1 00:00:02,520 --> 00:00:08,920 Speaker 1: Bloomberg Audio Studios, podcasts, radio news depending home sales here 2 00:00:08,920 --> 00:00:11,319 Speaker 1: in the US seeing a surprise uptick in February as 3 00:00:11,360 --> 00:00:14,080 Speaker 1: mortgage rates fell to their lowest since twenty twenty two. 4 00:00:14,440 --> 00:00:17,759 Speaker 1: It's a good backdrop for the new HGTV show from 5 00:00:17,760 --> 00:00:20,639 Speaker 1: the Property Brothers Joe and Jonathan Scott. That show is 6 00:00:20,640 --> 00:00:23,880 Speaker 1: called Property Brothers Under Pressure. It just premiered on Sunday, 7 00:00:24,160 --> 00:00:26,520 Speaker 1: and it's a deeper look here, not just into the homes, 8 00:00:26,520 --> 00:00:28,520 Speaker 1: but really into the home buyers themselves and how they 9 00:00:28,640 --> 00:00:32,519 Speaker 1: navigate a competitive market and make budget conscious decisions for 10 00:00:32,600 --> 00:00:34,120 Speaker 1: their new homes. I had a chance to sit down 11 00:00:34,159 --> 00:00:37,240 Speaker 1: with them exclusively earlier today and talk about the state 12 00:00:37,240 --> 00:00:40,919 Speaker 1: of the housing market and their journey to HGTV stardom. 13 00:00:40,960 --> 00:00:41,520 Speaker 1: Take a listen. 14 00:00:44,080 --> 00:00:46,400 Speaker 2: Unlike anything we've ever done, because people always ask us, well, 15 00:00:46,400 --> 00:00:48,760 Speaker 2: what happens when the cameras aren't rolling, what happens behind 16 00:00:48,800 --> 00:00:50,960 Speaker 2: the scenes. We show it. We show it. You see 17 00:00:50,960 --> 00:00:53,960 Speaker 2: our crew, you see us disagree, you see moments that 18 00:00:54,000 --> 00:00:57,240 Speaker 2: the homeowners. You know. I think it's very relatable for 19 00:00:57,280 --> 00:00:59,560 Speaker 2: everyone out there because there's so much pressure on everybody 20 00:00:59,840 --> 00:01:03,200 Speaker 2: affordability crisis, like there is across the country here. The stories. 21 00:01:03,240 --> 00:01:05,520 Speaker 2: We have fourteen episodes and they're all very different stories. 22 00:01:05,840 --> 00:01:08,920 Speaker 2: We have families have lost their house from the fires 23 00:01:08,600 --> 00:01:11,360 Speaker 2: in la We have other families that are trying to 24 00:01:11,520 --> 00:01:13,560 Speaker 2: pull two families together to live in one house because 25 00:01:13,560 --> 00:01:15,240 Speaker 2: that's the only way they can afford. We have so 26 00:01:15,280 --> 00:01:18,160 Speaker 2: many stories that will be very relatable for Americans watching, 27 00:01:18,200 --> 00:01:21,080 Speaker 2: and we're trying to solve with really tight budgets. We're 28 00:01:21,080 --> 00:01:23,040 Speaker 2: trying to solve what everybody out here is trying to 29 00:01:23,080 --> 00:01:24,600 Speaker 2: solve to be able to get a home that they deserve. 30 00:01:24,680 --> 00:01:28,000 Speaker 1: We talk about the evolution of HGTV and just these 31 00:01:28,040 --> 00:01:30,280 Speaker 1: types of programs that choose to be more about the 32 00:01:30,319 --> 00:01:32,920 Speaker 1: homes themselves, and they are becoming a lot more about 33 00:01:32,959 --> 00:01:35,959 Speaker 1: the people and what they're going through. And you know, 34 00:01:36,000 --> 00:01:38,800 Speaker 1: here at Bloomberg, we've talked a lot about the affordability 35 00:01:38,840 --> 00:01:42,160 Speaker 1: crisis in the housing market, and particularly out West, where 36 00:01:42,160 --> 00:01:43,880 Speaker 1: you guys do a lot of your work. I am 37 00:01:43,880 --> 00:01:47,520 Speaker 1: curious if you've seen any sort of movement and maybe 38 00:01:47,640 --> 00:01:51,160 Speaker 1: a sort of a future where you have real starter homes, 39 00:01:51,200 --> 00:01:53,800 Speaker 1: real affordable starter homes for people in some of these markets. 40 00:01:53,840 --> 00:01:55,960 Speaker 2: There's definitely been a lot of movement unfortunate. It's in 41 00:01:55,960 --> 00:01:58,960 Speaker 2: the wrong direction. We have, you know about a four 42 00:01:59,120 --> 00:02:03,520 Speaker 2: million short house shortage of a healthy inventory right now 43 00:02:03,760 --> 00:02:06,720 Speaker 2: and the challenges People don't seem to understand that we 44 00:02:06,840 --> 00:02:10,640 Speaker 2: need affordable housing. Any successful city in the world that 45 00:02:10,680 --> 00:02:13,320 Speaker 2: has embraced affordable housing, the cities have flourished and the 46 00:02:13,360 --> 00:02:15,320 Speaker 2: costs have come down. But I love the idea that 47 00:02:15,360 --> 00:02:17,440 Speaker 2: people can live where they work. And I think some 48 00:02:17,480 --> 00:02:20,040 Speaker 2: people here affordable housing, they think, well, that's going to 49 00:02:20,040 --> 00:02:23,160 Speaker 2: be you know, drugs and crime and everything. Absolutely not. 50 00:02:23,280 --> 00:02:27,160 Speaker 2: These are teachers and you know, nurses and police, you know, 51 00:02:28,040 --> 00:02:30,799 Speaker 2: household workers, people who want to live in the same 52 00:02:30,800 --> 00:02:33,359 Speaker 2: community that they work. And so that's our goals from 53 00:02:33,400 --> 00:02:36,079 Speaker 2: a messaging standpoint, show people that it's okay, you don't 54 00:02:36,080 --> 00:02:37,400 Speaker 2: have to be a nimby. You don't have to stop 55 00:02:37,440 --> 00:02:39,760 Speaker 2: projects that are being built, you know, in your neighborhood. 56 00:02:39,880 --> 00:02:42,880 Speaker 2: On the flip side, we've invested in companies like modular Builders, 57 00:02:42,880 --> 00:02:45,480 Speaker 2: So we're trying to find new technologies that will physically 58 00:02:45,480 --> 00:02:47,480 Speaker 2: bring down the cost of construction and at the same 59 00:02:47,480 --> 00:02:49,000 Speaker 2: time a hard time though, because there's a lot of 60 00:02:49,040 --> 00:02:50,880 Speaker 2: time about rate cuts to help the you know, government 61 00:02:50,880 --> 00:02:53,440 Speaker 2: trying to stimulate. What the problem is, you have no inventory. 62 00:02:53,919 --> 00:02:55,720 Speaker 2: Cut rates if you want, that gets people excited to buy, 63 00:02:55,760 --> 00:02:57,840 Speaker 2: but there's nothing to buy, you're not really solving the problem. 64 00:02:57,880 --> 00:03:01,440 Speaker 2: We need to find ways to incentivize make it possible 65 00:03:01,480 --> 00:03:03,959 Speaker 2: for developers to really focus in. For example, I have 66 00:03:04,040 --> 00:03:06,840 Speaker 2: a real estate portfolio in Calgary in Canada. The government 67 00:03:06,840 --> 00:03:10,160 Speaker 2: in Canada really incentivizes builders to do affordable housing, so 68 00:03:10,200 --> 00:03:11,919 Speaker 2: it makes it worthwhile and I can keep rolling money 69 00:03:11,960 --> 00:03:13,280 Speaker 2: from one project to the next to the next to 70 00:03:13,280 --> 00:03:14,960 Speaker 2: actually make a difference down here, I don't have that 71 00:03:14,960 --> 00:03:15,720 Speaker 2: same opportunity. 72 00:03:15,960 --> 00:03:18,600 Speaker 1: Where do you see potentially where those incentives come from. Obviously, 73 00:03:18,639 --> 00:03:20,799 Speaker 1: in a city like New York, affordable housing has been 74 00:03:21,280 --> 00:03:23,680 Speaker 1: a huge topic of conversation. It pretty much swayed our 75 00:03:23,680 --> 00:03:26,160 Speaker 1: most recent mayoral election. I'm sure out west where you 76 00:03:26,200 --> 00:03:29,560 Speaker 1: guys in oh guys are, whether it's California, Vegas, Vancouver, 77 00:03:29,800 --> 00:03:32,560 Speaker 1: they're also seeing similar issues there. Are you seeing things 78 00:03:32,560 --> 00:03:34,639 Speaker 1: at the state level or the local level that could 79 00:03:34,680 --> 00:03:35,600 Speaker 1: potentially leave well. 80 00:03:35,640 --> 00:03:37,360 Speaker 2: One of the biggest things is I think federally there 81 00:03:37,400 --> 00:03:41,440 Speaker 2: needs to be better policy that allow and incentivize builders 82 00:03:41,440 --> 00:03:44,120 Speaker 2: and developers to pull out more cash. So for example, 83 00:03:44,160 --> 00:03:46,960 Speaker 2: in Canada, if you create a certain amount of affordable 84 00:03:47,000 --> 00:03:50,120 Speaker 2: housing units within your building that you can finance up 85 00:03:50,120 --> 00:03:52,640 Speaker 2: to ninety five percent, whereas here not even close. And 86 00:03:52,680 --> 00:03:54,880 Speaker 2: so a lot of builders are leaving forty percent of 87 00:03:54,920 --> 00:03:57,040 Speaker 2: their cash in a building and that prevents them from 88 00:03:57,080 --> 00:04:00,240 Speaker 2: building forward. Also on the building side, if we're if 89 00:04:00,280 --> 00:04:03,160 Speaker 2: you're using you know, say you're building a building for 90 00:04:03,280 --> 00:04:06,120 Speaker 2: easy figures twenty million dollar building, if you do that 91 00:04:06,160 --> 00:04:09,520 Speaker 2: as an affordable building using public funds for some of 92 00:04:09,520 --> 00:04:12,480 Speaker 2: that construction, there's all this regulation that all of a sudden, 93 00:04:12,520 --> 00:04:14,720 Speaker 2: the costs it's about forty percent more just to do 94 00:04:14,840 --> 00:04:17,440 Speaker 2: the exact same building. So I think we're getting tied 95 00:04:17,560 --> 00:04:20,359 Speaker 2: up in you know, the manula, and we're not stepping 96 00:04:20,360 --> 00:04:22,160 Speaker 2: back and looking at the fact that we haven't seen 97 00:04:22,279 --> 00:04:25,120 Speaker 2: rapid enough growth to solve the problem when it comes 98 00:04:25,160 --> 00:04:28,680 Speaker 2: to actually supplying inventory. And it's also adding density. There 99 00:04:28,720 --> 00:04:30,520 Speaker 2: are different areas that are doing great things, but when 100 00:04:30,560 --> 00:04:32,719 Speaker 2: you can add some more density, even in California, so 101 00:04:32,880 --> 00:04:34,880 Speaker 2: for example, my house, I'm allowed to have two suites, 102 00:04:34,880 --> 00:04:36,760 Speaker 2: I can have two ADUs, which is great because I 103 00:04:36,800 --> 00:04:39,680 Speaker 2: could read both those out and it's helping with the crisis. However, 104 00:04:39,960 --> 00:04:43,440 Speaker 2: the backlog to get to that point one of my ADUs. 105 00:04:43,480 --> 00:04:45,719 Speaker 2: It should have been approved in a week. I waited 106 00:04:45,760 --> 00:04:48,080 Speaker 2: five months and there's such a backlog and the process 107 00:04:48,160 --> 00:04:51,120 Speaker 2: is so archaic. We need to revitalize the process to 108 00:04:51,160 --> 00:04:53,280 Speaker 2: get people moving to add density. This is one of 109 00:04:53,320 --> 00:04:56,120 Speaker 2: the things where I'm hoping that AI is actually helpful 110 00:04:56,400 --> 00:05:01,200 Speaker 2: because the bureaucracy behind trying to win through the planning process. 111 00:05:01,200 --> 00:05:03,520 Speaker 2: Anyone who's taken on a renovation knows how annoying it 112 00:05:03,600 --> 00:05:05,600 Speaker 2: is to wait on your permits, wait for the city, 113 00:05:05,640 --> 00:05:08,960 Speaker 2: also wait for the utilities to go through and process everything. 114 00:05:09,279 --> 00:05:11,520 Speaker 2: I would love to see something that automates a lot 115 00:05:11,520 --> 00:05:13,719 Speaker 2: of that, to make sure that the eyes are getting 116 00:05:13,760 --> 00:05:15,880 Speaker 2: dotted and the teaser getting crossed. But you can actually 117 00:05:15,920 --> 00:05:17,960 Speaker 2: get in and do the work. And as I say, 118 00:05:18,400 --> 00:05:21,760 Speaker 2: this literally is right now in modern history, this is 119 00:05:21,800 --> 00:05:25,640 Speaker 2: the absolute worst affordable housing market in history for first 120 00:05:25,680 --> 00:05:28,039 Speaker 2: time home buyers. First time home buyers are less than 121 00:05:28,080 --> 00:05:30,000 Speaker 2: twenty five percent of the market right now, and that 122 00:05:30,040 --> 00:05:33,000 Speaker 2: should be a lot higher. It's just not feasible for 123 00:05:33,040 --> 00:05:34,680 Speaker 2: people to get into real estate like it used to be. 124 00:05:34,760 --> 00:05:38,559 Speaker 1: Obviously, you've had a presence, specifically on HGTV. Now for 125 00:05:38,560 --> 00:05:41,160 Speaker 1: more than a decade, you've had a lot of iterations 126 00:05:41,160 --> 00:05:45,279 Speaker 1: of your show and obviously shows that don't actually feature 127 00:05:45,680 --> 00:05:48,400 Speaker 1: you two. How much does that change in terms of 128 00:05:48,400 --> 00:05:50,960 Speaker 1: being able to produce a show like that at a 129 00:05:51,120 --> 00:05:55,440 Speaker 1: reasonable cost, have whatever relationship you have with HGTV, and 130 00:05:55,480 --> 00:05:56,440 Speaker 1: actually make it profitable. 131 00:05:56,480 --> 00:05:58,160 Speaker 2: Yeah, everyone, I mean so, we are one of the 132 00:05:58,240 --> 00:06:01,480 Speaker 2: largest unscripted producers in North America. We have fifteen series 133 00:06:01,480 --> 00:06:04,560 Speaker 2: that we produce, we host two of them. But we 134 00:06:04,560 --> 00:06:06,400 Speaker 2: we have found a huge shift because what we used 135 00:06:06,400 --> 00:06:08,000 Speaker 2: to have for budgets for our shows down here on 136 00:06:08,040 --> 00:06:10,320 Speaker 2: AGTV or with other partners, we don't have that anymore. 137 00:06:10,360 --> 00:06:12,600 Speaker 2: So we as producers have to get more creative, and 138 00:06:12,640 --> 00:06:15,159 Speaker 2: sometimes that means going to Canada, green lighting with a 139 00:06:15,160 --> 00:06:16,919 Speaker 2: copro out of Canada and then coming down with a 140 00:06:16,960 --> 00:06:21,679 Speaker 2: license or coprowing with the US down here. So we 141 00:06:21,680 --> 00:06:24,040 Speaker 2: were really good at getting creative. But plus, our company 142 00:06:24,040 --> 00:06:26,920 Speaker 2: stands out from other production companies because we are up 143 00:06:26,920 --> 00:06:28,839 Speaker 2: in Toronto for our production base, so we can actually 144 00:06:28,880 --> 00:06:30,800 Speaker 2: take advantage of a lot of tax incentives up in 145 00:06:30,800 --> 00:06:32,839 Speaker 2: Canada that are great that a lot of US producers 146 00:06:32,839 --> 00:06:36,240 Speaker 2: can't well. And we're also seeing explosive growth in digital 147 00:06:36,360 --> 00:06:39,920 Speaker 2: and other forms of media, you know, YouTube, everything else, 148 00:06:39,960 --> 00:06:42,960 Speaker 2: So you know, trying this, We've always stayed a step ahead. 149 00:06:43,240 --> 00:06:46,320 Speaker 2: We're always looking at where the industry is going right now, television, 150 00:06:46,360 --> 00:06:52,279 Speaker 2: traditional television. I mean, what's the word imploding? Everything is 151 00:06:52,440 --> 00:06:55,000 Speaker 2: everyone's uncertain. There's a lot of mergers happening, and so 152 00:06:55,120 --> 00:06:57,840 Speaker 2: things around are paused. But that's what I like is 153 00:06:57,839 --> 00:06:59,680 Speaker 2: the fact that we're constantly looking at so there's enough 154 00:06:59,680 --> 00:07:01,480 Speaker 2: opera tunity that we can still find placement. 155 00:07:01,720 --> 00:07:04,320 Speaker 1: As as some of the mergers, particularly a Warner Brothers 156 00:07:04,360 --> 00:07:07,280 Speaker 1: being absorbed into Paramount, has that affected at all, maybe 157 00:07:07,279 --> 00:07:10,080 Speaker 1: your outlook for what HUTV and Discovery ends up being. 158 00:07:09,960 --> 00:07:12,360 Speaker 2: Yeah, ammolutely, it's more of a pause. That's what is 159 00:07:12,440 --> 00:07:15,120 Speaker 2: right now, because nobody wants to jump in a direction 160 00:07:15,160 --> 00:07:17,360 Speaker 2: if they don't know who's going to own the company 161 00:07:17,440 --> 00:07:18,800 Speaker 2: or what the focus is going to be. If you 162 00:07:18,800 --> 00:07:21,520 Speaker 2: look at Netflix, they were only interested in studio science streaming. 163 00:07:21,560 --> 00:07:25,400 Speaker 2: They weren't interested in linear cable. So Paramount's taking everything. 164 00:07:25,520 --> 00:07:28,200 Speaker 2: So that does mean that we as were the largest 165 00:07:28,200 --> 00:07:31,400 Speaker 2: producer for HTTV for Warner Brothers on the unscripted. Now 166 00:07:31,560 --> 00:07:33,840 Speaker 2: we'll have that opportunity to do the same with Paramount 167 00:07:35,240 --> 00:07:37,679 Speaker 1: Jonathan and Drew Scott there at the property of Brothers 168 00:07:37,960 --> 00:07:40,720 Speaker 1: on the launch of their new program, but more importantly, 169 00:07:41,040 --> 00:07:44,560 Speaker 1: an interesting conversation there about housing affordability, particularly in the 170 00:07:44,560 --> 00:07:48,240 Speaker 1: markets that they're focused on, primarily out West and in Canada.