Hello everyone and Welcome to another

episode of Selling Greenville your

favorite real estate podcast here in

Greenville South Carolina I'm your host

as always Stan Mccune realtor right here in

the Greenville area of South Carolina

and you can find all of my contact

information in the show notes if you

need to reach out to me for any of your

real estate needs and just a reminder as

always if you enjoy the show if you

benefit from it please subscribe rate

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please support the show in that one way

I would greatly appreciate if

you guys could just take a second to

just do that today I'm going to be

doing a little bit of a different show

we just had on let's see here March

the 7th so just this past week

President Biden gave his State of the

Union and he had some very interesting

proposals for the housing market some of

which I like some of which I don't like

and as you guys know or at least you

guys that listen to the show with

regularity no I'm very involved with

politics very interested in politics I'm

kind of non- Affiliated I have

supported Democrats I've supported

Republicans I've supported Independents

I take my vote to whoever is

closest to my personal beliefs

politically which is not very many

politicians that are out there and so

I am not doing this to either support or

to trash our current president or to

throw support towards anyone else this

is simply me looking at what President

Biden said in his State of the Union about

housing and discussing what I think

about it because I think that they're

right right now I think that we're in a

very we're in an inflection

point and there is a lot of momentum

right now in Washington to make a lot

of housing-related things that have been

local for years upon years to make those

things National and some of that is

because of Washington trying

to absorb as much power as they can and

some of that is simply because there are

systemic problems that are nationwide

problems that local municipalities are

are simply not taking seriously or not

able to affect direct change

themselves and so we're seeing more and

more momentum for the federal government

to get involved in the housing market

they already have in multiple ways over

the past few years and of course we

already know what the Federal Reserve is

doing when it comes to mortgage rates

and and they obviously impact the

housing market a tremendous amount with

what they do but it's it's very

interesting when the in the State of the

Union the president discusses something

housing-related so I just want to

jump right in and discuss actually what

the president said and we're going going

to actually start by listening to what

the president said so if you're watching

on YouTube, I am going to share my screen

with the YouTube video and well hold on

one second I need to make sure I do this

right because there's a certain way I

have to do it where I share my sound

here we go share

sound all

right here we go I know the cost of

housing is so important to you if

inflation keeps coming down mortgage

rates will come down as well and the FED

acknowledges that but I'm not waiting I

want to provide an annual tax credit

that will give Americans $400 a month

for the next two years as mortgage rates

come down to put toward their mortgages

when they buy their first home or trade

up for a little more

space just for two

years

and my

Administration is also eliminating Title

Insurance on federally backed

mortgages when you refinance your home

you can save $1,000 or more as a

consequence for millions of renters

we're cracking down on big landlords who

use antitrust law using anti who break

antitrust laws by price fixing and

driving up

rents we've cut red tape so Builders can

get federally financing which is already

helping build a record 1.7 million new

house housing units

Nationwide now

pass now pass and build and renovate 2

million affordable homes and bring those

rents

down all right so there you go there you

heard it sorry if there was a little

bit of an echo when I spoke there

there I have never done the screen

sharing thing when it comes

to whoops, I just press the I just

pressed the video going again here sorry

about that I've never done the

video sharing thing so I apologize for

those of you on YouTube oh and it looks

like my audio just stopped let me fix

that

here if you're watching on YouTube

You're Going to get a little bit of a a

little bit of a inside look as to how

this happens because I'm have to start

over here with the audio if you guys are

are longtime listeners or Watchers

you know I do not edit the video on this

so what you see is what you get I do not

have time for video editing maybe

that'll come in the future but I'm going

to start over here with the audio for

for a split second

here all right so there you have it that

was President Biden's statements from

the State of the Union on the housing

market and what he intends to do in

order to fix it now I have several

thoughts about this but I want to

actually take his statement and his you

know all these little statements line by

line to discuss what I think about what

he had to say and here is what I think

just starting from the top so he starts

by saying I know the cost of housing is

so important to you he's he's speaking

to my generation really my

generation which would be the

millennial generation he's probably

speaking to Gen Z as well and he

knows he needs to get he's not pulling

super well with the younger crowd

particularly the under-30 crowd he needs

to get those votes up his speech if we

could take a little bit of an aside

from this being a show about Greenville

real estate just my personal opinion his

speech was kind of all over the map if

you're a below 30-year-old person you

probably liked half of what he said

perhaps and half of it you probably

hated but he knew that the cost of

housing was something that is going to

be a hot-button topic for a lot of

people and so I think it was wise for

him to address it he said if inflation

keeps coming down mortgage rates will

come down as well and he stated that

that the FED is in agreement with

him on that that goes without saying

now what he didn't say is that most

likely for all of that to happen is

the economy has to worst

right and we've talked about that if

you're a listener on the show you

already know that okay if inflation

keeps coming down mortgage rates will

come down as well true but impartially

true statement if I'm going to fact

check him on this now here's where it

gets interesting he said but I'm not

waiting I want to provide an annual tax

credit that will give Americans $400 a

month for the next two years as mortgage

rates come down to put towards their

mortgage when they buy a first home or

trade up for a little more

space this reminds me a lot of 2009 and

2010 when Obama with

unsurprisingly at that time Vice

President Joe Biden on his right hand

side President Obama did a first-time

home buyer credit as well at that time

to stimulate the housing market which

had gotten to the worst place that

had it had been in Generations they

did a tax credit now I don't know

exactly B Biden did not give a whole lot

of specifics right $400 a month for the

next two years as mortgage rates come

down if you buy a your first home or

trade up for a little more space not

a whole lot of meat on the bone when it

comes to that but let me just say

this okay in general giving people money

from the government

in order to purchase real estate is

great if you're a realtor right that me

as a realtor a part of my heart is

really happy to hear that right because

I know a lot of first-time home buyers

who are struggling and with regard to

the trading up portion of that that's

interesting I'd like to know more

details about that what exactly the

President wants to do I think the

president's relying on Congress to

really put more meat on the bone with

some of the stuff because the president

can't do it you know

unilaterally but that's also inter in

particularly you know for for people

that have only lived in a home for a

couple of years maybe they're they're

ready to you know get a little more

space to start a family could be

beneficial for them but I am against this

proposal 100% regardless of how it would

help me and unfortunately regardless of

how it would help first-time home buyers

because yes it would help them for the

next two years but what about after that

and I'm going to if you're looking on

YouTube I'm going to screen share again

here and we're going to look

at oh hold

on sorry the sound thing that I had

going

on man that's a that's a rough thing

there all

right all right let's try this

again all right if you're watching on

YouTube You're Going to be seeing that

I'm going to share my screen here this

time without sound so that you don't

hear the weird echo of my voice but

we're going to look at for a second here

the market stats that we always look at

but this time we're going to be looking

just at one quick thing pending sales

and we're going to go back to 2008 to

2009 now if you are able to look at this

graph you'll see that from 2007 to

2009 the pending sales were plummeting

Big Time big big big plummet as the

world financial crisis or the Great

Recession settled in we had the standard

seasonal bump that happened you know in

the spring and summer of 2009 still very

low still very depressed numbers then it

really went way way down towards the end

of 2009 and then you see this big bump

that happens in 2010 and then right

after that bump, it pets right back down

to earth and actually goes down even

further at the end of 2010

guess what that was that was the Obama

first time home buyer credit expiring

guess what happened it helped the market

for about half a year and then it

actually made the housing market worse

in the aftermath why because it provided

artificial demand artificial demand

never benefits the market right if

you're going to if you are going to

increase demand you want to increase it

organically Al do things that have

organic sustainable impact now

perhaps President Biden could argue that

because he's doing this for the next two

years and mortgage rates are in theory

going to come down during that time that

that this will that what

happened back in 2010 won't repeat I

disagree and the reason why I disagree

is because a-okay here's what happens

right when we saw that Spike what is

that Spike is literally

inflation right we are trying to contain

inflation so what I could 100% see is

that Congress passes something like this

the housing market then takes off as a

result perhaps in tandem with mortgage

rates coming down a little bit and

and then we see all of a sudden a bunch

of demand enter the home sales

market and home sales take off again

inflation in the real estate takes

off again and now the FED is in an odd

spot right because trust me they're

monitoring the housing data they talk

about it all the time if they see

housing inflation start to spike again

they're not going to lower mortgage

rates and so then what happens is

when this proposed tax credit goes

away then rates will be higher than

they should have been because the FED

without this tax credit the FED likely

would have lowered rates and guess what

then we're going to see a second housing

crash a couple of years from now I do

not want that I want us to take our

lumps now we don't need to spread out

the pain let's take our medicine now

take the pain now and not defer it to

people two years from now now maybe

if you're a first-time home buyer right

now maybe you do want to defer it

a couple of years from now I

completely understand it this is my

perspective you are free to disagree

with it for your own personal reasons

but I'm telling you for the nation as a

whole this is not a good proposal

although in theory, it could be a good

proposal for a select number of people

over the next couple of years but

guess what it might be good for you now

but if the market then has a crash in a

few years once that credit is over what

if you want to sell your home and then

move into a new home at you know

and trade up into a bigger home at

that point you might find that you're in

in big trouble then you might find that

your home has lost value due to the

government doing these things so

there's no guarantee that even for a

first-time home buyer experiencing the

the benefits of this credit that

President Biden is proposing that

that that that they would actually see

that benefit throughout their entire

life right there's a very real

possibility that a few years within a few

years that benefit would actually have

hurt them in the long run and you never

know if mortgage rates stayed are stayed

higher than they needed to be because of

something like this that can have a

downstream effect on the economy as a

whole on jobs you you might get a house

but you might lose your job so

there's a lot of considerations there

okay I wanted to spend the most amount

of time on that but there are some other

interesting things that he said he said

My administration is also eliminating

title insurance fees for federally

backed mortgages when you refinance your

home this can save you $11,000 or more

now I have a lot of questions about what

he meant by this is he saying that title

insurance is not going to be required

for federally back mortgages or is he

just saying that it's going to be free

or not as expensive and then the fact

that he only references refinancing I

wonder if he's only talking about did

President Biden mean to say that you

won't be able that you won't be required

to get Title Insurance on a refinance or

on a new home purchase all right let's

unpack this for a second what is title

insurance title insurance is a onetime

fee that you pay when you purchase a

home that essentially guarantees your

ownership in the home a closing attorney

here in the state of South Carolina

Title Company in other states they

will do a title search essentially

during that title search they're trying

to find does anyone else potentially

have

a right to ownership to the house

that you're purchasing so while you're

under contract that title search is

happening in the background and they're

going to be checking with the government

does the government have any leans on

your home tax leans things of that

nature does is are is your home in an

HOA does the HOA is the HOA owed any

money by the current owner and do they

have any leans or judgments or anything

of that nature so it's checking for all

of these things any entity that

could potentially have a claim to the

home that is under contract and being

sold the title insurance company

which in South Carolina is a closing

attorney they're going to be checking on

those things once they have cleared all

the all the title conditions and they

can say for a fact everything is cleared

this seller can sell to this buyer and

and let's pretend that you are the buyer

this seller can sell this home to you

free and clear right that's what that

term means free and clear of title

defects at that point then they can

when you close in the home they can

issue to you a title insurance policy

now title insurance is Believe It or Not

optional for a

buyer if you're not getting financing

you don't have to get it you should get

it right let's say that the closing

attorney or the title company missed

something and this has happened many

many times if they miss something and it

come and you go to try to sell the

property in the future you might have

some major problems trying to sell the

property if some kind of a title defect

is caught by a more thorough attorney

and now here you are needing to

clean your title and clear your

title of defects in order to sell the

home it's going to cost you a whole lot

of money in order to do that a whole

lot more than if you had just gotten

title insurance on the front end because

your title insurance will then go to

for you in that situation and

essentially I don't want to say

guarantee your ownership in the home

because it's not quite that simple

but they it acts as an insurance policy

to defend your ownership in the home

okay now when you get financing the

there's also a Lenders Title insurance

policy in addition to the owner's title

insurance policy the lenders title

insurance policy is

required and so you have to pay again

one time Fe for both of these when

you're getting financing and so this is

what the president is talking about

eliminating Title Insurance fees for

federally backed mortgages by which I

assume he means FHA and conventional

loans and as well as USDA and VA

and a handful of others so what does

he mean does he mean that you're you're

not going to have to pay for it twice

that you don't have to pay for an

owner's policy and a lender's policy

I would have no problem with that now I

understand why the lenders have their

their own policy but that doesn't

benefit you as a homeowner at all

you're just having to pay twice maybe

the lender should have to pay for it the

lender pays for it I'm sure they're

going to recoup their funds another way

so that might be a problem with this

proposal or maybe President Biden

is saying that they're going to cut

some kind of a deal with title insurance

companies in order to reduce these fees

I don't know if we're talking about

refinancing it here is where I think

this could be interesting if you

refinance a home you already own if you

already got a title insurance policy

when you purchase the home why do you

need to get a new title insurance policy

when you refinance well the lender would

say because you might have done a bunch

of shady things with your home during

the time that you owned it and we need

to ensure that you still own the

Home Free and Clear as you did before

obviously they're still going to do all

that title work and everything but let's

say the title work comes back and it's

exactly the same as it was before

when you got your title insurance before

why do you need to pay for a second

title insurance policy and at least

paying full price for it right it makes

sense that there could be perhaps a

price reduction or perhaps that

title insurance policy would simply

be issued

without there being any cost associated

with it since you've already paid for it

once before and nothing has changed in

your ownership since that time so

that's an interesting proposal I am in

favor of title insurance reform if it

benefits the consumer I think that

you know insurance companies as a whole

are corrupt in a lot of ways we

already know this but title insurance

is one of those things that is important

but probably a lot of title a lot of

unnecessary title insurance policies are

issued and probably as well m a lot of

fees associated with them could be

reduced and if the president wants to

propose something and Congress wants to

pass something I think that there is

some Runway there for them to make some

some good reforms that wouldn't have a

major major impact per se but that

would definitely save Americans a lot

of money like if you add up all

Americans there is the potential for

Millions I don't know maybe billions of

dollars I don't have the numbers in

front of me but there's a lot of money

that could be saved and I'm definitely

all for that as long as it's done the

right way and isn't just a well we're

going to move we're going to save money

by spending it somewhere else right I'm

not in favor personally of them using

taxpayer dollars to pay for these titles

insurance policies for different

taxpayers I don't want to see that but

if there's a way they could negotiate

this or perhaps reform some of the

government-backed loan laws I

think that there is something there

to happen so we'll see we'll see if

they do something about that now going

on with what the president said he said

for millions of renters we're cracking

down on big landlords who break

antitrust laws by price fixing and

driving up

rents all right not a big fan of this

language right I'm not saying that there

aren't big landlords who break

antitrust laws and who do price

fixing and driving up rents but usually

when people talk about this usually the

examples they give are bad examples not

real examples of actual antitrust laws

or price fixing antitrust laws being

broken or price fixing actually

happening in fact we're seeing

Nationwide rents coming down why because

Builders have built more Apartments the

past few years than they have in a very

very long time so there's really a

simple solution to rents going up

and to the cost of housing going up and

it's much better than the solutions that

the president has said up to this point

in the speech that we're going through

and that is simply to build right before

John McCain, it was drill baby drill if I

were running for president My slogan it

would not be a prop one but it would be

build baby build we need to build and

that will solve really almost all of

these problems it wouldn't solve the

title insurance insurance thing I think

that that's again I'm interested by

that proposal by the president but it

solves these other problems in my

opinion listen if big landlords are

price fixing and driving up rents

what happens if a bunch of new

apartments come on board now they can't

do that they can't do that right because

the now the free market steps in and

there's competition and the competition

destroys all those antitrust type of

issues that come up

interestingly

next Biden starts talking about those

things really he should have led with

this but of course he knew not to they

was smart by his speech Builders to put

this at the end but he said I've cut

red tape so more Builders can get

Federal Financing which is already

helping build a record 1.7 million

housing units

Nationwide that's great that is it

it's always good to cut the red tape

because there's tons of it tons of it

now I do have a concern about this that

I'll come back to in a second but I

want to finish the final sentence of his

of this section of his speech where he

said now pass my plan and renovate to

I my transcript here isn't exactly

accurate but he said something effective

now passed my plan to build and renovate

2 million affordable homes and bring

those rents down so the president does

understand that we do have a housing

shortage in the country and I'm glad

that he understands that however cutting

the red tape on Federal financing

side great start that's not going to fix

it and as we've talked about before

housing is a very very local issue and

what I really wish that the president

would have done in this section is I

wish that he would have addressed

nimbyism again most of you have

heard of this term but if you haven't it

means not in my backyard it's all the

people that are anti-development anti-

housing I wish that he would have

presented some St statistics to educate

the nimes because a lot of people

listening to the State of the Union are

Nimes and it would have been very useful

very helpful if they had actually heard

statistics to help them to understand

why their philosophy of anti-development

and anti-growth is robbing future

generations and hurting us right

now but the President he didn't

address that he simply you know most of

of the things that the White House that

and that Washington wants to do to try

to solve local problems they try to do

with a blunt force tool, they try to take

a massive Mallet and boom here we're

going to solve this issue well the

problem is that a lot of the problems

with development are zoning related

which is hyper local are Council

City Council County Council municipals

related to their governments and

their constituents and their concerns

and all of that and not related to

anything that the president can do

and so well I think it's a good start

that he addressed the housing shortages

indirectly he didn't say that there that

there were shortages he just said

they're building a record he likes he

likes to throw any I didn't count how

many times he said million or billion

but he loved to say words like million

and billion so any opportunity he had to

use those big words those big numbers he

was doing it that's what he did here he

did it twice 1.7 million housing units

and then 2 million affordable homes not

a whole lot of evidence that what

Washington is doing is actually helping

those things but if and helping to

develop more housing but perhaps cutting

a little bit of red tape on the Federal

Financing side will help but the

President needs to acknowledge that most

of the issues with building right now

are local issues and I

wish that that he would have said

something to that effect during his

State of Union Address

now as far as what Donald Trump's

proposals are I have not heard those

personally, with regard to this we'll see

if he says anything if he says anything

as well I'd be happy to discuss what

what he says he tends to be a little bit

less specific in terms of his

proposals than what Biden was in

terms of these proposals even though

these are still not especially specific

still a lot of questions that I have

but it's interesting I don't want the

government the federal government to get

too involved in the housing market

I think that that's a bad thing I

think that the Federal Reserve is

already well more involved than they

should be but I am in favor of the

president potentially doing things that

would eliminate red tape eliminate the

government being involved more than they

already are or providing or you know

eliminating situations where the

government is going to be involved

regardless but their involvement isn't

positive and there are ways to Curt tail

that involvement I'm not in favor of

just giving away money and causing

inflation to Skyrocket again in

the housing market so let's not do that

please please let's not do that that's

all that I have for today's episode

if you guys have any questions or

thoughts about any of that please let me

know or you can simply comment by

leaving a comment on YouTube or even

leaving a review feel free to comment on

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thank you for listening and we will talk

again next time