As Jimmy and I were out strolling today I walked past several houses that were clearly labeled “for sale”. Some of these houses have been on the market for months. It’s sad to see houses sit empty when there are people in the community that would love to own a home. The economic law of supply and demand would indicate that there is not a demand for these homes (at least not at the current price). But, I know of several renters who would like to purchase their own property. In a perfectly free market these homes for sale would drop in price until they could be purchased. In our current market, these homes do drop in price (in order to fall in line with demand), but the drop is incredibly slow. So, what’s the hold-up? Who’s to blame for slow-falling property prices? I believe that it’s due to both agents and sellers, both of whom are reluctant to let a house sell for any amount less than they feel they can get for it (or, more likely, what they could have sold the house for in a past sellers market). Yes, I know that agents are highly trained *cough* individuals who have the knowledge to properly assess a house and market to find that perfect price point, but they’re people too, and people like money. The more an agent can sell a house for, the greater his take-home pay (generally). Homeowners also like money. Joe Homeowner scraped together just enough money for a down payment on this house to purchase it for $250,000 five years ago, and he’s not willing to sell it for less than $300,000 now. Hey, I understand you Joe, you just want to get some money out of this property, move on, maybe buy a new car someday, and retire with a few bucks. But meanwhile, Tim and Jane in the rental down the block can’t afford to buy your house, or any of the other 200 available because they’re just too expensive. What’s the answer? Financial counseling for Tim and Jane would help them to understand the value of debt-free living. A sympathetic heart might convince Joe to drop the price somewhat. Whatever the answer, education will certainly play a part.

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