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Real Estate Today 11-12-16

Nov 12, 2016|

Opening doors for buyers and sellers with critical and credible information on the real estate market. Fast paced and fact packed with experts, interviews, call-ins, field reports, and timely market conditions.

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This it's real estate today. The number one the real estate show on. On the radio. Welcome to real estate today. Backed by the professional experience of real tours from across America we're here most trusted source on the radio for help today real estate information. Real estate today is presented by the national association of real tours and Israel for members in your neighborhood. Hi there I'm Stephen gaffes great and today a very special show. Inventory. It's all about the shortage of homes for sale in nearly every market in America. It's considered to be the biggest challenge to real estate in the United States. We'll look at what it means to volumes to what it means to sellers and what it means to homeowners. Just like you. And we'll search for solutions in more ways to bring more homes onto the market inventory is straight ahead. But first let's go to the realistic today newsroom with Bill Thompson cartel I Stephen. With the election now over what next for housing regulation. Rodrigo Lopez a 2017 chairman of the Mortgage Bankers Association. Tells CNBC his organization's goals are clear. Most important thing that that we would want for my new congress and on who. Occupant in the White House would be. Clarity and regulations and I'm doing something about the future of the secondary mortgage Matthau markets IGS you reform Fannie Mae and Freddie Mac. Lopez says the lack of clarity in the FHA programs keeping a lot of lenders from using a product that he says particularly helps first time homebuyers. Two top Treasury Department officials say affordability. Must remain a central feature of a housing finance system as work continues to reform Fannie Mae and Freddie Mac. Writing in the post on medium dot com treasury councilor Antonio Weiss an assistant secretary for economic policy Karen Dimon. So the most fundamental question the future system must answer is that's quote. Are we providing more American households with greater and more sustainable access to affordable homes to rent or own. Dimon Weis call housing finance reform the great unfinished business of financial reform. And they say that whatever happens there needs to be quote a clearly defined role for government in ensuring the survival of products like the thirty year fixed rate mortgage. A steady and stable price gain is on display again and the newest core logic home price index for September. The index increased one point 1% from its August level the fourth straight month at that rate. Looking at the longer term trend frank no draft chief economist for core logic says quote home equity wealth. Has doubled during the last five years to thirteen trillion dollars. And that he says is largely because of the recovery in home prices. Just in the last year note Kraft says the average homeowner has gained 111000. Dollars in home equity. Coming up on half an hour more populous state news Stephen back to you. Thanks bill. Instead of course this week the entire nation was watching the election last Tuesday. And we were watching it too. To find out what the results would mean go home owners home buyers and home sellers all across America. So let's find out about that now would an expert. Joining us now is Jerry Jim and fellow senior vice president and the chief lobbyist of the national association of real source. We'll Gerri on election night I was up till 3:30 AM it was a long night for many Americans. Yes it was very interesting to. Jerry what do the elections mean it to our homeowners home buyers and home sellers. Across America well I think. What it means is essentially. Before the election the Republicans controlled house and senate after the election Republicans controlled house and senate. And that's mostly where that's almost exclusively where we are involved with public policy. That. Incentivized homeownership real estate investment so I think all in all we did very well last week. Looking at real estate from homeowner's perspective. Probably the biggest deduction most homeowners have on their taxes. Is the mortgage interest deduction. As we now have a Republican in the White House Republicans running the senate and Republicans running the house. Is the mortgage interest deduction. At risk the very much news. Both. The blueprints from the tax writing committee on the house side. Suggests combat to. What we do is raise the standard deduction and making them the use of itemized deductions such as mortgage interest deduction. Frankly less useful Penn. What it really does is make a century owning a home or ranting about Eden there's no concern to the so we're very concerned about the another big deduction. Property taxes. As you know if you own multiple properties you can deduct the property taxes on all of them there's no limit on that. Is that also at risk it is that risk because in one planned again from new Ways and Means Committee it's eliminated. Then that's a big change that's huge and this. That is an of course one of the biggest advantages to homeownership in America comes at the end it. A year ownership cycle. With the capital gains exemption. Which for a married couple allows you to make up to a 500000. Dollar profit with no taxes. And for a single person up to a 250000. Dollar profit with no taxes again. In the cross hairs. It's it's being discussed as are all deductions for charitable through this one state and local taxes mortgage interest deduction. Health care deductions all of it is on the table there and this is important because backed. Deduction for around capital gains. Has never have been index so in some states it's not as effective. For encouraging transactions. Of course the man who was elected as the 45 president of the United States Donald Trump is a real estate investor. One would wonder whether real estate we'll be safer under him. Or not at all what's your take. Yeah that's a good question because he obviously knows clearly state currently use commercial real estate and so I think you'll take a more active part if in fact tax reform starts to go down that route. That remains to be seen whether that's going to be a top priority middle priority or whatever but. I think he's gonna have a lot of input who met. And as you've told us before Jerry the real business for you occurs. On Capitol Hill where they write the laws of the land so you'll have a new team coming up to Capitol Hill. New members from all across America what do you tell them when you meet them for the first time. I think it's both educational I have to explain we have to explain work. Realtors. Do why we're here and being sent to step. Certain federal policy how far homeownership and real and gross say an investment the second thing I. The world so Burma's that the regulatory agencies need to be carefully watched that just because you pass a law doesn't mean street. Impact will be the same as soon as you thought it would be so Jerry all at all after the elections on Tuesday is real estate. Stronger. Weaker for the same. Then before the election again. I think we're OK but to have this perfect storm of tax reform. Reinventing Fannie and Freddie and these are important issues that we're gonna have to deal with because all of them affect. There was state. We'll Gerri I appreciate you joining us on realistic today and discussing. The epic 2016. Election thank you very much we've been good to be with it. Jerry given how senior vice president and chief lobbyist of the national association. Of real source. Coming up unrealistic today and not enough homes for sale competition. Bidding wars and how does a buyer survived. Even I work quit my tires. Right from the start act going through with our first why in my life so that they understand. The implications of the offer to. That's next on our special show. Inventory. Real estate today. Connecting you with the real estate professionals. Every week. And we're back. Would our special show inventories. And in depth look at today's market in which there are plenty of buyers who are ready willing and able to purchase homes. But a marketing wish there just aren't that many homes for sale. The result is rising prices and intense competition. In many markets is buyers try to outbid each other just to get a house now how come up by your win in a market like this. Let's ask a pro joining us now is Georgia wall real soar with the wall team had John L Scott real estate in Seattle Washington. One of the hottest market in the United States. Georgia is a 2017. Director at the national association of real source and a regional director for any arson young professionals network. She's also a director at the Washington real chores and vice president of government affairs at the Seattle King County real source Georgia welcome to realistic today. I thank you for having me we're delighted you're here so Georgia. How is business in Seattle. While high yield. I know all of that you think that it let inside PM Seattle but the market is hot he can. Pathetic effort for a bit torn out walk us through how this possibly can work Georgia you have a buyer they wanna purchase a house in the Seattle area. But it's so competitive what's the first thing that buyer has to do in today's market. Even I work quit my tired. Right from the starter act going through and copper line by line to the that they understand. The implications of the offer. And who like to term really matter the most. And white terms we can't really tighten up or even may be judged to have taken out of the contract altogether to make our offers standout. Oh that's excellent so step one is educating your buyers about exactly what's in the offer. Now how about price. Typically what I have my fired deal when we are looking at houses. If they take a resident of the one we really want we know it is that the why we don't need to be eating more and I'll talk to him about try to go to the cop with them. And now they're great guys go get a copy go talk to each other come uplink the right that you really want to pay for the house. And then it toward come back that the death oh my gosh the listing agent and asking for hiding the bad. We're at the absolute top number or willing to go to jail and I'll have them do that even together at the couple are riveted buyers are. And determine those numbers are credit I. And then they come back emea deputy average numbers you've done your homework now let's write your soccer right now and the courts put together but I don't offer that we can't. And then when we get to how are we find Howard bidding war we happened with integration and upset today. Buyers that you've decided at a time your Mac right so are you ready to respond with your next. Offered freight and they don't have to sit there and struggle they would get. We Bangkok that we know exactly what we're ready to do so your backstage at the contract. And it's very controlled prop. And it keeps them emotionally and Shaq and so that they can write offered that they feel good about the infantry and I. OK so how about contingencies. Like the home inspection. We've gone over all these that they understand the repercussions of either cap inspection report pre inspection are making no inspection and no I'm gonna. People are gonna sound the alarm that they don't inspection. That the the mean you wait bit I have met and inspectors at the house prior to the opera and we elect called. As for cork we look at every move. The cropping the burdens an addict. Fourth things. That's where a lot of good big problem especially in the north flat water moisture our biggest red flag. Camille we'd be inspection blind will go through and look at the report saying it and then we'll look at. At age in the condition and how will decide how we wanna handle inspection. OK so now you have a clean offer. How do you deliver. One thing that amonte that started doing right now all I don't know that happening everywhere and it is a little checkbox that says that seller interviewing offered on such Dutch state. What an agent and the teller are reviewing as received and a happy declared got on the lifting immediately for the can't change their strategy midway. So one thing at wired really quickly at that even if they paid every viewing it in a week I've. Started writing my operatives admitting that about two days prior to winning critically ill and we. Gill right and I could sign contract. With minimal contingencies. Short timeframe after the inspection if we have a party got it and then we act the dollar to review at a time and I don't today. It doesn't always work at the and how many offered command but if they're to whopper and we wrote the rocket to and we submitted it two days at a time and they've had a chance to talk to my buyer's lender. By the time they get to that in writing table. I think we had a leg up on the competition at that point. You play hard ball. But. You know I don't know what it did I'd like it did so recently we spoke to a real true who said. There's not much time to think about it in her market she said. If you wanna sleep on it someone else will be sleep been in it what are you thinking. You might not need to pay that she is bad thing or eight years and it true. It doesn't really fat I think. If you do the homework I've tried again that's always. I study it how much prep work. By the time in the Howell bare pretty quick to make an offer so it the pressured gonna be there and yeah emotions run I and they may have to think fast but we're not learning how to write a contract while we're standing in the kitchen. So it sounds to me like your strategy. Of preparing the buyers well in advance for any big decision and for any big complicated area of the transaction. It sounds like it works. It doesn't absolutely. Because that that team our prospects it's not just a realtor dictating the terms of the contract. And it's much that they won't do you really want you to tell us what to do I can't do that they have to deal to break that contract incompetent. And when they win I want them to go to sleep at night don't we brought a great offer and we eat a week overpaid we knew that the number we're comfortable with and we feel good. About the how and the chance that action. We'll Georgia I really appreciate that advice those are really great strategies for any market. Where a buyer might face competition thank you for sharing that witness today. You're welcome thank you so much for having me love you shared. Great I'm. Are you the best thank you Georgia Georgia wall real chore with the wall team could John L Scott real estate in Seattle Washington. Coming up unrealistic today we'll talk to a national financial expert who says. Don't worry about the lack of inventory relaxed until the end editorial comeback path. That's next on our special show. Inventory. But first it's time for real knowledge. A special segment on realistic today in which we talked to a realistic professional economist journalist or other specialist. About issues involving real estate maybe your realistic. And right now we're going to have a lot of fund because recently we had Tom Silva on the show. As you may know Tom is one of the hosts of this old house. At the time we talk to about home maintenance but I couldn't resist asking them another question which is. How can I get my house to be all fixed up by the pros at this old house. We're working on the street right yeah we achieved bracket strong at Washington bought the last one in Detroit. And pretty normal gonna putting out requests areas of the country other areas in staged on the NASCAR. To look for project work and end all right and while people lose your right hand that this solves. Our campus smaller project if you want done in the day are helpful. Stay right there at its all would travel. Almost every war world war almost why should he states. Upon a small problems but if you want to get it on the green salt project. Sending you try Dick shouldn't accuse Shandon your bucket because you don't grade corporate other important and now we hope you will. Won't pay people are a lot of people think that we paid our it's not sure what almost. Eight or most of the project ten inch. We are able to many cheap we're all reached we try to get manufacturers to help old Paul Eaton just charming a lot of neat products that we use. So is there any specific type of house you would think you'd. Personally you would be really interested in fixing up. You know I love all policies are looked at challenging any else it has a problem and I look to get that problem prediction Walsh. I guess I won't thing I considerate now working on a brick house. In Detroit in the working on new media people home you know and aunt did that eat a lot of war. So we're going to be looking broke her something that will be a little bit different would you argue that we do in huge. OK Tom so just to recap if one of our listeners has a major renovation project in mind for their home. No right to this old house. But if they have a smaller project in mind when it would only take a day. They'll write to Ask This Old House. And if their home is elected to the homeowner will have to pay for the project but they could get a substantial discount. On the total cost. That's great information Tom and thanks for being with us today. And he's gotten Smart boards or anybody could help. It's Tom sober professional general contractor and a host of this old house. Real estate today. Connecting you with a real estate professionals. Every week. And we are back when our special look at the shortage of homes for sale across the country in our special show inventory. It's the one big challenge in a realistic markets that otherwise is doing great with low interest rates plenty of mortgage money. And fighters who were ready to go. Coming up we'll talk to the homebuilders to have a plant and we'll hear from a national financial expert. Who says the shortage of homes for sale is no big deal inventory continues. Right after we checked in with co counsel in the realistic today newsroom cargo price even. After three years of decline the sheriff first time homebuyers rose in the new National Association of Realtors annual profile homebuyers and sellers. The sheriff's sales to first time buyers rose to 35%. Up from last year's 32% which was a near all time low. The long term averages 40% since the and I are started serving in 1981. 67% of this year's first timers said their main reason for buying was the desire to own a home of their own. Non bank mortgage lenders also sometimes known as shadow banks are capturing an ever larger share of the US mortgage loan market. A new report from Adam data solutions so shadow banks have now overtaken commercial banks to quote grab a record slice of the government and conforming loan market. The Adam report says these nontraditional lenders now account for 48% of mortgages up from 23%. In 2008. Of course non bank lenders are not subject to the same government regulation as banks. Guys a column publisher and CEO of inside mortgage finance tells REALTOR.com the quote. There's no evidence that non banks are lending in any sort of imprudent way and or hurting consumers. This sure kitchen big enough. The national average in newly built single family homes was 161. Square feet. Just under thirteen by thirteen according to new research from the national kitchen and bath association. But they also point out there are wide variations by geographic location home size and home style. On average America's biggest kitchens are in the west south central region Texas Oklahoma Arkansas Louisiana. But you'll also find spacious kitchens in the mid Atlantic region Florida and the Carolinas. The smallest kitchens on average are in the west north central region including the Dakota news. Coming up and half an hour the city the tops this year's top ten cities and emerging trends in real estate. Stephen back to you and thanks bill. In markets all over the country. Inventory remains a big. Crawl there just aren't enough homes for sale for all the buyers out there. Of course that's challenging for those buyers but couldn't be even worse than that's. Could their short supply of homes for sale stalled housing recovery and hurt the economy. Let's talk about this now with a national expert. Joining us is Jill Schlesinger the award winning business analyst for CBS news. And a host of the popular radio show and podcast Jill on money. Joseph welcome to realistic today Greek community out. Sergio let's talk inventory they're just aren't enough homes for sale for all the buyers out there what sort of impact it's having. On real estate and the overall economy. This is something we known has been going on for awhile and it has kept a lid on activity especially in the existing home market and so that's. But it's a problem now I would. Caution anyone to extrapolate too much from that problem that's a problem this actually should correct itself because. I seek it as the market continues to prove improve as the economy improves as. These things get incrementally bit better permits look like they're up so that could be good. I said it should. Basically solve itself but what I do think is fascinating about low inventories how can have a cascading effect across the market. Right so and if you are. 169 years old and you really want to downsize. And you look around and you try to find a place to move into when you can't find a place and you don't list your fall home. And then the person who would would've bought your home has no place to move any kind of trickles down and that is not a good back. Interest staying. You know when there aren't enough homes for sale economists say the answer is not just more people selling their homes. Because then those sellers usually by other homes themselves. So there's no real increase in inventory base say the key. Is more new home construction no what do you think of that. Premise first of all and second do you think we'll see more new home construction. Think new home construction would obviously help but it's a longer lead time and their you know the market is such that existing homes are much greater portion of the overall market. Then new homes. But that said I I'd I'm still a little bit wary of sort of getting myself to nuts about this overall. I think it most of these problems that exist in the housing marketer problems that occur after he had a boom and bust. And so what happens in a boom and bust it takes and really a long time before markets start to look quote unquote normal that said. Let's be honest we've come a long way from the bottom and that's good. It is good in another point Joseph is that low inventory. While it's creating challenges for buyers. Because there aren't enough homes for sale and prices are going up. We have to remember it's great for sellers were making more money when they sell their house. If for homeowners. Who are seeing greater and greater equity with every passing year so overall watch your take. On the low inventory situation. Relaxed no me in Victoria come back up. There are bigger problems that we had in the economy and in the housing market really retail. And some of those problems are not that it only have a lot to do with the housing market itself we know we have a generation of people that are spooked about housing market. And we need to get them on spooked and the only way that that happens is with time. OK or that they go may have families and household formations start to pick up a little bit. But you know you you can't make that happen all ones and so that's plain and not too freaked out about low inventory. I see it stinks if you're in markets where he can't get house but. You know I have ever given you this line my mother was a realtor you know that. I didn't know that yeah aha. You know your favorite line was sort of like the great Jewish mother line like you're in your boyfriend breaks up the do your girl from breaks out at you they always say oh don't worry honey they'll be another. Whenever my mother had a client who would lose a house. Or couldn't find the right hands she book at them achieve say house is like command is more than one for you in the world. Fifth. A that is live TU from Susan's last enter a love but that ten. That's one of the best lines have ever heard yeah in terms of realistic yeah. Will Joseph. I appreciate you being here it's been so great I look forward to our next visit Joseph Schlesinger the award winning business analyst for CBS news and the host of the popular radio show and podcast. Jill on money. Coming up on realistic today the nation's homebuilders talk labor. Lots. And lenders. We do pets training programs and we partner with Community Colleges. We re trying to get young people interceded in the building tree that's next on our special show. This is real estate today. 100%. Real estate 100%. Of the time. And where Barack put our special look at inventory. The number of homes for sale across America. As you know in many markets across the country there are more buyers than there are homes for sale. And many people and realistic hope the new home construction industry can ramp up to help meet that demand. Let's find out more about the builder's role in the inventory situation with Robert dank. Robert is a senior economist at the national association of homebuilders. His responsibilities include AT and metropolitan area housing activity. Projections of housing demand and analyses on a range of housing sector issues. Prior to joining an HP. Robert was at the Federal Reserve board serving as chief economist for the institute on taxation and economic policy. Robert welcome to realistic today thank you crap we're glad your here Robert a few weeks ago the Census Bureau reported that. New home sales are up so it looks like the new home construction industry. Is moving in the right direction and that might help the inventory. Absolutely and it is consistent with some of the other signals were getting from the market single family housing starts were up to this month also. And builder confidence is also a hovering at very high levels sir housing recovery is yen. Pretty good stead here. Excellent now. The builders of course have faced a lot of obstacles throughout the past decade what they like to call the three l.'s labor lock and lending. So let's start with labor is there's still a shortage of workers out there Robert. There's still a significant shortage of skilled laborers during the downturn what we saw was a lot of ski. Plumbers electricians carpenters the people who were really critical and building houses there was no work so they left and found other ways to put on the table as the recovery has unfolded it's been slow and steady but those workers are slow to return and serve our members and builders tell us. That there really is a real difficulty finding the skilled labor that we need to build those houses. I see you know as a national organization representing homebuilders. Can NAHB. Do any saying to try to ramp up that labor force quickly. We do you have training programs and we partner with Community Colleges where we try and get young people interest stated in the building trade ties that plumbing electricians carpenters. So we're working hand in hand with the community and some of the local associations. Are setting up outreach programs and meeting point to that Bryant put workers together with jobs. Another one of the Els is locked. Just as sweet labor. We ended downturn came to the entire infrastructure. Proves we gathered there when buying houses and their own building houses. And no one was developing lots to build houses are now that the recovery he is. Coming back demand is coming back and reaching some steady years but we'd come from the very low place and end infrastructure. To develop lots still has to catch up with the demand it's government backed. Interest and and also lending. Is money flowing for new home construction across America. It is it's getting better it was a struggle a few years ago. But it has gotten incrementally better over the last several years. Our guilders attention has turned more to labor and lots shortages. As a real constraint on a more robust recovery Banda landings situation now. Perhaps you can give us a quick thumbnail of what's considered. A normal level of new home construction. Compared to what's happening right now. From 2002000. Trees. Just sort of a free housing boom measure we averaged one point three million single camera housing starts in 2009. We hit bottom at about 350000. That's about two point 7% of normal we have struggled back since then we are now in the power. Mid seven hundred's it's weird about 55 to 6%. About normal level of production. How long before we get back to that normal level. Of one point three million net new homes a year. We expect that 1718. And nineteen are still all going to be you rebuilding years outs but again. Different markets are having a different levels of success and struggles Sarah. That's something to keep an eye on some of the markets will get back to normal quicker than others expect to. It will be sort of a multiyear process nationally. Well Robert I certainly hope that soon you and I have another conversation in which your saying we are having a banner year were back. We're building all the homes we need it. And we're really contributing to a balanced market all across America I'm looking forward to that day you and I boat. We're very much like on a percentage well thank you Robert and thank you very much for joining us on the show today. Okay thank you. Robert thank senior economist at the national association of homebuilders. Coming up unrealistic today some people don't mind low inventory is in fact they're celebrating. We'll talk about that next right here on our special show. In into. If you love listening to us talk about real estate doing the conversation. I'm really see today radio on FaceBook. We can't wait to hear from you that's real estate today radio on things. This is a real estate today. Location. Location. And information. We are back put our special show inventory. All about the shortage of homes for sale across America and what it means to buyers sellers homeowners. And you. If you own a home or if you're planning on selling your home. Low inventory is really good news for you. The reason is with lots of demand for homes and not enough supply. Prices just keep going up the national association of real torsos. But in the past year alone median prices have risen more than 5%. And it follows the year before when they were up nearly 7%. For homeowners that means the market value of your house is rising to. Even if you have no plans to sell the value of your home. Is getting higher every year. That means your equity is growing and your LTV. Your loan to value ratio is dropping. So in the eyes of lenders your looking better and better with every passing year. Because as sure equity rice's Europe better candidate for refinancing. A better candidate for a loan on a second home. A better candidate for any kind of home loan you might need. And by the way that's just market value were talking about if you add to that the amount you paid down on your mortgage every year. You're equity will be growing on twin tracks. The next great not only for homeowners but also for real estate investors big and small. Who see this same positive results. Okay now is there a downside well maybe. Because it's possible that your property tax bill will be going up to. But hey it takes money to make money right and your equity gains were outdistanced any increase in your property taxes by a country mile. Okay now on to home sellers. For you were talking about a much more immediate benefit because when you go to sell your home you might be amazed at how much it's worth. You can either put that money towards your next house or if you're downsizing. You might even be able to buy your next home all cash. And that's a great development. Here's what the real estate pros tell. Even though there aren't enough homes for sale in today's market and even though buyers will line up at your door when you do put your house up for sale. You'll still have to put in the work your house will still have to be white glove clean. Perfectly painted and perfectly maintained. If you want to achieve the ultimate goal of maximum profit in the minimum time. Now one note just because it's a seller's market. You can't just pick a price out of thin air. Work with your real tort to determine the correct price for your home. If US too much. Other homes in the neighborhood will sell. Well yours might just sit there and if it's a long enough you might end up reducing the price anyway and and buyer are you that. They'll probably come in with a low offer so price it right from the start and you might have a great transaction in today's market. So again if you own a home where you're selling a home low inventory is in your favor. But for buyers it's another situation altogether. Will look at their side of the settlement table including. House some buyers are managing to thrive. In the next hour of real estate today. If you'd like to hear more realistic today's special show inventory. Either stay tuned or join us online at our ET radio dot com. From all of us here at realistic today thank you for listening. If you're realtor you can put the entire real estate today show on your web site. The best real estate still on the Radio One 100% free to any our members. Just go to RE ET radio dot com. And click for real. This isn't real estate today. The number one the real estate show on. The radio. Welcome back to real estate today. Backed by the professional experience a real tours from across America where your most trusted source on the radio for help today real estate information. Realistic today is presented by the national association of real tools. And Israel for members in your neighborhood. Hi again and Stephen guests weigh in today we are looking at the one big challenge to real estate markets from coast to coast. Inventory and not enough homes for all the fires out there. The results those fires are facing rising prices competition and bidding war. While sellers and homeowners. Cedar property values go up and in this hour we'll talk about how what seller evaluates multiple offers in today's hottest markets. Inventory is straight ahead but first let's go to the realistic today news truth with Bill Thompson Pardo. I Stephen Austin, Texas tops this years top tens of Asian emerging trends in real estate released by price Waterhouse Coopers and the urban Land Institute. PWC partner Mitch Rochelle told Fox Business why Austin is number one. The millennial population there is fibers a larger than the morning a population the United States and it's growing seven times faster than the one you population United States and more ideals are who the workers are for the future so that's why investors wanna be where the kids are. Nation neighborhoods and the economic diversity are also factors putting Austin on the top he says. Emerging trends in real estate is a highly regarded annual industry outlook for the real estate and land use industry. The head of the Mortgage Bankers Association is making an impassioned plea for housing reset in Washington. MBA president and CEO David Stephens says that for the past eight years the national housing policy has been shaped not just by a crisis but the collapse. Now he says. The election has given us an opportunity for the reset the housing agenda needs. Stevens is calling on the president elect to create the position of a national housing policy director. Coming up and half an hour why the government wants your home on higher ground. Stephen back to you thanks Phil. We have some important news for you right now if you have any sort of real estate investment. From a single Condo which you rent out 2000 unit apartment building which generates millions of dollars in revenue or. Any other kind of real estate investment. The news is one of the fundamental. Tools that real estate investors used to sell one investment and by another might be at risk. It's the 1031 like kind exchange which allows you to defer taxes when you sell one property and by in other. In this era of tax reform some members of congress want to do away with the 1031. But the national association of real tourist believes in it so they'll be working hard to keep the 1031. Alive and well. Joining us now to talk about the like kind exchange is Bill Brown the 2017. President of the national association of real torched. Bill has been and realistic for 35 years. And he's the founder of investment properties in Oakland California. A brokerage that focuses on the sale of existing apartment buildings. To both institutional. And private capital investors. Bill welcome to realistic today you. Now bill let's start with the basics of the 1031. Like kind exchange. How exactly does it work what is it and how would I use it as a real estate investor. If you buy an apartment building 400000 dollars. So old familiar to get all current. Gain a solid 400000. Dollars a year later. You have the ability. Shaking. Equity that you just made and the it's engineered in you nice exchange. I go to property Korean exchange. That is equal to or greater in value so it between 2000 dollars or over. Without having to pay up. S ten year just worry that tax you're not out of it completely just comes way down the line. Exactly recurrent attacks. And actually all the property and take to catch a big thing here. When you sell your original property I guess he bought the current account or to a out and when you have 200000 dollars. You can not have control over my. So even you do what we call it simultaneous exchange in your property. Sells. You would purchase another way closer on the same day or you do any Starker delayed experience. Where you would use an intermediary. You all the content. And I and yet you have no control and made that money goes into. More of your accounts. It becomes a score that. So it's very important and how it could intermediary. You know Omaha and until you find out another property or buy out four and five days charmed. Time to sell the property. You I guess I. Or next you all you got six months. Children that aren't all the other result property to clothes so yeah some time. What you don't got it here you are the guidelines. Now bill you explained it on our show earlier this year what that means to a small investors that if I have a for unit building. And I make a profit on it I can go to an eight unit building. Then to a sixteen and then right on up the line because the whole time I'm able to invest all the profit into the next property. Without that big tax hit. Is that pretty much how it works. Yeah exactly go well don't that. Would really hurt or are you sort well in the coming year with a new congress in place. There's a chance. That some of the benefits to real estate might be in the cross fears especially. The 1031 like kind exchange. In your view as the president of the National Association of Realtors bill. How important is the 1031. End will we be able to keep it in place. What you're doing it doesn't have to continue attacks which change is one of my top priority and you know it probably. Will come up next year. The problem here is outside the RL IP idea or reduce or eliminate it got a different regions. But the bottom line. Is you know is not a tax break. The risk and you talk to exchange comedy it is geared geared to hold B and on. Most here you are mom and pop. Between scored twenty. So what congress really need to realize. Is that it can you going to biscuits and 31. People and not be able to deal where art except we live buying apartments and a light up early eighty. And you can't do what straight. I am yes we have to also hampering all I actually am depreciation capture we wouldn't have our equity be not. And we were held here don't you really do we each do it turned. I heard it pop so what is it what they need to realize. Whatever the group premiere where we call it government and forty billion dollars a year. The contiguous tax trichet used yes they eliminated. They're not going to. You. They get money back because most people will not hear what you just simply tell it Apatow. So I mean it is incumbent on up on us in and they are here to show congress how important. Well bill I really appreciate you talking with a today in the best to block in the year ahead in protecting. That important part of the tax code for real estate investors from coast to coast thank you bill and don't read much you're very welcome. Bill Brown the 2017. President of the national association of real source. And the founder of investment properties in Oakland California. Coming up unrealistic today. What a seller's market means to sellers. Curb appeal to extremely important. Health property shows that side. Gauging the property getting ready for sort of extreme importance that straight ahead on our special shown. In control. Real estate today. Connecting you with the real estate professionals. Every week. And we are back with our special show inventory. All about the shortage of homes for sale in markets all across America. And what that means to you. And right now we're focusing on dollars. Now for you sure low inventory means higher prices. Which means you might have a great transaction. But in this kind of market Kenneth Allard just ask any sky high priced. Or not let's ask a pro. Joining us now is Michael about real tore Enbridge broker at ERA shields real estate in Colorado Springs, Colorado. Michael is the former president of the Colorado association of real torched and was NAR's 2016. Vice president. In 2012. Michael served as an heiress regional vice president representing the rocky mountain regions states of Arizona. Colorado Utah Nevada. New Mexico and Wyoming. Michael welcome to real estate today. They need to thank you so much it's great to be reputed. I'm glad you're here so Michael how is the supply. Vs demand it. In your market of Colorado. So our interest Jane we are still seeing the world supply the most inventory levels we've seen in years so they're in my marketing power strains scale substantially from what it was just. Several years ago the Denver market just to the door and he. It's really skill at a critical level overseeing. A buried most supply relationship to bail and so it's been very market. Michael what does that do to people selling their homes. Have they said to you hey I can ask any price I want because the buyers are just gonna line up what do you think. Much yeah sometimes I get back yeah some people think because that they you know we're at war. I'm that's really not a case yeah interest in doing watching the buyers is. Even know and our market yeah urged China market it's all about strictly by just sixty are certainly days. All have buyers say. Way to get this property bet on the market in three weeks I mean there's got to be some roll quite so. It's funny that's not necessarily respect. The Denver market no question. So extremely active. But I buyers will often not even look at property wearing a big deal but its price to the market. Sold each berries important skill or so first question properties correctly. Let me ask you about that how does a realtor advised their seller clients. About correct. Pricing. As a member of the national association short sweet to assist all our yard she wore our speech nobody else had access to. The district probation is huge. The largest cell. Parcells centric database in one place in the car were include residential. India and certain information that we are able to sharpen our actions. The evil shot source their decisions aren't so it's invaluable. Michael let me ask another question about that say they want a beer sellers has correct pricing. But he's now saying when you know in today's market again the buyers are gonna line up. So I'm not gonna fix this house up let him come and pay top dollar. I'm not gonna lift a finger to get this place ready for sale how about that. CBI considers media always potentially fires that our property about what the condition especially depending on the price range but I haven't seen the NRA. What I tell sellers mistake about it you were so there are either cute guy at all sorry that you prosecute rappers in the backseat on the floor. Is that what attracted to acquire I don't think it is I think still curb appeal is extremely important. Well properties shows inside. Gauging the property getting ready for sale it's extremely important. How it's Merrill's street and he is such. You know by actual walking to property and don't make a judgment call on whether their interest to property or write about so she. Still continually get out property right tradition. I think it still critically important special agent trying to get such as much you can dull the property. OK but now I think you have correct pricing and the place is looking like a million bucks now you have potentially another problem which is you put it up on the market. And all of a sudden you have 121520. Offers. How do you evaluate those offers. It's you know and we actually bulk or present our market in the debt market per unit or what took place across the country. We're seeing that's still quite a bit so. When you're working with the fire being able to get it right probation an epic epic the right decision. On how they're current court structure are urged to important. What are your wish to engage changed. Looking at those offers an abiding great it would be able to get slower. But right guidance at the right information it's still better. But hoppers can be dramatic and they are a lot of and so worst will be looked at this side. Bet it's not just necessarily a price. Sometimes it's the church sometimes it is closing date sometimes each other negotiable like I hit it can be very very or. So. Advocate multiple law firms trying site. Which one makes sense. He's part of what we years is what orders to give them the expertise. Keep giving them the right guy. So those are some of the challenges facing sellers in today's market but Michael Tellme have you had any experiences in which. You put a seller's property on the market and you've got an offer and they said no walks we're going to make that much money I think. Yeah. Yes struck out more than expected. It is happening a lot there must be delighted people selling must be delighted. It's a whole body Cuban was in 2000. Dinner eight speed I can tell you there are a lot of respect that would be all right so here's the bad news and here's the other bet such a date it's a lot better no question. You know property values got up pretty much crossed border post market. A lot of times people are seeing more equity that they bought the paper better yet. That's great wall Michael. I appreciate your perspective in your advice in your insight. On how to sell properties in an old truck hot market. Thanks to unique great great dignity it's a pleasure to be a real sure it's a great work work. What are okay. Michael about real sore in branch broker at ERA shields real estate in Colorado Springs, Colorado. And a former presidents of the Colorado association. Of real source. Coming up unrealistic today. What low inventory. Means to you. Buyers need to understand because of limited inventory build will be more are fierce competition on. Sports page single property especially here's some hot markets like Seattle or Portland Oregon. That's next on our special show. Inventory. But first it's time for real knowledge. And a special segment on real estate today in which we talked to a top level professional economist journalist who deals with real estate and related issues. And ask them a tough question designed to help you have a complete understanding. Of some of the most complicated areas of real estate and now we're talking safety in your home. Joining us now is John remembered the consumer affairs manager for underwriters laboratories. We don't know you well it's one of the leading safety organizations in the world. And John's been with them for more than forty years helping people around the world stay safe John welcome to realistic today. My pleasure being with you again it's always fun to. Talk about safety because that's what you'll is all about. Well John today we wanna ask you about the electrical grids in our homes. Now any homeowner can go out and buy a small plug in electrical tester. Which tells them whether the socket their plugging it into is grounded correctly or not. But those testers are so inexpensive you've got to wonder. Are they really any good. Well they can be very good and I can tell you affirmed at some but he knows he missed one here one of those outlooks. And that's very important because others certain parts to that outlook that I have grounded. Elements of that and others that carry the current. And them making sure the polls are mixed up so are really very important from an overall safety standpoint. Not just for electrical fire sales are also were shock tells urged. So that's something that's very hard to do but these little adaptors that you comply again and that'll give you were reading whether something is working properly. We'll tell you that something might be wrong and already yours who knows may be the former owner was a do it yourself perch and didn't do things click right. That could be a problem where maybe even a contractor might have been in a hurry and missed lawyer something no would be the time to fight it out before there's an emergency that happens. OK so that's the grounding now how about those multi testers with the two metal prongs on the that you can stick into the outlet. Which tell you how much of voltage you're getting. Well post would work out having the correct pulled it just something that does almost impossible to change in her home the older you've got to do so certainly what the electric company has slipped from. Providing true you after the lines coming into your home but some outlooks are designed to have 240 bolster can accommodate large clothes dryers are or larger stole much of one kind or another. Character electric and though those do have to have that proper voltage very definitely. Before your report one of those things and. Great advice John and we thank you. For being on the show this week. Stephen is my pleasure. Stay safe. John joining berg the consumer affairs manager for underwriters laboratories. This is real estate today. All real estate all the time. And we are back when our special show inventories. All about the shortage of homes for sale in markets from coast to coast. It's a good news bad news story because for sellers it spells a bigger net profit. For homeowners it means their home equity is growing fast plus for buyers. It means prices are rising and there's more competition. For the few homes that are for sale. Our special show inventory continues. Right after we check in with Bill Thompson the the realistic today newsrooms I know. Stephen starting next month Fannie Mae is expanding its home ready program and it's 3% down mortgage to include eligible refinances of loans already owned by Fannie my. Up till now Fannie Mae's maximum loan to value ratio for refinance or was 95%. The new LTV of 97%. Will be available for one unit limited cash out refinance transactions. Hugged once FHA backed homes on higher ground in flood prone areas. The Department of Housing and Urban Development is proposing new elevation standards for all hog and FHA supported properties. Hunt says it's the first time in nearly forty years of its proposing to establish higher elevation requirements for properties seeking Hud assistant or FHA mortgage and Ernst but the chairman of the national association of homebuilders and Brady. Says hugs proposal will quote severely disrupt the housing market. And harm affordability for millions of Americans living in areas designated under the expanded flood plain definition. Are you living near a meth lab. The website drug abuse dot com. Used data from the Drug Enforcement Administration to create an interactive map the lets you see worked LA methamphetamine incidents have been reported. Just plug in a street address city or state the cedar red dots that pinpoints such incidents. The US had over 9000. Meth incidents in 2014 alone on the website says. The data show that the largest number of meth incidents have occurred in Indiana Tennessee Missouri Ohio Illinois and Michigan. Stephen back to you and thanks bill. We're continuing now with our special show and inventory. And in depth look. And the shortage of homes for sale all across America. As you know. That shortage is contributing to rising prices it's contributing to bidding wars competition among buyers in hot markets. And even though it's great for home sellers and homeowners. Who were seeing their home values rise. It's not considered healthy for the overall real estate market or the overall economy. Let's talk more about inventory now would an expert joining us is Lawrence June and a chief economist of the national association. Of real torched. Lawrence welcome to real estate today wrote Lawrence all across the country in nearly. Every market. We're hearing that there are not enough homes. For all the buyers who wanna get one. What is this doing to the economy of those areas and the economy of the United States. You lack of inventory. Print out patient data it is safe frenzied market because other partners are competing word. That limited inventory and our hands there's more barter competition and she told feels like Atlanta market. But you home soil fertility is actually met incredibly lord today compared to dust up arms boom that occurred ten years ago. Eric M has if we have more inventory. Though market will feel much more balance you'll be a healthier. And there will be increased job creation and so currently. Lack of inventory is hoarding back to potential or even sweeter broken homes tell us. Are sold more job creation in the local economy are so hopefully the builders can ramp up production and bring more inventory on marring. And that will solve our many of the housing related difficulties. That's well that's helped lead local economy. Now you've walked us through this before Lawrence but let me ask you again. Why is it that we must have new home construction to relieve the inventory. Why is it that if more people didn't just put their house up for sale. It would solve it that way. Shall hold it looks scared because there are changes planned ceremony circumstance that may be each some people want to move to a different school district. Ordered her job relocation of I'm told there are a variety of reasons that black people would want to move. Well one thing that we aren't consistently is that homeowners when they moved to a new residents. It is always from all mean to owning it is not from owning renting. You know are coming up patriot which means that even at stage left her home. They will arsenal auto home therefore take inventory out of the market. So the net impact to beat Marquette. Is fuel and cargo on inventory. Only way we can get clean inventory additional supply onto the market. It's either poor home builders to big old or somebody institutional investors who have scooped up beat properties in the past two years. Begin to unload. Right now we are shouldn't something no indication and that institutional. Investors want to unload that rattle income it's just too good and they're holding onto property. Which means that argued ball. Only way to truly increase housing supply is sporty. Guilders to increase construction work. Dicey so Lawrence last couple questions for your. If I am a buyer in today's market and I want to find a house and purchase that house. What sort of uphill road will I be facing. Buyers shouldn't need to understand because of limited inventory build will be more. Are your competition and for every single property especially in some hot markets like Seattle or Portland Oregon and bill be multiple buyers who want their property so they should on the clearly understand there will be additional competition and how and second party has. Even though the contours are getting pushed up. That people should realize that pitched well within their budget. All the mortgage default and on this list shall that it people we're stretched. That could lead to problems but you people stay well within the bloodshed. They will not be defaulting. So in your margin. Of whole party local market conditions and if I should try it blew too much perhaps the consumers should look for different neighbor looked at it more affordable. Finally Lawrence if I am a dollar in today's market. Things are looking pretty good for me. These silver have bench over by yours but. Jury he optimistic shutters. Has followed the professional. Or other realtors would indicated that if stay over par extra haunt you will linger in the market. And if it lingers on the market for too long. And Egypt ready damaged bland food at home so these numbers even talking about it edged continue to assured that it priced home correctly. Laura June the chief economist of the national association of real source. Talking inventory right here on realistic today. Coming up unrealistic today we'll meet a real tour who travels the globe. Trying to make life better and for the people he meets. Always focused on is. Making sure that they have clean water and then we worked and sanitation projects that straight ahead right here. On realistic to back. This is a real estate today. Because you're home ninety beat your biggest investment. And we are back with a very special story. About a real sort who has spent years making life better. For people in one of the poorest and most disadvantaged areas of the world. His name is win wrecked. And since 2008. He and his wife have traveled again and again at 21 of the most remote parts of Ethiopia. Bringing school supplies medicine. Water and basic sanitation to the people who live there. For all those efforts when was recognized this year as a good neighbor by realtor magazine. Win is a real chore with Coldwell Banker Brunette in Chesko Minnesota and we're delighted he could join us on the show will and welcome to realistic today. Thank you Stephen it's going to be on your show. Where and what kind of work do you do. For the people in those remote villages of Ethiopia. Well we focused on is making sure that they have clean water. In the end we work on sanitation projects. Because a lot of people and it's remote area had never used to latrines. And count and we focus on medical missions or we have. Group the doctor's command and also work and school supplies. So your work makes a huge difference in the lives. Of every one in those villages that you visit. Yeah yeah we wouldn't keep going back. We wouldn't be the winner of a factor that you know poll. Children are dying because the main water source had given not until it certainly willing to go back and she's part arched. And that's what drives shoot. To go back to Ethiopia again and again and again to help people who otherwise would go without. Well my favorite quote from John Bunyan. And she's good you have not lived a day until you build something or someone who can never reach eight. They are very grateful for what we do standard he innovative. What what we do and it's a collaboration so they will go from mutt about a month and collect just meager amount of money. And then they contribute debt to the projects. Now when you're recognized as a good neighbor by real drum magazine. Your charity. He's scheduled now to receive 8101000. Dollar contribution. From the magazine and it's good neighbor sponsors REALTOR.com and Wells Fargo. Will that make a big difference in the work you do. Well the dollars of Guatemala. Are magnified by twenty times over there for example we could do. A new water pump well. Which would give 300 can only serve 15100 people clean water. We can also little shadow latrines. And that would keep the sanitation. Level people from getting sick attribute saying you know we all so. Don't have money for school supplies. Or even part of it pour me a medical mission impact and help a friend who is actually going to matched he could paperwork Arnold's. Oh that's wonderful. Win for all the real source who were listening to this now. Would you recommend that they also find some way. To give Barack. I think it everybody. Can do. This something great by volunteering. You don't forget. Have to be a large scale all operations. We look at the things that we do that maybe we can effect on child like any GOP it would. Clean water and accountants they can go to school. I don't have to be much just go a little effort and it can change the meat like dramatically. Well winner. Again it is inspirational to hear you tell about what you do. I appreciate the opportunity to shared. A good neighbor word and I hope it inspires many other cultures chew. Just give back to their communities and do something for others who may be you know can't control themselves scorer. Could match something which you can't do it you know it collaborative effort. Win re real sore with Coldwell Banker Brunette and Chesko Minnesota. And it 2016. Good neighbor award recipient from realtor magazine. The good neighbor awards recognize real tours to make an impact on the community through volunteer work. Since the year 2000 the good neighbor awards granted more than one million dollars to real tournament charities. Richard magazines good neighbor awards would not exist without the support of its generous sponsors. Real tort dot com. And Wells Fargo Home Mortgage. Coming up unrealistic today how a buyer can still thrive. In today's market that's next on our special show. The inventory. If you're hungry for real estate information to follow really seat today on Twitter to share segments listened to them again. And be the first to know what's on next week's show. Just search real estate today on Twitter. Real estate today because you. Love real estate. And we're back with our special show inventory. Taking an in depth look at what it's like to buy sell or phone real estate when there aren't enough homes for all the buyers out there. We're going to wrap up today's show with a look at how buyers can make it happen when they're in a competitive situation. No on today's show we've heard solid advice from real estate pros about how some buyers make it while others don't so let's look at what they had to sect. Step one. Get a real tour sure most buyers start their house hunting on line and that's great. But don't try to go it alone a real sore we'll have the local market experienced. Knowledge and contacts. To help you get the best house at the best price even in a tough market okay. Step two get preapproved for a mortgage not just pre qualified but pre approved. That means the mortgage lender has crunched the numbers and gone through all your paperwork and said. Yes we will give you a mortgage at this price point. That's huge when it comes to getting a house in a competitive situation. Because sellers wanna make sure that you can do to deal. And if you're pre approved the you know you can't. If you're not preapproved. They don't. Now the only time you do not have to be preapproved. It is well step three buy all cash if you can't. I know most of us can't do that but if you can chances are you will win in any competitive situation. Now if that's not an option well OK but if it is it's a slam dunk in just about every market out there. Up four try to get the home in expected before. You write an offer. You'll need permission from the seller side of course but they'll probably be OK with no if you do that in the house is good. Then you can may cure offer without the home inspection contingency. That could bring your offer to the top of the puck. Speaking of contingencies. Real tours will tell you that it's a great idea to write a clean contract. That means make it simple the right price the right closing date and very little else. If you loaded up with contingencies. Things that let you walk away your contract might end up at the bottom of the pile. Now obviously you want to protect all your interest. So talk with your real tour about what's reasonable and what's not in today's competitive market. Step five day flexible. If the seller wants a different settlement date. Ask yourself if it really matters the more you say yes the better chance you have of getting that how she walked. OK so there you have it five ways that you can be competitive and hopefully win. In today's tight market. Okay now let's end up with a reality check. Prices are going up there's no way around a 300000. Dollar house might be worth 3151000. A year from now. And that situation is very hard for buyers. But let's balance that out with this. Interest rates are still incredibly low your money will buy more house now. That it would with higher interest rates. All in today's market plenty of good home loans are available with 3% down payments good solid loans. So you won't have to say about forever. Lost more lenders are saying OK to lower credit course. That could be good for you also. So okay for buyers the competition in the rising prices are challenging for sure. But you do have a lot going for you so don't give up get in their side by side with your real tore. And go for it because when you get the best house for the best priced at some of the best interest rates ever. You can say yep that was a tough market but I wanted. Coming up next week on realistic today. Here come the holidays. A special show dedicated to all the festivities in the months ahead. We'll talk to experts about how to get your house ready and we'll answer key questions. Should you try to sell your house over the holidays. That's next week on our special show here come the holidays. And remember you can always listened online at our ET radio dot com. They're from all of us here at realistic today thank you for listening. If you are realtor you can put the entire real estate today show on your website. The best real estate show on the Radio One 100% free and they are members just go to Ari TV radio dot com. And play.