About five years ago, real estate was selling at a very fast clip.  Housing prices were growing by about 4 percent every year and it took but a little wheedling with an appraiser to make the contract value stick.  But five years before that, housing was fairly steady.  Values did increase, but at a more moderate rate of 1 to 2 percent per year.

Given that values grew by about 20 percent in a five year stretch – what would’ve taken 10 years to do previously – and given that values have dropped by about 20 percent across the nation (30 to 40 percent in some places), I expect the housing recovery to take about 10 years in all.  This is not based on any economic studies or actual hard numbers.

The bottom line is that the old way of selling homes – absent a run on houses by buyers because of easy loans – is the new way.  Buyers must save a down payment, they might expect to again pay closing costs (depending upon the seller), and they’ll have to verify they have job security before being approved for a loan.

Through the next five to eight years, I anticipate the housing market to be like it was in the 1990′s.  If sellers were able to sell then, they can do it now.  If real estate agents were able to make a living then, they can do it now.  And if buyers could save then, they can do it now.

To save, buyers may need to take on a second job for a year or two.  To sell, home owners may need to be realistic about their pricing.  To keep clients happy, real estate agents will need to pay attention to the details, respond to all aspects of a contract in a timely manner, and remember to stay in touch with their customers.

Everyone must find a way to walk the path of the new way – the old way.