Gary Friedman: Well, I think it all depends where demand goes, what happens to the housing market. What’s going to happen with interest rates, inflation in the housing market? And are we in — how long of a downturn are we in? Is this downturn get worse? If housing falls off at a greater rate, just demand is going to go down. Our business is tied to the housing market because if you look at our business, it’s tied to events. Someone bought a new home, they’re remodeling a home or they are redecorating their home. The core of our business is not like the person that goes, yes, I need some new bedding. That’s — our business is tied to those three things. So, if people are not buying homes, if people are not remodeling home. And by the way, when people remodel a home, they’re generally buying a home to live in, our customer is while they’re remodeling.
So, that’s actually kind of good for our business. But if the real estate activity stops, it hurts our business. So, if you have a 20% downfall in the housing market, two out of 10 people didn’t buy a home. If it’s 30%, three out of 10 people didn’t buy a home. And then — or didn’t move or are not remodeling it. Activities — I mean what is it, mortgage applications were down 47% in October. That’s just the number. I’m not the doomsday guy. That’s just the number. And we look at these numbers. So, mortgage applications down 47%. Isn’t good for the outlook of our industry. It’s the highest print yet. So next year, it’s like a month and a half away. That slowdown — like that — they don’t buy a house and they buy the furniture the next day.
So, there’s a whole tale to all this stuff. And so how it cycles through, I just don’t know where it’s going yet. I don’t think anybody does. I think anybody tells you they think know where the housing market is going. I don’t know who’s been right yet. This is not — by the way, for the housing point of view, there is no soft landing. We’re way beyond the soft landing. This is a really hard landing or a crash landing, and it’s looking more like a crash landing in the housing market. It’s looking like 2008, 2009. And that sounds like whatever Eri said like I’m a pessimist or whatever.
Jack Preston: Ominous.
Gary Friedman: Yes, ominous or whatever. Okay. Okay. Maybe I’m a truth teller, and I’m not a BSer. But sometimes the truth isn’t what everybody wants to hear. But it’s just the truth, the fact. You guys can read out, yes, so.
Seth Basham: Understood. Thank you for your candour, and happy holidays.
Gary Friedman: Happy holidays.
Operator: That does conclude today’s questions. I would now like to turn the call over to Gary Friedman for closing remarks.
Gary Friedman: Great. Thank you, everyone. Well, as we said in our letter, we really want to thank all the people and partners, all the world that contribute to our cause, our shareholders for believing in us. And we just wish everybody, happy, happy holiday, and we look forward to speaking with you in the New Year. Thank you.
Operator: Thank you, ladies and gentlemen. This does conclude today’s call. Thank you for your participation. You may now disconnect.
Allison Malkin: Goodbye.
