34:05,640 Speaker 1: you know, the probably about the court of our business 530 00:34:05,680 --> 00:34:09,960 Speaker 1: really is relating to you know, mortgage type work refunds, 531 00:34:10,640 --> 00:34:16,200 Speaker 1: but we do a tremendous amount of matrimonial type UH litigation. 532 00:34:16,520 --> 00:34:22,719 Speaker 1: And uh, the attorneys are getting ready because this could 533 00:34:22,760 --> 00:34:25,680 Speaker 1: be a phenomenon. And and I think I agree with 534 00:34:25,760 --> 00:34:27,759 Speaker 1: your you know about the birth rate. Uh, you know, 535 00:34:27,800 --> 00:34:29,799 Speaker 1: we could have a baby boom when we have to 536 00:34:29,800 --> 00:34:35,080 Speaker 1: figure out what to call the next generation the pandemic boom. Well, Jonathan, 537 00:34:35,080 --> 00:34:37,719 Speaker 1: thank you so much for spending some time with us. 538 00:34:38,120 --> 00:34:40,399 Speaker 1: Is there is there anything else we haven't touched upon 539 00:34:40,480 --> 00:34:43,600 Speaker 1: that you think is worth bringing to our listeners attention. 540 00:34:44,080 --> 00:34:46,040 Speaker 1: I don't think so. I think I think the only 541 00:34:46,239 --> 00:34:49,080 Speaker 1: you know, sort of final point is that right now 542 00:34:49,320 --> 00:34:53,160 Speaker 1: we don't really know that much about the future of 543 00:34:53,200 --> 00:34:56,040 Speaker 1: the housing market. Other than that, we don't know that 544 00:34:56,120 --> 00:34:59,360 Speaker 1: much about the future of the housing market, and this 545 00:34:59,480 --> 00:35:03,440 Speaker 1: really is developing a story we have been speaking with 546 00:35:03,560 --> 00:35:07,719 Speaker 1: Jonathan Miller, President and CEO of Miller Samuel. If you 547 00:35:07,880 --> 00:35:10,279 Speaker 1: enjoyed this conversation, be sure and come back and check 548 00:35:10,320 --> 00:35:13,360 Speaker 1: out the podcast extras, where we keep the tape rolling 549 00:35:13,440 --> 00:35:17,480 Speaker 1: and continue discussing all things real estate. You can find 550 00:35:17,480 --> 00:35:23,120 Speaker 1: that on Apple, iTunes, Spotify, Overcast, Stitcher, wherever your finer 551 00:35:23,160 --> 00:35:27,400 Speaker 1: podcasts are sold. We love your comments, feedback and suggestions 552 00:35:27,960 --> 00:35:31,520 Speaker 1: right to us at m IB podcast at Bloomberg dot net. 553 00:35:31,920 --> 00:35:33,680 Speaker 1: I would be remiss if I did not thank the 554 00:35:33,680 --> 00:35:37,359 Speaker 1: crafts staff that helps put these conversations together each week. 555 00:35:37,840 --> 00:35:42,799 Speaker 1: Charlie Bolmer is my audio engineer, Michael Boyle is my producer. 556 00:35:42,840 --> 00:35:46,480 Speaker 1: Michael Batnick is my head of research. I'm Barry Ritolts, 557 00:35:46,800 --> 00:35:50,280 Speaker 1: You've been listening to Masters and Business on Bloomberg Radio.