Buyers are getting wise…not all is doom and gloom

(Riverside, California)…As you may know if you read this blog with any sort of regularity, I make no bones about generally bashing the media.  Why?  Because they make it so easy.  Facts and the real story generally give way to whatever scintillating, ratings inducing sound bite can be produced and then repeated over and over until, when repeated enough, the general public actually begins to believe in it’s validity.  How many times have we been told something is bad for us (or good, for that matter), only to have the “experts” reverse themselves at a later date?  Food, drugs, tobacco, wine, tax codes, seatbelts, etc. are but a few of the many things that have, at one time, been good for us, bad for us, or somewhere in between.  And why am I delving into this subject now?  Because the media is at it again with real estate…but the good news is that some people have wised-up to the ways of the majority, and by thinking and seeing for themselves, are reaping the benefits.  Read on.

While the media will have you think the sky is actually falling (well, I guess it really is since we had to shoot down one of our own satellites a couple of weeks ago)…at least with regards to real estate, every expert the media can create will tell anyone who wants to listen that real estate is mess, and to be avoided at any cost until the experts tell you otherwise.  But….like the stockmarket, someone is going to make money in this real estate market…you just need to know where to look.

Right now, March 12, 2008, there are certain aspects of our Riverside area real estate that are amazingly good.  Busy, active, energetic, frenzied even.  Yes…real estate prices have dropped drastically, and this is not good for sellers…but only half the market is selling…THE OTHER HALF IS BUYING…AND THAT IS WHERE THE SMART INVESTORS AND FIRST TIME BUYERS ARE HANGING OUT. 

I always joke with my stockbroker (ex college roomate) that for once, could we try the old addage “buy low, sell high.”  This same philosophy can and does apply to real estate as well.  As I have mentioned before, the difference between housing and stocks as an investment is the length of time they need to be held, and the volitility of each market.  Stocks can be bought and sold in a much shorter time period (yes, some should be held longer, I know) because as a general rule, that market is more volitle.  Housing on the other hand, unless you are a very savy investor who is flipping houses for profit (and they do not really exist in todays market), should be held for a planned period of at least 5 years. SO…since buyers are 50% of the equation, and at the moment, there is no shortage of sellers (ie:bank repos) willing to sell for amazingly low prices compared to a few years ago, smart buyers are purchasing now and will reap the huge rewards in the not-so-distant future….AND THAT IS WHAT THE MEDIA IS FAILING TO REPORT.

Westcoe represents a lot of banks in their foreclosed properties, not to mention really motiviated sellers who realize they must also compete with the banks…and on those properties that stand out as a good value, we are receiving multiple offers daily.  Yes…in this “sky-is-falling” market, we are seeing numerous mulitple offers on many of our listings.  Why?  Because smart people are realizing that 5 or so years from now, they will wish they had purchased every piece of real estate they could get their hands on at today’s prices.  Will the prices go lower?  Maybe, but again, THE SMART PEOPLE DON’T CARE…because they know is doesn’t matter.  Again, 5 or so years from now, it really won’t matter if they could have waited and bought real estate for a few thousand dollars less.  Do you really think anyone who could sell Google stock right now for $440 per share (yesterday’s closing price) really cares if they bought it at $200 or $220 or even $250 per share?  Of course not, and 5 years from now you will feel the same way about real estate.

Another factor in all this is the current interest rate market combined with the government’s desire to get people spending money.  The Feds are so scared of a recession that they are practically making it possible for banks to give the money away.  Oh yeah, you might need to show that you can acually make the payments on what you borrow, but that doesn’t seem too out of line…AND THIS MENTALITY OF AVAILABLE MONEY AND REDICULOUSLY LOW INTEREST RATES WILL NOT LAST.  At the first sign of a recovering economy, the Feds will begin to raise rates and tighten things up a bit, because these low rates are killing our dollar compared to other countries currencies (which is why you may be vacationing locally this year as opposed to Europe, etc.). 

In conclusion, you are now seeing the perfect storm for real estate investing…sellers willing to sell at really attractive pricing, very low interest rates to help you purchase, and not a lot of buyers who have put these two together.  I am telling you, 5 years from now you are going to shake your head and wonder how you missed this opportunity.  In the meantime, those who can see what is right before their eyes are frenzied in their desire to get going, and we are delighted to help…because once the media begins to tell everyone it is the right time to buy, ALL THOSE PEOPLE WHO ARE BUYING NOW ARE JUST GOING TO SIT BACK AND SMILE….because the media will be wrong on that one too!

Call us…we will show you how to make lemonade from our current crop of lemons.