June 18, 2008
The Housing Market Grieves
Healthcare practitioners, counselors, psychologists, and clergy often use an emotional framework to explain the emotions that people go through after experiencing a traumatic event. While there are a couple of derivatives of this model, one of the most common is listed below….
- Shock - Is this real?
- Denial - This isn’t happening to me!
- Anger - Why is this happening to me?
- Bargaining - I promise I’ll be a better person if…
- Depression - I don’t care anymore.
- Acceptance - I’m ready for whatever comes.
How does this apply to real estate, you ask? Well, frankly for many homeowners, the recent severe downturn in the housing market is traumatic. For some, the pain may be immediate and life changing, such as a forced home sale or foreclosure. For others, the decline in real estate values may mean a delayed retirement. Yet for others, the current situation may be the lost dream of moving closer to family or obtaining a better job because they can’t sell their current home. There is no question that for many, the real estate market is a traumatic event and, with any trauma there will be some amount of grief.
If the U.S. housing market is the subject, where would you put us in the stages of grief?
- Shock. It seems that sometime in the first quarter of 2008 we watched in collective horror as events began to unfold. Major institutions were failing on Wall Street, northwest stewards such as Washington Mutual Bank lost 80% of their stock value, and potential home buyers were turned away by lenders.
- Denial. Fast on the heels of this bad news, cable news pundits started predicting a second half recovery for the market.
- Anger. By April, the US Senate is holding public hearings with major mortgage lenders.
- Bargaining. As summer is upon us, legislation is being proposed in the US Senate to help bail out many homeowners stuck in high risk loans.
- Depression. Consumer confidence was just rated at a 16 year low.
- Acceptance…
Me said:
Shut it, you whiners with homes in the city. You’re getting no sympathy from me. I am 33, with an M.Sc. and a better job than I expected- 54k per year. This is the area median for 1 person. Housing is so high here, that 43k qualifies a single person for subsidized housing-that’s $21.50 per hour. This is unmitigated greed, that’s all- if your home value has more than doubled in the last few years, good for you! But quit your bitching that it didn’t continue- you’ve got yours, and if things kept rising at that rate, I’m coming to live on your lawn- and so are thousands of people in this city who work hard and have educations and can’t possibly buy anything, and might not be able to rent either, if rents keep going up, and gas and food…. To be frank, I’m thrilled property values are dropping. One friend sold her car and has no phone or internet to buy a year ago- not an option in my profession, but it should not be a requirement to own a basic studio condo either. The folks who’ve watched their value drop from 550k to 490k won’t be getting any sympathy from me. Get real. Grow up.
June 19, 2008 11:13 PM