Modifiers To The News

1.The prices recording now are not the story of the housing market where many who wish to sell do not or cannot because the prices they want are unaffordable for the available buyers.That inventory lingers unlisted for the most part as a continuing hindrance to increased volume and prices in future markets. More likely, the many influences now influencing affordability such as a more restrictive mortgage market for new purchases, the defaults looming for borrowers of sub-prime loans, alt-a loans and conforming 1sts with add-on home equity loans will bring a greater volume of property to the market and prices will fall in a serious way

2.The idea of borrowers defaulting when they have a steady, good-paying job is off the mark. How can a job be good-paying when wage earners can’t pay the bills for a middle class life?  American jobs have to pay way more if we’re going to maintain today’s prices and built the quality of home with the planning standards and community services the consumer expects and our cities are legislated to require.  More likely we will reduce the home ownership percentages and build more rental property.

3.Real estate commissions paid to agencies are also subject to interlopers like Lending Tree and others who get between the agent and the buyer and seller.  And we have yet to see what the income model for Zillow and its competitors will bring at maturity.  You can count on Google enhancing its ad-words position too.  For the agent, after the broker subtracts technology fees, referral fees, desk fees, this fee and that fee from a gross which less than 5 % of the price and also subject to the interlopers, the pickings are slim.  Couple that with the prospect of lower prices.  Remember the cost of operating an automobile is probably closer to 65 cents per mile now, E & O insurance is through the roof, individual agent technology costs exclusive of what the broker fronts are escalating, and on and on.  The agent is going to be stressed for profits in a 7x24 business.  Goodbye individuals and hello more teams.This has become a high capital business which will limit the number of high-paid agents and increase the numbers of low salary transaction personnel.