It's not a good time to have a job related to real estate. The collapse of the housing market was a key catalyst to the recession we're currently in. And many people connected to that industry are out of a job or have seen a sharp drop in income. That's where we pick up "Stories from the Line," our ongoing look at the struggles of everyday Ohioans. ideastream's Eric Wellman reports.
Rick Linhart knows a thing or two about weathering downturns. Owner of R.W. Linhart and Associates, he's a real estate appraiser -- third generation. He's lived and worked through downturns first in the 70's, again in the 80's and early 90's. He says it's something you expect and budget for in this line of work.
Linhart: "Generally you know that business is going to be ground chuck or sirloin steak. So I was ready for anything"
But there was nothing that prepared him for what happened in 2005. That's when the first large wave of interest rates on subprime loans began to adjust and people were losing their houses in droves. In early 2006...
Linhart: "The phones just stopped ringing."
At the time, he had six employees and was appraising homes for people interested in refinancing. But with the collapse of the housing market, refinancing was no longer an option for many, and business dried up. Richard Linhart found that this was no ordinary downturn...that something had fundamentally changed.
Linhart: "Things got a little startling and we knew that some of the basic building blocks of valuation, appraisal and the real estate industry are missing."
Wellman: "You mean many of the rules you lived by your whole career no longer exist?"
Linhart: "Exactly. There was like a new gang in town that changed things around."
Wellman: Do you think there will come a time when the rules you've known will come back?
Linhart: "No, it's a different game all together."
I asked him what he means by that - a different game all together- Linhart says because of the number of foreclosures it's gotten way more difficult to do his job: putting a value on a house.
Linhart: "It's double the work time wise. So a lot of things go through your mind. It almost deals with your self esteem that you can't produce something that particular day. You don't have a final product to give out and if you do have one it doesn't make anybody happy."
As business ground to a halt, Linhart was forced to lay off four employees -- two thirds of his staff. And he began taking on other kinds of work. Doing appraisals for divorce attorneys, or appraisals for tax purposes. In this way he's made up some of the business he lost, but Linhart says things are really slow and he doesn't see things looking up any time soon.
Linhart: "We are waiting for a turnaround. We're planning to stick it out. We know this is an extremely dry season for us. We're going to stick it out and hope we're wanted again after this meltdown clears up."
Eric Wellman, 90.3.