The real estate blog.

Disclaimer: My intended audience for this article is Realtors/real estate agents who blog. Please don’t be offended if you read this and are not in this group.

It’s been a year and a half since I started blogging about real estate and the promise of Web 2.0 revealed itself to agents across the nation. It was also about the same time symptoms of the housing downturn presented themselves and Bubble bloggers gained large audiences.

For a while real estate professionals, myself included, denied things would be as bad as the housing bears made them out to be. The test of time has spoken and the bears have been proven correct. Due to a number of circumstances, faith in the U.S. credit markets have been shaken and lenders are very cautious about originating new loans and the risks associated with such lending.

Last year there were a number of real estate bloggers that took the promise of Web 2.0 and the bubble bloggers to task. As the realities of the marketplace have revealed themselves, I turn to the Web 2.0 real estate pioneers and find myself disappointed.

I’m not writing this article to throw stones. I’ve been guilty of making a number of misjudgments, so if you’re one of the people pointed out here, please take this criticism with the constructiveness that is intended.

This week it became painfully obvious the U.S. credit markets are headed for big trouble. The Fed has made some bad moves and the GSEs have made changes that will impact everyone, even prime borrowers. So I turned to one of the great real estate blog sites, Bloodhound blog to get some perspective. I have my own thoughts, but I like to hear what other people are thinking. Greg Swann provoked the ire of the bubble blog Housing Panic last year and they’re still talking about him. His blog has changed from a collection of real estate perspectives to a collection of Web 2.0 perspectives. That’s great if that’s the direction he wants to go, but in my estimation it helps prove the cynical point that Realtors aren’t really that talented, especially in a down market.

So I started searching some of the other Realtor blogs I like. BlueRoof in Salt Lake has also developed a Web 2.0 spin. Greg Tracy recently talked about six word stories. If I were a home seller now, I’d be wondering how to sell in a challenging market. This is where Web 2.0 Realtors can make a difference. I kept searching.

Pittsburgh Homes Daily…nothing since July…about a month before the true nature of this downturn really became apparent. How about 360Digest in Seattle? Fluff! Do you know where I’m finding some good perspective on the real estate market? From a Web 2.0 blogger. Though Pat Kitano is in real estate, he’s not an agent. He’s on the title and technology side. He pointed out last month that real estate bloggers aren’t covering the looming foreclosure crisis. He’s also provided some very balanced stories showing the other side of the downturn. Pat’s real estate agent friend in the Bay Area has followed this model as well.

The promise of real estate blogging is readers will get an idea of the talent, thoughts and capability of a real estate agent by reading what they write. Please don’t take this the wrong way, but ignoring the downturn makes you look like you’re clueless or inexperienced in dealing with that kind of market. Either way, it’s not good.

As a community, we need to come to terms that a downturn has taken place. Credit standards have changed for the worse and real estate professionals who are not skilled are going to be finding new jobs. The fact of the matter is credit standards are always changing and real estate markets are indeed cyclical. Right now it’s tough to get a loan under certain circumstances and declining market designations are going to make things worse. Now is the time Web 2.0 real estate professionals can really distinguish themselves. While some are ignoring the challenges that clearly exist, others will grab the brass ring and distinguish themselves from the crowd.

The mortgage and real estate markets are changing. Fannie Mae is making it more costly for even the slightly marginal buyer to get a loan. Guess who isn’t? That’s right, FHA. What’s a good option for people wanting to buy, but afraid to? A lease option. If lenders won’t loan to buyers, who can? Sellers. The high interest rates of the late 70’s and early 80’s sparked a lot of seller financed wrap around contracts. By the time rates adjusted down in the mid 80’s, wrap arounds were curtailed by the lenders, but levels of home ownership increased as did housing values. This type of seller financing did a fine job in stabilizing home prices and ownership rates. Just because things are different than they have been, doesn’t mean everything is over.

Again, I say these things with utmost respect. I think real estate professionals who blog are headed down the right track and I see this downturn as a fantastic opportunity for Realtor 2.0 to take off. Let’s take this challenge by the horns and really provide readers what they want to know - how to buy/sell/invest in a down market.

Editorial Note: The company logo used in this post is here. I guess their vision didn’t really work out.