How could this happen?
The Plight of Today's Seller of Real Estate
The typical seller in today's Berkshire real estate market reflects the five stages of grief: denial, anger, bargaining, depression and finally acceptance....that the values and their life savings along with those former values, have tumbled beyond recovery in the foreseeable future.
Each phase is predictable. After protesting their Williamstown, Adams, North Adams or other Berkshire Property is "different" from all the rest, getting angry at their broker for failing to get them the price they "needed" or what they believe their property is "really" worth¸ after trying to negotiate with the market and falling into despair over their plight, they eventually arrive at acquiescence and acceptance and do what is necessary to move on with their lives.
This reaching the acceptance phase can run the gamut from just accepting the "loss" to dipping in to their own pockets to cover their current debt to working out a short sale with their lender or even just walking away completely and simply allowing the bank to foreclose.
The former ideas and "solutions" that once could be relied on to assure a fairly quick sale at a good profit no longer can be counted on to do the job. The current dilemma for those not absolutely forced into "acceptance and selling" has become one of "selling now at a measurable loss or waiting indefinitely and facing an unknown and potentially greater loss."
The economist Robert Shiller among others has projected potential housing price declines from the peak in '07 by as much as 65%. Since property values across the nation have already declined on average 30-35% that means we could be facing another 30-35% decline ahead. Any further decline will be very difficult. The painful grief work will continue as retirees seek to fund an uncertain future without the profit they had anticipated from their home sale.
The baby boomers were solidly invested in the belief that the best investment for retirement was owning a home. This belief was parlayed and reinforced by economists, politicians, bankers, accountants, and investment advisers for more than 50 years.
Now after years of striving and paying mortgages the retiree is told by a Realtor® the terrible truth of the current times. "No Virginia, there is no Santa Claus. The story was a fairy tale from which only banks, Wall Street, and politicians benefitted."
Walking away can be filled with grief also.
Now that you (seller) are ready to cash in your investment to secure the next 20 years of your life you learn that no one is coming to your aid. The grief and anger are overwhelming and undeniable. Where do you go from here? Realtors® have evolved into grief counselors, anger mediators, and a shoulder to cry on. Realtors® have become a target for all the stages that a seller goes through before they accept the market value offer and eventually sell their home.
How can we help our sellers cope and still maintain our own positive attitude and enthusiasm as we work harder to make more sales at lower prices resulting is a much lower income for many, many more hours of work? We vow to keep working those hours, listening to our sellers and doing everything possible to get the best price in the least amount of time for our clients and to work with sellers through the grief process.