How to ease America’s housing crisis, according to the Realtor.com CEO

Realtor.com CEO Damian Eales weighed in on what measures are needed to address America’s housing crisis, taking particular aim at excessive regulation. 

The U.S. has been contending with affordability and supply issues in its housing market for some time, making it difficult for people to purchase homes. 

“America is in a state of gridlock in terms of housing transactions where we’re really, for the last two years we’ve been hitting 30-year lows,” Eales said during a recent “Mornings with Maria” appearance. “That’s largely because of high interest rates. Most American mortgages – in fact, 70% of American mortgages – are below 5%, so prevailing rates are closer to 6.8%, perhaps even going up shortly. Sellers are very reluctant to sell because they’re going to have to refinance at a much higher cost.”

High costs of homes compared to income have also made it challenging for people to enter the market, the Realtor.com CEO said. (iStock)

High costs of homes compared to income have also made it challenging for people to enter the market, the Realtor.com CEO said.

IS THE US HOUSING MARKET BECOMING A BUYER-FRIENDLY MARKET?

In the U.S., there is a supply gap of 3.8 million homes as well, according to a report released by Realtor.com in March. 

Eales said Realtor.com was “optimistic that all of the moving parts of the economy will fall into place such that there can be easing of mortgage rates.”

The 30-year fixed mortgage rate came in at 6.81% on average the week of April 24, according to Freddie Mac. 

“But I would say that even if mortgage rates were to drop substantially, that would free up the market, but it certainly wouldn’t address this issue of a lack of supply, which the president is also trying to address in terms of freeing up federal lands,” Eales remarked.

High costs of homes compared to income have also made it challenging for people to enter the market, the Realtor.com CEO said. (iStock)

The Trump administration’s Joint Task Force on Federal Land for Housing was unveiled in March. The goal is to pinpoint “underutilized” federal lands that could be “suitable” for housing development as well as make land transfer processes smoother and promote measures to boost affordable housing, according to a memorandum of understanding. 

“It’s not just an issue for federal policymakers,” Eales said. “This is really an issue for state and local governments to free up the ability to build those homes.” 

He said federal and local governments need to ease regulations and get rid of costly red tape to help with housing affordability and supply.

“It is estimated that one-quarter of the cost of any new home in this country is due to red tape, so freeing up regulations. I think environmental regulations in many states throughout the country have been really weaponized to just prevent development of…