Q: I understand you were an international student ... what lead to you study abroad?
SH: I was both an international student coming from Croatia to U.S., but also went on a study abroad to Denmark while at a university in Virginia. I came to study in the U.S. following the war in former Yugoslavia. I studied international business as an undergraduate and I thought my career would be in international trade. I wanted to travel everywhere, and I took the advantage of study abroad program to explore yet another country. I appreciate exploring different cultures. I appreciate diversity, architecture, foods!!!

Q: Tell us about some of your past positions you’ve held?
SH: I’ve worked in various realtor groups for the last 8 years, including California Association of Realtors and National Association of Realtors. However, prior to those roles, I worked for Department of Housing and Urban Development and at the Smart Growth Research Center at the University of Maryland. I was very interested in urban form and how cities developed into what they are today. Coming from Europe in 1995, I appreciated urban density and walkability and wanted to understand how American cities could be made more walkable. I think that’s less of an issue in American cities today than was the case in 1990s. My first job out of college was managing an office for a manufacturer of auto wash equipment in Buffalo, NY. I also worked as a Real Estate Agent in Florida and Virginia.

Q: Can you define your current position as Vice President of Business Intelligence?
SH: I’m basically a data guru for our organization. There is so much data available now that Business Intelligence officer basically needs to understand what is useful for the organization and then, more importantly, how to transfer the knowledge in most efficient and effective way so that message is received, and it resonates. There is also valuable, unique information that is being generated thru transactions that our real estate professionals conduct, and my role is to make sure that information is collected, analyzed, and used in impactful ways

Q: How do you support Real Estate Agents at Pacific Union?
SH: Serving as an economist and business intelligence officer, I support our professionals in a few ways. First, I track economic and market trends and identify ways in which they are impacting our housing markets, and then transfer the knowledge in a way which is easy to digest and can be used when communicating with their clients. I also help gather their collective knowledge and develop analytics which can determine current and predictive trends.


Q: How has technology changed in Real Estate?
SH: While real estate services have benefited a great deal from technology, the service itself – helping buyers and sellers to buy or sell their homes – is essentially unchanged. However, because of technology changes and consumers ability to do most of the legwork themselves, the role of a real estate professional has evolved to one that focuses on education, guidance, safeguard.

Q: Obviously, Artificial Intelligence is everywhere … I’ve notice Property Management companies are now using Robots to show rentals. How will further enhancements in AI effect the Real Estate Agent and their client in the future?
SH: AI will make the home buying process more efficient, whether in allowing clients to visualize their renovation ideas or in simple allowing them to view homes from the comfort of their homes. It will be especially useful for home buyers who are looking to relocate to another state or a country or those who would like to visit open houses at any hour of a day. It will also ensure a more efficient relationship between agents and their clients as agent learns more about clients’ likes, needs, and desires, thru their use of technology and AI products. The opportunities for efficiency are almost endless with further enhancements in AI.

Q: With the potential downsizing in jobs due to AI and further automation, how will this affect the Real Estate Market in the future?
SH: AI and automation will certainly make real estate agents more efficient and effective and with that some functions with become automated and thus eliminating some of the jobs that currently exist. However, the integral role of a real estate agents in home-buying and home-selling process, their experience, and institutional knowledge will remain necessary and in demand. Overall real estate industry will become more efficient deeming possibly a need for fewer agents, but I don’t see the human component losing value due to AI. 



Q: Why have builders been slow to filling the needs of a housing shortage throughout the Country?
SH: There are many components to that story and a lot has to do with the last housing crash. The crash left fewer builders around as some smaller ones bankrupted, or sold to bigger builders, and others consolidated. Larger builders look for larger swats of developable land and a lot of demand following the recession was happening in metropolitan areas with fewer developable land options. Many of builders who were doing smaller infill projects found it unprofitable to do those and faced much resistance from existing homeowners when attempting to build, especially in California. There is also higher cost of building due to shortage of labor, higher material costs, higher costs of obtaining building permits in desirable markets (can account for almost 25 percent of the final price of a new single-family home), and higher fees imposed by municipalities, which all lead to focus on higher-end new home construction – clearly not filing the needs of first-time buyers. It seems that builders were overall timider this time around and wanted to ensure buyer demand will remain strong and consistent.


Q: We now know where we stand with tax reform regarding mortgage interest and property tax right-offs. Since tax reform was signed into law I've seen a few different articles. First is the potential of a 10% downturn in Bay Area pricing. I’ve also seen an article that predicts home prices in the Bay Area will go up further, as residents stay in their current home to enjoy the full property tax right-off. Can you give us your insight on how you think this will play out in 2018 for Bay Area buyers and sellers?
SH: Tax reform is not favorable for new home buyers in California or other states with higher cost of real estate. Home buyers will be able to deduct less in mortgage interest, state and local income taxes, and property taxes. It is true that tax reform disincentives existing home-owners from selling their homes and potentially losing some of the tax deductions. That is my biggest concern. Creating a discontinuous relationship between existing and new home owners will lead to fewer existing owners willing to sell. Prop 13 has in a sense already created some of that disincentive. Nevertheless, because of the severe housing shortage and possible fewer listings in the future, I don’t think we’ll see a 10 percent decline in pricing. At our Bay Area Real Estate and Economic Forecast to 2020, we discussed some of this potential outcomes and the impact on home pricing which may be more price moderation than previously expected but not a price decline. 


Q: Any further predictions for the next two or three years?
SH: It will be an interesting market. Absent tax changes, demographic shifts alone suggested strong demand from millennials coupled with solid potential supply coming from retiring baby boomers. In the Bay Area, we’ve seen a continually strong demand from millennials/first time buyers in 2017. Millennials are driving demand for walkability, access to transit, urban amenities. I think we’ll see these trends intensify and there will be more infill development. Fortunately, employment and income growth in the Bay Area has helped fuel this demand and will continue over the next few years. Anticipation over interest rate increases may light a fire under some potential buyers though millennials seem less sensitive to interest rate changes than the previous generations (probably because they weren’t purchasing in times of 10+% rates). Lack of inventory will continue pushing prices up which will further deteriorate affordability. And lack of affordability is one of the biggest concern for our area. The question is how it will impact outmigration of young adults, who will be able to afford to stay, and what is the quality of life in that case. We may see more people leaving the area as other tech hubs, such as Seattle, Austin, develop across the country.


Five Things About Selma Hepp

1. If you could talk to one person from history, who would it be and why?
Mother Teresa. It’s hard to fully verbalize my admiration for Mother Teresa, but there was something about her unconventional ways coupled with her modesty and kindness that is so beautiful. While I don’t necessarily agree with some of her beliefs, I do appreciate her dedication to peace and poor.

2. What’s the best advice anyone’s ever given you? 
When you find yourself stressed, ask yourself one question: Will this matter in 1 years from now? If yes, then do something about the situation. If no, then let it go.

3. Do you have a favorite Movie?
Yes, it’s 1987 After the Promise about a father who was declared an unfit parent because of his financial situation when his wife dies. On a lighter side, I love The Thomas Crown Affair.

4. Where is your dream vacation?
I’m currently obsessed with Latin America and would love to tour the continent for a month, or two.

5. Do you enjoy cooking? If so, can you share some of your favorite meals you enjoy making?
Yes, I love cooking. One of my go-to dishes is Roasted Tomatoes with Shrimp and Feta. Also, I love fish so I make a lot of salmon and brancino, and ceviche. I like to add jalapeno to everything. Then there is Mexican Turkey Burgers with cilantro-Lime Pesto. I’m an avid user of Pinterest for recipes!