Compass goes public, economy soars, Congress pivots on homeownership tax benefits and more
As we approach the end of yet another year, one of the biggest questions on most everyone's minds, especially those of us in the real estate industry, is "what is going to happen next year?" Brad Inman of Inman.com recently reviewed his past predictions about the real estate market, some of which came true and some not. Two years ago as we approached the year 2016, Brad Inman predicted that Donald Trump would be elected President of the United States. That obviously came true. Last year, Inman predicted that Zillow would expand overseas in 2017 and NAR would choose a woman CEO; didn't happen.
Inman was accurate about a soaring housing market and Redfin's public offering, but aside from that, 2017 didn't unfold exactly as he had anticipated. iBuyer Opendoor has grown but at a slower pace than previously predicted. This cautions his predictions for 2018.
So, here are Brad Inman's predictions for the economy and the 2018 real estate market:
1. Tax reform legislation which will be signed by the President by the end of 2017 will be amended in 2018 and Congress will give back the homeownership benefits that were excluded from the original bill. The National Association of Realtors (NAR) will be credited for using its strong arm tactics to manipulate the politicians.
2. Speaking of NAR, the powerful trade group will not squash RPR or Upstream. A fan of Bruce Springsteen, CEO Bob Goldberg will quickly discover that singing a new hit tune is difficult when the old band (trade group bureaucracy) controls the score and the set.
3. Compass real estate will successfully go public. In November 2017, the fast growing real estate technology company announced plans to expand into 10 new markets in an ambitious bid to grab 20 percent market share in the 20 largest U.S. cities by 2020.
4. Backed by Fidelity National Financial (FNF), Pacific Union Real Estate will expand outside California. This year, the San Francisco-based brokerage went on a Southern California buying spree acquiring Partners Trust, a luxury brokerage with 240 agents, on the heels of snatching up the John Aaroe Group.
5. Fidelity National Financial will merge its brokerage operations with its real estate software company holdings (Commission, Inc., Real Geeks and SkySlope), spinning off a NewCo and laying plans to go public in an effort to capture a Redfin-like tech/brokerage valuation (nearly $2 billion).
6. The StreetEasy data squabble will fizzle out with Zillow winning again. New York brokers will realize that their customers don’t give two hoots about the politics of data and just want their listings on StreetEasy.
7. Zillow will face some regulatory sniffing around about its Premier Agent ad placement program, which allows a Zillow agent advertiser to preempt the listing agent on a home listing. But the scrutiny will go nowhere. (Full disclosure; Brad himself was duped by this advertising slight of hand when he purchased a home this summer — calling who he thought was the listing agent but really a paid advertiser).
8. In 2018, Keller Williams Realty will do exactly what it did this year, grow like a weed.
9. Leading Real Estate Companies of the World (LeadingRE) CEO, Pam O’Connor, will retire. Describing itself as “a global community” of brokers and agents, LeadingRE is the best kept secret in town with 572 brokerage members and 130,000 realtors in 65 countries. O’Connor has been the master behind the company’s growth.
10. EBay, Google and Facebook will all expand their real estate business through acquisitions and investment. The real estate opportunity is irresistible.
BONUS: The economy and the housing market will grow like crazy. Job creation is at record levels; unemployment is at a 17-year low; wages are feeling upward pressure and companies are investing at a fast and furious pace. A backdrop of political uncertainty will not slow down the global economic thoroughbred that is galloping at a full run. Left in the dust will be housing affordability in many major metro markets, which will further galvanize local political activism and polarize more communities.
Fasten your seatbelt, 2018 will be a fun and scary but prosperous ride.