Why Housing Feels Hopeless

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Hello, and welcome back to the David Fromm Show.

I'm David Fromm, a staff writer at The Atlantic.

My guest today will be Glenn Kalman, CEO of Redfin, an online real estate brokerage service, and our topic will be the state of the U.S.

housing market.

Before my dialogue with Glenn, I want to offer some thoughts on quite a different subject, the impending 80th anniversary of the end of the Second World War.

On August 15th, 1945, the Imperial Japanese government communicated its surrender to the United States and the Allies in the Pacific War.

That ceremony was formalized with a ceremony in Tokyo Bay on September 2nd, bringing the war to its legal conclusion.

The United States and every belligerent in the war have observed many commemorations of this immense event.

As the commemorations have extended in time away from the events that they commemorate, a kind of vainglorious note has tended to enter into these commemorations, never more so than in the message President Trump issued on the 80th anniversary of the end of the war in Europe.

I quote from his true social account.

Many of our allies and friends are celebrating May 8th as Victory Day, but we did more than any other country, by far, in producing a victorious result on World War II.

I am hereby renaming May 8th as Victory Day for World War II and November 11th as Victory Day for World War I.

We won both wars.

Nobody was close to us in terms of strength, bravery, or military brilliance, but we never celebrate anything.

That's because we don't have leaders anymore that know how to do so.

We are going to start celebrating our victories again.

Now, it's kind of news that the United States never celebrated VE Day or VJ Day before Donald Trump came along.

Of course, it did.

But it is true that in the past, these celebrations were always muted with a remembrance of the terrible suffering that the wars brought to those who fought them, the terrible damage they did to the world, the terrible unnecessariness of the wars, and the hopes for lasting peace.

But as we get more distant, there has been a tendency, and Donald Trump expresses it more than anyone, to think of World War II as a kind of military Super Bowl in which the United States, a bunch of teams competed, the United States won the trophy, they had the biggest point spread, they had the fanciest jerseys, the prettiest cheerleaders, and And so, yay us.

I think as we approach this anniversary, that way of thinking seems even more unhelpful than at any time in the past.

The thing I'd like to commemorate on this 80th anniversary is not the war that ended on August 15th, but the peace that began on August 15th.

The long peace in Atlantic and Pacific.

nervous and tended at its start, overshadowed by the threat of nuclear destruction in the Cold War, but building and growing and enhancing the lives of people on both sides of the war,

whose parents and grandparents had been on both sides of the war.

Victors and vanquished, allies and Axis,

found a way to come together and to build reconciliation, to build a new kind of world.

And American leadership was absolutely crucial to the building of this world.

The American leadership in providing aid to the war-ravaged countries of Europe and Asia.

The American guarantee of security that was tested in Asia and Korea and Vietnam, that was tested in Berlin in periodic crises over the Berlin, that was tested in Europe in periodic crises over the city of Berlin, that was backed by American strength and power, and supported by a growing number of allies, increasingly democratic allies.

The triumph of bringing to democracy countries that had been non-democracies during the war, countries like Portugal or South Korea that had been American allies but began not as democracies but achieved democratic government.

All this supported and paid for by the mounting prosperity achieved by the free trade system that was built by American leadership in the worlds after World War II.

And all of these accomplishments are things that have now been put at risk.

As they're put at risk, I think if we remember the end of the war, we need to remember also the beginning of the war.

The American role in the years before 1945 was not as magnificent, not as glorious, not as something to be proud of as the American role in the war and afterwards.

The war was made inevitable by a lot of bad American decisions in the 1920s and

was nearly lost because of even worse American decisions in the 1930s and 40s.

Trade protectionism, isolationism, indifference to the fate of struggling democracies, those are part of the American story too.

And while the heroic achievements of the years after the war, the turn to free trade and collective security, those are receding, the mistakes that brought the war into being, those are being repeated.

In 2025, America is less the country it was in 1945 and much more the country it was in 1925 and 1935.

It is funny that Donald Trump is taking credit for a victory that was only made necessary because people did the things that were recommended by the presidency of Donald Trump.

The greatest accomplishment of the United States in its history was the peace built after 1945.

I think that is the thing that together with Japanese, together with Germans, together with all the defeated, together with the British and the French and the Canadians and the Australians and all those who helped to win, we want this war to recede into into history.

We want only its lessons to remain alive.

Its lessons of cooperation, collective security, democracy, of trade.

Those lessons are at risk.

We need to reaffirm them.

That's the message for this day, not boasting.

Every time Donald Trump speaks of war, I think of a poem by Rudyard Kipling called Recessional.

And there's a line in that poem that haunts me because it seems to describe so well our present situation.

Kipling wrote: if he was addressing a prayer to the God of armies, he said, if drunk with sight of power, we loose wild tongues that have not thee in awe.

I think the America of Donald Trump is a little drunk with power.

And even as that power is waning, it is loosing wilder and wilder tongues than ever.

And it's not keeping in awe this divine spirit, the spirit of justice and reconciliation.

that is the thing that I will be thinking about on August 15th of 2025.

And now my conversation with Glenn Kilman.

But first, a quick break.

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Glenn Kelman is the CEO of Redfin, an online home brokerage service.

Prior to joining Redfin, he was a co-founder of Plumtree Software, a publicly traded company that created the enterprise portal software market.

Glenn was raised in Seattle and graduated from the University of California at Berkeley.

Glenn, thank you so much for joining the David Fromm show today.

So excited to be here.

Thanks for having me, David.

Oh, so grateful to you.

So let's just start with the open-ended question.

What is going on in the housing market?

We've had a terrible spring.

There's more bad economic news this summer.

What's the state of the housing market?

Home prices are softening.

So for the first time in nearly a decade, home prices seem likely to soften in the second half of the year.

Interest rates may go down just because the jobs news was weak, and that would be a welcome respite.

But inventory has been very low for a long time.

Sales volume has been extremely low, probably 30% below historic levels on a per capita basis.

We haven't seen this sales volume since 1997 when the United States population was about 30% smaller.

So the market has been more a bun, but home prices have held up.

And we're going to see that in the June numbers.

But if you look further ahead, 35% of listings are staying on the market for more than 90 days.

We have many unsold listings right now.

It has just gotten hard to sell a house, especially in the Sunbelt.

And so that may bring some relief to homebuyers who really need it.

The average age of the first-time homebuyer is 38.

It used to be 31 just a decade ago.

Yeah.

Well, one of the things that is strange, and you're sort of anticipating the question, is this is a market that is experienced as a bad market, both by sellers and by buyers.

And normally, at least one of those two groups is happy.

Bad news for sellers, good news for buyers, bad news for buyers, good news for sellers.

Now they both seem unhappy, that

the prices are high, buyers can't buy, but the buyers aren't there, so sellers can't sell.

Everybody's miserable.

That doesn't seem like an equilibrium state.

No, it isn't.

I think we're at an inflection point.

So mostly people who have had to sell their home have been able to do so quite easily over the past two or three years.

So even in the post-pandemic correction, it was fairly straightforward.

But now home sellers are struggling, especially people who bought a house during the pandemic.

We are talking to them about lowering their price and they can't because they'll be short on their mortgage.

Now, we're not going to have anything like the great financial crisis in 2008, where there was a wave of foreclosures.

But for a particular population of folks who did buy during the pandemic, it has suddenly gotten very hard to sell their home and pay off their mortgage.

And so right now the market is just teetering in a very unhappy equilibrium.

I think that prices will come down.

And I'm one of the people who views that as good news.

When bread prices come down, when gas prices come down, most Americans view that as cause for celebration.

But when home prices go down, about half of us are worried about it and the other half are throwing a party.

And really for the younger generation, we need prices to come down.

Well, is the cause of the misery that the people who bought during the pandemic, and a lot of people were buying with money that was almost free, very, very low interest rates.

And they're now, it's five years on.

If they bought and the cheapest money is the five-year interest rate that resets after year five, those people are now thinking about selling, but they're selling to people who have to pay, who have to go borrow at real interest rates.

And so that's the mismatch.

That it may be that the secret is one group has a low monthly payment, but wants to sell the house at a high price.

The other group has a high monthly payment and cannot possibly meet the price.

And that's the mismatch.

And that's why everybody's miserable.

That is a huge part of it.

So about 75% of American homeowners have a mortgage below 5%.

We're unlikely to see a rate like that anytime in the foreseeable future.

And so those folks...

create this rate-locked inventory.

Many, many people in America, more than half of all Americans, really couldn't afford to buy their own home at current interest rates.

So it's very common for us to go to a listing consultation with someone who has had another baby or going through a divorce, had some kind of life event where they need to move.

And when they realize what they're going to be able to afford from the sale of their home, they decide to stay put instead.

Let's go around the country and let's start in what is like, what I understand, like, what the Dust Bowl was during the Great Depression, Florida is to today's real estate market.

It's It's just the endless source of bad news.

So let's start.

Tell us the story of Florida and then let's go around the rest of the country.

Well, Florida has all kinds of problems, and some of them are climate change related because insurance rates are shooting through the roof.

So so many buyers in Florida get a home, get a mortgage, and they think that's all there is to it.

And usually that's the case.

But now there's a third rail, which is getting insurance.

And because there have been so many storms, insurance rates are sky high.

The state has tried to regulate that to some degree, but it's really a triple whammy because home prices have gone up.

Many people are moving into the state.

That has started to slow.

Florida has always been a real estate-driven economy.

So the overall economy struggles when real estate struggles like no other state in America.

And that just makes it extremely volatile, especially condos in Florida right now, very hard to sell.

So there are places where it's still easy to sell a home in Florida, but those are getting more scarce, driven by those three factors.

Yeah.

What's the strongest real estate market in the country?

Strongest real estate market in the country is probably in the Midwest right now.

It just saw less volatility than before.

So if you went to a place like Austin, Texas, somewhere in the Sunbelt, home prices went up 40 or 50% during the pandemic and then came crashing down.

But place like Chicago has been very Midwest and stolid, just as you would expect Chicago to be.

And so that market has been holding up.

I think it's some of the markets where we saw the biggest pandemic highs that we're now seeing the most volatility.

West Coast markets are doing better because there were a bunch of Amazon workers or Google workers who thought they could move to Texas and keep their jobs.

And now they're being called back to the states.

And so this exodus that we saw from California and Washington State is now reversing.

And that is supporting the market.

If I had to say the biggest split in the market right now, condos are just always more volatile than houses.

Townhouses are also much more volatile.

Those are the first parts of the market to go.

Builders are really struggling right now.

So the incentives that they're offering the home buyer usually involve buying down the rate, and then they're offering 5% or 6% to a buyer's agent when normally it would be 2% or 3%.

That's an incentive that the consumer herself doesn't see.

It's an indication that home builder sentiment is very negative.

I think it's been negative for 15 months.

They've got their own double whammy where consumer demand is softening, but also their labor supply is shrinking.

Well, let's talk to the generational aspect because that's probably one of the most socially debilitating.

So you said a decade ago, the first-time homebuyer averaged 31 years old.

Today, the first time home, how old?

Say it again?

38.

38.

So let's talk to those 29 and 30-year-olds who said, I thought I was one year away from buying a house, and now I discover I'm nearly a decade away.

I'd like to have a house when I'm of age to have children.

What hope is there for me?

What hope is there for them?

Well, we just need a correction with a correction.

So we already talked about this phenomenon where home sales plunged at the end of 2022, but home prices kept increasing.

And that was because all this inventory was rate locked.

And now we're starting to see inventory pile up.

It's getting harder to sell a home.

We think prices will go down by at least 1% in the second half of the year.

And that means that home buyers may catch a break, but 1% probably isn't enough.

The second part of this is that there just has to be a building boom.

There's this big debate on the left about whether or not we should continue with the current policies or be much more permissive about building not just houses, but nuclear power plants and high-speed rail and all sorts of other projects to bring the American economy forward.

I will be quite explicit about this.

I am a yes in my backyard, yemby kind of politician.

I really think America has to be good at building houses or the next generation is really going to be in a pickle.

We always talked about the bad vibes economy where Joe Biden wondered why are people so down on the economy, especially this younger generation.

And it's just hard to be optimistic about the economy, even when unemployment is low, if you're living in your parents' basement.

And so I see some hope.

Tim Scott and Elizabeth Warren, unlikely bedfellows, are now sponsoring a bill to lower housing regulation and to get more homes built.

It passed through the banking committee on a unanimous vote.

It's something that I think the president could really get behind.

I had hoped when he started his term that because he's a builder, he could be the builder-in-chief or the developer-in-chief.

Mostly, he has not addressed this issue.

Yeah,

you're in the realist.

You believe that Donald Trump is a builder?

David,

are you trying to get in trouble?

you know i do not think that he's a name licensor he's not a builder he's when was the last time donald trump built anything like 19 i think 80 i think he has an enthusiasm for construction yes regardless of he draws these bona fides those are his favorite those are his favorite doodles yes draw the skylines they are his favorite doodles

in the white house right now he wants to build another room in the white house i know it's going to have this louis coutor's kind of vibe but um

not

at Las Vegas.

But okay, we're not going down the politics path.

So I just wanted to hear more hope for the young, because even if the day of the two and three-quarters percent mortgage is not returning soon.

And even, and that was a trap, by the way, because the way you got two and three-quarters percent was by saying, I'm signing up for five years and then letting the interest rate reset, which is not advice that anybody should, any young person who doesn't have a lot of other resources should be following.

You want the length of your loan to be the length of time you're going to own the home.

The depression generation knew that.

So, but anyway, two and three quarters money or even three and a quarter, we're not going to see that in the mortgage market so soon, even if the overnight rates come down.

So, what's the hope for the young?

What's the hope for the young?

I think the hope for the young is that mayors have been losing their jobs over housing.

If you look in Seattle, Los Angeles, San Francisco, there has been so much rage over the high cost of housing that it has really shifted the politics.

There have been a bunch of state bills in California that failed five years ago, that made it easier to build housing, made it easier to build accessory dwelling units, lifted parking requirements and other things that dwindled the supply of housing in California.

And now that state has gotten religion about trying to get builders back to increase the supply of housing.

So I think there's just a new political movement.

It is a bipartisan issue on the left and the right.

At the local level, especially, there has just been this religion.

that we have to make it easier to build houses and increase the supply of homes.

We are probably 4 million, 5 million units short of where we need to be, just given the demographics.

Yeah.

So we need to, well, if we were having this discussion 10 years ago, 2015, what we would have said is the outlook for housing is exciting because the autonomous vehicle is almost here.

And when it gets here, people won't need to have their own individual parking places anymore because these autonomous vehicles will be rolling around the city.

It'll be robot Uber for everybody, at least in any major place that's got any population density.

You'll press the button for the robot Uber.

It'll be there in eight minutes, and you will not need a parking space, and that will cut $40,000 or $50,000 off the price of a condo.

What has happened to that hope?

Medium.

So, you know, the classic realtor move when you can't afford to live in the city is to look in the suburbs and then to look in the exurbs.

So people's commutes just get longer and longer and longer.

And at some point, the rubber band always breaks where people just aren't willing to live in New Jersey and commute into Manhattan.

But now, because of Zoom and maybe because of autonomous vehicles, vehicles, at some point, we are going to see people who are more tolerant of longer commutes.

We have certainly had these conversations with customers and been surprised.

There are people living in Sacramento who commute into San Francisco, and that's because they're only coming to work a couple of days a week.

But it's also because the cost of housing is just insane in San Francisco.

And I think there's probably a broader trend here, which is that it used to be that the politics of housing were toxic in San Francisco, New York, LA, and Seattle.

But if you went to Indiana or Chicago or Florida, there it was still possible to work a middle-class job and get a starter home.

So the American dream died in different places at different rates until the pandemic.

And then all of a sudden, you saw LA's housing problem come to Indiana, where people showed up with monopoly money from LA saying, I don't care if the house is $300,000 or $500,000.

It's easy for me to afford.

and so i think now the housing crisis isn't just a local political issue it's a national political issue and it did i think contribute to some of the economic anxiety that was nationwide previously i think you felt like if you were living in san francisco that your kids had to go to harvard and then to yale and major in computer science and get a job at google and become a vp if they had any hope of buying a house in the same city they were raised in now i think that anxiety has spread to other parts of the country.

And that's why I think there's a broader consensus that we need to do something about housing in America.

We need to build more housing.

We need to deregulate a little bit.

Well, from your vantage point as the intermediary between buyers and sellers, if I said, okay, we got the governors of the states here with their notepads open, ready to take dictation.

What are the top two, three, even four steps you'd recommend to make it easier to build housing and make housing cheaper?

Almost all zoning laws.

Be specific.

What would you change?

Well,

and this is an issue where I think Donald Trump has been on the wrong side of the issue, but some places only allow single-family homes, so they don't allow density.

You can't build an apartment building.

You can't build a condo building.

And that's because rich people like to have less density, fewer cars on the road.

There's a certain kind of neighborhood that's a leafy neighborhood.

And so in the past, you would see Republican homeowners really argue for zoning laws that made it very difficult to build a house.

And then on the left, the issue that people really fought for were some kinds of rent controls, which discouraged us from building rental housing.

And so, you know, the zoning laws that were popular on the right, the rental controls that were popular on the left, both of those need to go.

We've already talked about the parking minimums, but mostly it's just the approval times.

So if you talk to builders, they will say that it's just so much easier to build a house in Arizona than it is in California, even though the housing shortage is so much more severe in California.

And if you look at what drove California's boom, Orange County used to be Orange Groves.

And then the city made some unholy alliance with the builder to turn the whole thing into a suburb.

And they built houses faster than at any point in America.

And I just think We may not need that rate, but we need something like it if we are to give hope to a new generation of Americans.

And my broader argument is that I think this will be good not just for housing, but I do think we need to upgrade the American economy so that it's ready for the 21st century.

And if we're going to do that, we need to start saying yes to solar and wind and nuclear power to high-speed rail and all sorts of other projects.

Liberal cities are going to fail if they can't get stuff done.

And the sharp end of that spear has been this Yembe movement, this yes in my backyard movement.

So I think that's the hope for progressive politics.

I think one of the things that people often lose sight of, we talk about housing building, people don't understand that houses fall apart.

We lose housing every year, a certain percentage.

It's a physical asset.

It deteriorates over time.

And so the idea that, and this is the thing that I think the rent controls, that the housing is dropping out of the market all the time because it's aged, it's dilapidated.

And either you either need to tear it down and build something new, or you need to invest in order to upgrade it.

But in either case, you don't just build once and then forget.

And then, and the development, the owner isn't just clipping coupons.

If you want to maintain that unit, actively reinvest all the time to maintain its quality.

And so it's not just, it's not build and forget.

One of the reasons that people say, well, we're not, we don't have a lot of population, natural population growth.

Immigration is slowing down.

Why four or five million units?

You see this in big cities.

A lot of things are just dropping out of the market.

The building falls down.

There's a number, I'm going to forget what it is, of the number of apartments in New York that are rent stabilized and vacant.

The building is beneath the city's code.

And so it's not allowed to be inhabited, but the landlord can't afford to renovate it because of the rent stable.

That's tens of thousands of units in the city of New York.

Now, not everybody has crazy rent stabilization schemes, but everybody has the problem of housing deterioration, which is not something that I think a lot of people in the YIMBY argument world, the YIMBY people make, might get it, but not everyone understands.

or remembers, I should say.

People understand it once you explain it.

One thing that people forget about home price corrections is that it's not just that the same asset is selling for less money because of the laws of supply and demand that happens.

But if you looked in past corrections like 2008, 2009, and actually walked through the houses, you would see that they were run down.

that nobody had lived in them for six or 12 months, that there had been a foreclosure.

So the actual quality of these housing assets across America declined, even as the price for the same house also declined.

So there were two factors that drove this wealth destruction during the last major price correction, which was in the great financial crisis.

And so now, you know, if you look at what the mayor of Detroit has been talking about, there are taxes for investors who own blighted properties.

It's sort of a use it or lose it tax that you have to invest to make the property really livable, or you have to sell it because there's sort of a vacant property tax that's quite punitive.

And so that forces turnover in the marketplace.

Yeah.

And I mean, I think there's a broader issue here.

I mean, of course, I'm an advocate for turnover in the marketplace because we're a brokerage and we make money every time there's a trade.

But to me, it's bigger than that.

What has made the American experiment so dynamic is this idea that when Flint, Michigan goes through a downturn because we're just not making as many cars as we used to in America, people eventually move.

That is the story of the Okies going to California in a John Steinbeck novel.

But if you look at the likelihood that an American will live and die in the same town in which he was born, that is actually increased.

My Atlantic colleague Yoni Applebaum has a very important book about this called Stuck.

And

I think the figure that Yoni cites is, now, we're an older country than we used to be on average, so you'd expect a little less movement.

If you adjust for age, if you look at people in the equivalent age group, an American is about, if I remember Yoni's book correctly, about half as likely to move at their peak moving years than a comparable American was in the 1980s.

We're not talking about pioneer days.

We're talking about the 1980s when there were personal computers and airbags and cars

and a lot of channels.

Not so long ago, we were both alive then.

A lot of channels on TV.

Disco was dead already.

And in the 1980s, Americans at the peak years of moving were twice as likely to move as Americans in the peak.

And housing prices have to be a huge part because once you get a house, and especially when you move from a depressed area to a thriving area, the housing hit that you have to take to move from Flint to wherever the jobs are today is so terrible that people say, well, here in Flint, I may not have a job, but at least I have a roof.

Yeah.

And here's where I really will be teaching my book.

Redfin exists to lower the fees paid to a real estate agent.

If you couple the fees paid to an agent with the lender fees and the title and escrow fees, it's about half of your down payment.

And so there's this conventional wisdom that you need to live in a house for seven years before you offset those fees and get the appreciation necessary to make it a profitable decision to own a home.

And those fees should be half of what they are.

If you look at what it costs to trade a stock or what it costs to trade almost any other asset, All markets have become more liquid except the real estate market.

And real estate liquidity is more important to American society because it determines where we live, where we send our kids to school, who our neighbors are.

The demographics of the country are really stuck.

There is a lot of inefficiency in the housing market, and that can be fixed by technology and transparency.

I think so.

It's been a slow road to make real estate more efficient because it's a cooperative industry.

So, what that means is that you have one agent representing the seller and another agent representing the buyer.

And if you were to replace one of those real estate agents with some kind of chat bot, I think the other would take offense.

And so, nobody wants a disruptive real estate agent because you worry that somehow you'll lose access to the club.

And it still is a club that's running the U.S.

housing market, that gates access to the most exclusive listings in the best neighborhoods.

And so, I think people are very risk-averse, homebuyers are very risk-averse about working with different types of real estate agents.

And I am not one who thinks that the real estate agent will be automated out of existence.

I tried to do that when I first got into this business, but I do think that technology can make the process much much more efficient.

Redfin has proved that in part.

We charge half the fee.

Our agents are three times more productive, but we still only have about 1% market share.

And that's because people are skittish, skittish about working with a different kind of real estate agent.

Yeah.

I want to, as we wind this up, I want to deal with an argument that

you hear a lot.

If you like the work of Derek Thompson and Ezra Klein, you've seen them catch up to this argument with people who want to personalize the problems in the real estate market and say,

the problem here is not zoning laws.

The problem is not interest rates.

The problem is that builders are greedy.

They're wicked people and they are colluding in wicked ways to make housing less available to others.

And this is ultimately a cause for moral reform rather than technical reform.

I've put that in a kind of unsympathetic way because it's pretty obvious.

I don't think much of the argument, but let's hear from someone who's there and knows.

Is there any possible truth to the argument that what is going on here is some kind of conspiracy by home builders to oppress America?

I don't think so.

I mean, I've been to home builder conferences and,

you know, it's a bunch of guys wearing cowboy boots.

Most of them are Republicans, but they are trying to make money.

And the way that they make money is by building more houses.

And they are very much in favor of trying to build as many houses as they can.

So I think there's some hostility to rent controls because it makes it harder to build properties for rent.

But mostly these are people who are very pro-immigration.

These are people who are very pro-housing.

They got their clock cleaned in 2007 because they were building a massive number of units at very low price points with very skinny margins.

And you just have to have a little bit of sympathy for them.

You know, they're making a bet 18 to 36 months in advance of the demand.

They have to buy the land, they have to get all the materials, they have to get the labor and build the house.

And to stick their neck out that far, they have to believe that they're going to be able to get the project done.

And so when they encounter political resistance to that, they simply build somewhere else.

That's why there's been so much construction in Florida and Texas and less in some progressive states.

And so I do think the Derek Thompson-Ezra Klein argument that we should judge...

liberal governance by its ability to actually get things done and the simplest way to lower housing prices is to bring those builders back.

There's There's no conspiracy here.

They're just trying to figure out where they can build properties.

Let me ask, finish by asking you a little bit about change.

And

if we think of the house as a technology,

it's an especially conservative technology.

Human life changes rapidly, but people still want dining rooms or think they do, even though they don't eat in dining rooms anymore.

They want lawn even as it becomes ever more unaffordable and difficult to maintain.

And even as they move to climates where lawns don't make sense.

Lawn in Arizona, tough problem.

Where do you see the possibility of how we talked about the possible elimination of how the autonomous car might liberate us from the need to have a parking spot for every high-rise unit?

If there are autonomous cars and you don't need to own your own car, you don't need the parking spot.

Are there other places where the technology of the house, as we know, it could change?

I mean, do you put any stock on this idea that young people might be attracted to a kind of like clubhouse living?

where you own your bedroom, you own your bathroom, but you don't necessarily own your kitchen or your public spaces.

Do any of those technologies hold promise, or do you think that's a lot of lifestyle section talk, but people want, when they end, people want the house that they grew up in?

I do think it's a bunch of baloney.

You hear about it every once in a while.

And I'm just too old, David.

I think that people say that they're open to all sorts of alternative living arrangements.

And then they have a couple of kids.

and they want the same thing that everybody else does.

So the change in the floor plan that we've seen has been the second master bedroom bedroom because so many people now have their parents helping them raise their kids, helping them buy the house.

There's a lot of Nepo home buyers where the parents kicked in half the down payment and they just have an extra bedroom because they spend months of the year with that family helping to raise the kids.

So that's maybe the only major change in maybe the only major change in the floor plan.

And then the change in the process is you should just remember that as we talk about how to bring manufacturing back to America, there is one asset that has to be manufactured in America.

It's 20% of GDP, and it is the house.

There are different parties that have tried to do more of the construction in a factory where the house is built in one place and then shipped very short distances because the shipping is so expensive.

But the cost of construction and the speed of construction come down.

It's using lasers and all sorts of other computed-dated engineering techniques to build actually higher quality housing where it's just to a higher degree of precision.

There's just so much that we could do if we just made it easier to build houses.

I think we could lower the cost.

And of course, the offset on that has just been the labor.

It is a real issue that many of the people who build houses in America come from south of the border.

And I have wondered, because the new immigration policies, if we are going to see, especially as we talk about AI and worry that men especially can't find the kinds of jobs we had 50 years ago, if more

traditional Americans, non-immigrant Americans are going to move into the construction industry.

But that is going to be an issue.

We'll see how it goes.

Is there an immediate effect of immigration on making pending that rotation of the labor market?

There are sections of the house building process that, as I read it, are more immigrant driven than others.

Like roofers are more likely to be immigrants, especially illegal immigrants.

Drywalling is very much an illegal, and part of that is the date, it should be said to understand here what's going on, the dangerousness of the roofing job, which is one of the most dangerous jobs in America.

And so that tends to be,

and this is where there are some, there is maybe a moral story that you can invest in making the roofing process safer, or you can hire somebody who, if injured, has no right to complain.

And a lot of builders are attracted to option B.

A lot of homes, by the way, a lot of roofers, don't bang it on the builders, a lot of builders, and through a lot of buyers are voting with their dollars to tell

the builder, don't invest in the cost of making the roofing process safer.

Just hire someone who can't complain if he's hurt.

Yeah, well, I hope that isn't the only solution.

I don't know that it's just danger or even low wages or the willingness to do hard work.

There are also craft-level jobs that have been staffed by immigrants.

So, people who make cabinets, people who do electricity.

You know, Americans aren't going into trades at the levels that they once did.

And I think we should just account, at least for a moment, for the impact that tariffs have on housing.

It's not just lumber, it's appliances, it's a wide range of goods that are imported from outside the country to build the house.

And so

it's just a tough time to be a builder right now because there's so much volatility in the economy and these people are making long-term bets where they buy land years ahead of actually trying to get a sale.

And so if your whole supply chain and your labor market have been disrupted, it's just harder and harder to make that bet.

Okay, here's where I want to end.

I want you to think about someone who's 28, 30, 31, who's confident that they're going to keep their job for a little while.

So they don't have the immediate fear, I'm going to lose my job, which many people have right now.

But let's say you don't have that fear, but they don't own a home.

What's the outlook for them?

Can you say something hopeful to them about their path ahead?

And any advice for them about where they should be looking?

My hope is that for the first time in 2012, home prices are coming down.

And I think that trend is going to continue into 2026.

And so maybe time is on your side.

It also seems likely that rates are going to come down at least somewhat.

And so...

I don't think there's going to be some revolution that lets you buy a home for half the cost in three years.

But I do think that after years and years of home prices going up, at least since 2012, home buyers are going to get a break.

And I'm really glad that you are.

Thank you.

Thanks for talking to us, Glenn.

We're so grateful to you for your candor and your time.

Yeah, David, it's good to see you.

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sip of it.

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Thanks so much to Glenn Kalman for his fascinating insights into the U.S.

housing market.

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