Last week’s Southern California Housing Outlook event, hosted by Meyers Research, raised over $40,000 with combined ticket sales and sponsorships for HomeAid America. We were excited by the generous support from the sponsors, panelists, and attendees in raising money for the building industry’s non-profit housing provider for today’s homeless. Cautious optimism was the prevalent theme for the educational event and below are some key highlights from each of the three sessions.
ECONOMY SESSION HIGHLIGHTS
Kevin Gillen Ph.D, Chief Economist at Meyers Research, shared key trends in the national economy:
- Most Metro areas have not yet fully recovered their prices from the downturn
- California’s GDP is closely correlated with real estate activities (17% of GDP comes from real estate)
- California has a four month supply of unsold resale homes, significantly below the equilibrium point of 6 months
- California’s restrictive land use and environmental regulations force significant variations in cycle lengths and swings
- The housing recovery will continue in the US and California but California is limited by affordability
CAPITAL SESSION HIGHLIGHTS
Jeff Meyers, President at Meyers Research, evaluated the capital market through the lens of a private equity source, mortgage lender, and construction lender. Notable panelists included Dan Hanson – Executive Vice President National Production at iMortgage, Connie Emmitt-Stern – Executive Vice President Of Investments at Resmark Land and Housing, and David Petrone – Chairman at Housing Capital. Insights from the session included:
- Underwriting is getting a little easier
- Purchase loans are expected to increase in 2015
- Attached housing is part of the conversation now (and 50 to 75 unit projects are most easy to underwrite).
HOUSING SESSION HIGHLIGHTS
Tim Sullivan, Practice Leader at Meyers Research, moderated a lively conversation that included Doug Bauer – CEO at TriPointe Homes, Larry Webb – CEO of The New Home Company, and William Witte – Chairman and CEO at Related California. The lively debate touched upon the following topics:
- New Home Company and TriPointe went public to finance growth
- Related Communities has found that mixing affordable and market rate units works well and the consumer readily accepts the community
- The millennial will buy homes but generally they are delayed because of financial reasons. However, they will be buyers.
- The mixed use communities our industry has been building generally qualify as “healthy communities” (and have for many years)
Thank you everybody!