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Lawrence Yun, 
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38 Comments on Lawrence Yun, NAR Chief Economist ~ Spoke Today at Orange County Association of Realtors
Yun and his predecessors all do their best to spin a positive light on our industry despite how absurd it seems. This is a continuance of what I have seen from NAR for years. Does it help spur the market and inspire buyers? Based on results, no. Is it what NAR feels is best to bolster our industry, probably. Does NAR have much control or effect on our current state of affairs? Not unless they get given a bunch of cash from the bailout and do something wise with it. At this point, there's not much insight in what he said for those of us who follow this stuff regularly and deal with buyers who cannot qualify. Thank goodness on Kauai, we still have a handful of cash buyers and some wealthy folks.
What about the unemployment rates? Everyone wants to talk about consumer confidence. To me, the largest negative factor is that people are afraid they are going to lose their jobs and don't want to take on a major purchase. Why can't corporate America dig their heels into the ground and keep people employed? Yes, it might mean a tough budget crunch and shareholders might not be happy. But keeping people employed so that they feel confident enough to spend is another aspect of this floundering economy.
Good conversation and nice overview of Mr. Yun thoughts. I don't think anyone has a handle on what the future will bring however until we get the public to feel good they will be hesitant to go forward both on home purchases and any major decision.
The job losses are going to weigh heavily on the 2009 housing market. Great point there by Valarie.
As for Yun's comment about the financial crisis leading to the housing crisis, NOTHING could be more incorrect. Housing started melting down in Florida in 2005, when supply / demand issues combined with astronomical property taxes began to destroy that market. As foreclosures began to accelerate across the country, it landed the investment banks in trouble with MBS's which took down AIG due to credit default swaps, which insured those MBS's. These were investment plays based on the "hot" housing market. Yun still can't seem to grasp the real root problem here, which was housing affordability for owner occupants and real estate investors. Higher loan limits for FHA are still insane when buyers can't afford them. And buyers without jobs, or reduced job hours certainly do not need higher FHA loan limits. As usual this is a case of the blind leading the blind, and they have already fallen into a ditch. Yun and NAR have no credibility at this point, and have shown themselves to be no more than a self-serving union entity, playing the same old tune and hoping that the membership will continue to sing along.
A few comments...the tax credit will be for all buyers, not only first timers, but it will be lower than 15k max, just wait 24 hours or less...Yes, home ownership is the American Dream...the thing about dreams is that some people will not be able to realize them and we shouldn't be putting "programs" in place to make sure that EVERYONE does, that is partially why we are where we are...Giving bankruptcy judges power to re-write loans will hurt mostly everyone, especially future home buyers who will be paying a premium to offset the increased risk to banks but even more so the would-be buyer who will no longer be able to afford payments at these higher rates. Great post, thanks Harrison.
Good post Harrison. I have always enjoyed Dr. Yun for his comic value and rarely miss an opportunity to hear him at NAR meetings. During his most recent in Orlando his co-host Stefan Swanepoel disagreed (politely) right on stage. Since moving into the top seat at NAR he has missed the mark far more often than he has hit it. It doesn't help our credivility at all.
Having said that, I noted with some concern the number of people who said they wouldn't be paying their RPAC dues. People - that is our life force! You may not agree with everyting NAR does or says but don't cut off your nose to spite your face. In this political climate we're either at the table or we're going to be on the menu. You may not like Barney Frank, and you all know I don't, but the fact is he has done more for organized real estate in two years than we could accompish with Michael Oxley in the past decade. Regardles of your political affiliation, we are all members of the Realtor Party and we represent one of the largest grassroots special interest groups in the country. If you don't like something, it can be changed from the bottom up. Remember, it's not easy representing a united face for 1.1 million members as diverse as Realtors. Your input is critical.
Finally, to the gentleman who knows everything - please come back in a couple years after you have learned some PRACTICAL aspects of the industry. Your theoretical ramblings are almost as comical as Lawrence Yun's. Don't raise the GSE's - drop prices further - ahhahhahah. Maybe stand-up comedy is a better calling for you after all.
Gene ... thanks for your comment here and clarifying for others that RPAC is "that is our life force!" and that we must be with NAR and "at the table or we're going to be on the menu." Good metaphor.
And that "we are all members of the Realtor Party and we represent one of the largest grassroots special interest groups in the country." That's good also, and I agree.
My suggestion to those who are angry with NAR or Yun ... contact your Congressmen and Senators and President Obama and have them get this STIMULUS BILL 2009 right.
If you don't like what NAR is doing, get involved, work on committees, go to the meetings, write articles about localism and posting for educational value, and educate your fellow Realtors and agents.
Kevin ... thanks for your valuable comment here.
Let's wait and see what final proposed US Economy Stimulus Bill 2009 will be hen it comes out of conference committee between US House and Senate. Some people say that will be complete on Saturday, Valentine's day, delivered to Pres. Obama on Sunday, and then vote for approval by House and Senate on Monday, Feb. 16 ... Then to be signed as law by Obama.
I hope that the $15K income tax credit in this Stimulis bill will be for all home buyers. I agree with you that giving bankruptcy judges power to re-write loans will hurt almost everyone and is not the right answer.
Donna .. thanks for your comment here. I don't believe it's important whether we agree hat the financial crisis lead to the housing crisis ... or the other way around.
The MBS industury was completely unregulated and dumping money on Wall Street between 2002 and 2006, almost begging for more mortgage loans to feed the beast. Then housing affordability went down, then real estate sales slowed, then real estate investors stopped buying, and mortgage investors got scared left the MBS market, then financial institutions started to collapse, then foreclosures increased.
We are in real estate crisis as big part of our US economy. Question is how should that be corrected.
Please get involved at NAR and your local association and let them know your thoughts. We are in challenging times. Check out my other article at
We Need a US Economic Stimulus Package 2009 With Significant Housing Element
for discussion about what we need to be in the proposed US Economy Stimulus 2009. Also contact your US Senators with your thoughts.
Wow, Harrison, the hen is out and has turned into a goose who has laid an egg in the housing area...yep, zero. Is that the end of it? Can a home purchase tax credit somehow find it's way back in? It is not looking good, I think this is humble pie in a sense. Too bad.
Kevin ... it looks like you are right that he US Senate and House conference committee have removed the $15K income tax credit for homebuyers from the stimulus bill.
We have seen and will see better days in real estate than this.
Terry ... thanks for your comment here. We are in real estate crisis as big part of our US economy. Question is how should that be corrected.
Our challenging times and now and in front of us. Check out my other article at We Need a US Economic Stimulus Package 2009 With Significant Housing Element and let your voice be heard.
I think he is accurate on our current situation, but not on the ways to fix it. Thats why he won't make any predictions for 2009 possibly... he was wrong in 06 (like many others) because he is unable/unwilling to say things will continue to be bad. At least unlike in 2006, they are remaining silent rather than predicting that values will only go up.
You can offer 1% interest rate, $1 million conforming loan limits and otehr gimmicks... but until people feel safe about their jobs, they won't make long term purchase committments. Rates are already low, we are in an area with median prices well below the conforming loan limits and still purchase application volume is way down (Reuters reports an 8 year low this week). Slightly lower rates aren't much of a help and neither is a one time tax credit (that is really an interest free loan that you have to pay back).
The government/private sector need to focus on job creation and economic stability. Once that happens, buyers will be more motivated to buy a home.
WOW. Just read over on Lenn's blog that the 15k is out of the mix. Screwed again. These people don't seem to realize that, as Mitch McConnell said the other day - 'we've gotta fix housing first.' So 800+ billion and no housing stimulus. Gotta love them porkers.
If people are out of a job -- no income -- or fear imminent job loss, it doesn't mater how much of a tax credit you give them.
Was anyone at this conference surprised by what Yun had to say? If so that would surprise me. I would expect him to tell us (NAR members) something we don't already know! It really is a shame he holds the position of economist for NAR.
I do agree on the importance of the PAC. Not only do I contribute, but I am a legislative liason for CAR and chair of the Local Goverance Relations committee for my local board. I hope those of you who engaged in this debate let your voice be heard at the local and national level and not just here on AR.
Kathie ... thanks for your comment here. The debate in terms of what we need and want in the UC Economy Stimulus Bill 2009 ... is over for now. The bill passed yesterday and will be signed by President Obama on Monday, Feb. 16.
It's interesting to me that each of the Republican members of the US Congress voted against this bill and that recent polls show that many if not most Americans are against it.
The bill will not provide most of what NAR asked for. Let's see how this administration's approach to real estate will change or possibly stay the same.
Best wishes to you.
Larry ... thanks for your comment here.
It's true that those out of a job won't care much about tax credits. My concern would be about those who do have jobs. They are the ones that pay the income taxes. We needed and probably did not get a true ECONOMY STIMULUS BILL.
Gene ... you are right on. We needed to get HOUSING fixed first ... and the SPENDING BILL that we did get will not be fixing housing.
Please check back in here whenever possible and share your ideas.
Roland ... thanks for your comments here, and I see that you are involved in mortage business.
It's true that you can offer low mortgage interest rates and larger conforming limits and that people hesitate to make purchase commitmentss until they feel safe about their jobs. Let's hope that the $789 billion U.S. SPENDING BILL 2009 that we just got will help consumers feel better about that.