This Week in Startups TikTok takes on Spotify, startup advice + US housing market w/ Redfin & Divvy Homes CEOs | E1523
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Aug 2, 2022 Glenn Kelman, CEO of Redfin, and Adena Hefets, CEO of Divvy Homes, dive into the challenges and dynamics of the current U.S. housing market. They discuss the impact of rising interest rates on affordability and home sales while exploring innovative rent-to-own models. The conversation also highlights how institutional buyers are influencing housing supply and prices. Additionally, they share insights on pandemic-driven migration trends and the future outlook for new construction and the rental market.
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Housing Market Complexity
- The housing market behaves differently than other markets (stocks, crypto) and is currently confounding.
- Factors like iBuyers, Airbnb, and remote work further complicate the housing market dynamics.
Housing Market Slowdown
- The June 10th rate shock marked a turning point for the housing market, leading to a significant slowdown.
- Pending sales dropped 20% year over year in July, indicating a bearish trend.
Affordability Crisis
- Rising interest rates significantly impact affordability, even with falling home prices.
- Increased mortgage payments due to higher rates reduce the amount of home people can afford.