An acute lack of affordable homeownership opportunities, another lawsuit challenging broker commissions and a Frank Lloyd Wright-designed house that changed hands for the first time since 1955. From the wild and wooly world of real estate, here are the hits and misses for the week of Dec. 25-29.
Miss: Elusive Affordability. One of the most depressing data reports this week came from Redfin, which determined that only 15.5% of homes for sale in 2023 were affordable for the typical U.S. household. This presents a drop from 20.7% in 2022 for a new record low; prior to the pandemic, more than 40% of homes were affordable. Redfin also noted there were 352,500 affordable listings in 2023, down 40.9% from 596,135 in 2022 and down from over a million per year during the prior decade. Here’s hoping for a 2024 where affordable homeownership options are more plentiful.
Miss: Another Texas Lawsuit? For the second time in a month, a lawsuit has been filed in Texas faulting the state’s real estate industry for how it structures its broker commissions. This new action is putative class action lawsuit that calls out the Texas Association of Realtors and more than 40 local-level realtor trade groups and state-based brokerages. The lawsuit claims the National Association of Realtors (NAR) was the “creator of the conspiracy” on how commissions are determined, although it is not among the organizations being sued. The fact there are two near-identical lawsuits in the state and a flurry of too-similar lawsuits elsewhere in the country could suggest that the real “conspiracy” is with the lawyers attempting to wreck too many real estate companies and organizations.
Miss: Anything You Can Do, I Can Do Better. And speaking of NAR, a pair of high-profile real estate professionals are reportedly trying to start their own trade organizations as an alternative. Jason Haber, a Compass real estate broker who became a vocal critic of NAR’s leadership in the wake of the organization’s recent scandals, said he was seeking funds to start a new trade group by mid-2024, provided that NAR’s troubles worsen and its future becomes perilous. And Mauricio Umansky, the founder and CEO of The Agency and a reality television personality, said he was planning to create an alternative to NAR. Who wants to bet that we’ll arrive at New Year’s Eve in 2024 with NAR still operating and these two vague efforts being long forgotten?
Hit: Take That, CCP. While many politicians are worried that Chinese President Xi Jinping will launch a military attack on Taiwan, the commercial real estate industry on that self-governing island is not losing sleep over Xi’s saber rattling. According to a report in the Taipei Times, commercial property transactions in Taiwan increased 2.8% to $4.46 billion this year, fueled primarily by the demand for offices and factories. When one compares Taiwan’s robust real estate environment to the dismal real estate miasma created on the mainland by the Chinese Communist Party’s leadership, it is easy to understand why Xi hates the capitalist democracy in Taiwan.
Hit: Doing the Wright Thing. A Milwaukee residence designed by Frank Lloyd Wright in 1917 that was listed in September for $1.5 million was sold this week for $1.7 million. The five-bedroom, 6,712-square-foot Prairie-style home, known as the F.C. Bogk House after its original owner, is the only Wright-designed residence in Milwaukee. This sale marks the first time since 1955 and only the second time since its construction that the house changed hands – the last time it was listed, it sold for $36,000.
And with this article, we close out our coverage year for 2023. Thank you very much for making our news site part of your must-read sources. We will back with more news on Jan. 2, 2024. Until then, Happy New Year!
Phil Hall is editor of Weekly Real Estate News. He can be reached at [email protected].