Ozymandias 2013 AEI 1.1

ozymandias, 2013

1. renter nation

Renters: +3.6MOwners: -2.8M2010 Census

Why Renter Nation is the New Normal

Basic Math, FY 2012

Tax Revenues$2.469 trillionminus

Interest on Debt $360 billionMandatory

Spending$2.525 trillion

Total$2.885 trillionequals

Shortfall -$416 billion

Discretionary Spending

Discretionary Spending

Federal spending on real estate?

Discretionary Spending

Our Elites Have Lost Faith

“Sustainable Homeownership”

MIDQRMFHAWTF

MID vs. MedicareQRM vs. Social Security

FHA vs. Section 8NAR vs. Public Unions

2.8% turnout rate2.8% turnout rate

Fight with Money?

Source: OpenSecrets.org

“the commission recommends

consideration of further modifications to

federal tax incentives for

homeownership to allow for an increase

in the level of support provided to

affordable rental housing”

let’s not forget our states and cities...

Property Taxes vs. Police Protection

Yes, but... The Fed!

The Fed will own more than a third of the entire mortgage market by 2014...and... two-thirds of the entire bond market with maturity over 5 years

this ride will come to an end

Renter Nation is the New Normal

Ah, but Millennials Are Coming!

2. generation screwed

Sure am Sure am glad I glad I

studied studied Business Business

and Italian and Italian in college!in college!

source: prosumer-report.com - http://www.prosumer-report.com/blog/2012/03/12/moneyless-millennials-and-their-new-lives-of-financial-dependence/

40%

NY FED ON STUDENT LOANS

“My debt is crushing my chances of purchasing a home.”

source: prosumer-report.com - http://www.prosumer-report.com/blog/2012/03/12/moneyless-millennials-and-their-new-lives-of-financial-dependence/

one of three

pent-up demand?

I can afford rent, but the dream of owning a home has become just as ludicrous as the one where I win the Olympic Gold Medal for figure skating. At 29, I no longer see home ownership as an option. I no longer see anything but renting in my future, and the only possibility is that one day I will be able to rent a home and pretend a little better than I do in this one bedroom apartment.

— Jennie Fernandez, 29Albuquerque, N.M

10 years ago, Steve Jobs, Johnny Cash, and Bob Hope were still alive.

Today, we have no Jobs, no Cash, and no Hope

X X X

What about the ones who are buying?What are they like?

The Elite Professional Class

So what do these elite young professionals

think of real estate agents?

HearItDirect Southern CaliforniaAUDIO #2

QuickTime™ and a decompressor

are needed to see this picture.

Ah, but... Family Formation!

60 / 40

“In one Manhattan ZIP code, for example, women account for 63 percent of 22-year-olds.”

Really?

Conclusions & Even More Questions:Knowns:

• Government support for real estate simply cannot last• Elites have turned against homeownership• Gen-Y Will Not Save Housing• Real Estate Agent: Loss of Value• REALTORS(R) Can’t Win the Fight Over Pie

Unknowns:

• Will Europe hold up? Will China?• How will new laws, new taxes, & new regulations affect

employment?

Black Swan Events:• Open warfare• Currency Collapse• Zombies

so... what do we do about this?

towards a solution

QuickTime™ and a decompressor

are needed to see this picture.

Gov. Chris Christie, February 16, 2011

“Our calling for greatness at this time, is to confront these issues, say them out loud, stop playing around, and not waste another minute.”

associations: reality check

#1 reason for joining?Access to the MLS

World Without MLS

crisis of identitycrisis of purpose

consumerist unionist activist

members are buyers

members are workers

members are activists

products and services

income protection

political power

competitorsloss of

franchiseapathy

Three Identities of Associations

few love youmost don’t care about you

some hate you

radical solutions for radical times

political actionpolitical actionpolitical action

old and bustedold and busted

The New Hotness

precinct by precinctempowering the local activist

your greatest asset:

members who are social

average: 190 friendsmedian: 100 friends

grassroots movement

members as precinct captainsleverage social connectionsinfluence homeowners

member

member

consequences:

intend to lose people

smaller, more focused, more engaged

divest non-essential operations

change in governance

If not now, then when?

If not us, then who?- Hillel the Elder

Questions?Comments?

rhahn@7dsassociates.com

@robhahn

973.869.9357