Most of us have heard of post traumatic stress disorder, but only a very few have experienced or witnessed post foreclosure stress disorder (PFSD). Similar to, but different from PTSD or post traumatic stress disorder, PFSD is specific to the trauma of losing one’s house due to foreclosure rather than trauma caused by warfare, assault, or something else that threatens a person’s life. Could this hold answers to some of the questions about the real estate market today?
Certainly, a percentage of the 9 million people who lost their homes and the 8.5 million people who lost their jobs in 2008 know first hand about post foreclosure stress disorder. Despite their lives being back on track money-wise and work-wise today, the mere suggestion and/or thought of owning a home again triggers the past trauma of losing their home/job. No one suffering from PFSD wants to experience that nightmare again so they often steer clear of homeownership altogether despite its inherent benefits.
The National Association of Realtors (NAR) believes that PFSD may be one of the primary factors affecting the reality that home ownership rates in the U.S. are at a 50-year low at a time when homeownership rates ought to be booming due to historically low interest rates, low unemployment rates and improving local job markets. Other factors, according to NAR, contributing to low homeownership rates include mortgage availability, the growing burden of student debt, single family home affordability and single family home supply shortages.
First and foremost, NAR is tackling issues confronting people experiencing PFSD by sponsoring programs and workshops that focus on the how-to’s of effective, beneficial financial decision-making. Armed with concrete, realistic specifics that help put PFSD people in control of their financial decision making may just reduce their fears of reliving the trauma of losing everything for which they had worked so hard to obtain. Who knows…perhaps these NAR programs for PFSD people will enable them to put their toes into the waters of homeownership again…this time with their eyes wide open, their feet planted in reality and their fears reduced.
