I began my career in the housing industry in 2005 as an economist at the tip of the housing boom. It was a Gatsby-like experience during which mortgage credit flowed freely, home-price growth seemed unstoppable and the collective national euphoria was unmatched at any point in housing’s history.
As we all know, there was no shortage of misinformation and lack of transparency in the housing market at that time. Consumers were making the biggest purchases of their lives, but were essentially blindfolded without access to quality, up-to-date information about the real estate market.
But that was then. Now, homebuyers and sellers have more tools and information at their disposal than ever before. We realize it’s a tough market out there, but improved technology and increased transparency are making it easier to make tough decisions. Which brings me to why I’m here.
I joined Redfin because it is fundamentally changing how consumers buy and sell homes. Because of its trailblazing technology, Redfin has data that can’t be found anywhere else, including real-time demand numbers, agent insights and customer surveys.
Lack of data was a key contributor to the housing downturn. At Harvard University’s Joint Center for Housing Studies, I analyzed every aspect of the housing crash, including deteriorating mortgage underwriting standards, toxic subprime and nonprime mortgages, risky structured derivatives and lax regulation.
Though the roots of the housing crisis are complicated, the cause can be boiled down to one common denominator: bad choices.
Redfin technology empowers consumers to make better choices. Buyers face a limited selection of homes for sale, as well as bidding wars for the few homes that are for sale. But Redfin’s tour and offer insights help buyers decide which homes to tour and which bidding war strategies to use. Sellers still face the uncertainty of if and when to list and for how much. But Redfin’s Home Value Tool and Price Whisperer help sellers make their decisions based on real-time information. Redfin agents, armed with our technology and their expertise in their local markets, help consumers navigate these tough decisions.
It’s not just consumers who are facing tough decisions. Far from the snowcapped mountain and lake views of Redfin headquarters in Seattle, Congress continues to wrestle with how to reform America’s housing and financial markets.
This is an issue that I’ve researched extensively as a government economist helping to write Dodd-Frank financial regulations at the Commodity Futures Trading Commission and more recently as a senior economist at Bloomberg. I’ve talked with academics, industry participants, members of Congress and other policymakers about how to reform the mortgage system, and everybody has a different opinion!
Redfin is perfectly positioned to provide timely information to policymakers about the behavior of buyers and sellers that is crucial to the ongoing debate on housing reform. Informed market participants — be they businesses, consumers or policymakers — are able to make better choices. Consumer-centered data and analysis empowers them to do better because they know better.
If the promise of technology was only about providing better housing data, our job would be nearly complete. But the decision to buy or sell a home is not just about economics. It’s about emotions: A house is the most emotional and high-stakes purchase that most people will make in their lifetime. No matter how many data points, algorithms and economic models you overlay on the housing market, it’s impossible to commoditize a home.
Redfin is made up of passionate, determined people on a mission to make real estate better for consumers. The company has pioneered an end-to-end customer experience that combines technology with service. Engineers work alongside real estate agents to create software with the consumer, not the sale, in mind. This shared purpose and commitment is not only inspiring, it’s infectious. This is why I am so thrilled to join this team in the newly created position of chief economist. Redfin is a company with a heart that has its finger on the pulse of the market