A fascinating, but little reported factoid from the US is that a hell of a lot of real estate agents and mortgage brokers have lost their jobs as a result of the collapse in the housing market. This is one blog post that covers the incredible rise in the number of real estate agents over the last 30 years, and their rapid decline of late.
Membership of the NAR has fallen by 218,000, which represents 16% of agents. I read somewhere that heaps of mortgage brokers and originators are now without jobs as well.
Let's assume for a minute that out of the umpteen million now unemployed in the US, half a million were previously employed in inflating the housing bubble, selling mortgages to people who could not pay them back, fraudulently inflating house values and processing "liar" loans. Stop for a second, and tell me whether you really give a bugger if one of these blood sucking leeches is out of a job.
Do you really want to re-inflate the bubble so that they can go back to their bad old ways?
Do we really need agents boosting the market so they can make a sale and take a fat commission? Do we want crooked mortgage brokers to once again stuff the pockets of the poor with unaffordable loans? Are we not better off with cheaper housing, which allows first home buyers to get into the market without taking on a crippling level of debt? Cheaper housing might also allow us to get housing commission tenants off the public tit, and into private housing.
Remember that many of these Realtors, brokers and valuers were also dealing with clients who were buying a second or third home - a holiday home or an investment property. Is it really the job of the taxpayer to boost the market to maintain the value of holiday homes that are occupied for only a few weeks per year?
I'm not trying to play the class envy card here, as I really want to buy a flash ski lodge at Hotham, but come on, is it really a problem if the value of ski lodges falls by 60%? If no ski lodges are built this year, does the collapse of the construction industry in that area mean that many people will potentially be made homeless? I doubt it.
Frankly, if a million real estate agents suddenly find themselves wandering the streets in ragged suits, begging for change at traffic lights and maniacally jangling the keys to the black 5 series BMW that they once leased, I will not weep. I won't suddenly feel the urge to stimulate the economy to put them back to work. I say good riddance, and may they join a few thousand bus loads of lawyers at the bottom of the ocean.