Money Rehab with Nicole Lapin

Episode: Is the Housing Market Finally Improving—Or Is It a State of Emergency?
Guest: Jon Grauman
Date: September 12, 2025

Episode Overview

In this episode, Nicole Lapin welcomes back one of her favorite real estate experts, Jon Grauman, to dissect the current state of the U.S. housing market. Together, they explore whether the market is showing signs of improvement or if it's spiraling toward a state of emergency—diving into rising inventory in major markets, affordability obstacles, government intervention proposals, and what it means for both buyers and sellers. Tackling both national trends and local anecdotes—especially in Los Angeles and fire-affected areas—the episode is packed with actionable advice and behind-the-scenes insight for anyone navigating today’s real estate landscape.

Key Discussion Points & Insights

1. A Vibe Check: The Market at a Crossroads

• Hyperlocal Variability:

  • Jon emphasizes that the real estate market is “hyper local specific”—what’s happening in L.A. might be very different from Miami, Boise, or Austin.
  • Quote:

    “It’s still a supply and demand issue…there’s still not enough supply to meet the demand.”
    — Jon Grauman [03:54]

• Inflation vs Home Prices:

  • Jon highlights a key overlooked problem—construction costs (labor, materials, debt) have inflated faster than home values, squeezing builders and leading to fewer new homes.
  • Quote:

    “The rate of inflation of construction costs is far outpacing the rate of appreciation in home values. That’s a collision course.”
    — Jon Grauman [04:45]

• Luxury Market Surprises:

  • L.A. is seeing a spike in inventory (about 50% year-over-year)—a big change after years of scarcity.
  • Higher rates have led many to stay put, locked in by low-rate mortgages, but life changes are now pushing more to sell.

• National Recalibration:

  • Pandemic-era price growth was unsustainable and markets like Miami and Texas are adjusting, but they’re still benefiting from migration out of cities like L.A. and San Francisco.
  • Quote:

    “In certain markets, that means we’re going to see prices start to adjust downward—and while that’s painful, it’s ultimately healthy.”
    — Jon Grauman [07:40]

2. Buyers vs Sellers: Challenges on Both Sides

• Neither’s a Clear Winner:

  • Buyers face affordability hurdles (high rates).
  • Sellers feel locked-in at low rates—move-up is expensive.
  • Quote:

    “People ask me all the time, is it a buyer’s market or a seller’s market? And it’s honestly neither. Both are challenged in different ways.”
    — Jon Grauman [08:30]

• Personal Timing over Market Timing:

  • The “is it a good time to buy?” question is best answered personally, not with market trends. Rate drops may simply crowd the market and drive prices up due to pent-up demand.
  • Quote:

    “It’s really about, is it the right time for you specifically to buy? Don’t let even interest rates make that decision for you.”
    — Nicole Lapin [10:30]

3. Can the Government Step In? State of Emergency & Policy Proposals

• Treasury Secretary Besant’s Emergency Proposal:

  • Calls to declare a housing state of emergency have circulated, including proposals for standardizing zoning, expediting permits, and cutting closing costs.
  • Jon is skeptical of the meaningful impact unless local governments actually carry through with reform.
  • Quote:

    “This is like trying to turn a very old, big, archaic ship.”
    — Jon Grauman [11:44]

• Cutting Closing Costs:

  • Jon finds most closing cost fees “BS” but points out that even eliminating some “is not going to move the needle in a measurable way” since they’re a small fraction of home prices.
    — [13:26-13:55]

• True Levers:

  • What’s really needed: builder subsidies, expedited permitting, reform of outdated codes, and scaling up modular housing (“house in a box”).
  • Quote:

    “Anything that contributes towards the cause, I’m all for. What we’re talking about doesn’t build more homes. And that’s what we really need.”
    — Jon Grauman [13:58]

4. Innovation on the Horizon: Modular Homes

• The Future is Modular:
  • Jon is bullish on modular construction as a scalable way to address supply constraints—most effective “where there’s more land.”
  • Quote:

    “Modular homes…this is the future of home building.”
    — Jon Grauman [14:32]

  • U.S. now has plants making modules domestically, less reliant on overseas imports.
  • Barriers: Not enough skilled GCs, design limitations, less suited for certain geographies (e.g., winding L.A. hills).
  • Opportunity: Faster, cheaper, and more disaster-resistant building in suburban/rural America.
  • Follow-up: For those interested, Jon's open to helping people explore this path.
  • Quote:

    “If somebody was interested, where would they start?”
    “jonGrauman.com…Reach out to me and watch this space.”
    — [17:00]

Notable Moments, Quotes, and Explanations

5. Realtor Commissions, The NAR Lawsuit, & Real World Negotiation

• What’s Changed?

  • Despite the splashy headlines, recent commission lawsuits have not really changed how fees are structured—just added some contractual and paperwork steps.
  • Quote:

    “It really hasn’t changed what the final outcome is… It’s a longer, more circuitous route to the same destination.”
    — Jon Grauman [17:58]

• Are Commissions More Negotiable Now?

  • Technically always negotiable. Custom is powerful—offering none to buyer agents makes a seller’s home less competitive.
  • On Negotiating Comms:

    “There’s plenty of discount brokers who’d be happy to take it at a lesser amount…But I try to obviously protect and guard my fee, which is my livelihood…”
    — Jon Grauman [20:19]

• Tactics in Tough Markets:

  • Personal touches may give buyers an edge (writing a heartfelt letter to the seller)—sometimes even in multi-million dollar deals.
  • Quote:

    “Buying and selling homes is very personal and very emotional…if you can connect with someone that can win the day.”
    — Jon Grauman [55:07]

6. Interest Rates: Myth vs Reality

• The Fed Doesn’t Directly Set Mortgage Rates:

  • Jon (and former guest, Fed President Austan Goolsbee) clarify that while the Fed sets short-term rates, mortgage rates are determined by long-term bond yields, inflation expectations, and market sentiment.

  • Quote (Austan Goolsbee):

    “There’s not one interest rate…there’s short rates…the Fed sets, and then there’s long rates which…influence mortgages…The Fed doesn’t set those.”
    — [25:05]

  • Jon agrees, adding uncertainty in the broader economy and political environment further complicate mortgage rates.

  • Quote:

    “Even if the Fed does lower rates…adjustment to mortgage rates might be minimal.”
    — Jon Grauman [27:18]

  • Nicole distills:

    “Long-term rates…the end of the curve is really a referendum on inflation…mortgages are more reflected on that than the 25 basis points the Fed might move.”
    — [27:59]

7. Fannie & Freddie IPO Talk

• Implications of an IPO:

  • Jon outlines the pros (capital, competition, innovation) and the cons (loss of government stability) of taking Fannie Mae and Freddie Mac public, noting their key role in middle American lending.
  • Quote:

    “They could raise capital…create more competition…But they’re also the backbone of the American lending institution for a long time.”
    — Jon Grauman [31:24]

• Government Conservatorship Analogy:

  • The U.S. government’s role since the 2008 bailout is compared to being a “backstop”—with $187 billion injected at the time.

• Anecdote:

  • Jon’s front-row seat as a mortgage broker during the 2008 crisis:

    “It was like having a front row seat for the end of the world…Most people don’t realize how close we were to the brink of total financial collapse.”
    — Jon Grauman [33:50]

8. Natural Disasters & the Real Estate Market

• Post-Fire Market Dynamics:

  • In fire-ravaged L.A., thousands of lots are set to hit the market, creating temporary over-supply and downward price pressures.

  • Quote:

    “We started to see about three, three and a half new lots hitting the market every day. That creates an oversaturation…and starts to apply downward pressure on values.”
    — Jon Grauman [38:09]

  • Land values are down 40-50%, except in the Huntington, which remains a prime location.

  • Builders are pushing to get first to market as eventual oversupply is expected.

• Buyer & Renter Tactics Post-Disaster:

  • After the fires, rental demand exploded; people were submitting rental applications before viewing properties to get an edge.
  • Quote:

    “The real estate community…probably worked as hard as we ever have for virtually nothing, which is fine…We were just trying to help so many displaced families find housing.”
    — Jon Grauman [50:36]

• Market Advice:

  • Even after disaster, basic principles of supply and demand rule: early buyers pay more, oversaturation moves prices down, and location remains key for re-building communities.

9. Actionable Takeaways & Tips

• Insurance: Don't Get Complacent

  • Examine and update your home insurance coverage for disasters—know what’s covered, understand scenarios, and make sure you’re protected.
  • Quote:

    “Most areas today are under threat of some type of natural disaster…Really check with your carrier, understand what your coverage is…prepare yourself for that doomsday scenario…”
    — Jon Grauman [53:13]

• Who You Work With Matters

  • Whether buying, selling, or renting, team up with an agent who truly advocates for you—especially during high-stress market events.

• Letter to Sellers: A (Legal) Personal Touch

  • No photos, but a sincere note may win out if offers are otherwise similar in a competitive market.

  • Anecdote:

    “One of the biggest deals I closed…was in multiples…Had them write a letter that spoke to the sellers…and they accepted the lesser of two offers.”
    — Jon Grauman [56:16]

Timestamps for Notable Segments

• [03:54] – Jon’s market “vibe check”: local specifics, supply & demand, inflation outpacing appreciation
• [07:40] – Patterns in major market corrections and recalibration
• [08:30] – Buyer vs seller challenges in today's market
• [10:30] – Why timing your next move is a personal, not market-driven, choice
• [11:44] – Jon's skepticism of government emergency proposals and reforms
• [13:26] – Why lowering closing costs won’t fix the housing crunch
• [14:32] – Modular homes and construction innovation as the best hope for building more
• [17:58] – Realtor commissions: NAR lawsuit fallout and the reality of negotiations
• [20:19] – On commission negotiation: value, service, and “discount brokers”
• [25:05] – Austan Goolsbee: Fed rates vs mortgage rates explained
• [27:59] – Nicole and Jon explain long- vs short-term rates, mortgage impacts
• [31:24] – Jon’s take on the Fannie and Freddie IPO debate
• [33:50] – 2008 crisis, government conservatorship, and financial system stress
• [38:09] – Post-fire real estate: market saturation, builder strategy, and pricing uncertainty
• [53:13] – Jon’s three practical tips: insurance vigilance, disaster-resistant building, and working with the right agent
• [55:07] – Using personal letters (without photos) to stand out in competitive offers

Episode Tone

• Conversational, clear, and accessible (“the only financial expert you don’t need a dictionary to understand”)
• Warm, honest, occasionally irreverent, with real-life anecdotes and gentle humor (e.g., “If you want to buy a sexy modular home…”)
• Deeply empathetic when discussing disaster recovery and displacement

For the Listener: Core Takeaways

• Supply & Demand Rules—the core law even in chaos; watch how inventory shifts, and learn your local trends.
• Time Your Buy/Sell to Your Needs—Don’t just chase rates; act when it’s right for you.
• Don’t Trust Hype Over Substance—Big policy moves, lawsuits, or even rate cuts often only tinker at the margins.
• Protect Yourself—Know your insurance, have disaster contingencies, and choose experts carefully.
• Bring a Personal Touch—In crowded markets, personal stories and relationships can still give an edge.

For more from Jon Grauman: Visit jongrauman.com
Got questions for Nicole? Email moneyrehab@moneynewsnetwork.com