REAL ESTATE & CONSTRUCTION INTERVIEW
Fortunate Real estate services companies are enjoying strong growth but the labor shortage is an issue
Joseph Maressa President & CEO – Title America How has demand for your services shifted from prepandemic levels? Our business is probably up 30% to 40% from the beginning of the pandemic. We’re very fortunate, as are many in the real estate and real estate services business.We have all seen an explosion in volume. Mortgage companies, title companies and builders were not shut down and have seen an unprecedented increase in volume. At Title America, as is true with most of my competitors, we could run seven days a week. What’s stopping that? We can’t find employees; human capital is at a premium. The workforce pool for the title industry has been practically non-existent during these times. Which side is driving growth – residential or commercial? We’re seeing both. There’s a lot of commercial refinancing going on because interest rates are so low. Somebody with a 5% loan can refinance and get threeand-a-quarter. On the residential side, it’s driven by people coming out of the urban areas and into the suburbs. People are buying houses at a pace that you would never have imagined pre-COVID. Most of the builders that we’re fortunate enough to do business with are building at a much higher pace than pre-COVID. There’s no shortage of buyers, especially while the rates remain low. Do you see retail bouncing back after the pandemic? Big box retail, I think, is a thing of the past. I don’t see much big box expansion at all. I’m sure Walmart, Target, Home Depot and Lowes will always build a store here and there but the major expansion for big box and other name retailers is tough because of Amazon and other avenues of e-commerce. That is true all over the country. The way we buy our goods is definitely changing because of advanced technology.
What is the near-term outlook for Title America? We’ve been extremely fortunate to have long-standing relationships with many of our clients. I think the outlook for the next year or so, and even longer, is very good as long as interest rates stay low, inflation stays in check, we don’t get overburdened with constraining regulation, and Washington leaves the long-term capital gains rate alone. I think, generally speaking, we may be in something of a bubble. This industry is something of a roller-coaster ride and we’ve been on an upward trajectory for a long time now. What goes up must come down. To what degree? No one knows. When? Your guess is as good as mine. If you’re a student of history, it’s probably sooner rather than later. I certainly don’t have the answers but I think we’re in good shape for the foreseeable future. www.capitalanalyticsassociates.com
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