Part of the “new normal?”

I wonder if squirrelly deals are a part of the “new normal” – the pattern that we have settled into as a consequence of the “Great Recession” of 2008-9? It certainly seems and feels like every deal is a little squirrelly these days, a little more difficult, with a few more issues to resolve. Now, admittedly even before the current economic problems real estate transactions were often fraught with opportunities for screw-ups or blow-ups. This is not a profession for the faint of heart; nor for the perfectionist, since it will drive them nuts.

Even though we are required to point out to the clients that we are not lawyers, just lowly Realtors, we write legally binding addendums and amendments to legal contracts on a daily basis. Thought we are not professional arbitrators we arbitrate disagreement and disputes on many contracts. And while we are neither title company employees nor mortgage brokers, we do much of the legwork for both to make sure that deals go through.

I serve as a mentor for several new agents in our office and I always try to help them understand and make sense out of the chaos that is our business. To a great extent is it part of our job to mask as much of that chaos as we can from the clients, working feverishly behind the scenes to make it appear to be a seamless and smooth process. Sometimes you get help from the agent on the other side and sometimes you end up doing the work for both sides, but the client doesn’t need to see any of that. If you can get to the end of closing and have the client say, “Wow, that was easier that I thought it would be” you have done your job well.

These days, that’s getting harder and harder, especially when the deal involves the infamous “third party” that must approve everything. Banks being involved with sales, whether it is a foreclosure or a short sale, throws a whole new monkey wrench into the process and it is one that even both agents in the deal can’t do much about. Having talked to some ex-bank employees who were involved with these things I can better understand that many times they don’t know what they’re doing or don’t have enough people on board to deal with the tsunami of distressed properties that they have to deal with these days. So, rather than add to the solution, many times they just add to the problem.

I certainly hope that this is a temporary thing, but I may have to have a very liberal definition of “temporary”, Unfortunately we seem to be only in the middle of the foreclosure mess, with another wave or two still to come and most economists still predicting no real relief around until 2011 or 2012. So maybe this is a part of the “new normal” for a while to come. Falling home values and their impact upon appraisals also appear will be sticking with us for a while yet.

There are all sorts of secondary fallout that has occurred because of the economic mess. Divorces are up, which has a big impact on our business. Leases and land contracts are up as ex-homeowners who were foreclosed look for places to live. Failed deals are up dramatically as more an more buyers find defects in the homes that they were trying to buy out of foreclosure or more and more homes fail to appraise at agreed upon prices.

The Chinese have the saying “may you live in interesting times”, which many initially took to be a positive statement, but which really is a curse that meant times that are filled with danger and challenges. We certainly are living through interesting times right now. What an interesting time to be a Realtor!