Grading Time! The 2020 Predictions

Okay, so… let’s be honest here for a moment. 2020 was the Year of Black Swans. I mean, when I made my Seven Predictions for 2020, I didn’t have a global pandemic, government lockdowns, and the nastiest election in history on my list of things to consider. So I’m pretty sure I already know the score for this year, and it’s not likely to be good.

But still, one must soldier on, consoled by the fact that all of my predictions are sure to be wrong, or your money back! (Does not apply to VIP Subscribers.) It’s not as if I have a particularly good track record over the past five or six years, after all.

For those keeping track at home, my record so far:

With that said, let’s look at what I wrote last year and see where we end up.

1. Realogy Files Strategic Bankruptcy – NO

It should be clear that this made a lot of sense when I wrote it, but it did not happen for a variety of reasons. The biggest one, I think, has to be that COVID made second half of Q2 and Q3 amazing quarters for all things real estate. Realogy had an amazing Q3, and I suspect Q2 was already showing strength signs.

Plus, with everybody else getting caught up short in Q1 and Q2 with the pandemic, any kind of strategic urgency went out the window and was replaced by the strategic urgency of surviving the bug. Realogy did that, and then some.

The underlying issues (too much debt, not of their own making) remain, but there wasn’t the pressure to do something dramatic in 2020, what with all the other drama going on. So yeah, this one didn’t happen.

2. Regulatory Tsunami Hits Real Estate – NO

I’ll just say this: I think a regulatory tsunami would have hit real estate… if the entire country didn’t go on lockdowns starting in April. The NYS Senate, for example, postponed a lot of their hearings to the fall, and we all know how those went. Plus, the craziest election year in modern history so everybody in government was a bit more than a little bit preoccupied.

So I’ll just move this to 2021 predictions. Didn’t happen this year though.

3. Compass Implodes – NO & 4. The Era of Office Exclusives Begins – NO

I’m going to take these two together, because they’re related and because the reason why I got these wrong is the same.

I think an implosion was coming because of Ocho, which would have spawned the era of Office Exclusives, but… but the bug changed just about everybody’s priorities. I mean, when the country is on lockdown, real estate agents are fighting to be declared as essential, and the government is spending a trillion dollars… nobody is really thinking all that hard about Coming Soon and such.

At the same time, the same tide that lifted Realogy’s boat lifted Compass’s boat too. I rather think they had a fantastic Q3 and probably a very strong Q2, since Compass has some of the top producers in the industry.

So forget implosion and the era of office exclusives; I think the new world we live in now requires completely new perspectives on these two topics.

5. Massive Three Way Merger: Opendoor, Redfin, Move – NO

Yeah, just didn’t happen, even though it made a ton of sense. Again, COVID completely threw Opendoor and Redfin for a loop, and they were both just busy trying to stay alive. Had 2020 kept course with what we saw for the first 10 weeks or so… I think this was very possible, but not in the new world we find ourselves in today.

Then again… Social Capital acquiring/merging with Opendoor introduces a new player to the scene… so I may be moving a part of this to 2021.

6. President Trump Nominates Tracy Kasper as HUD Secretary – NO

Clearly, Trump did not nominate Tracy Kasper as HUD Secretary… which might partially explain why he lost (?) the election. If he had, he might have had a far stronger showing amongst suburban women voters. I mean, I rather think Kasper would have done a better job with that demographic than Ben Carson.

Okay, so that’s only the stretchiest of stretch partial explanations… and there was little chance I was getting this one correct even in a normal year but still… it really would have been fun. Oh, what might have been!

7. Zillow Ignites a Revolution in Mortgage – NO

I’m fairly convinced this is another COVID victim. I think Zillow fully intended to do this in 2020, because everything I wrote in 2019 remains valid.

Except… the one thing that COVID immediately did was to throw the secondary markets into turmoil. Remember what happened to the Jumbo market almost immediately? It disappeared for a while. The Non-QM market also nosedived as everybody ran for safety in the midst of an “unprecedented” situation. And of course, Zillow suspended iBuying completely for a few months since nobody knew if buyers were going to be allowed out of their own houses.

So let’s push this one off to the future; I don’t even know 2021 is soon enough for a return to normal (whatever that means today), so it might be 3-5 years out now.

So a revolution in mortgage is coming, and I still think Zillow is the company to bring that, but I don’t know when anymore.

Conclusion

Yep, 0-for-7, just like I thought. I’m blaming myself less this year, however, than I did in previous years when I went 1-for-7. Because like every company in the world that missed expectations, COVID is the perfect excuse. It might even be the actual reason for missing results.

Either way, as we prepare to say sayonara and good %*#@$ riddance to the Plague Year, I’m happy to report that Sunny and I have made it through, disease-free, and divorce-free. Who cares about going 0-for-7 when you’ve got that going, right?

2020 might have knocked us all down, just like it did my predictions, but we’ll all get up again. A little pandemic will never keep us down, unless we let it. Let’s not let it.

Be safe, be healthy, and be of good cheer everybody!

-rsh

 

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Rob Hahn

Rob Hahn

Managing Partner of 7DS Associates, and the grand poobah of this here blog. Once called "a revolutionary in a really nice suit", people often wonder what I do for a living because I have the temerity to not talk about my clients and my work for clients. Suffice to say that I do strategy work for some of the largest organizations and companies in real estate, as well as some of the smallest startups and agent teams, but usually only on projects that interest me with big implications for reforming this wonderful, crazy, lovable yet frustrating real estate industry of ours.

3 thoughts on “Grading Time! The 2020 Predictions”

  1. Huge COVID sized asterisk covers you on the 0fer. I think the prediction that matters most in 2021 is the extent to which I-Buyer gains traction in the coming year.

  2. Covid huh… Not likely. Maybe number one had a shot. But the rest mostly swinging for the fences. The yearly prognostications leave me shaking my head. They happen everywhere. Hello Inman! Brad’s little beauty about 50% share for the iBuyers was going to a classic giant heaping bowl of wrong.

    It’s like the classic horror movie where you are screaming at the kid not to go in the attic. Boom dead teenager. The trend to more outlandish predictions has a well… pretty predictable outcome. Love watching a good slo-mo trainwreck.

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