The Monday morning staff meeting started off fairly quietly. The Boss was out of the office taking a class, and one of the agents was off getting a certification (real estate agents sure like those important looking letters after their names), effectively leaving the meeting with just four attendees; myself, Office Manager, and two agents. We discussed a new listing, bickered good-naturedly over who was holding a house open for the agent tour tomorrow, talked about our newest overhaul to one of the company websites....

Then we arrived at our list of closed and pending sales.

It's no mystery to anyone in the country that the real estate market has plummeted, a fact that is driven home every time I look at statistics, and especially so when I glanced at the office's closed/pending sales report this morning. There's not much on there. It's a low number. Scary low. Lower than I've ever seen. Granted, here in my small corner of Western Washington we're not as bad off as some parts of the country, but it's still not a pretty picture.

There are a few things I wanted to touch on here concerning the real estate market in my town. The first is Washington's new(ish) "Distressed Home" sales law. This law, enacted somewhere around June of this year, created new duties for real estate agents and brokers who were selling "distressed" homes; that is, homes that are in danger of/ in the process of foreclosure. An agent/broker who agreed to help someone sell a "distressed" home is now a Distressed Home Consultant, which entails additional duties and much greater liabilities, including the potential for incurring much greater actual damages in the event of a violation of the law. From my take on things, this was an extremely important step that needed to be taken. Foreclosures have skyrocketed as homeowners default on mortgages, leaving them vulnerable to foreclosure rescue scams. Unfortunately the extreme increase of liability associated with taking on the responsibilities of a "DHC" caused many larger real estate offices to refuse to allow their agents to accept a distressed listing, leaving homeowners little option but to have their homes repossessed, something I'm sure the banks weren't all that thrilled by. They don't want the houses back.

The swell of foreclosures was met by an equal tide of cheap new construction homes, leaving resale houses to linger on the market.

Interestingly enough, home prices have not fallen all that much in my county (in comparison to other areas). Of course, the trade off is that there are fewer and fewer sales. Home prices are being forced to adjust until affordability is again on par with income, and from my personal experience, sellers are unwilling to acknowledge the fact that prices are dropping. They insist that the price of their home is exactly where it should be. The value of a home is a touchy subject for homeowners. It can be deeply personal, especially if the homeowner has done a lot of work to the property; put in a new deck, perfected the landscaping, added that bonus room.... they are often unable to recognize the fact that prices are dropping around them as their home spends more and more time on the market, with newer, lower priced listings leaving them behind, trailing in the dust. All listings are engaged in two separate battles - a pricing war and a beauty contest. Homes have to win both to even attract a showing, much less a reasonable offer. Top real estate agents in the country are now encouraging brokers to be extremely selective with the listings they accept - taking a listing is extremely draining financially with all the marketing and time necessary to attract a buyer, and if the seller isn't motivated and understanding of the current market, it is frequently, to be perfectly honest, not worth a broker/agent's time to attempt to sell it.

As more houses maintain an unrealistic asking price and don't sell, additional houses appear on the market, swelling the inventory.

Of course in conjunction with the rising home inventory, it has become more and more difficult to obtain a loan. We had a meeting last week with a lender from Countrywide that we frequently do business with. Countrywide has recently been purchased by Bank of America, and the lender expressed considerable relief. "Hey, at least Bank of America still has money," she told us. She explained a lot about mortgages that were still available though it is more difficult to qualify.

I'll admit, I'm not as knowledgeable as I probably should be. I don't know all that much about loans, though I do think it's probably a good thing that companies aren't handing out mortgages left and right to people who can't afford them. What I know about the statistics and seller reactions are what's staring me in the face every time I come to work. I could do more research, but I don't. Why? Honestly, I'm kind of freaked out. It's not a real fun time to be working in real estate. Agents are having their own homes foreclosed on, and dropping out of the business. An agent working in my office, two years older than I am, told me today that he thought he was going to have to find a second job. He's brilliant at what he does, and has done exceedingly well in the last couple of years, only to tank in this difficult market like so many other agents.

So....

Most of this morning's meeting was taken up by discussing the market. One of the agents asked my office manager (my boss's husband) and asked if he had ever seen a market this bad.

Office manager shook his head. "Honestly? No."

I know this has been a pretty disjointed ramble, but hey, it's Monday. Give me a break. ^_^