America’s Housing Crisis Recap
The Zillow team is back home in Seattle after hosting our first housing forum “America’s Housing Crisis: Private-Sector Responses and Public Policy Innovation” in New York City, along with Columbia Business School and the Progressive Policy Institute.
The global housing market, foreclosures and government’s role in housing were the hot topics of the two-day event, which kicked off last Wednesday night with presentations from Nobel Prize-winning economist Joseph E. Stiglitz and Chairman of Hang Lung Properties, Ltd. Ronnie Chan.
The next morning, Zillow CEO Spencer Rascoff welcomed attendees, speakers and panelists at the Grand Hyatt in New York. Zillow Chief Economist Dr. Stan Humphries kicked off the presentations with a look at the current state of the housing market. His presentation can be found here, on the Zillow Research page.
He was followed by Rep. Jim Himes, a Democrat from Connecticut, who told the crowd to watch Congress in December — after the elections. Among other topics, the mortgage interest deduction may be back on the table then. Himes doesn’t expect it to go away, but the deduction for second homes may be on the chopping block.
Foreclosures — and consumers’ appetite for them — were the focal point of the first panel. The Wall Street Journal’s S. Mitra Kalita facilitated a discussion on private-sector responses to the housing crisis. Foreclosures remain a large part of the market, and panelist Laurie Goodman of Amherst Securities Group expects 7.5 to 9 million more to come before the crisis is over.
Those should be dealt with quickly, said Realogy head Richard A. Smith.
“I can sell as much as you can give me,” he said of foreclosures. Foreclosure inventory is currently stuck in a “bureaucratic mess,” being warehoused by banks, rather than marketed to sell. But the appetite for foreclosure inventory is large, and it’s possible to accelerate the process, he said.
The Progressive Policy Institute’s Jason Gold moderated the second panel on public policy innovation in the housing sector. Much of the discussion centered around what the government could have done. Columbia’s Chris Mayer — one of the organizers of the forum — said the government’s role in a financial crisis should be to return function to the credit markets as much as possible. That didn’t happen this time, and it represented government’s biggest failure.
Of course, the discussion was much more in-depth than what can be captured here, so we’ll be posting a video of highlights next week.