In this episode of the REconomy Podcast™, Chief Economist Mark Fleming and Deputy Chief Economist Odeta Kushi explore the often-overlooked infrastructure that makes America's $5 trillion real estate economy1 possible: private property rights and property records. The conversation explains how private property rights fuel wealth creation and economic growth, how title insurance emerged from the need to protect those rights and why property records qualify as critical economic infrastructure — all in honor of America's 250th anniversary and the enduring legacy of Kurt Pfotenhauer, First American Title's former vice chairman.
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Listen to the REconomy Podcast™ Episode 145:
"Our economy wasn't built solely on physical infrastructure. It was built on institutional infrastructure: property rights and contracts and courts and financial systems and public records." — Odeta Kushi, Deputy Chief Economist, First American
Transcript:
Odeta Kushi - Before we begin, we'd like to dedicate this episode of The REconomy Podcast to Kurt Pfotenhauer, former vice chairman of First American Title and a mentor to both of us. Kurt was a man of principle, integrity and deep knowledge, not only of our industry, but of our nation's history and the institutions that underpin it.
He often reminded us that strong institutions, property rights and the rule of law are foundations of economic prosperity and must never be taken for granted. As we reflect on America's 250th anniversary and the importance of the institutions that support homeownership and property rights, we are reminded of Kurt's wisdom and lasting influence. Kurt, you are deeply missed. May you rest in peace.
Odeta Kushi - Hello, and welcome to episode 145 of The REconomy Podcast, where we discuss economic issues that impact real estate, housing and affordability. I'm Odeta Kushi, deputy chief economist at First American, and here with me is Mark Fleming, chief economist at First American. Hey Mark, can you believe America is celebrating 250 years since the adoption of the Declaration of Independence this week?
Mark Fleming - I know it's remarkable. 250 years, the semi-quincentennial. I got that right. That's a lot of history, a lot of change, and a lot of economic evolution.
Odeta Kushi - Ooh, mouthful. It really is, and this milestone got us thinking about a simple question: what helped make the U.S. such an economic success story?
Mark Fleming - Of course, there are many answers to that question: innovation, entrepreneurship, natural resources, geography. But economists also tend to focus on institutions, the rules and systems that make economic activity possible in the first place.
Odeta Kushi - Any examples?
Mark Fleming - Well, I'm thinking of the rule of law, enforceable contracts, functioning financial markets and, perhaps one of the most important institutions of all, near and dear to our hearts: private property rights.
Odeta Kushi - Yes. Which just so happens to be where today's conversation is headed. And, since this episode will publish just ahead of Independence Day, we thought, of course, we'd take a step back from mortgage rates and inventory, affordability, all the things we typically talk about and focus on something more foundational, specifically why property rights matter, how they helped shape America's economy, and the often overlooked infrastructure that helps make property ownership possible.
Mark Fleming - And yes, for anyone listening, this means we're going to spend some time talking about title insurance because of its foundational role in the establishment of those private property rights.
Odeta Kushi - Great point. Talking title, something we don't actually do very often.
Mark Fleming - No, we don't. It's almost as if we just all assume that those private property rights are just there.
Odeta Kushi - Indeed, we spend most of our time talking about housing markets and economic trends, but this felt like the right moment because, when you think about homeownership, you really can't separate it from the concept of ownership itself. So, time to talk about the institution of private property rights.
Mark Fleming - Exactly. And, before there can be homeownership, there has to be ownership, and ownership requires confidence. It requires confidence that property rights are clearly defined, that ownership can be established, that transactions can occur efficiently and that the rules governing those transactions are widely understood and enforced. Those things sound obvious to us today, but historically they were anything but.
Odeta Kushi - And that, you know, is one of the main reasons economists care so much about property rights. There's a famous economist named Hernando de Soto who spent much of his career studying why some countries struggle to create wealth, while others prosper. One of his key insights was that economic growth depends not only on physical assets, but also on the systems that allow those assets to be used, financed, transferred, and protected.
Mark Fleming - Yes, de Soto famously referred to unclear ownership as creating dead capital. His point was that people may possess land or property, but if ownership isn't clearly documented and legally recognized, it's much harder to unlock the economic value of that asset. You may not be able to borrow against it or be able to transfer it easily. You may not be able to use it as collateral to start a business or invest in your future. Without clear property rights, democracy and capitalism suffer.
Odeta Kushi - In other words, ownership isn't just about possessing something, it's about having confidence that your ownership rights are recognized and protected.
Mark Fleming - Exactly. And that's one of the reasons secure property rights have long been associated with economic growth. People are more willing to invest in a home, improve a property, start a business, or build wealth when they're confident that they can enjoy the benefits of those investments.
Odeta Kushi - Which brings us to a question that many people probably don't spend too much time thinking about. How do we actually know who owns what?
Mark Fleming - Ha, that is a great question because when most people buy a home, they naturally focus on the house itself. They're thinking about the bedrooms, the schools, the neighborhoods, the commute times, mortgage rates, maybe whether the kitchen needs updating. But what they're generally not thinking about is the property's ownership history.
Odeta Kushi - Unless you're a housing economist like you or me. But every property has a history. In many cases, that history stretches back decades, sometimes more than a century. Over time, properties are bought, sold, inherited, subdivided, refinanced, improved, and occasionally disputed. Every one of those events creates records.
Mark Fleming - And those records form the foundation of our property ownership system, which brings us to a concept that has been getting a lot of attention recently and was the focus of a new First American white paper. The idea that property records are actually a form of critical economic infrastructure. When people hear the word infrastructure, they tend to think of physical things like roads and bridges and ports and airports, power grids. But infrastructure is really anything that supports economic activity at scale, and property records absolutely fit that definition.
Odeta Kushi - That's definitely one of the most compelling ideas in the paper. Property records support an economy that generates roughly five trillion dollars in real estate activity every year. They enable people to buy homes, sell homes, refinance mortgages, develop land, invest in real estate and transfer wealth across generations. Without reliable ownership records, much of that activity becomes slower, riskier, and more expensive.
Mark Fleming - Exactly. But what's especially interesting about the United States is that this infrastructure is maintained through a public-private partnership. Public recording offices preserve property records and make them available, but title professionals perform the search, the examination, underwriting, curative, settlement, claims, legal and risk management work that helps ensure those records can actually be relied upon in a transaction — that those records do represent clear private property rights.
Odeta Kushi - That's an important distinction because recording a document and determining whether ownership is clear are not the same thing.
Mark Fleming - That's exactly right. The public record contains information, but someone still has to evaluate that information, identify potential issues, resolve problems and assess risk. That's where title professionals come in. They curate the public record for the benefit of society.
Odeta Kushi - That's something I learned that surprised me when I first joined the title industry: just how much preventative or curative work occurs before a transaction ever closes. Because most people hear the word insurance and assume it's primarily about paying claims after something goes wrong. Think health insurance, think car insurance, right?
Mark Fleming - That's right. It's the case for all other types of insurance, I think. But title insurance is different. A significant amount of effort occurs before the policy is even issued. The objective is to identify and resolve those issues before they become claims. That's why title professionals spend so much time searching records, examining documents, identifying defects, and curing those problems.
Odeta Kushi - The word curative still sounds like a medical procedure to me.
Mark Fleming - So true, but curative is derived from the verb to curate, which is the action taken by title professionals on that public record.
Odeta Kushi - Actually a pretty good analogy.
Mark Fleming - And that is the goal: to identify and fix issues before they become larger problems. Maybe there's an unreleased lien, maybe a legal description contains an error, maybe an ownership interest wasn't properly transferred years ago, maybe a document was recorded incorrectly. Whatever the issue, the objective is to resolve it before that transaction closes.
Odeta Kushi - Which is one reason title insurance emerged in the first place. Let's do a quick history lesson because it's America's semi-quincentennial — whew — and economists love history almost as much as they love spreadsheets. Or at least we do. Before title insurance existed, buyers often relied on attorneys to review property records and provide legal opinions regarding ownership. But legal opinions weren't guarantees, right? In the late 19th century, a court case involving a defective title opinion highlighted the risks associated with that system.
Mark Fleming - You got it.
Odeta Kushi - And ultimately helped spur the creation of title insurance.
Mark Fleming - That's right. The basic idea was straightforward. Rather than relying solely on an attorney's interpretation of the record, title insurance would combine a thorough examination of the title with financial protections against covered risks. The concept proved valuable because it increased confidence in real estate transactions, again helping to clearly identify those private property rights.
Odeta Kushi - And, around that same period, in 1889, Orange County Title Company was founded in Southern California. That company eventually became what we know today as First American.
Mark Fleming - Yep, which means our company's history overlaps with much of the modern history of title insurance itself. Cue Elton John's "I'm Still Standing." Okay, I'll stop. We all have to contribute in our own special way.
Odeta Kushi - Oh my gosh. America's turning 250 and you're celebrating 1983.
Well, for the last 136 years, we've had a front row seat to more than a century of economic development and population growth, homeownership expansion and, of course, real estate innovation.
Mark Fleming - And one thing that has remained remarkably consistent over that period is the importance of maintaining confidence in property ownership, because confidence is really what makes markets work. Investors need confidence, lenders need confidence, home buyers need confidence, builders need confidence, and that confidence ultimately depends on the integrity of the ownership system.
Odeta Kushi -Yep. A bit like Wikipedia, most people don't think about who maintains it until something is wrong.
Mark Fleming - Hmm, subtle 2000s reference. I like it. I see what you did there.
Odeta Kushi - I had to sneak it in. Now, of course, the difference is that property ownership is maybe a little bit more consequential than a disputed Wikipedia entry.
Mark Fleming - Yes, slightly.
Odeta Kushi - But I do think there's a common thread here. Whether we're talking about Wikipedia or financial markets or property ownership records, these systems only work when people trust them.
Mark Fleming - And that trust doesn't just appear on its own. Behind every reliable economic institution are the people doing the work to maintain it, improve it, and protect its integrity.
Odeta Kushi - Exactly. And, as Mark and I were preparing for this episode, we both found ourselves thinking a lot about someone who had a tremendous influence on us and how we think about these issues. Our late friend and mentor, First American Title's former Vice Chairman, Kurt Pfotenhauer.
Mark Fleming - That's right. Kurt had an extraordinary ability to explain complicated ideas in ways that immediately made sense. One of his phrases that has always stayed with me was his description of title professionals as private property protectors.
Odeta Kushi - He did. And honestly, that was one of Kurt's gifts. He had a way of articulating the very thing you were trying to say, but couldn't quite find the words for. We miss him every day. And you know, I do love that phrase. Again, he was so good at creating these phrases because it captures something bigger than a single transaction. It really reminds us that title work is about protecting an economic institution.
Mark Fleming - Exactly. Go figure that Kurt would be the one to put it perfectly. One that allows ownership rights to be established, transferred, financed and protected. A system that supports homeownership, investment, entrepreneurship and economic mobility. A system that most people rarely think about because when it works properly, it's largely invisible.
Odeta Kushi - Exactly. That's actually one of the great ironies. Nobody notices property records when they're functioning well. I mean, nobody wakes up in the morning excited to discuss chains of title.
Mark Fleming - Speak for yourself. I do it daily.
Odeta Kushi - I know, I've gotten a couple calls from you in the morning to discuss chains of title, but you know, we're economists. We may not be representative of the broader population. Nevertheless, as we celebrate America's 250th this week, it's worth remembering that our economy wasn't built solely on physical infrastructure. It was built on institutional infrastructure: property rights and contracts and courts and financial systems and public records. These institutions created the confidence necessary for investment, innovation, and economic growth.
Mark Fleming - And they continue to matter today.
Odeta Kushi - So maybe that's our Independence Day takeaway. As we celebrate 250 years of American history, it's worth appreciating not only the homes we live in, but also the institution that helped make ownership of those homes possible.
Mark Fleming - And perhaps taking a moment to recognize the people who work every day, often behind the scenes, to help protect those rights.
Odeta Kushi - Private property protectors.
Mark Fleming - Exactly, protecting our modern democracy and the institution that has served America so well since the Declaration of Independence in 1776.
Odeta Kushi - Well, yes. Wow.
Mark Fleming - For those listening, you're going to have to look up the YouTube video to see what's happening right now.
Mark Fleming - I highly encourage you to look up the YouTube video, maybe take a screenshot or two. I don't know, just for records. Where does one get a hat like that? Yeah, I'd like to know.
Mark Fleming - Ha, a good question. I'm not answering it.
Odeta Kushi - You know, I think we'll end there. Happy Fourth of July to all of our listeners. And, as always, thank you for joining us on this episode of The REconomy Podcast. If you have an economics-related question you'd like us to feature in the future, you can email us at economics@firstam.com. And, as always, if you can't wait for the next episode, you can subscribe to our Econ Center at firstam.com/economics or connect with us on LinkedIn. Until next time.
Thank you for listening, and we hope you enjoyed this episode of The REconomy Podcast from First American. We're pleased to offer you even more economic content at firstam.com/economics. This episode is copyright 2026 by First American Financial Corporation. All rights reserved.
This transcript has been edited for clarity.
[1] The National Association of Home Builders (NAHB), using data from the U.S. Bureau of Economic Analysis (BEA), reported that housing's share of U.S. GDP was approximately 16.1% in 2024, equivalent to roughly $4.7–$5.0 trillion annually based on U.S. GDP.
