a | r | e Summer 2014

MEET the the

KOREAN on the

Fred Underwood’s role in fair housing, his stories growing up in South Korea, and his family’s 129-year history on the Peninsula

FOREFRONT of the FIGHT for MULTI-CULTURAL HOUSING ( Hint: Hint: HE'S ON THE LEFT ) SUMMER2014

How Will Housing Recovery Proceed? / Intergenerational Households Here to Stay / AREAA’s 2014 Global Summit and MORE…

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SUMMER 2014 Vo l u m e 6 , I s s u e 2 ON THE COVER: A young Fred Underwood in Korea, around 1958. Photo courtesy of the Underwood Family

12

F E AT U R E S 12

Fred Underwood's Journey from Korea to Washington D.C. and the Fight for Multi-Cultural Housing Hear from AREAA’s 2013 Person of the Year as he recounts growing up in Korea, working on the ground as a grassroots organizer in Chicago’s South Side, and his position as the National Association of Realtor’s Director of Diversity.

By Michael Kelly

16

Housing Market at a Crossroad: How Will Recovery Proceed?

16

With almost 6 years since the collapse, the fate of sustained growth in the housing sector is examined while considering the impact of recent developments in lender’s access to credit as well as the fate of two powerful housing entities, Fannie Mae and Freddie Mac.

By Michael Kelly

28

Rise of the Multi-Generation Household in America American families are beginning to stick together under the same roof. Although not un-common for Asian American families, the roots of this emerging trend in the country are explored.

By Sharon Marsh-Wyly

2

SPRING 2014

28

22

26

30

CONTENTS 20

10 Questions with AREAA Policy Chair Tom Truong

D E PA RT M E N T S 26

We sat down with AREAA’s 2014 Policy Committee Chair and found out his greatest fear, his favorite rock band, and the one country he wants to return to.

22

Hear how a small delegation of AREAA members went to the Washington D.C. to speak to our nation’s leading lawmakers and executive officials about the issues that really matter to real estate professionals around the country.

Global Summit Recap AREAA’s annual spring event, the 2014 Global and Luxury Summit, was held in one of the world’s most luxurious cities and offered attendees unforgettable experiences and lasting connections.

Photos By Will Cadena

4

AREAA Goes to Washington: 2014 National Policy Day

SPRING 2014

30

Bringing Two Worlds Together: The 2014 US China Real Estate Summit Leaders from two of the biggest economies on the planet, the United States and China, met in Los Angeles for the first time this June to discuss the direction that real estate development is taking and how real estate professionals can develop their investment strategies.

9

A Message from Chair Choi Ivan Choi tells us about what he thinks is the most important benefit of being an AREAA member.

10

Letter from the Editor a | r | e Magazine's Editor in Chief recounts her first time meeting Fred Underwood, her own Korean background, and the dichotomy of heritage and values.

CONTACT MICHAEL KELLY to discuss EDITORIAL CONTRIBUTIONS:

CONTACT PRAVEEN SHARMA to find out about ADVERTISING OPPORTUNITIES:

mkelly@areaa.org | 760-918-9162

psharma@areaa.org | 951-514-1053

ADVERTISERS

32

24

In My Neighborhood with Anne Thai Longtime resident Anne Thai shows off the best restaurants, parks, and other attractions that make our nation’s capital one of the most exciting and fast-paced areas in the country.

32

Around the Association The organization was brimming with activity over the spring with numerous luxury and business development events in Las Vegas and California’s Central Valley.

Additionally, one of AREAA’s members completed a rigorous course at REALTOR® University.

AREAA Korea Trade Mission

CharlieSuhRealtor@Gmail.com

Inside Back Cover

AREAA National Convention

www.areaa.org/convention

Bank of America

www.bankofamerica.com/webinars

California Association of REALTORS®

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page 7

Gina Duncan, Maui Real Estate Advisors, LLC

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page 11

Gary Kawano, Citi

GaryKawano@citi.com

page 11

Linda Lee, Keller Williams Realty

Linda@buy858.com

page 11

National Association of REALTORS® Global

www.realtor.org/earncips

John Sullivan, Allison James Estates & Homes

John@SanDiegoHomesNow.com

page 11

Wells Fargo Home Mortgage

www.wellsfargo.com/homecontest

page 3

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www.CindyEstates.com

page 11

Back Cover

Inside Front Cover

page 1

SUMMER 2014

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SUMMER 2014 Vo l u m e 6 , I s s u e 2

EDITOR-IN-CHIEF Caroline Gim EDITOR Michael Kelly C R E AT I V E D I R E C TO R Praveen Sharma

is a publication of the Asian Real Estate Association of America (AREAA), a national nonprofit trade organization dedicated to increasing sustainable homeownership in the Asian American community. For more information visit: http://areaa.org. Š2014 by the Asian Real Estate Association of America.

Reproduction in whole or part without permission is prohibited. Opinions expressed by individual authors are not necessarily the opinions held by AREAA. Interested in advertising or contributing? Contact us: Praveen Sharma ADVERTISING | psharma@areaa.org Michael Kelly EDITORIAL | mkelly@areaa.org Office: Asian Real Estate Association of America 5963 La Place Court, Suite 314 Carlsbad, California 92008 760-918-9162 Phone 760-585-1397 Fax Previous issues available online at: http://areaa.org/a-r-e

For additional web-based content, please make sure to download the application.

8

SUMMER 2014

MESSAGE FROM THE CHAIR

As a National Chair of this organization,

I find myself being asked by non-members and members alike about what is the most rewarding aspect of being associated with AREAA. With the number of great things that our organization gets to initiate and participate in, I find that question increasingly difficult to answer. However, I always find that I answer that the most beneficial experience that our members can participate with the organiza-

had a lot of new faces join us on our trip to Washington D.C. who were eager to talk to lawmakers about the issues affecting their communities. Despite initial feelings of intimidation, these newcomers made an impact on those who they engaged with in our nation’s capital.

The reason that I mentioned this is both to highlight the accomplishments of this group of first time attendees as well as stress the fact that any member has the ability to connect and engage with these types of individuals.

Even though you might initially think you can’t

...what they were saying was actually making an impact on the way these decision makers view the issues at hand. tion is the opportunity to speak with those at the center of decision making in our nation’s government.

When impressive national events like the National Convention and the Global Summit come to mind, I am sometimes met with reactions of surprise. Although I understand that the topics discussed and the connections made during these events cannot be understated, providing a unified voice for the Asian American and Pacific Islander (AAPI) to lawmakers and other leaders is of utmost importance for AREAA. This past May, a small delegation of AREAA members made their way to our nation’s capital to attend appointments with their local representatives as well as top-echelon officials in the Department of Treasury and the Consumer Financial Protection Bureau (CFPB). During the various meetings I was able to attend, I witnessed our members engaging in genuine discussions with these individuals about the issues that are directly affecting their local market and the clients they serve. Most importantly, I could see in these interactions that what they were saying was actually making an impact on the way these decision makers view the issues at hand.

enter into real conversation with lawmakers and other officials, I guarantee that these individuals are willing and eager to hear from the people they represent about the issues that matter to them. As a result, this gives you the power needed to be the voice of change for over 14,000 real estate professionals serving the AAPI community around the country, which is the unchanging goal our organization established more than 10 years ago.

To me, there is nothing more rewarding than that associated with the Asian Real Estate Association of America.

Best,

IVAN CHOI 2014 AREAA NATIONAL CHAIR

What excited me during the event was the amount of AREAA members who were attending AREAA’s Policy Day for the first time. We

SUMMER 2014

9

LETTER FROM THE EDITOR

F

red Underwood is an interesting character.

I remember the first time I met him, he recognized my unique last name instantly as being the same last name in Korean as Kim. He also smiled warmly and said “만나서 반갑습니다” (pronounced “mahn-na-suh bahn-gab-seub-nidah”, which is “pleased to meet you” in Korean) without hesitation as he shook my hand. I thought he had asked some friends to teach him how to greet Korean people when he meets them. Turns out, Fred grew up in Korea and knows more about Korean history and culture (and speaks Korean) better than I do.

The Underwood family arrived to the Korean Peninsula in 1885 and founded some of the most famous and influential institutions in the country.

In fact, there is a statue of Fred’s great grandfather, Horace Grant Underwood, in the center of Yonsei’s campus today. In our feature article, we learn more about NAR’s Director of Diversity and longtime friend to AREAA. Learning more about Fred Underwood’s childhood in Korea makes me wonder about Asian Americans’ place in American history. Asian immigrants and U.S.-born Asian Americans understand the dichotomy of culture, language, and values that we are exposed to at home versus school and work. As a Korean by blood but born and raised in the United States I honestly cannot say which country I identify with more. I can tell you, however, that I do feel responsible to positively impact

10

SUMMER 2014

both communities in every way I can. And I am not the only AREAA member to feel that way.

In May, AREAA members from around the country converged on the nation’s capital to meet with the nation’s leaders and advocate on behalf of the Asian American Pacific Islander (AAPI) community. These members are not trained politicians but they are armed with professional insight and personal stories about to how Washingon’s policies affect local real estate markets and the Asian American constituents that live within the policy maker’s communities. In this issue we recap AREAA’s Policy Day, review AREAA’s 3-Point Policy Plan, and get to know 2014 Policy Committee Chair Tom Troung a little better.

This issue of a | r | e Magazine is all about the convergence of two worlds. In addition to learning about Fred Underwood’s unique history and AREAA’s visit to Washington, DC we review AREAA’s Global & Luxury Summit held in New York and AREAA’s recent U.S.-China Summit in Los Angeles. We also discuss the boomerang generation and the increase in multi-generational households in America.

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11

JOURNEY

FRED UNDERWOOD’S

from KOREA to

WASHINGTON D.C.

FIGHT FOR MULTICULTURAL HOUSING and the

hen Fred Underwood is introduced at an AREAA event, one of the organization’s board members almost always goes to some length to mention the fact that the National Association of Realtor’s Director of Diversity is perhaps the most ‘Korean’ person in the room. While this light-hearted remark, which is usually made

by AREAA’s Immediate Past Chair Jim Park, often receives laughs at these national events, it truly speaks to the unique experience that Mr. Underwood has had in spending a significant portion of his life abroad.

by Michael Kelly

Fred comes from a long line of missionaries that first arrived on the Korean Peninsula in the late 19th century. It is this familiarity that gives him a deep seated sense of passion for the region as well as the continent as a whole.

Fred began his stay in South Korea when he was just three years old with his parents relocating the family to the Peninsula. “At the time, my father was working for an association that was rebuilding a lot of rural areas throughout the country side” explains Underwood, “we lived in an early 20th century house in which one of the rooms had a traditional ondol system (an underfloor heating system typical in Korean homes).” During his early childhood, he recounts that he was in the region at a very interesting time. “When I was around five years old, I distinctly remember the start of the April Student Revolution.” He continues, “My uncle worked at Yonsei University and asked my father to pick my cousins to stay with us. I distinctly remember going along with my father and seeing protestors filling the streets but letting us through slowly. Thankfully, we were able to get through the crowd; I was not necessarily scared rather what was running through my mind was how fascinating and exciting it was.”

While growing up in South Korea, Fred began to see the country around him change in many ways. “Before I was old enough to go to school, it was a period where there was still a significant amount of poverty. The [Korean] War wasn’t that far removed at this point and the country still had an economy damaged by war. The population was vulnerable to frequent floods and famines, and development was slow before the 1960’s." Despite the state of the country’s battered economy and infrastructure, Fred believes it was actually a good time to grow up. He learned to speak Korean when he played with the neighborhood children and learned from his parents, who both grew up in Korea, the richness and beauty of Korea, its people, and culture. He attended Seoul Foreign School, one of the oldest international schools in the world with classmates from all over the world.

Having grown up in Seoul, I found cities fascinating.

During this time, cities were not thought of as desirable places to live.

However, I grew more and more interested in cities, particularly the intersection between urban dwelling and race relations.

TOP: Fred with his brother, David, and sisters, Beth and Marilyn on the large dolman on Kangwha Island. ABOVE: Fred with his younger brother David near Seoul LEFT: Fred with a neighborhood friend – around 1958 BOTTOM LEFT: Fred at the unveiling of the restored statue of his Great Grandfather, Horace G. Underwood, at Yonsei University.

(L to R) his sister Marilyn, his father Richard, Fred, his Aunt Joan, his cousin Peter, and his Uncle Horace Photos courtesy of the Underwood Family

B

y the time he was entering his high school years, Fred witnessed significant changes both in Seoul and in relatively sleepy areas of the country. “That period of

my life was a time of rapid change in the county”, he explains, “When we were growing up, the neighborhood kids and I were able to skate along the rice patties for fun. By the time I was in high school, the village I grew up in was completely urbanized.” During this time, South Korea’s major cities began to see a significant influx of population and growth. An example of this expansion is seen in Seoul, where the city went from less than a million inhabitants before 1960 to almost 5 million in a period of ten years.

It was this emergence of urban living in the country that captivated Fred as he left for college and eventually propelled him into a career in housing. He explains, “Having grown up in Seoul, I found cities fascinating. During this time, cities were not thought of as desirable places to live.

However, I grew more and more interested in cities, particularly the intersection between urban dwelling and race relations.” Because of this interest, Fred made the decision to enroll in a Chicago urban studies program while attending school in Minnesota. While taking part in this program, he was able to engage with business leaders, political leaders, community organizations, police, and even gang members about issues related to urban development.

Due to his experiences with this semester-long program, Fred decided to return to Chicago after finishing up his degree and take a position as a community organizer. While in Chicago, he focused primarily on landlord-tenant issues in the north side of Chicago as well as a host of other issues in the south side of Chicago. It was at this time where he first started his work with race relations in a city that is one of the most segregated in the country.

Fred took his experiences with grassroots organizing and joined a Chicago-based fair housing

CONTINUED SUMMER 2014

13

The

Underwood Family History in Korea

H

orace G Underwood (1) came to Korea on Easter Sunday in 1885. The family’s mission work was supported by the Lafayette Ave Presbyterian Church in Brooklyn. Early mission work including the funds to build what became Yonsei University was provided by Horace’s brother John T Underwood of the Underwood Typewriter Company.

Lilian’s Horton went to Korea in 1888 from Chicago as a medical doctor partially at the request of the Queen who requested a female doctor. She and Horace were married in Seoul in 1889 and were provided passes by the King to enter the interior of Korea (first westerners) visiting as far north as Kan gye near the China border. One of the wedding gifts from the King and Queen is on display at the Brooklyn Museum.

Their son Horace Horton Underwood was born in Seoul in 1890. He was educated in Seoul and New York and returned to Korea as a missionary and is credited with building up Chosen Christian College, founded by his father. That school is now Yonsei University. Horace G (1) died in 1916 in New Jersey.

Ethel Van Wagoner went to Korea from Michigan in 1912 to be the first teach at Seoul Foreign School where generations of Underwoods have attended.

She married Horace H in 1916 in New York and the

Fred’s great grandfather Dr. Horace G. Underwood (center) with the Board of Bible Translators at about 1900

Fred (bottom left) with his family at the statue of his great grandfather, Horace G. Underwood

Photo courtesy of the Underwood Family

Photo courtesy of the Underwood Family

couple returned to Korea. They had six children, three of whom also spent their careers in Korea.

left Korea well before the war. Dexter stayed and was also imprisoned after Pearl Harbor and was repatriated at the same time

The Underwoods stayed in Korea as World War 2 approached. When Japan attacked Pearl Harbor, all the adult Underwood men were imprisoned.

The whole family was repatriated during the war.

Ethel Underwood documented in an unpublished memorandum the recruitment of Korean women for Japanese military brothels.

Sone Horace G (2) and Richard (Fred’s father) served in the military. Horace learned Japanese from AREAA’s Founding Member Allen Okamoto’s father in Boulder, CO. Richard was part of the US team assigned to work with North Korea at the time of liberation from Japan.

After the war Horace H, Ethel, and Horace G returned to Korea mission work resets listing Yonsei.

Ethel continued her work with victims of prostitution and with returned comfort women. Another brother, John also returned as an evangelical missionary who served in Chongju and Kwangju.

During the civil strife following liberation, Ethel was murdered in her home in 1949.

Carol Lutz (Fred’s mother) was born in Pyongyang in 1929, fourth daughter of Dexter and Lenore Lutz. Dexter was an agricultural missionary and Lenore was a musician. Lenore and her daughters

Although Richard and Carol knew each other growing up, the met again in the summer of 1949 when both were in Korea for the summer.

Durning the June 25 war (known here as the Korean War) Horace G (2) and Richard served in the US military as interpreters. Horace H (1) and John remained in Korea doing mission work. Horace and Richard served with active military units during e first year of the war. Richard was interpreter when the peace talks first began in Kaesong and then both Horace G and Richard interpreted during he talks in Panmunjom. Horace H (1) died in Korea during the war.

Richard finished his military service in 1952 and married Carol in Tokyo. They moved to the US to finish school.

Horace G (2), John, and Richard served until retirement in Korea. Richard was head of school for Seoul Foreign School. AREAA members Fred Underwood and Mie Kim both attend the school.

agency called the Leadership Council for Metropolitan Open Communities as a testing supervisor. At this agency, Fred was tasked with overseeing housing investigations with a number of fair housing cases. He states, “Around this time, the housing industry was moving from opposition to fair housing laws to acceptance and actively accommodating fair housing. At the same time, precedent setting fair housing court cases firmly established important fair housing principles. Because of this, it was an interesting and rewarding time to begin involvement with fair housing.” Fred built off of his experiences in Chicago and was able to coordinate the Fair Housing Program for the city of Evanston, Illinois, upon completion of his Master’s Degree in Urban Planning and Policy from the University of Illinois at Chicago.

His work in Evanston caught the attention of the department of Housing and Urban Development (HUD), an agency that in 1988 was granted increased enforcement authority , and offered him a position as an Equal Opportunity Specialist.

It was during Fred’s fair housing work where he first came into contact with the National Association of Realtors (NAR).

Ironically, his initial impressions of the organization were not entirely positive. “During that time, fair housing advocates and NAR disagreed on testing and other fair housing issues," he explains. “Interestingly enough, at the time my wife, Katie, got a job at NAR. We would have long conversations about both organizations and she eventually convinced me to apply for a job at the organization.” Since that time, Fred has spent more than 20 years at NAR as the Director of Diversity.

W

hen starting out at NAR, Fred’s work focused almost entirely on fair housing initiatives. He explains, “The job that I and the Equal Opportunity Committee were tasked with was to educate Realtors and provide them with the tools so that they could comply with the law."

Around the mid 1990’s, the Census Bureau released data that immigration was resulting is rapid growth of the Hispanic and Asian American population. Despite this growth in population among Hispanics, African Americans, and Asian Americans, the NAR remained close to 90% white. It was at this point that NAR asked Fred to shift from exclusively addressing fair housing to finding ways to engage these rising minority groups in the NAR. This new change in the makeup of the U.S. population presented unique challenges for Realtors and local Realtor Associations. Fred elaborates, “When we were first finding ways to approach this demographic change, we saw a lot of our members making mistakes based on cultural differences. We needed to find ways to make sure members had access to a good

Fred (Center) with AREAA members Dave Tran and Mital Amin at the 2013 AREAA National Policy Day / Photo: Ben Droz

educational material about working with clients from different cultural backgrounds.

After a few years of enacting such initiatives, NAR began to see the multicultural makeup of NAR membership begin to change. This change was paralleled by the creation of the National Association of Hispanic Real Estate Professionals Fred Speaking at AREAA’s 2011 Leadership Summit Photo: John Salangsang

and the Asian Real Estate Association of America and the growing importance of the primarily African American National Association of Real Estate Brokers. This trend of growth and diversification continued for a decade within NAR’s membership base as well as the various multicultural groups.

Despite this groundswell of activity in the industry by multicultural communities, Fred believes that there are still issues that will continue to pose challenges to these groups in terms of homeownership. He elaborates, “Income and jobs are two of the major factors that affect homeownership rates, especially for the millennials. Coupled with tighter mortgage restrictions, this means that it will take this generation a lot longer to save up for a down payment for a house. Because this generation is so diverse, it will affect a lot of young multi-cultural families as a whole.”

Even with these challenges, Fred remains optimistic that NAR will work with organizations like AREAA to ensure that multicultural communities are more fully integrated into the real estate and housing market. “To me, AREAA is a fantastic organization”, he states, “Personally, seeing an organization that has been able to unite such a diverse group of different cultural and ethnic groups to focus on the common issue of homeownership is fantastic.” Perhaps most importantly, being able to participate in AREAA gives Fred the ability to return to his Korean roots. “For me, [being a part of AREAA] is a way to connect the dots in my life: my childhood in Korea, my connections with east Asia through my ties with family and friends, and my work in civil rights and real estate. My family’s history and my life are inextricably linked to Korea; Joining AREAA is a way for me to connect with people who share similar cultural experiences.”

It is this connection Fred shares with members of the organization through similar stories of acclimating to life in the Unites States that still fascinates him and keeps him excited with being involved in AREAA.

For me, [being a part of AREAA] is a way to connect the dots in my life: my childhood in Korea, my connections with east Asia through my ties with family and friends, and my work in civil rights and real estate.

SUMMER 2014

15

HOUSING MARKET at a

CROSSROADS HOW WILL RECOVERY PROCEED?

BY MICHAEL KELLY

As the third quarter of 2014 arrives, it is an intriguing time for the real estate market to say the least. After six years, we are afforded some perspective as to how far recovery has gone as well as look to the market’s trajectory in the coming years. According to leading real estate and mortgage professionals, what is seen in this examination is the fact that today’s housing market is at an important crossroads. While housing prices continue to rebound and inventory catches up with demand, it appears that the market has the potential to be healthy enough to sustain steady growth for the foreseeable future. Despite this fact, both the shape and scope of this growth remain unclear. In some areas of the United States, some professionals are concerned that the rate of growth in home prices will lead to a bubble similar to the one seen leading up to the 2008 crash. To make sure the same collapse does not repeat itself, lawmakers and regulators in our nation’s capital have gone to considerable lengths to enact and refine legislation and other executive guidelines.

The reforms made in Washington D.C. in the years following the housing crisis will continue to play a monumental role in determining what the housing market will look like for those looking to finally enter the housing market again following the recession as well as the generation of millennials reaching the purchasing power suitable for homeownership. With the nature of the federal government’s interaction with this segment of the economy, it is vital for real estate professionals from around the country to become familiar with two vital areas of government activity, which are reforms

16

SUMMER 2014

enacted to monitor availability of mortgage credit as well as the fate of the government sponsored entities (GSE)s involved in the secondary mortgage market.

AVAILABILITY of MORTGAGE CREDIT Despite being at levels nowhere near its peak in the early 2,000’s, borrower’s access to credit has been the highest since 2011. This upswing in mortgage availability is due to the fact that federal agencies are beginning to adjust mortgage underwriting standards with existing

110 NSA, 3/2012=100

Credit Availability Index

Mortgage Credit Availability Index 105 100

107.5

105

108.87

~99

95 12/2011

2/2012

1/2013

5/2014 Source: Mortgage Brokers Association (MBA)

market conditions after years of very strict guidelines.

As mandated by the 2010 Dodd-Frank statue, the federal government was given the task of re-defining which type of consumers would be able to secure and maintain mortgages and the fees associated with it. To do this, the bill stipulated the creation of a new type of mortgage, which was dubbed qualified mortgage (QM). Congress mandated that agencies like the Department of Housing and Urban Development (HUD) and the Consumer Protection and Finance Bureau (CFPB) make a series of rulings on what characteristics these mortgages will take.

Throughout the second half of 2013, the CFPB and HUD delivered its final ruling on these mortgages. According HUD’s ruling, qualified mortgages will be defined as loans whose terms do not exceed 30 years, require periodic payments without risky features, and limit up-front points and fees to under 3% of the mortgage amount. Additionally, The CFPB made a ruling in September of 2013 on the ability-to-repay requirements for QM. In their ruling, they established a set of minimum requirements for fulfilling the ability-to-repay requirements for the loan including current and expected income, employment status, and certain non-mortgage payment obligations.

The first set of rulings, which went into effect in the beginning of the year, will actively shape what type of credit will be available to millions of Americans. Although these rulings are designed to protect consumers and lenders alike, this underwriting, as well as any additional modifications to the rulings, could limit mortgage availability to critical segments of the population. One such segment of the population that could be adversely affected consists of those who are self-employed. As part of these rulings, the ability-to-repay considerations are closely tied to credit indicators such as FICO scores. This presents a problem for a large number of small business

owners due to the fact that many of these owners conduct business on a cash-only basis. This means that transaction with credit is not as prevalent with this group, which translates to a FICO score that does not accurately represent an individual’s purchasing power and could exclude them from obtaining a QM in the future. This issue is also present in certain groups of recently emigrated families who have not been sufficiently explained the importance of building credit in the United States.

With these rulings both decided upon and enacted, the amount of mortgage credit available to consumers in the next few years depends on how these executive agencies effectively communicate these guidelines as well as modify these rulings when needed. Vijay Yadlapati, who is an Associate Commercial Policy Representative at the National Association of REALTORS® (NAR) states, “In order to determine whether or not these rulings are going to work, we need to give it time to see how they will play out. Even though a significant portion of the rulings have been made, the CFPB will continue to listen to lenders if further complications arise.” With any sort of ruling like this, it is imperative that these entities allow for compensating factors for underserved consumers who are in danger of falling through the cracks when applying for a mortgage. Yadlapati adds, “I’m encouraged by the fact that leaders in the CFPB have made it explicitly clear that their main goal in these rulings is not to restrict credit to worthy borrowers. I believe that they will make the necessary modifications to the rulings if issues arise.” If these agencies are successful in continuing to adopt flexible and common-sense underwriting, we will continue to see sustained rises in access to credit available since the housing collapse.

CONTINUED SUMMER 2014

17

HOUSING MARKET AT THE CROSSROADS: HOW WILL RECOVERY PROCEED?

Johnson-Crapo Bill: Summary ++ Phase out Fannie Freddie, Replace with Federal Mortgage Insurance Corporation (FMIC). ++ FMIC would act as an independent regulator overseeing the mortgage finance market while insuring mortgage-backed securities. ++ Private firms would be able to participate in secondary mortgage market, but must maintain 10% holdings on loans at all times. ++ Small-lender mutual will be set up for smaller banks to participate in mortgage market. ++ FMIC will set up 3 mutual for affordable housing initiatives.

Source: www.nationalmortgagenews.com

JOHNSON-CRAPO BILL Another factor that will drastically affect mortgage availability and subsequently the health of the housing market in the following years is the fate of Fannie Mae and Freddie Mac, two of the most involved GSEs in the housing market. Ever since they were placed into government conservatorship in 2008, the future of these entities has been put into question by a growing number of lawmakers tasked with tackling reform in the housing market.

In this current session of Congress, Senate Banking Committee Chairman Tim Johnson and Committee Ranking Member Mike Crapo introduced a bill to the Senate that calls for a massive overhaul of these entities.

The bill, which is named after the two senators, calls to ultimately do away with Fannie Mae and Freddie Mac and replace them with an entity similar in form to the FDIC. The aim of this legislation is to slowly limit government participation in mortgage transactions while simultaneously encouraging the private sector to take its place and become more involved in the market. However, in its

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current form, the bill’s contents could adversely alter the amount of credit that lenders are able to extend to their consumers.

To ensure that the private sector has more at stake when conducting these lending transactions, the bill calls for a 10% holding on all loans issued by the lender. This raises concerns as lenders could have fewer resources to work with when originating loans, which could limit the number of mortgages offered by these banks. Additionally, this transition of the mortgage market to the private sector raises the risk of large banks effectively dominating the market altogether. According to the wording of the bill, the country’s largest lenders can participate in the market in a number of different roles, such as a loan guarantor, originator, and aggregator, which could realistically shut out smaller banks that offer a variety of different loans in the process.

Although the Johnson-Crapo Bill addresses the need to modify the current arrangement of Fannie and Freddie, these conditions could create a scenario where a significant portion of the American population would not be

HOUSING MARKET AT THE CROSSROADS: HOW WILL RECOVERY PROCEED?

...the prospects of it reaching the floor are put in serious doubt. In its current form, it’s not likely it will have the widespread support needed to proceed in Congress.

– Vijay Yadlapati able to secure a loan for their family. For this legislation to address this problem, greater effort needs to be taken to make sure affordable housing goals are put in high priority. However, the prospect of the Johnson-Crapo being acted on as a whole is unlikely in this term of Congress.

“Even though the [Johnson-Crapo] bill has passed out of the Senate Banking Committee, which is where the bill originated, the prospects of it reaching the floor are put in serious doubt”, adds Yadlapati, “In its current form, it’s not likely it will have the widespread support needed to proceed in Congress.” Despite this fact, this bill represents one of the first major efforts to address reform for these GSEs and signals the fact that their fate will be increasingly debated upon in the legislative branch in the coming years.

WHAT’S NEXT for FANNIE and FREDDIE? When considering possible Fannie and Freddie reform through the nation’s legislative branch beyond the Johnson-Crapo bill, the prospects of immediate change is dubious for the time being. In this current session of Congress, there are a number of things that need to be addressed first before serious GSE reform can be seriously considered. With numerous appropriation bills and initiatives like the terrorism insurance program, it may not be likely that Congress gets around to it this year.

Additionally, the fact that 2014 is an important election year for members of Congress will also have a significant effect on the direction reforms of this type will take. Because GSE reform is not an issue that resonates as strongly with the American public as other issues such as immigration and entitlement reform, any action to further speed up the process of enacting legislation might be stymied until elections have subsided. Furthermore, based on whether or not the majority in each house is shifted due to the results of the election, the process of reform for Fannie and Freddie could take markedly different paths.

Despite the continued yet often muffled discussion on the sustained existence of these particular GSEs, Fannie Mae and Freddie Mac have recently gone about internally re-structuring some key initiatives and business models.

During the 2014 strategic plan address on May 13th, Mel Watt, who is the Director of the Federal Housing Finance Agency (FHFA), laid out the direction that Fannie Mae and Freddie Mac will take in the coming year.

Similar to the Johnson-Crapo Bill, Watt indicated that reducing taxpayer risk would be at the forefront of Fannie and Freddie’s priorities in the coming years. To accomplish this, the entities will shift their focus to finding ways to bring additional capital from the private sector into the system. This means that Fannie and Freddie will conduct additional credit risk transfers for various single family loans. When it comes to multi-family purchases, the FHFA is now requiring Fannie Mae and Freddie Mac share risk with the private sector through capital market structuring and risk sharing models.

Although the fate of these particular GSE’s is undetermined in the legislative branch, it is clear that the system on which these entities are placed on is not sustainable.

With these statements, it is clear that Watt realizes that Fannie and Freddie must take steps to ensure that the secondary mortgage market shifts to the private sector.

As the economy bounces back and investors are willing to provide capital in the market, the role that Fannie and Freddie will play in loan transfers will shift accordingly.

WHAT CAN WE EXPECT with the HOUSING MARKET IN THE COMING YEARS? In addition to the prospects of nation-wide changes in the areas of mortgage access and GSE reform, the fate of growth in the housing market will be dependent on additional factors. One such factor is based on location.

In the coming years certain markets around the country will heat up while others will continue to languish. For example, markets in the western part of the United States such as Dallas/Ft. Worth, San Jose, and San Francisco are projected to thrive and markets such as Miami and Ft. Lauderdale could slow immensely.

The fate of the housing market is also deeply tied to the performance of the nation’s job market. If job growth, which reached 217,000 additions to the workforce at the beginning of the third quarter, remains steady, then the housing market will react favorably.

If the emerging millennial generation as well as multi-ethnic communities are provided with access to employment as well as mortgage credit, then there is no indication that recovery for these underserved communities and the nation as a whole will remain subdued.

Average U.S. Unemployment Rate Per Year 2010

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2014* 0

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*2014 figures only up to 5/14 Source: Bureau of Labor Statistics

SUMMER 2014

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QUESTIONS w / AREAA POLICY CHAIR

TOM TRUONG Realtor, SRES, CRS, Broker Associate

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What’s the biggest lesson in business you’ve learned that was never taught?

If you had to move out of this country, what country would you move to? Why?

The biggest lesson in business I’ve learned that was never taught is that perseverance is the key to any successful venture. I wholeheartedly support the idea of a “get it done” attitude, no matter what the obstacles one is faced with. “Break down the walls and push through all barriers! Let’s do this.”

If the political landscape looked different than it does today, I would be intrigued by the idea of moving back to my home country of Vietnam. I see endless business opportunities and a whole different lifestyle there and it would be great for my kids to grow up experiencing what I did when I was a child and learning Vietnamese because that’s something I’ve yet to teach them.

3 Who’s your favorite musical artist?

I like the classics- Billy Joel (favorite song is, “My Life”) and Santana are on several of my playlists, but every once and a while an artist surprises me with music that inspires, like Pharrel Williams song, “Happy” or “The Best Day of My Life” by American Authors.

QUESTIONS with AREAA’S TOM TRUONG

4 Tell us something that no one would ever guess about you.

I used to play the drums in a band.

As a matter of fact after a hard day’s work, there’s nothing I like better than playing drums at home.

And I love working in my yard/ garden and sitting by a campfire catching up with friends & family.

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What’s your greatest fear?

Dying before my time. I have a LONG bucket list and every day brings new challenges and experiences I’ve yet to get to.

8 What are your two favorite movies of all time?

The first would be Stand By Me. I deeply treasure my longtime friendships and that movie spoke to the heart of what friendship is really about. The other would be the original Star Wars, there’s nothing like a sci fi movie with great drama that sucks you in.

5 If you could rid the world of one thing, what would it be?

Apathy, it drives me crazy to think there are people out there who just don’t care about anything. I believe everyone should stand for something…it’s the only way things get done in this world.

TOM SAYS...

I wholehearte dly support th e idea of a “get it do ne” attitude, n o matter what the obsta cles one is fac ed with.

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“BREAK DOWN THE WALLS A ND THROUGH ALL BARRIERS! L PUSH ET’S DO THIS.”

What famous person do you most admire?

There isn’t anyone famous that comes to mind that I admire, but what I do admire in people is when someone is faced with a challenge and fails, but gets back up again and again and perseveres. Did you know Thomas Edison once said, “I haven’t failed; I’ve just found 10,000 ways not to make a light bulb”.

9 What book (other than the Bible) impacted you the most?

I have two: The first is “Think and Grow Rich” by Napoleon Hill. I read that one back in college and still refer to its philosophies to this day. The second is “How to Win Friends and Influence People” by Dale Carnegie.

Before I agree to mentor anyone that asks me, these two are required reading.

10 Give us three visions of the future of real estate ten years down the road.

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The caliber of Real Agents will increase as barriers to entry become tougher; this is a great thing for our industry as there are too many non-professionals not representing real estate agents in the right light.

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Agents will become advisors of the real estate transactions, providing local and international market knowledge and not sales people showing property because the typical consumer can get all the information about any property they want via the internet. What will always be missing and that the consumers need are our expertise and our trusted advice.

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We already see this today, but the agent who does not stay on top of technology and information will continue to get etched out and lose market share to the cutting edge agents.

SUMMER 2014

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GLOBAL SUMMIT RECAP

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April 12-15th, 2014 | Waldorf-Astoria, New York City Photos by Will Cadena

eal estate professionals from all around the world flocked to New York this spring for one of AREAA’s premiere annual events. On April 12-15th, the organization hosted its third annual Global and Luxury Summit in New York City. The three day event was held at the historic Waldorf Astoria. The event brought together nearly seven hundred real estate professionals and industry representatives from across the world to create a forum for best practices and setting standards on the global and luxury real estate industry.

Co-Chairs for the Summit were Philip White, CEO of Sotheby’s International Realty and Angie Lee, Vice President of Corporate Communications at MCS Mortgage. The Summit drew attendees from across the United States as well as attendees from Japan, Canada, China, France, Hong Kong and Mexico. “The quality of education, training and networking at this year’s Summit far exceeds what’s offered elsewhere in the industry. Not only did the event boast of top rate speakers but it also offered topics that are on

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the forefront of luxury and global real estate”, said Ivan Choi, 2014 AREAA National Chair.

The event included high level speakers like Diane Ramirez from the Halsted Group, Dottie Herman from Douglas-Elliman, Kathy Korte from Sotheby’s – all top women CEOs from New York who offered practical advice for growing luxury business prospects to audience attendees. Additionally, retail star Faith Hope Consolo was top billing for the commercial real estate session that attracted a standing-room audience at the event. Other keynote speakers included Lawrence Yun, chief economist of the National Association of REALTORS®, Ryan Gonsalves, Head of Global and Mortgage Proposition at HSBC and Alex Perriello CEO of Realogy who spoke on the trends that impact international real estate market not just in New York but in other key markets.

In addition to a successful educational program attendees enjoyed a wide range of networking events. The Summit opened with a private reception at

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PHOTOS 1. Keynote Speaker Jose Antonio Vargas 2. 2014 AREAA Chair and 2014 Global Summit Committee Co-Chair Philip White 3. Grand Ballroom at the Waldorf Astoria 4. NAR Chief Economist Lawrence Yun 5. Faith Hope Consolo of Douglas Elliman Real Estate 6. Summit Speaker Lesley Corydon (left) and AREAA Founding Chair John Wong (right) at the Global Congress Session 7. Immediate Past Chair Jim Park (left) speaks with Dianne Ramirez, Kathy Korte, and Dottie Herman on the New York CEO Panel at the Summit’s General Session. 8. 2014 Global Summit Committee Co-Chair Angie Lee

Sotheby’s Auction House. Attendees enjoyed food and drinks while viewing one-of-a kind art. “Having the reception at the studio of the Sotheby’s Auction House was a fantastic opportunity for the organization to set the tone for the event as a whole”, explained Choi, “When attendees arrived on site at the auction house, I think they really understood that the event’s focus was on the higher end of real estate transactions.”

The Summit also included an awards gala that highlighted Asian American leaders who have impacted communities across America. Christopher Kui, who is the Executive Director of Asian Americans for Equality (AAFE), received AREAA’s Lifetime Achievement Award for his work in advocating for the AAPI community. Congresswoman Grace Meng was honored by AREAA with the 2014 AAPI Leadership Award. Meng represents the Sixth Congressional District of New York in the House of Representatives and is the first Asian-American member of Congress from New York, and the first female Member of Congress from Queens since former Vice Presidential

nominee Geraldine Ferraro. Jose Antonio Vargas, Filipino-American turned immigration activist and a Pulitzer Prize-winning journalist and filmmaker, was awarded AREAA’s Advocacy Award. His groundbreaking essay detailing his life as an undocumented immigrant was published by the New York Times, both captivating social and political circles and attracting worldwide media coverage.

The 2105 Global Summit will be hosted in Chicago, IL from April 19th to 21st at the luxurious Trump International hotel.

SUMMER 2014

23

IN MY NEIGHBORHOOD with

ANNE THAI

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he Washington metropolitan area is made up of the District of Columbia and the boarding states of Maryland and Virginia. The area is also referred to as National Capital Region; another term used to describe the region is the DC Area. The area in the region that is surrounded by Interstate 495 is also referred as being “inside the Beltway”.

The Washington D.C. area is home to hundreds of major research universities, think tanks, non-profit organizations, and the Federal Government, which makes it one of the most exciting areas in the country.

What’s the number one selling point that residents and new buyers rave about?

Ease of living, social interaction, good nightlife, cultural opportunities such as the Kennedy Center, Smithsonian, National Geographic Society, Cherry Blossom Festival, etc., and being around people who are generally bright and interested in the world around them. It’s the usual list of urban attractions. In addition, DC is actually affordable compared to New York or San Francisco or any other major cities.

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©istockphoto/fstockfoto

Washington, D.C. Metro Area SHOPPING

It is depends on what you are looking for. You can start at a fun and historic Washington D.C. venue in UNION STATION, where over 100 shops and 45 eateries can keep you busy for many layovers. While there, you would be close to another favorite for shopping: EASTERN MARKET, which is an international market with vibrant merchants creating various cultural expressions. Eastern Market can be one of the exciting places to buy gifts, artwork or watch street performers and enjoy a beautiful day.

What attracted you to this part of town? What types of outdoor activities does What is your favorite way to spend an As a refugee from Vietnam in 1975, your neighborhood offer? afternoon with family or friends here?

I had no other choice other than to reside in the Washington Metropolitan Areas. However, I am so glad I was able to grow up here. By being here for so long, I have learned that Washington D.C. has a lot to offer.

Even though Washington Metropolitan is not as big as New York, Los Angeles, or some other major cities, it has a lot of culinary restaurants, diverse neighborhoods, world class national theaters, and museums which are visited by billions of visitors each year, and a work force that is ranked amongst some of the best and brightest.

If you crave the outdoors, you can participate in biking, hiking, boating, running, fishing, horseback riding, and enjoy a number of parks and picnic areas. The Washington D.C. area offers endless outdoor activities for all ages. My favorite outdoor activity is enjoying summer concerts at Fort Reno Park, a popular destination in Tenleytown that has the highest point in the city.

Eastern Market – Washington D.C.’s original and premier food and arts market. Located in the heart of the historic Capitol Hill neighborhood, the market is D.C.’s destination for fresh food, community events, local farm-fresh produce, and handmade arts and crafts on the weekends.

Holidays are also a great time to visit Washington. From the White House Easter Egg Roll to the Spring Cherry Blossom Festival, there’s always something fun happening in D.C.

OPPOSITE TOP: The Lincoln Memorial, a national monument built to honor Abraham Lincoln

ABOVE: Columbus Fountain and Union Station

OPPOSITE BOTTOM: Japanese style altar at Cherry Blossom Festival

©Depositphotos.com/fstockfoto

What is a common misconception about your neighborhood that you’d like to clear up?

People always think that Washington D.C. is small and does not have a lot of things to do. Actually, it is not small at all; the area itself spans a considerable distance. There are a lot of things to do and a lot of interesting places to see.

Can you share one of the neighborhood’s best kept secrets?

94th Aero Squadron restaurant in College Park, MD – the restaurant offers a very nice ambience. It’s a French farmhouse look with all kinds of mixed WWI and WWII décor all over with big band music playing in the background. You will see a few airplanes on the grass. The restaurant overlooks College Park airport runway so you can watch planes take off and land on the College Park airport strip. It is a fun place to dine and enjoy the view.

What is your favorite restaurant in the neighborhood? Tell us about it.

That’s a tough one. I cannot just pick one as my favorite restaurant in D.C.; there are so many good restaurants.

However, if I have to pick one – I choose Busboys and Poets.

The restaurant was established in 2005, and they are now located in four distinctive neighborhoods in the Washington Metropolitan area.

The name Busboys and Poets refers to American poet Langston Hughes, who worked as a busboy at the Wardman Park hotel in 1920, prior to gaining recognition as a poet.

They are recognized by The Snail of Approval Program that provides quality, authentic, and sustainable food and drinks. They also support local independent businesses in the Washington D.C. area.My favorite brunch dish is sweet potato pancake with fresh fruit and my favorite lunch item is the grilled brie panini.

PLACE to GRAB a DRINK CANTINA MARINA – When I’m there I enjoy the sunset while drinking the best margaritas on a relaxed outdoor patio located on Washington D.C.’s Southwest Waterfront.

Do you volunteer with any local organizations or causes?

I am very actively involved with my local association as a committee member with the Budget and Finance Committee, a Vice-Chair for Global Business Forum, and a Task Force member for Charitable Giving Task Force. I was also the Chair for the Vietnamese Realtors Forum for 2012 and 2013. You can only serve and involve yourself with different organizations if you have the passion and the time to do it.

The reward that you receive at the end of the day is the impact you have created among the community and the lifelong friendship and mentors that you have made.

I enjoy cheese, charcuterie, and chocolate pairings at CORK RESTAURANT AND WINE BAR’s 50 bythe-glass options in Logan Circle area. I also head up to West End area to enjoy the CHOCOLATE LOVE TUB, which is a fun-to-do fondue creation at the JUNIPER RESTAURANT.

©istockphoto/NoDerog

DATE NIGHT

SUMMER 2014

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AREAA WASHINGTON PHOTOGRAPHY BY BEN DROZ

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CLOCKWISE FROM TOP LEFT: Policy Committee Members (L to R) Tom Truong, Michael Kelly, and Wendy Knipp. AREAA Founding Chair Allen Okamoto. (L to R) John Wong, Allen Okamoto, Carmen Chong, Ivan Choi, Hope Atuel, Allen Ching, and Michael Kelly. Tom Truong and Evan Huynh enjoying the NAR reception.

n May 5th-7th, almost 45 AREAA members representing chapters from around the country such as Silicon Valley, Las Vegas, New York, and Chicago met in Washington D.C. for the organization’s 2014 National Policy Day. Armed only with AREAA’s 3-Point Policy Plan, business cards, and know­ledge of the issues at hand, attendees took on the nation’s capital and spoke with the most influential leaders about the things that matter most in today’s real estate industry.

Before making their way to the numerous meetings they had set with decision-makers in Congress and various regulatory agencies, AREAA mem-

bers received a special briefing from policy experts at the headquarters of the National Association of REALTORS® (NAR), which is only a short walk from Capitol Hill. At this meeting, members heard from NAR staff members Helen Devlin, Tony Hutchinson, and Brendan Reilly as well as Radian Mortgage’s Phil Bracken about how to effectively engage with lawmakers and regulators as well as the intricacies of AREAA’s policy positions in immigration reform, access to credit, and GSE reform. With the Capitol building in sight from the meeting room, AREAA members began to get a sense of how important these meetings will be.

With this briefing, attendees engaged in over 30 meetings on the Hill. One such meeting was with the Consumer Financial Protection Bureau (CFPB).

At this meeting, AREAA members spoke with leading officials in mortgage underwriting to discuss the agency’s recent rulings on Qualified and Qualified Residential Mortgages (QM and QRM respectively). Tom Truong, who is the 2014 AREAA Policy Committee Chair, said, “It was a great opportunity to speak with the CFPB about their rulings and voice our concerns about the rulings on QM and QRM. They were receptive and really valued our input about how these rulings could drastically affect homeownership rates for Asian Americans and other minority groups.” Additionally, AREAA delegates met with Dr. Michael Stegman, who is the Counselor to the Secretary for Housing Finance Policy, at the Treasury Building. During the gathering, Stegman spoke with members about the financial impact of the Johnson-Crapo Bill, which is a piece of legislation that aims to significantly restructure Fannie Mae and Freddie Mac. Attendees were also given the opportunity to speak with key members of the Federal Reserve as well as tour the Washington D.C. location.

In addition to these meetings, the delegation broke into small- NAR’s Director of Diversity er teams and conducted a number of meetings with attendee’s Fred individual congressmen and senators. At these appointments, Underwood members were able to meet directly with staff members and representatives like Senator Ted Cruz [R-TX], Senator Dianne Feinstein [D-CA], Representative Nancy Pelosi [D-CA], and Representative Grace Meng to discuss AREAA’s 3-Point Policy Plan and relate their own personal experiences in real estate transactions and lending to AREAA’s policy positions. “It was really a great experience to have a conversation with our representatives and their staffs about what we are observing in the field”, AREAA’s 2014 Policy Committee vice-Chair Wendy Knipp acknowledged, “For a lot of our members, it was a little intimidating to try to start a conversation with their representatives, but I think that they realized the importance of what they were doing and they really gained some traction towards the end of their meetings.”

After these appointments were completed, AREAA delegates attended a special gala at the Washington Hilton hosted by the Asian Pacific American Institute for Congressional Studies (APAICS) honoring the 20th year anniversary of the organization. Keynote speakers for the program included actor/activist George Takei and former Speaker of the House Nancy Pelosi. As part of this event, AREAA was honored with the distinguished Community Award. The award was accepted by Chair Ivan Choi and marks a continuing relationship between the organizations in furthering the interest of the Asian American Pacific Islander (AAPI) at the forefront of the nation’s decision making center.

When many members of the AREAA delegation made their way back to their respective homes, they returned with a new understanding about how real estate professionals can interact with their representatives and other officials. Before this year’s Policy Day, many AREAA members did not realize the power they have when voicing their opinions to these national leaders.

While at these meetings, members were able to offer fresh perspectives on these issues that a number of these leaders would not have seen otherwise. It is precisely this reason why the organization places such a high importance on its annual trip to Washington D.C.: providing these officials with this unique perspective and a unified voice for AAPI homeownership is instrumental in bringing about change in the housing market.

(L to R): Lance Grob, Moon Choi, Evan Huynh, Wendy Knipp, Allen Ching, and Sean Palcher

It was a great opportunity to speak with the CFPB about their rulings and voice our concerns about the rulings on QM and QRM. They were receptive and really valued our input about how these rulings could drastically affect homeownership rates for Asian Americans and other minority groups.

– Tom Truong

AREAA’s delegation takes annual picture in on the Capitol’s steps

SUMMER 2014

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RISE OF THE MULTIGENERATION HOUSEHOLD IN AMERICA

BY SHARON MARSH-WYLY

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or a large number of Asian American fami- American and Pacific Islander (AAPI) population. lies, the idea of multi-generational house- According to a Pew Research report, Asian Ameriholds is nothing new. With a strong em- cans lead in this category with 25% of AAPI homes phasis on family values that many Asian cultures considered multi-generational households. This ascribe to, a significant portion of the Asian Amer- number is followed by African Americans with ican population have stuck with the tradition of 23% and Hispanics with 22%1. Steady immigration having more than one generation living under the from Asia and Latin America throughout the last same roof. However, the idea of multi-generational four decades has not only shifted the demographic households is now becoming more and more com- makeup of the United States, but has also led to a mon throughout American households significant amount homes in the United since losing prominence after the States with more than one immediGreat Depression. According to ate family unit in a household. For the U.S. Census Bureau, approxthe majority of these, a strong imately 51 million Americans family support system encourmulti-generational households live in some sort of multi-genages the older parents to live erational households, which with their children and their accounts for almost 17% of grandchildren. For many of the country’s population. This these adult children, when vs. number is on the rise and is their parents get older and expected to grow significantly reach retirement age, they enwithin the next few years. In the courage them to move into their other households small time between 2007 and 2009, house as opposed to placing them the number increased by a staggering in a retirement community. When un10 million people. With this increase, the Source: Pew Research der the same roof, many of these parents multi-generation household is beginning to play act as a second set of eyes for the grandchildren a role in how the idea of a family household is and aid in taking care of responsibilities around shaped. the house. Due the cultural traditions as well as Of the leading causes of this emerging phenom- the mutual benefits that come along with having enon, the cultural demographic of the country adult children and their parents split household must be primarily taken into account. Leading the responsibilities, the multi-generation arrangement trend in multi-generation housing arrangements is something that is popular and sought after in a are multi-ethnic communities such as the Asian number of these multi-cultural communities.

2009 POVERTY RATES

17.5% 30.3%

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tional household2. To explain this reversal, one must consider the age distribution of the country. At this point, the sprawling Baby Boom generation is reaching the final stages of middle age, which offers the older generation on average of 50% more children in which they can move in with in event of the death of a spouse or deteriorating health1. This demographic reality, in addition to economic troubles caused by entitlement reduction, is driving seniors to consider multi-generational households.

Despite being caused by economic and other restraints, most of those involved in this type of arrangement have very positive things to say. According to another Pew Report, more than 75% of the “boomerang” generation has reported that they are satisfied with their current living situation3. A similar report done by Generations United in 2011 concluded that 82% of young adults believed the arrangement brought the family closer, 72% saw that their finances improved significantly, and 75% saw other benefits4. Additionally, with senior living care growing increasingly expensive, the multi-generation arrangement is becoming a sensible and lowcost way to care for aging parents.

With this arrangement frequently benefiting all parties involved, it is not a surprise that this trend will not subside anytime soon. To accommodate

Multigenerational Households by Ethnicity

In addition to these cultural reasons, the state of the economy can explain the rise of multi-generational housing. With the prospect of finding employment in today’s job market still shaky, many young adults who just graduated from college are finding that moving back in with their parents is a way to save on costs before finding suitable jobs.

This move in young adults is at historically high levels. In 1980, only 11% of adults aged 25 to 34 lived in a multi-generational household. By 2008, the number increased to 20%1.

The “boomerang” generation, the name attributed to this group by analysts, continues to face an often-intimidating job market induced by the recession and have had to delay many milestones

Young Adults in Multi-Generational Living 30 25 20

%

Source: Pew Research Center analysis of U.S. Decennial Census Data, 1940-2010

Source: Pew Research

ASIAN AMERICANS: 25% AFRICAN AMERICANS: 23% HISPANIC: 22% NON-HISPANIC WHITE: 13%

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Year in their adult life. An example of this is seen in average age of marriage in the United States. In 1970, the average age for a first time marriage in the United States was 23 for males and 21 for females.

Today, this number has increased to 28 in males and 26 for females. For many, moving out is one of the milestones that has been delayed, thus sustaining the rise in multi-generational households.

On the opposite side of the spectrum, economic factors are also causing older adults to move back in with their children. Throughout the 1980’s and 1990’s, the United States saw older adults who were more independent with only 17% living in multi-generational homes. Within the past few years, this trend has reversed with over 20% of those over the age of 65 living in a multi-genera-

for growing demand, builders and developers are beginning to offer designs with a multi-generational focus in mind. For example, many builders have begun to incorporate two master suites into some of their designs. To meet this growing demand, real estate agents must take active steps in finding these types of homes for multi-generational clients and making necessary accommodations for a more than one set of adults.

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http://www.pewsocialtrends.org/2010/03/18/the-return-of-the-multigenerational-family-household/

2.

http://www.pewsocialtrends.org/2010/03/18/the-return-of-the-multigenerational-family-household/#fn-752-2

3.

4.

http://www.pewsocialtrends.org/2012/03/15/who-are-the-boomerang-kids/ http://www.gu.org/OURWORK/Multigenerational.aspx

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BRINGING TWO WORLDS TOGETHER

The 2014 US China Real Estate Summit Photos by KEN JACQUES

On June 12-13th, the Asian Real Estate Association of America (AREAA) and the China Real Estate Association (CREA) hosted the first ever US China Summit at the Hyatt Regency Century City in Los Angeles. In attendance were over 250 real estate and lending professionals from both countries.

The Summit kicked off with an exclusive shopping event/reception that included locations on Rodeo Drive such as Louis Vuitton, Max Mara, Van Cleef & Arpels, and Tourbillion boutique. During this event, attendees from the United States and China were able to meet with one another for the first time.

During the Summit’s opening general session, attendees heard opening remarks from AREAA’s 2014 National Chair Ivan Choi as well as CREA’s President Liu Zhifeng. These remarks were followed by addresses from the session’s keynote speakers, Greenland Holding

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Group’s Chang I-Fei and Vi’s Randy Richardson. In her address, Chang I-Fei detailed the strategies of the firm’s development projects such the Metropolis Project located in downtown Los Angeles as well as the Atlantic Yards project located in Brookyln. Randy Richardson, who is the Owner/President of the development firm Vi, spoke to attendees about the emerging opportunities associated with developing and selling senior living communities.

The Summit’s general session also had President of Ginnie Mae, Ted Tozer, give speakers a detailed overview of the secondary mortgage market’s role in housing recovery. “We were very pleased to have these industry leaders speak during the Summit”, remarked AREAA Founding Member Allen Chiang, “These speakers are at the forefront real estate development and mortgage transactions and I believe our guests got a lot of useful information from the experience.”

In addition to the session, the Summit featured a Marketplace of North America Cities Development Session where top developers from around the continent shared information about their firms development projects consisting of single family residences, assisted living facilities, commercial and mixed-use lots, and vacation rentals.

The summit also offered six specialized sessions spanning topics in managing urban growth, big data, strategies for developing commercial projects, “green” building and technology, financing for international buyers, and opportunities in senior housing projects. In these sessions, guests were able to get valuable information and talk directly to the speakers about their area of expertise. Chiang added, “With these breakout sessions, our guests were able to get a more focused look at the areas that interest them and their business ventures, which could really help them down the road.”

At the conclusion of the event, attendees gathered for a closing ceremony where representatives from both organizations exchanged gifts and thanked guests for their attendance. A closing reception was then held at the Hyatt’s Green Circle Lawn where attendees were able to strengthen the connections made at the Summit.

The U.S. China Summit comes at a time where global real estate markets are seeing a surge in investment and purchases of real estate projects from Chinese firms. Within the past year, investment firms such as Greenland Holding Group have branched out into places like the United States, the United Kingdom, and Australia for property development. The company intends to generate up to 25% of its revenue share from oversees for diversification purposes amid fluid markets. This trend focusing outward expansion is set to grow in the coming years. After two decades of almost complete growth in prices and construction, the housing market in China has begun to show signs of slowing. In 2014, housing starts fell significantly by 25%. In anticipation of this cooling market, government officials are modifying their outbound investment strategies. As a result of these changes, it is now easier for Chinese firms to look for investment opportunities overseas. This will allow Chinese firms to more easily utilize one of their strongest assets, a large amount of capital, to attract starved markets and fuel residential and commercial development projects such as mixeduse properties and senior living properties.

Those who attended the Summit received first-hand information about these investment strategies and made connections that have the likelihood to carry over into concrete real estate development partnerships, which signals the increased importance of the relationship between AREAA and CREA in the coming years.

TOP LEFT: Greenland Holding Group’s Chang I-Fei TOP RIGHT: CREA Vice President & Secretary General Leru Miao MIDDLE LEFT: Hyatt Vi’s Randy Richardson MIDDLE RIGHT (L TO R): Carmen Chong, Tom Truong, Ethel Groger, Crystal Ansay, Alex Schaub BOTTOM LEFT: HSBC’s Jeff Needham BOTTOM RIGHT: Ivan Choi moderates keynote luncheon panel including (L To R): Gerald Fogelson, Elizabeth Harrington, and Terry Theologides OPPOSITE PAGE: (TOP) AREAA Leaders Present Certificates of Congressional Recognition from Congresswoman Judy Chu to the CREA delegation (BOTTOM) CREA President Liu Zhifeng

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AREAA LAS VEGAS’S ELEVATION EVENT On May 15, AREAA’s Las Vegas Chapter soared to new heights at Elevation, an event to remember. A luxury jet hangar was turned into the ultimate party, complete with a private airplane, Lamborghinis and a helicopter from Maverick Helicopters.

The event included a luxury panel of speakers and was moderated by Randy Char, senior vice president of One Queensridge Place and chapter president of AREAA Las Vegas. Panel speakers included Josef Vann (Publisher and VP of sales Vegas Magazine), Sebastien Silverstri (VP of Food and Beverage at The Venetian | Palazzo), Marilyn Spiegel (Former president of Wynn Las Vegas and Encore Las Vegas), Jim Gentleman (Senior Vice President of Strategy at SK+G) and Jordan Shiraki (Director of Marketing for Lamborghini Las Vegas.)

Following the panel, guests were greeted with savory food from Three Square Food Bank’s Executive Chef John Hilton. Plenty of photos were taken aboard the helicopter and private airplane, the centerpieces of the party.

The event focused on real estate professionals who wanted to break into the luxury market and what it takes to succeed in the business.

AREAA Las Vegas (Asian Real Estate Association of America, Las Vegas Chapter) donated $10,000 to Three Square Food Bank to fight hunger in the Las Vegas valley. Photos: Ray Alamo

AREAA DC METRO CHAPTER’S 3 SECRETS DC Metro Chapter has been established for 6 years. In the last few years, this chapter has been growing steadily and financially, and it is becoming a well-known organization among the real estate and Asian communities.

What is most unique about this chapter is that all the past chairs, presidents, and most of its past board members are still involved in the chapter's activities. Below are three secrets of the chapter: Secret 1: Strong leadership from the beginning. Song Hutchins was the founding president of the DC Metro Chapter and is currently running the Asian-American Homeownership Counseling (AAHC), a 501 C 3, tax exempt nonprofit, to empower and inspire immigrant communities to achieve and maintain the American dream of homeownership - which is exactly the same goal as the AREAA. Secret 2: Diverse board experience and representatives. The DC board and its member base is not 100% Asian in ethnicity. Its core group consists of many non-Asian professionals from many different sectors of real estate related industries like banking, mortgage, title, legal, commercial real estate in addition to the traditional residential real estate field.

Secret 3: Education, Fun and Networking.

DC Metro is very active promoting the AREAA by creating 1 to 2 events each month. And, almost all the events are based on professional education plus business information exchanges, which draws many local professionals to local events.

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EU T I R W

To have your news, awards, good work and accomplishments considered for publication in future editions of a|r|e magazine, contact Michael Kelly at:

mkelly@areaa.org

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rates begin at $200/issue email a-r-e@areaa.org for details

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AREAA’S KENDRICK KIM COMPLETES MASTER’S DEGREE AT REALTOR UNIVERSITY On May 16, 2014, AREAA CAOC Member Kendrick Kim graduated from Realtor University. During the ceremony, this was held at the Omni Shoreham hotel in Washington D.C., Kim was recognized with completing the Masters in Real Estate (MRE) program.

The program was created specifically for real estate professionals and has 5 concentrations ranging from asset & property management to real estate association management.

AREAA CENTRAL VALLEY’S F R O M B R E A K D O W N S T O B R E A K T H R O U G H S WITH BRIAN GOODELL On May 20th 2014, Bank of America and AREAA Central Valley Chapter partnered up to bring a Tom Ferry coaching event to Fresno, CA led by Brian Goodell. Brian Goodell is a world-renowned speaker and a two-time gold medalist in the 1976 Olympics in Montreal, Canada. The event, From Breakdowns to Breakthroughs, talked about solving the 5 biggest problems in the real estate industry. These 5 problems can be found in these 5 areas of how real estate professionals should run their businesses

»» »» »» »» »»

Mindset and Goals Business Systems Presentation and Conversion Skills Lead Generation and Marketing Systems Planning and Organization

Goodell discussed how one can overcome these problems that arise in each area and how to stay on top of them. The attendees enjoyed the interaction and shared their own stories and insights. After the event, many of the attendees took the opportunity to thank Brian Goodell and took pictures with him with his 2 gold medals.

2014-15 AREAA N AT I O N A L E V E N T S

2014 National Convention September 5-7, 2014 Las Vegas, Nevada 2015 Global Summit April 19-22, 2015 Chicago, Illinois 2015 National Convention October 22-24, 2015 San Francisco, California

VIEW LOCAL AND NATI O NAL EVE NT S ONLINE AT:

www.areaa.org

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Join AREAA in Seoul, Korea SEPTEMBER

22-26,

2014

Join AREAA in Korea and take advantage of the opportunity to expand your global reach.

T O PA R T I C I PAT E O R L E A R N M O R E D E TA I L S A B O U T T H E T R A D E M I S S I O N , C O N TA C T: P E T E R PA R K : p e t e r p a r k @ p e t e r p a r k r e . c o m | C A L L : 3 2 3 . 8 1 0 . 1 5 6 5 CHARLIE SUH: charliesuhrealtor@gmail.com | CALL: 818.482.1314

www.areaa.org