New: 🧠 Market Minds Issue #136

We appreciate each and every one of you for taking the time to read Market Minds. Buckle up and enjoy the free value, and you won’t want to miss…  a converted grain elevator that proves some of the most remarkable homes begin with the most unexpected buildings.

Congress has unanimously advanced the ROAD to Housing Act through the Senate Banking Committee, a rare bipartisan effort to address the housing affordability crisis.

Washington is no longer treating housing as a problem exclusively for mayors and local governments. Rising home prices have turned it into a national economic issue, forcing Congress into a debate it largely avoided for years.

The bill's strategy is simple: increase the housing supply.

Instead of launching a major federal spending program, it relies on incentives. The idea is to encourage local governments to loosen zoning rules, speed up permitting, and approve more housing by tying part of the federal funding to those efforts.

It also promotes manufactured and modular housing, based on the premise that building faster and at lower cost should play a much larger role than it has so far.

The legislation largely avoids one of the most visible political debates: large institutional investors buying homes.

Its approach is based on a simple idea: investors are not the main reason housing has become unaffordable. The real problem is that not enough homes are being built. Whether that explanation is sufficient remains open to debate, but the bill clearly prioritizes expanding supply over redistributing the homes that already exist.

Even supporters acknowledge that the bill will not solve the housing crisis on its own. Construction labor remains scarce, insurance costs continue to rise, and land prices remain high. Building more homes may ease some of the pressure, but it does not eliminate those underlying challenges.

There is another paradox. The bill passed the Senate Banking Committee unanimously, yet its future remains uncertain after President Trump canceled plans to sign it. A measure with broad political support has nevertheless ended up in procedural limbo.

There is growing agreement on what the housing problem is, while there is still much less agreement on how to solve it.

U.S. home prices accelerated in May, rising 0.3% from April and 2.5% from a year earlier, marking the fastest annual pace in six months.

Most of those home purchases were negotiated in April, when mortgage rates briefly declined. Buyers who had been waiting returned to the market, and that increase in demand is only now beginning to show up in closing prices.

The obvious question is: if there are now more sellers than buyers, why are prices still rising?

Because the market isn't short of homes—it remains short of the homes people actually want to buy. Well-located, reasonably priced properties continue to attract multiple offers, even as overall inventory keeps increasing.

On the surface, the market appears to have cooled, yet the best homes still behave as if supply remains too limited.

The national figures hide very different regional realities.

Cities such as Cleveland, Providence, and New York recorded the strongest monthly price gains. Meanwhile, Riverside, San Jose, and Phoenix experienced noticeable declines.

The annual comparison is even more striking. San Francisco posted one of the largest year-over-year increases despite declining during the month, driven by renewed demand linked to the artificial intelligence economy. At the same time, several Sun Belt markets—including Austin, Dallas, and San Antonio—continued to post annual declines after years of rapid appreciation.

It is becoming increasingly difficult to talk about a single housing market. It looks more like dozens of markets moving at different speeds.

The price data reflects contracts signed weeks earlier. More recent indicators show that pending home sales have flattened as mortgage rates climbed again throughout May.

Under normal circumstances, that would point to slower price growth. However, the number of newly listed homes has also begun to slow, limiting the amount of fresh supply entering the market.

As a result, the forces pushing prices higher and those pushing them lower are largely offsetting one another.

For now, the brief decline in mortgage rates appears to have given the market a temporary boost. What remains unclear is whether it marked the beginning of a new trend or simply pulled future demand forward.

Investors face a dilemma. When the S&P 500 finished its worst quarter since 2022 last month, diversifiers like bonds and bitcoin fell too.

Even with the turnaround in mid-April, analysts at Goldman Sachs and Vanguard have projected low-single-digit annualized returns from 2024-2034.

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The biggest complaint clients usually have isn't bad advice or poor negotiation. It's not knowing what's going on.

When communication slows down, people don't remain neutral—they fill in the blanks. They assume the property isn't getting attention, the search has stalled, or their agent has mentally moved on. By the time they ask what's happening, trust has already started to erode.

The proposed solution is almost boring in its simplicity: call every active client once a week.

For sellers, the call follows a predictable structure: what happened, what's changed in the market, and what has been done behind the scenes.

Much of an agent's work is invisible—marketing campaigns, conversations with other agents, or monitoring comparable properties. Clients can't value work they never see, so they often mistake invisible effort for no effort.

The weekly call isn't just an update. It's a reminder that progress isn't always visible.

With buyers, the challenge is different. Some weeks, there simply isn't a suitable property.

The temptation is to wait until there's something new to share. Instead, the recommendation is to keep clients informed about the market itself: mortgage rates, seasonal changes, homes going under contract, and whether it's worth adjusting their search criteria.

The conversation shifts from "nothing happened" to "here's what we're learning." That keeps clients engaged even when the market isn't cooperating.

One small habit stands out above the rest: before ending every call, schedule the next one.

It's a minor detail, but it removes uncertainty. Clients know exactly when they'll hear from you again instead of wondering whether they should be the ones to reach out first.

There's a deeper idea behind all of this. Consistency tends to build more confidence than intensity. A predictable rhythm can be surprisingly persuasive.

Whether that alone is enough to keep clients loyal is another question. Consistent communication can't make up for a lack of results forever. But it can prevent silence from becoming the story.

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The housing market is becoming less predictable, making both policy decisions and professional guidance more important than simple market updates. Lawmakers increasingly agree that housing affordability is a national problem driven by limited supply, but consensus on the diagnosis has yet to produce agreement on the best solution. At the same time, market conditions remain uneven, with national trends masking sharply different local realities and short-term improvements proving fragile as mortgage rates continue to fluctuate. In that environment, uncertainty becomes a challenge not only for buyers and sellers, but also for the professionals advising them. Whether through public policy or consistent client communication, the common goal is no longer eliminating uncertainty altogether, but helping people make decisions despite it.

Have a great weekend - we’ll see you next Saturday.

Cheers 🍻

-Market Minds Team

The content of Market Minds is provided for informational purposes only and reflects personal opinions based on sources believed to be reliable. It does not constitute financial, investment, legal, or professional advice. Each reader is solely responsible for their own decisions.