Are You Still A Real Estate Agent? If So, Why?

Seriously, this now has to be a question asked of many Realtors out there. It’s funny. When data that just hammers home the reality of the imminent housing sector collapse, where is the National Association of Realtors and Lawrence Yun?

Right now someone should be standing post lighting the bon fires and ringing the alarm bells. You know they give tsunami warnings when an earthquake happens in the ocean? Well someone needs to be sounding the alarm across the land right now telling everyone in the real estate business to head for cover.

It’s not just the agents who need to head to higher ground. If you’re trying to sell a house or complete a short sale you may want to don the life jacket and begin rationing the morsels that you have in the cupboard.

Don’t believe me? Mark it down. Take a note, put it in your wallet or pocketbook and then take it out in about 6-12 months and look at it. If you don’t take heed now, you’ll be wondering why you didn’t listen and why you didn’t jump head first into the lifeboat.

Why do I sound so ominous? Well, I get info, I get data, I see studies, and right now the storm clouds are as bad as I have ever seen them. But I’m not an economist so I’ll just tell you what the guys with the MBA’s are saying.

Maybe then you’ll stand up and take notice.

The third quarter reports from Fannie Mae, Freddie Mac and the FHA were recently released. In those reports it was stated that the combined Real Estate Owned (REO) inventory of the coven of debt rose 24 percent since the 2nd quarter and an unbelievable 93% over the same period last year.

For you math challenged, that’s almost a doubling of REO inventory! Let me pose it to you in a different way.

There are nearly 300,000 REO properties sitting on the books of JUST Fannie, Freddie and the FHA. That doesn’t even include the other lenders sitting on bad mortgages and REO’s.

So what does all of this mean? It’s really simple and something that I have been saying for years. Realtors don’t understand, or refuse to acknowledge the irrefutable Law of Supply And Demand.

Instead they go to flowery seminars and meet-ups where everyone speaks the same language and no one speaks the hard facts. Listen, if you were in the used car business… (as if you wanted to escalate up the food chain) and there were a bunch of cars on the lot and no buyers, would you hang around just waiting, hoping someone would eventually walk onto the lot?

Now imagine that same lot being on the route for 50 trucks bringing hundreds of more cars to sell. What would you do? Ya can’t even sell the ones on the lot now! Get the picture?

If you have a ton of savings and want to wait it out, ya might survive the real estate Armageddon. But how many real estate agents can actually do that?

Diana Olick from CNBC’s Realty Check said it best today when she penned an article about this very subject and closed it with a great, punctuating quip.

“We can talk prices, affordability, confidence, foreclosures, scandals, politics, whatever you want, but in the end it comes down to supply and demand.

We are looking at a ballooning supply coupled with dwindling demand. You do the math.”

Source: RealEstateRadioUSA