Monday Morning Cup of Coffee: Trump expected to dilute Dodd-Frank in 2018

Monday Morning Cup of Coffee: Trump expected to dilute Dodd-Frank in 2018

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Monday Morning Cup of Coffee takes a look at news across HousingWire’s weekend desk, with more coverage to come on bigger issues.

2018 is off to a bang, with leading economic indicators moving up and up.

At what point will the labor shortage begin to drag construction? Probably sooner than we think, looking over analyst reports over the weekend.

Is there anything we can do to stop it? Probably not.

President Trump recently got tax reform on the line and looks to start racking up victories, so supporting the labor market (we all know that looser immigration, not tighter, helps solve ^^^ our problem up there) won’t be near the legislative agenda.

So what is? Analysts at Goldman Sachs think two issues will be the subject of reform in 2018.

“First, a few smaller issues stand a good chance of enactment,” said the global analytics team in an email to clients. “Among these are health legislation that would incrementally stabilize the ACA and banking legislation that would make incremental changes to the Dodd-Frank Act.

So, say “Adios, Dodd-Frank,” Goldman says the president is coming for you.

Here’s the rest of the prediction:

“Second, Congress faces new fiscal deadlines. Spending authority expires January 19 and the debt limit must be raised by March. These deadlines could lead to near-term uncertainty but are also likely to lead to some additional fiscal stimulus. We expect spending caps to be lifted and a third round of disaster relief funding to be approved as part of the process.”

Keep in mind, Goldman makes bad decisions from time to time; Read on.

Nearly a year ago, Softbank Group announced an agreement to purchase real estate investment powerhouse Fortress Investment Group for $3.3 billion in cash.

That was a good move. But, investing in The Weinstein Company?

Distressed film producer The Weinstein Co. is nearing a sale for less than $500M, The Wall Street Journal reports, and shareholders might lose all their equity in the deal.

Without getting into the controversy surrounding the embattled Weinstein name, let’s just repeat that last line…. Shareholders in The Weinstein Company might lose it all.

Who are the investors in that company who also invest in housing finance? Well, both Goldman Sachs and Softbank are investors, and they could lose it all.

This is what we finance journos refer to as a “black swan.”

Speaking of major overhauls, the largest full-service residential real estate services company, Realogy, made several key organizational and executive leadership changes across its business units. 

“We begin 2018 with an industry-leading market position, great brands, and technology/data scale,” said Ryan Schneider, Realogy’s chief executive officer and president. “The organizational changes we are making today are designed to accelerate our transformation and position our company for stronger business performance.”

Toward those objectives, Realogy made the following, seven, major organizational changes, announced in a statement:

  1. Ryan Gorman was named president and chief executive officer of NRT, a residential real estate brokerage subsidiary of Realogy Corporation.
  2. Bruce Zipf, the former president and chief executive officer of NRT, has transitioned to the role of executive advisor to Realogy’s CEO.
  3. John Peyton, president and chief executive officer of Realogy Franchise Group, the company’s real estate franchise services segment, will expand his responsibilities to include oversight of two NRT businesses: the Corcoran businesses and the company-owned Sotheby’s International Realty brokerages.
  4. Realogy expects to announce the appointment of an executive vice president, chief technology officer in the next week, replacing Stephen Fraser, who previously served as senior vice president and chief information officer.
  5. Realogy has launched a search for a new president and chief executive officer of Cartus Corporation, the company’s relocation and affinity services segment.
  6. Kevin Kelleher, the former president and chief executive officer of Cartus, has transitioned to the role of executive advisor to Realogy’s CEO. 
  7. Scott Becker, who currently leads Cartus’ affinity business, will serve as the interim leader for Cartus.

Aaaannnddd speaking of that labor shortage, you know, where not enough homes are being built? Well, Business Insider wrote a report about how San Francisco is solving its own housing shortage crisis.

Nope, they didn’t throw more workers and money at the issue, instead Silicon Valley came up with the following bright idea:

HomeShare is a startup that leases apartments in expensive new buildings and splices them into additional units, so more tenants can split the rent for less per person. A two-bedroom becomes fit for three after HomeShare installs an upholstered partition in the den.

Melia Robinson writes that in 2017, San Francisco renters paid an average price of more than $3,000 a month.

“People come here for opportunity, not to spend tons of money,” CEO Jeff Pang said.

About half of HomeShare customers are recent transplants who are “shell-shocked” by the rent prices. And the converted living rooms are the most commonly requested units because they’re the cheapest, according to Pang.

HomeShare, like any good real estate business, is already looking to expand into new markets.