I am constantly hit with questions about when I think the real estate market will rebound from Real Estate Agents all across our Nation. The short answer is “No Time Soon!”
Before the real estate industry can begin a recovery we must first hit bottom and unfortunately I feel we are far from that yet. The housing market is not only suffering from the subprime lending fiasco it is currently driven by nothing less than fear and lack of confidence.
Public perception of the real estate market as a solid investment is shaken daily by the news of record braking home foreclosures. This “cancer” is now spreading rapidly infecting neighborhoods across America with devaluation of homes that took no part in subprime lending.
Homeowners are experiencing their equity diminish weekly as homes are just not selling. While some buyers are waiting for the market to hit bottom before buying others that are normally qualified buyers are experiencing difficulty in obtaining home loans as the credit crunch continues to tighten.
There will be no recovery anytime soon. On top of all the issues facing the real estate industry we have a Presidential Election right around the corner. While the main stream media has a true love affair with Sen. Obama, Wall Street reels over the prospect of an Obama Presidency. As well they should. Sen. Barrack Obama has demonstrated his distain for business and as made his intentions of raising taxes on business across the board well known. Legislative bills that Obama has co-sponsored shows a severe lack of knowledge when it comes to the real estate industry and the economy as a whole. If Sen. Obama is elected as president we can count on Wall Street and investors sitting on their hands for at least a year until they can assess how Obama handles key issues in the economy such as taxation.
In addition to the Obama wildcard there are still ARMs (Adjustable Rate Mortgages) that have yet to mature. Some Subprime loans that were originated in 2005 will not mature until sometime in 2010. This means there will be many more foreclosures in months to come. So the immediate prospect for industry recovery is bleak to say the least.
It is clear that many real estate Agents will not survive these tough times. It is unfortunate but as in nature only the strong will survive. That is NOT a bad thing for the industry. Real estate has always and always will cycle. In bad times weak Agents will drop by the way side and while the quality of professionalism improves the competition becomes less intense. This is a win-win proposition for both the general public and the true real estate professional.
For real estate Agents to survive they must be good managers of their time and resources. Unnecessary expenditures and marketing expenses that do not work need to be pruned. To survive we must make every penny and every minute count. Those that do will survive to see better times.Share