The tide of foreclosures sweeping across the country have resulted to a big reduction in home prices as well as a decrease in the number of homes sales the past few months in hardest hit states and cities. The results proved catastrophic as even realtors themselves lost their jobs or suffered a significant reduction of their income flow.
Agents typically do not have a guaranteed base salary, and earns only based on commissions. What this implies is that if no sales are closed by the agent, he or she will also not receive any paychecks.
With lower pay checks and increases in their mortgages adjustable rates, real estate agents themselves find it difficult to maintain their loan payments and are now in the danger of losing their homes to foreclosures.
Real estate professionals nationwide are describing this as a growing trend, with more and more real estate agents finding themselves in financial distress and in danger of losing their homes.
This ironic situation for realtors resulted in a drop of active agents by 10%. The current number of real estate agents dropped to 1.24 million agents from as high as 1.37 million from two years ago. This spurned actions from associations of real estate agents who are trying to raise funds to support troubled colleagues and help them avoid foreclosures.
Currently, real estate agents are struggling to make sales even with foreclosure properties from underwater homeowners. Also termed short sales, these transactions involve homes that have higher unpaid loan amounts than what the home currently is worth. Some investors stay away from short sales of these foreclosure homes as the process takes more processing time than a standard home purchase.
Still, some realtors are optimistic that this crisis will finally come to an end in the near future. Sales are starting to pick up once more this October with sales up to 30% even on areas that are hard-hit with foreclosures. Some experts foresee this trend to continue in the coming months. Realtors could only hope that this be true, and so does the rest of the nation.
Leticia Carvalho has been educated in the finer points of the foreclosure market over 5 years.