Jon Grauman
speaker
142 appearances
1 recordings
1 series
first heard Nov 2024
last heard Nov 2024
Jon Grauman’s voice in public audio — every appearance, attributed to the second.
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Appearances
Ultimately, we're gonna need, I think, several rate cuts in our rear view before we really get to the point where the market starts humming again. My hope is that that all sort of coincides with as we ramp our way into the spring selling season, which is always the most optimal time of the year.
And we have that ramp where if you look at it and go, this could really line up very well here where we have time for a few more rate cuts and all of that kind of ramps at the same time with the spring selling season and the market is really sort of poised to take off.
Let's go.
Well, again, we just established it's not directly correlated. So I think that while before, I'm sure that there's various different graphs that you can show wherein you can look at what the correlation has been between the Fed fund rate and mortgage interest rates. I think what we're experiencing right now
coming out of this historically high inflationary period is going to differentiate a little bit from that.
Yes, I think that's right. And you're hoping that will happen or how do you think that's going to I think that I mean, look, the Fed came out at what was it, I guess, the end of last year and said they were anticipating anywhere between four to six cuts this year. And, you know, we just saw the first cut.
So I know that they've talked about potentially reducing the federal funds rate by two percentage points next year. That would be tremendous if that happens. But we've seen in the past that it may veer off from that course. And I just don't know. Again, my feeling is that the housing market, the capital markets, they all benefit from obviously lower interest rates.
And I think that those markets are chomping at the bit and so poised to take off. I think that I'm very, let me put it this way. I'm uncertain of what the next 60 to 90 days might look like. I'm very bullish on what the next six to nine months are going to look like.
Okay, how so?
I agree with that. I think it'll be more measured, which it should have been from the beginning, right? If we look at the sort of reverse of this and how quickly interest rates climbed, it was the fastest and highest spike in history in such a short period of time. Why weren't they raising them a quarter per quarter? Just gradually ease our way into that.
The reality is I think that they got greedy. Things were too good for too long. And then they had to make more of a drastic correction. And, you know, that's just the world that we live in right now is sort of drastic extremes as the pendulum swings from one side to the other. But it's not good for markets.
Those are both great questions. And I think it's first important to just distinguish the difference between those two questions because they're two entirely separate issues. So it hasn't really affected the market because it's not meant to affect the market. These are internal policy changes that relate to the way we as real estate agents operate within our industry.
not how it's going to affect home values and home prices and the housing market in general. So that's one point. In terms of how it's affected the real estate industry, I think it's just new territory for everybody. I think everybody is really just in a place where they're trying to figure out, you know, is this... Is this the new world order or is this just business as usual?
Ultimately, what it really is, is a more circuitous route to the same destination, right? It's in most instances, I'm finding that it is still the seller that is paying the commission to both sides. It's just structured a little bit differently today. So the simplest way to explain this is that as a result of the NIR settlement, there were a couple of situations.
specific policy changes that went into effect. One of them is that agents are no longer allowed to advertise the commission that is being offered to the cooperating broker, i.e. the buyer's agent, via the MLS, which is somewhat ironic because that was one of the reasons the MLS was initially established, was actually to have a place to hold that information. It's no longer allowed to be there.
It does not mean that commissions can't still be offered there. It just can't be advertised. And the reason why they implemented that was to try to guard against something called steering. Because there was an argument made during the court case that some agents, some bad actors, let's say, in middle America were steering their clients towards listings that were offering higher commissions.
Now, that doesn't really play in a market like L.A. where I live and work because... It's about matchmaking. I've never once ever even thought about directing a client to a listing that's offering more commission and that somehow I was gonna make that the right house for them. It's about finding the right house for them and then the commission is dealt with separately.
That's not my job. My job is to never try to sell someone on what should or shouldn't feel like the right home for them. That's a personal decision that they have to come to on their own. My job is to help negotiate the best deal for them, to help be a steward that guides them through this very foreign process. But I've never... Let me put it this way.
I've taught clients out of buying many more homes than I've ever attempted to talk a client into buying. A lot of times it's like, trust me, this isn't the right house for you. There will be others. But I've never said like, you have to buy this. That's just not...
No, no. So there's a lot of faults with these new policies. One of them is it is now somewhat, I guess, counter-productively created a different kind of steering, where now agents are gonna call the listing agent and say, are you offering a commission on this listing? And if the listing agent says no, oftentimes the buyer's agent's gonna say, well, I'm not gonna show this property then.
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