The David Frum Show

Episode: Why Housing Feels Hopeless
Air Date: August 13, 2025
Host: David Frum
Guest: Glenn Kelman, CEO of Redfin

Main Theme

This episode dives into the challenges, causes, and possible solutions regarding the current "hopelessness" many Americans feel about the housing market. David Frum and Redfin CEO Glenn Kelman dissect why both buyers and sellers are deeply dissatisfied, how generational and regional dynamics are shaping the market, and what policy and social innovations might offer paths forward—for homeowners and those still hoping to join their ranks.

Key Discussion Points & Insights

I. Setting the Context: The State of American Society (00:00–07:25)

• David Frum begins with a reflection on the 80th anniversary of WWII’s end, segueing into the need for democratic renewal and forward-looking hope, paralleling the optimistic projects America undertook post-war.
• He draws a symbolic connection between past American achievements and current national crises—including housing—highlighting risks to democracy and prosperity if structural issues go unresolved.

II. Market Overview: Why Both Buyers and Sellers Are Miserable (08:25–11:57)

• Glenn Kelman explains the unique situation where both sellers and buyers are unhappy:
  • Home prices are softening after nearly a decade of increases.
  • Interest rates remain high for new buyers, but 75% of existing homeowners have locked in low mortgage rates (<5%).
  • Transactions are at historic lows, with sales volumes not seen since 1997 despite a much larger population.
  • 35% of listings are sitting on the market for more than 90 days, signaling declining demand and liquidity.
• Quote:

  "On a per capita basis, we haven't seen the sales volume since 1997, when the United States population was about 30% smaller."
  —Kelman (08:48)

III. The Rate-Locked Dilemma & The Generational Divide (11:18–15:51)

• Pandemic-era buyers purchased at low rates and high prices, but now may owe more than their homes’ resale value. They can’t lower prices without taking a financial loss.
• Many would-be sellers can't afford today’s prices on a new property with high interest rates, so they're staying in place (“rate lock”).
• Millennials and younger Gen X now face longer waits for homeownership: the average age for a first-time homebuyer has risen from 31 to 38 in the past decade.
• Quote:

  "Many, many people in America, more than half of all Americans really couldn't afford to buy their own home at current interest rates."
  —Kelman (11:57)

• Quote:

  “Yeah, you're in the realest. You believe that Donald Trump is a builder.”
  —Frum (17:38, poking fun at Trump’s self-image as a developer)

IV. Regional Breakdown: Crisis Hotspots and Outliers (12:36–15:21)

• Florida: A “Dust Bowl” of today’s real estate market due to:
  • Soaring insurance costs (driven by climate change and hurricanes)
  • Volatile sales trends, especially with condos
  • State’s dependency on real estate for economic health amplifies swings
• Midwest: More stable, less wild pandemic price spikes.
• Sun Belt: Big swings, boom-and-bust cycles, especially in places like Austin, TX.
• West Coast: Slight recovery as remote workers are called back, reversing some pandemic migration.
• Builders are struggling, offering more incentives, and facing severe labor shortages.

V. Policy Fixes: Housing, Regulation, and the YIMBY Movement (15:51–24:47)

• There’s hope in bipartisan efforts:
  • Example: Sens. Tim Scott and Elizabeth Warren supporting regulatory reforms making housing approvals easier.
  • Shift in local/state politics as housing affordability becomes an electoral issue.
• Kelman argues for “Yes in My Backyard” (YIMBY) approaches: reducing regulation, expediting approvals, lifting restrictive zoning, and removing counterproductive rent controls.
• Quote:

  “I'm a yes in my backyard, yemby kind of politician. I really think America has to be good at building houses or the next generation is really going to be in a pickle.”
  —Kelman (16:48)

• Innovations like easing parking minimums and promoting accessory dwelling units in California have become politically popular.

VI. National Crisis: Spread of the "Bad Vibes Economy" (20:26–22:27)

• Housing woes are now felt nationwide, not just in coastal cities; remote work and “monopoly money” influx during the pandemic drove up prices even in previously affordable regions.
• Consensus is growing that the housing crisis needs national political action, not just piecemeal local fixes.

VII. Solutions for Governors: Direct Policy Recommendations (22:27–24:47)

• Reform single-family zoning to allow more density (apartments, condos).
• Speed up approval processes to make construction feasible.
• Remove counterproductive rent control policies that deter rental housing investment.
• Focus on the ongoing need to replace and update aging homes, not just build new units.

VIII. Housing as Deteriorating Asset & Local Blockages (24:47–27:55)

• Houses are physical assets that deteriorate; many become unlivable and drop out of supply each year.
• Overly tight rent controls or high renovation/carrying costs can keep vacant units off the market, worsening shortages.
• Examples from New York: Thousands of vacant, rent-stabilized units that landlords can’t renovate profitably.
• Detroit’s “use it or lose it” tax penalizes owners of blighted, vacant homes to spur necessary turnover.

IX. Lack of Mobility & Housing Liquidity (27:55–29:52)

• Declining geographic mobility: Fewer Americans move than even in the ‘80s, with homeownership barriers a primary cause.
• High transaction costs (agent, lender, escrow fees) make turnover difficult; Kelman argues liquidity/investment should be easier, as it is in other markets.
• Real estate remains inefficient, partially because of outdated market conventions and industry resistance to technological disruption.

X. Builders, Markets, & Misplaced Blame (31:01–33:21)

• Frum challenges the narrative that “greedy builders” are at fault.
• Kelman describes homebuilders as “pro-immigration, pro-housing,” and “trying to build as many as they can”; profit incentives push them toward production, not restriction.
• Quote:

  “There’s no conspiracy here. They’re just trying to figure out where they can build properties.”
  —Kelman (33:06)

XI. Future Innovations: What (If Anything) Will Change? (33:21–36:30)

• Despite new concepts (co-living, shared spaces), young buyers still overwhelmingly aspire to traditional homes, especially after settling down and starting families.
• The only major trend: second master bedrooms for multigenerational living ("Nepo homebuyers" getting family help and co-residence).
• Construction innovation has been slow; prefab/factory approaches could help, but face logistical and labor challenges.
• Immigrant labor remains vital to construction; decline in immigration and new tariffs threaten builder margins and project planning.

XII. Final Advice and Hope for Young Buyers (38:24–39:27)

• Frum asks: "What hope can you give someone in their late 20s or early 30s who wants to buy a home?"
• Kelman's response:
  • Home prices (for the first time since 2012) appear to be dropping, and the trend could continue into 2026.
  • Interest rates may dip—slowly making conditions better.
  • There's no “revolution” coming, but it may finally be a less hostile market for new buyers.
  • Quote:

    “[After] years and years of home prices going up at least since 2012, home buyers are going to get a break.” (39:09)

Notable Quotes & Moments

• David Frum on past American mistakes, echoing today’s housing crisis:

  "America is less the country it was in 1945 and much more the country it was in 1925 and 1935... The mistakes that brought the war into being, those are being repeated in 2025." (06:25)

• Kelman on market fundamentals:

  “About 75% of American homeowners have a mortgage below 5%. We're unlikely to see a rate like that anytime in the foreseeable future.” (11:57)

• On policy roadblocks:

  "The zoning laws that were popular on the right, the rental controls that were popular on the left, both of those need to go." (22:49)

• On builders and innovation:

  “They got their clock cleaned in 2007 because they were building a massive number of units at very low price points with very skinny margins. And you just have to have a little bit of sympathy for them...” (32:12)

• On the enduring American home ideal:

  “People say that they're open to all sorts of alternative living arrangements and then they have a couple of kids and they want the same thing that everybody else does.” (34:34)

Timestamps for Key Segments

| Timestamp | Segment | |-----------|---------------------------------------------------| | 00:00–07:25 | Frum's monologue on WWII and American renewal | | 08:25–11:57 | Market malaise: why buyers & sellers are stuck | | 12:36–15:21 | Regional deep dive / Florida and Midwest | | 15:21–18:56 | Generational aspects & political implications | | 20:26–22:27 | Nationalization of the crisis (post-pandemic) | | 22:27–24:47 | Policy steps governors should take | | 24:47–27:55 | Asset deterioration and turnover | | 29:45–31:47 | Market inefficiencies and technology | | 31:47–33:21 | Addressing “greedy builders” argument | | 33:21–36:30 | Housing as technology & construction innovation | | 38:24–39:27 | Final advice and hope for young first-time buyers|

Tone and Takeaways

The episode is pragmatic, candid, and at times wry—both Frum and Kelman blend sobering analysis with moments of hope and modest optimism. They steer away from easy villains, focusing instead on structural barriers, outdated policies, and missed opportunities for reform. Both speakers make clear: fixing housing will require difficult choices, regulatory humility, bipartisan cooperation, and a willingness for Americans—especially those who already have homes—to embrace change.

For listeners who missed the episode, this summary covers the hard truths, the honest debates, and the slivers of hope for the future of American housing.