Listen
Show Notes
Today on Real Estate Backstage, the December CPI report shows inflation is going in the wrong direction, although the markets don’t seem to be too concerned … We take a look at Trump’s nominees for HUD, the FTC, and the DOJ’s Antitrust Division … EasyKnock announces that it will be closing its doors … And finally, we take a look at Zillow’s 2025 Consumer Housing Trends Report.
December Inflation Data
According to the Wall Street Journal:
“Markets seemed undisturbed by Wednesday’s inflation data, which showed consumer prices rising 2.7% in November from a year earlier, up from 2.6% in October … the data confirms an unsettling trend that inflation’s decline has halted, or at least stalled. Core consumer prices excluding food and energy rose 3.3% from a year earlier, similar to the pace at which they have been rising for several months now. Of particular concern was services inflation which, excluding energy services, clocked in at 4.6% year over year. That doesn’t seem like enough to discourage the Fed from plans to cut rates at its December meeting. As of Wednesday, futures markets were pricing in a 96% chance of that happening … Markets are betting that the gradual slowdown in hiring over the past few months makes the Fed still comfortable with some additional easing. Month-to-month swings in such factors as labor strikes and hurricanes have made the data somewhat hard to read, but the underlying trend is still clear: The three-month average for job gains is down to 173,000 in November from 243,000 at the start of 2024.”
Back in September, when the Fed first started cutting their benchmark federal funds rate, they signaled three cuts were likely by year-end, followed by four rate cuts in 2025. However, with inflation becoming increasingly stubborn since then, I’m not sure we’ll see as much easing as expected next year unless the labor market really starts breaking.
(Source: wsj.com)
Recent Trump Picks
According to HousingFinance.com:
“Scott Turner, a former Texas lawmaker and NFL player, is Donald Trump’s choice to be secretary of the Department of Housing and Urban Development … During Trump’s first term, Turner led the White House Opportunity and Revitalization Council, which aimed to enhance the coordination of federal economic development resources in Opportunity Zones and other distressed communities. Turner, 52, has been chief visionary officer at JPI, a leading Texas-based multifamily housing developer, since 2023. He also chairs the Center for Education Opportunity at the America First Policy Institute, a think tank that features former Trump administration staffers … If confirmed, Turner would take over HUD at a time when housing affordability has emerged as a leading issue in communities across the country.”
(Source: HousingFinance.com)
According to HousingWire:
“Many real estate professionals were hoping that Donald Trump’s victory in the 2024 presidential election would lead to a lessening of antitrust scrutiny on the industry by the Department of Justice (DOJ). But Trump’s recent nomination of Gail Slater — a veteran technology and media policy adviser — to lead the DOJ’s antitrust division is casting doubt on these hopes. ‘My gut tells me this isn’t going to be a good thing for us,’ said Steve Murray, the co-founder of RealTrends Consulting. ‘It may be neutral at best, which just means that everything pretty much continues.’ … ‘How this plays out remains to be seen as to focus on the realty industry, but those who believed there would be more of a ‘laissez faire’ philosophy at antitrust were certainly surprised by Ms. Slater’s nomination,’ Chuck Cain, an attorney and the president of Alliance Solutions, added. Prior to the nomination, Slater served as a policy adviser to vice president-elect JD Vance. During Trump’s first presidential term, she was a technology policy adviser at the National Economic Council. Slater is known as a bit of an antitrust hawk and has previously called for Google parent company Alphabet to be broken up. Like Vance, she has praised Federal Trade Commission Chair Lina Khan for her work going after Big Tech under the Biden administration.“
(Source: HousingWire.com)
According to the Wall Street Journal:
“President-elect Donald Trump on Tuesday selected Andrew Ferguson to lead the Federal Trade Commission, elevating a Republican lawyer who is likely to abandon the Biden administration’s liberal approach to policing mergers while keeping the heat on big technology companies. Ferguson, one of two current GOP commissioners on the five-member FTC, would succeed Chair Lina Khan, a progressive hero who sought to flex the commission’s enforcement muscle in ways not seen in decades. She challenged a range of mergers, as well as business practices by dominant companies.”
(Source: wsj.com)
DOJ Files Brief With Supreme Court
A couple of months ago, back on Episode 1 of the show, we covered the fact that NAR was seeking to escalate its case with the DOJ up to the Supreme Court… To make a long story short, NAR and the Department of Justice entered into a settlement back in 2020 in which the DOJ agreed to close its investigation into some of NAR’s practices, including the Participation Rule and the Clear Cooperation Policy (The Participation Rule stated that in order for a listing to be submitted to a NAR-affiliated MLS, the listing agent had to cooperate with other members and provide a unilateral, binding offer of Buyer’s Agent compensation) … However, the DOJ withdrew the settlement in 2021 after the Biden administration took over, and resumed their probe into NAR’s practices … NAR fought back after the DOJ withdrew from the settlement, and a District Court judge ruled back in January 2023 that the DOJ was bound to honor the 2020 settlement … The DOJ appealed that ruling last March, and earlier this Summer the Appeals Court sided with the DOJ … Most recently, in October, NAR filed a petition with the Supreme Court asking them to overturn the Appeals Court ruling.
According to RISMedia:
“The Department of Justice (DOJ) Antitrust Division appears committed to pushing forward with a long-running investigation into National Association of REALTORS®’ policies, despite the looming transition to a new presidential administration, continuing to defend its inquiry all the way to the Supreme Court. After sending a lawyer to speak at the final court hearing for NAR’s landmark settlement deal, the DOJ yesterday filed its first brief to the nation’s highest court, urging the justices to deny NAR’s request that they intervene and block the investigation … While NAR previously argued that allowing the DOJ to restart the inquiry set a bad precedent and could negatively affect trust in law enforcement in the future, the DOJ referred repeatedly back to the previous appellate court ruling, which focused on the “plain language” of the DOJ’s letter. “(B)ased on the plain language and various other aspects of that agreement, the court held that the government had made no commitment to refrain from reopening the investigation in the first place,” the DOJ wrote. It also spent time pushing back against some of the more technical legal arguments made by NAR, including that the agreement to close the investigation was an “illusory promise,” that the DOJ received favorable treatment and that the contract issues were improperly presented to the appeals court. NAR specifically claimed that the appeals court misapplied the “unmistakability principle,” a precedent that states contracts should not be viewed to “cede a sovereign right” of the United States government unless the government “unmistakably” waives that right … At the highest level, NAR’s appeal to the Supreme Court would appear to be a long shot, with that court only taking up a tiny fraction of appeals, and mostly focusing on urgent legal questions or inconsistent rulings by lower courts. The DOJ, in its arguments, claimed that this case is a “poor” example of the kind of issues the Supreme Court focuses on.”
(Source: RISMedia.com)
DOJ Ends Criminal Investigation Into Algorithmic Price-Fixing in Rental Markets
According to RISMedia:
“RealPage, a software and property management company which uses algorithms and data sharing to recommend pricing to landlords, claimed that a Department of Justice (DOJ) antitrust inquiry that focused broadly on algorithmic pricing practices in real estate has been closed, though it was not immediately clear how this would affect separate civil lawsuits against RealPage or other investigations into those same practices. According to a statement released by RealPage last Friday, the company ‘received notice that the…Antitrust Division has closed its criminal investigation into pricing practices in the multifamily rental housing industry.’ … In its announcement, RealPage continued to defend its practices, which include widespread sharing of pricing data among competitors, which the DOJ previously argued drove prices up.”
(Source: RISMedia.com)
EasyKnock closes its doors
According to Inman:
“Sale-leaseback platform EasyKnock, which faced consumer lawsuits and enforcement actions by attorneys general in several states, has closed its doors, the company announced Thursday … The news was first reported by NPR, which published a lengthy investigative piece on the New York-based sale-leaseback platform’s business practices in June … last month, the Connecticut Attorney General’s Office filed suit against EasyKnock, alleging the company ‘targets cash-strapped homeowners in need of financing who, for reasons of poor credit or excessive debt, may not qualify for financing.’ The Nov. 27 complaint, which detailed three instances in which cash proceeds allegedly equaled ‘just a fraction of the consumer’s total home equity,’ and accused EasyKnock of engaging in illegal practices as a landlord, sought to stop the company from doing business in Connecticut, as well as restitution and civil penalties … NPR documented consumer lawsuits against EasyKnock in Texas, Maryland, South Carolina, Pennsylvania and Ohio, and enforcement actions by attorneys general in Michigan and Massachusetts … Last year EasyKnock announced a deal to acquire power buyer Ribbon and launch a national marketplace, followed by a $28 million Series D funding round in February with Northwestern Mutual Future Ventures joining existing investors.”
(Source: Inman.com)
Consumer Trends
A couple of months ago, Zillow released a report with findings from a recent survey of buyers and sellers.
Leave a Comment