Real estate agents believe their own bull

So says Steve, my fellow real estate agent at the office. Real estate agents in general are an optimistic breed with only one thing in mind: sell, sell, sell. Nary will you here a single negative comment utter from their mouths. I can only think of one reason for this. There are too many real estate agents, chasing too many dollars, chasing too few deals. So many have taken the real estate exam and so many have come to our great city to make a living, that I think SF now has one of the highest number of real estate agents per capita. If you don't know at least one real estate agent, then you must live in a bubble.

Competition is fierce. The pressure to sell coupled with the natural cheery disposition of our profession has resulted in an industry break from reality. I've heard agents tell their nervous buyers, "I can guarantee you that the value of your condo won't go down." This was just a month ago (reality check- prices are headed south). I've seen agents gladly sell their clients into risky interest only, adjustable loans so that they can buy a home that they really can't afford. I've also seen agents sell their clients an overpriced piece of investment property in a bad location or worst yet, sell them a cash flow negative property. Or that property bought in a sub par area with a promise of a quick flip into TICs. Most realtors will sell you any piece of real estate under the belief that real estate is safe and prices won't decline. Reality check, real estate, like almost everything, is cyclical.

Speaking of cycles, the market has definately changed. Right now we seem to be in that stand off stage. Seller's are not marking down and buyers are not writing offers. Something has got to give and I don't think it will be the buyers who back down. These corrections tend to take 18 months, so buyers have enough time to be patient. Still listening for the "pop"...