So, how's the housing market in Cherokee County?

When asked recently by a reporter from Charlotte how business was going, local Realtor Bob Shelton responded with an insider joke.

"It's great," he said he replied. "All two of my prospects showed up last week."

While Cherokee County seems far removed from the financial problems on Wall Street, Shelton and other real estate experts say they are seeing the effects of a national downturn in the housing market and the impacts of the credit crunch in banking sectors.

On one hand, it's a buyers market in Cherokee County and across South Carolina as there's a lot of housing stock from which to choose. As of Friday, a search of available properties in Cherokee County listed 208 single-family homes in a wide range of price points — from entry level starter homes to large and modern.

On the other hand, however, fewer people are buying and some of the people who are in the mood to buy are finding that home loans aren't quite so easy to come by any more. That's led to homes staying on the market about 30 days longer than they did last year, Shelton said.

"It's tougher," agreed local Realtor John Wall, who estimated that home sales in Cherokee County are likely off by about 20 to 25 percent compared to last year. "(Credit) certainly hasn't dried up," he said. "You can get loans. (But) if you have questionable credit, it's more difficult that it would have been, say two years ago or even a year ago."

Shelton, whose firm handles listings of foreclosed homes all across South Carolina for many banks and asset management companies, said he's currently getting about 41 new listings a month now compared to the 29.5 new listings a month he saw last year.

The foreclosure rate in Cherokee County isn't as high as other areas of the state, particularly places like Myrtle Beach, but it is up, Shelton said.

While the inventory of foreclosed homes is increasing, Shelton said so too are the requirements for obtaining a home loan.

"We've had (loans) turned down for people who, two years ago, would have been quality loans," he said. "We've had lenders change the terms the day before closing."

One of the factors troubling the housing market on a national level, even though it wasn't seen on a local level, is that housing in some areas of the country appreciated too quickly and by too much.

"Even if you dropped prices in places like San Diego (Calif.) by 40 percent, you're still talking about a home that's $600,000," said Elaine Worzala, director of the Center for Real Estate Development at Clemson University.

Housing prices in some areas were so out of whack that income levels could no longer support them.

In interviews with people who lost their homes to foreclosure, Shelton said he noticed that most people weren't losing their homes because of common problems like job loss. Rather, most of the people he's interviewed lost their homes because of the financing arrangements they signed.

"It's mostly from these exotic loans," he said, referring to 100 percent loan to value ratio mortgages and mortgages with adjustable interest rates. "They refinanced, got a (low) teaser rate and then (the loan's interest rate) adjusts."

After the adjustment of one loan, he offered as an example, a Charlotte man's monthly mortgage payment was $50 more than he brought home, resulting in a foreclosure.

The impacts of these socalled bad loans have weighed so heavily on banks and Wall Street investment firms that a $700 billion bailout package was signed into law on Friday in an effort to shore up the financial system.

No one, however, is expecting the typically cyclical housing market to turn around quickly even with the bailout.

"My thought is once we get through this election, and once this bailout comes through and the markets adjust, I would hope this Spring we would start getting more active," Wall said.

In all of the housing cycles Wall has worked through, experience has shown the number one "killer" of home sales is when people lose jobs, while the second "killer" is high interest rates.

Like many others, Worzala said her family is facing the results of the housing market downturn as well as it's sitting on a home in high-priced Maryland that it can't sell. "If we were to sell today, it would be several hundreds of thousands of dollars lost," she said. "I know I'm not alone."

Luckily, she said her family didn't have a loan on the home it can't afford and that her family can wait.

Overall, current consumer reactions to housing market problems aren't unexpected. "The consumer confidence level is way down so people are very concerned," Worzala said. "Even if you haven't lost your job, you hear people are losing jobs. You then tighten your belt."