The headlines can be frightening
The Post and Courier is Charleston's daily paper. I don't generally read the paper any day but Saturday morning when my wife Polly and I have breakfast or lunch out at a restaurant if I am not working with a client. I like the Saturday paper and my wife especially likes the real estate section which is included in the Saturday edition. I really don't understand why she likes looking at the 1 inch black and white ads of houses rather than online with multiple color pictures and far more information but since we're really not looking for a new house, it really doesn't matter and she seems to enjoy it.
Every once in a while, the paper seems to deliver a free newspaper to everyone and this Sunday, it was laying in the driveway just waiting to read. And the headline across the top of page one just had to frighten anyone who is interested in real estate which is almost everyone in the Charleston South Carolina real estate market, homeowners, buyers, sellers and real estate agents.
Good Credit? Good luck screams the banner. The story goes on to say that Lowcountry home buyers are struggling to find financing during the market crisis and one individual was found who had money to put down on a house, reasonable credit that could be a little better and was having problems obtaining a mortgage. There were mentions of lenders going out of business, real estate attorneys having to delay closings and other negative happenings in the real estate and mortgage industry.
OK, there are problems. There is too much inventory of homes for sale. There are fewer buyers for several reasons. One reason is that many people can't sell their current home either here in Charleston or somewhere else in the country if they want to move to Charleston. A second reason is that it is now more difficult to obtain a mortgage because the lenders will no longer lend money to individuals who can't provide full documentation of income and demonstrate they can afford the monthly payment. Credit standards have been raised and if you want to use an adjustable rate mortgage, you have to qualify at the higher rate that the loan could reset to in 3, 5 or 7 years when the adjustable period ends. That means you need a higher income to qualify than previously. And the lenders are looking at the percentage of debt as well to determine whether you might be getting in over your head.
The mortgage pendulum has swung from too easy to too difficult but, mortgages are still being offered and buyers can in fact obtain them get them funded and they can proceed to buy the home they want. The frightening newspaper headline would make you think that you can forget about it.
Read the headline, the sub headline and you might think, it's all over. It is the end of real estate as we know it.
While the newspaper was on the subject of Charleston real estate, the business section ran a story on the declining numbers of real estate agents. Of course it is true. Many people got into real estate during the boom to make big, fast and easy money. It would have been nice if the real estate schools spent a few hours on the reality of the real estate industry and that it isn't big, fast and easy. It is difficult and it takes time to learn and after you sell a house or two to a friend, neighbor or relative, you have to find a way to become successful.
There were so many real estate agents coming into the ranks that the old facilities could no longer accommodate the size of the crowds getting sworn in as Realtors (R). CTAR, The Charleston Trident Association of Realtors (R) even waived the quarterly MLS fees for the 4th quarter of 2005 because they took in so much money in dues that their budget coffers were overflowing. There were a lot of excess agents and when the number of sales declined somewhat, many found they couldn't make a living and had to go find a "real job".
I'm sure glad I didn't have to spend $1.50 to read all about it.