Real Talk Real Estate with David Greene: Episode 38 Summary

Title: Tariffs & The Future of The Economy
Release Date: March 10, 2025
Hosts: David Greene and Christian Bashelder

Introduction and Context

In Episode 38 of Real Talk Real Estate with David Greene, hosts David Greene and Christian Bashelder return after a brief hiatus caused by David's cross-country move. The episode delves into the current state of the economy, the impact of federal job cuts, and the intricate relationship between tariffs and the housing market.

Impact of Federal Job Cuts on the Housing Market

David opens the discussion by addressing the concerns surrounding recent federal job reductions, possibly influenced by policies implemented by high-profile figures like Elon Musk and former President Donald Trump. He highlights the vulnerability of regions heavily reliant on federal employment, particularly the greater Washington D.C. area.

David Greene [02:14]: "There's a surge of people without work now... housing that is available on the market... turns it much more in the favor of the buyers."

Christian echoes these sentiments, noting the increasing number of homes for sale in D.C., which currently stands at around 18,000—a figure that may have grown since.

Christian Bashelder [02:14]: "The D.C. metro... is in a weird position right now... there are going to be a big shakeup probably though, in federal jobs."

Housing Market Dynamics: Supply and Demand Shifts

The hosts explore the ramifications of a saturated housing market, where the supply of homes exceeds buyer demand. David warns of potential price drops as sellers compete to attract limited buyers, drawing an analogy to an avalanche triggered by increasing layoffs and reduced consumer spending.

David Greene [04:30]: "This is the most worried that I've been in over a decade that we could be watching ourselves slipping into housing prices falling and potentially a recession coming."

Christian adds that such dynamics are not confined to D.C., as nationwide measures could lead to broader economic consequences affecting housing markets across various regions.

Tariffs Under the Trump Administration: Boosting Domestic Manufacturing

A significant portion of the episode is dedicated to understanding President Trump's tariff policies and their expected impact on the economy and real estate. David explains tariffs as a means to make imported goods more expensive, thereby encouraging domestic production.

David Greene [10:07]: "President Trump has talked about these tariffs... it's basically a way of charging a country who sells their items in your country extra so they can do it."

Christian discusses the potential geographic shifts in manufacturing, suggesting that jobs may migrate to the Midwest where operational costs are lower compared to expensive coastal regions like California.

Christian Bashelder [14:47]: "There is a growing consensus that... we might see a resurgence in productivity and more people getting into the workforce."

Opportunities for Real Estate Investors

The dialogue transitions to the implications for real estate investors. With manufacturing jobs possibly increasing in more affordable regions, there emerges an opportunity to invest in these emerging markets where property prices are lower, and demand for housing might rise as populations shift.

David Greene [18:18]: "If it does happen, I would definitely keep an eye out for opportunities to buy in those markets where they are more affordable."

Christian concurs, emphasizing the untapped potential in markets like Kansas, which have traditionally been overlooked by investors.

Christian Bashelder [18:18]: "We might see a surge in people who see that as a normal alternative... it might actually be a thing that could happen."

The Role of Trade Education and Blue Collar Jobs

A pivotal discussion revolves around the resurgence of blue-collar jobs as viable career paths. Both hosts advocate for trade education, citing examples of young professionals bypassing four-year degrees for trade certifications that offer substantial starting salaries and robust career growth without the burden of extensive student debt.

Christian Bashelder [20:49]: "There's going to be an exodus of blue collar workers... trade school route can potentially put them ahead in life from income at an early age."

David emphasizes the economic benefits of a more industrious workforce, highlighting increased productivity and reduced dependency on imports.

David Greene [21:35]: "We have this problem of everything becoming expensive because there's fewer people that are actually being productive and on our economy."

Conclusion and Future Outlook

In wrapping up, David and Christian reflect on the dual-edged nature of current economic policies. While short-term challenges like job cuts and housing market instability pose significant concerns, the long-term outlook suggests a potential stabilization and growth in more affordable regions. The hosts advocate for adaptability and strategic investment to navigate the evolving real estate landscape effectively.

David Greene [24:26]: "I would think this will be very healthy for the real estate market. We might get a price correction that makes it relatively affordable to get into it."

Christian adds optimism about the infusion of motivated young professionals into blue-collar industries, ensuring sustainability and innovation within these sectors.

Christian Bashelder [23:07]: "We're getting good minds, you know, motivated people in that are taking over these businesses from retiring, you know, 60, 70, 80 year olds with some energy."

Key Takeaways

• Federal Job Cuts: Potentially leading to increased housing inventory and decreased prices in areas like D.C.
• Tariffs and Manufacturing: Trump's tariffs aim to boost domestic production, possibly shifting manufacturing jobs to the Midwest.
• Real Estate Investment Opportunities: Emerging markets in more affordable regions present new avenues for investors.
• Trade Education: Growing emphasis on trade schools as viable, lucrative career paths for younger generations.
• Economic Outlook: Short-term instability may pave the way for long-term growth and stabilization in the real estate sector.

Notable Quotes

• David Greene [04:30]: "This is the most worried that I've been in over a decade that we could be watching ourselves slipping into housing prices falling and potentially a recession coming."

• Christian Bashelder [20:49]: "There's going to be an exodus of blue collar workers... trade school route can potentially put them ahead in life from income at an early age."

• David Greene [24:26]: "I would think this will be very healthy for the real estate market. We might get a price correction that makes it relatively affordable to get into it."

This episode offers a comprehensive analysis of the interplay between federal economic policies, job markets, and the real estate landscape. David Greene and Christian Bashelder provide insightful perspectives for investors, professionals, and enthusiasts looking to navigate the complexities of the current economic climate.