What needs to happen for housing market relief, according to Ryan Serhant

The Street

Celebrity real estate agent Ryan Serhant joins TheStreet to discuss what needs to happen in order for the housing market to cool.

Transcript

00:00So tell me, easy ratio, home affordability down, home prices up, if you got called into

00:12a meeting on how to fix this problem, what would your strategies be?

00:21Affordability and pricing is affected in three ways.

00:25It's supply, demand, it's interest rates.

00:27So number one is rates are just too high.

00:30So rates have to come down.

00:32That fix a lot of the problems because it will also fix inventory.

00:36A significant amount of the homes that should be on the market today, I think we're short

00:40like 2 million nationally, are just not coming to market because people can't afford where

00:44they want to go because rates are too high on the next purchase.

00:48So that's why we have a huge precedence in Florida.

00:52We list a home for $6.2 million yesterday, it's fully in contract by yesterday.

01:01It shouldn't be that fast.

01:02That's okay.

01:03Right.

01:04It's fine.

01:05And so I think as you have rates start to come down and as you have incentives get created

01:12in a lot of especially urban markets to create new housing, then affordability will become

01:18much, much better.

01:19There'll be more options for more people and you'll have more sellers go through that

01:23life cycle of moving.

01:24You have a whole baby boomer generation that's saying, I think I'm just going to stay because

01:29your loan is a financial asset.

01:31It's not debt anymore.

01:32But what about the supply side of that equation?

01:35Because I mean, we're here in New York and there are other places that have this problem,

01:39you know, not in my backyard.

01:40They come up with these plans to build more housing because we don't have enough supply.

01:44So how do we address that issue?

01:48Supply is getting better now, you know, even in some of the hottest markets in New York

01:51City and the entire state of Florida, you actually have supply ticking up for the first

01:56time in four years.

01:57So more and more people are coming to market as rates start to stabilize.

02:01So rates coming down, not going down to where we were pre-COVID, but coming to a point where

02:06people say, okay, this is the new normal.

02:09I'm either going to move or I'm not going to move.

02:11That creates more supply, more home builders going into the market as land prices hopefully

02:16start to stabilize and come down, brings more homes to the market and increases supply.

02:21Labor costs, construction costs, you know, material costs, costs of lumber, the cost

02:27of appliances.

02:28As costs stabilize, as inflation starts to cool, all of that is going to help create

02:33more supply.

02:34It's just not going to do it tomorrow.

02:35But we'll look back in a year from now, probably at this moment, we'll also be post-election

02:40and we'll say, okay, that's when it started.

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