Unquestionably, real estate—particularly residential real estate—is an important issue to many of the area’s entrepreneurs. But internationally, many more people are coming into the D.C. region for reasons other than to be close to the federal government. To talk about that, and the growing community of immigrants that are coming here, and making their way in the residential real estate market is Lorraine Arora, chair of the Northern Virginia Association of Realtors.
ABERMAN: Well, I very taken when I had an opportunity a few weeks ago to learn that your group just collaborated with a few others, and went over to France to sell our region, and why people should come and locate here. You learned some really interesting stuff.
ARORA: Oh, it was absolutely fabulous. We didn’t know what to expect, but we know that a lot of people come into the area for reasons other than the federal government, as you said. This was the largest, and is the largest, trade fair, where we had a over 26,000 people that attended, and we had a booth—the Greater Capital Association of Realtors—along with D.C. Association of Realtors participating, and it was fantastic, because people are coming in for a number of reasons.
They don’t want the big monstrosities, there’s a lot of interest coming into this area. People want want to move here, they want to live here, they want to play. There are investment opportunities, and I was totally blown away, because they were from all over the country. It’s called MIPIM, and I’m not going to even try giving you the French version, but that’s what it is.
ABERMAN: It’s really heartening to hear that, notwithstanding the cloud that hangs over the town politically, that when you get outside the region and you go overseas, people are still able to see the positive aspects of, A, living in this region, and B, living in the United States. It sounds to me like you saw that a lot.
ARORA: Absolutely. It’s the American dream, and people still want to come to the U.S. I know way back when, when I came into this country, my parents couldn’t get a mortgage because they had no credit. So, they paid cash for their tiny little house. And when they bought their home, being involved in watching how the whole process played out, they got their realtor, who was someone from their church, and I saw things that could have been done differently. So, I decided to get into real estate, and get my license, because even though that was not my background, I wanted to make sure that when I bought a home, or my siblings bought a home, I’d do it the way I wanted it.
ABERMAN: What I love about that story, there are a couple of things. I love the self-made aspects, that’s just a story that echoes so many different ways here in the region, with so many people, but you know, it’s funny—I’ve had entrepreneurs come in and talk about why they started businesses, and they say exactly what you said: somebody gets PO’d because they see something done wrong. They say, you know, somebody has to fix that.
ARORA: Absolutely, absolutely. And that’s part of the reason why I even took over a chair. I was voted, but it’s making a difference. Making a difference in the lives of our members. We have over twelve thousand, almost thirteen thousand, members, and they want to earn a livelihood. And that’s important. If we can help them engage and make a living, then I feel I have accomplished something.
ABERMAN: So, when I think about what’s going on the real estate industry, there are technologists, and people who are launching businesses, that are trying, desperately, to mediate and take agents out of the equation, but it sounds to me, at least from your perspective, this is a craft and a calling.
ARORA: Absolutely. I was at a convention recently, the T3, it’s run by Stefan Swanepoel, and he had fantastic speakers, and every one said that traditional real estate is not going to go away. It’s going to be there. But how they practice real estate is going to be different. The internet has been one of our biggest challenges, because a lot of the information, we have opened the barn gates.
People can get information really very easily, but we, as realtors, serve a purpose, and that purpose is relationship building, and making sure that people get what they actually want. You can’t have a computer, or an algorithm define the house that you buy. You can to a certain extent, but that human aspect cannot be taken away.
ABERMAN: So, I agree with that, and a lot of the work I do around technology, people talk to me about algorithms and machine learning, and so forth, and you see it when you go into Amazon, and you make the mistake of buying a piece of Lego for your kid, and for the next twenty years, every time the Lego comes on the “you might like.” Well, I did when he was six, now he’s twenty-three. Algorithms are not good for that. People want to relate to people.
You know Lorraine, as I think about this market, and I think about the the power of home, two issues that comes up fairly frequently now, when I speak with people, one is housing affordability, and the second is, do the tax laws that have been put in place affect behavior? So, how you see this market right now? Is this still a market that people can get into?
ARORA: Oh, absolutely. Thanks for asking that. So, this is another aspect of what we, as realtors, do. We defended the mortgage interest deduction. They were trying to take that away, and in the past you could deduct up to a million dollars of interest. That has been reduced to a certain extent, to $750,000. I’m not a tax consultant, and the way they work it is likely different, but we were able to save that. That’s important, because everyone wants part of the American dream. People say, oh, the millennials don’t want to buy a home. They want to live in a condo. It’s affordability, and when they come out with a lot of debt from schools, they can’t afford it.
So we’re working with things to help them grow, and have a piece of the American dream, and they’re putting off having families and children. So, they’re waiting, and then they do move out to the suburbs, and have a home, and live there. So yes, the taxes did impact it. We didn’t have enough inventory, that has creeped up. Some of it is cyclical, but that has creeped up. So, the inventory is raised just a little bit. But if a house is priced right, and it shows well, it will sell.
ABERMAN: I really appreciate you coming in and taking the time. As I say, it’s really heartening to see a Washingtonian get out of Washington, go overseas, and be welcomed with open arms. I want to hear that more.
ARORA: Thank you so much for having me.
ABERMAN: Lorraine Arora, chair of Northern Virginia Association of Realtors.