My House Is Burning Give Me A Fire Hose
Buyers are you serious about buying or are you playing a game?
For years the world economy has been shifting, twisting, slowing, falling, collapsing.? For six years real estate has been following the economy and sometimes even leading it down.
For years buyers have been saying I am going to buy as soon as:
- The real estate market hits bottom
- The real estate market bounces up 5%
- The stock market has to improved
- The world economy improves
- The world stock markets goes up
- The risk of depression disappears
- The risk on recession or double dip recession goes away
- Ruinous inflation slows in China and India
- The EU Euro situation stabilizes
The buyers have been right to be worried about all of the above.? The question is should the buyers be worried about the above today?? Are these 9 concerns valid reasons not to buy real estate today?
I think it is time to buy real estate in many markets in many countries.?? There are always big worries in the world.? There are always reasons to keep your wealth in cash.? Many studies have shown that if you always keep your money in the bank you will almost certainly miss good opportunities to grow your wealth.
- The real estate market in many communities has hit bottom. A few communities have shown increases in prices.? Many more communities have experienced decreases in inventory.? None of these changes has been a straight line up.? Turning points are always confusing, muddy, and inconsistent.? It is only by looking back that we can identify a turning point.
2. What is clear is that taken together the real estate market is looking better than any time within the last 6 years.? Worldwide it is not up 5% but it is getting better.
3. The American stock market is within 10% of its all time high and way above it 2008 low.
4. The world economy free fall has slowed.? The European market is a question mark.
5.? World stock markets are very muddled.? The free fall seems to be over.? Some markets are very messy.? The big economies except for Europe are moving up.? Some have a long way to go.
6.? Talk of an American depression has disappeared.
7. Talk of a double dip recession has almost disappeared in America though there are other economies where this is still an issue.
8. Ruinous inflation in China and India has slowed.
9. The Euro has not stabilized and the situation in the Euro zone is fragile and of great concern.? Italy and Spain have lowered their cost of borrowing significantly.? Greece is an explosive situation.?? Success or failure in Greece will have significant consequences in Europe and to a lesser extent worldwide.? The delay in resolving Greece?s debt has enabled the construction of some ?firewalls? around Greece.? The more delay the higher the walls.? Wall construction is not a complete solution.
Things are better and sellers are still very anxious to sell.? Good markets have 6 months or longer inventory.? Bad markets have 9 months inventory.? Markets with high numbers of foreclosed or about to be foreclosed properties have 12-15 months inventory.? The shadow inventory is high worldwide.
Sellers are sending a clear message because they are lowering their prices in order to sell.? The message is clear.? My house is burning is the sellers? message.
This is a great time to be the ?hero? by buying real estate.? Everyone loves a hero.? The key is in the timing.? If you arrive at the fire when it is hot and not under control you are a hero.? If you arrive when the fire is almost out you are still appreciated but you will not be a hero.? If you arrive after the fire is out and the house has burned to the ground you will not be a hero and may be a villain.
Who will you be a hero too?? You will be a hero to yourself, your family, the seller and all the participants including the seller.? It makes sense that you can negotiate a better sale when you are perceived as a hero rather than as a villain. ??It makes sense to buy low so you can sell high.
Is it a perfect world?? Perfection does not exist in any market.? Are there many good reasons to buy?? Yes.? Is there risk in buying?? There is risk in everything.? Are the indicators saying the risk of buying is declining and the chances for success are increasing?? Yes.
Only you can answer the question are you serious about buying or just playing a game?
Source: http://bonaireislandrealestate.com/2012/02/13/my-house-is-burning-give-me-a-fire-hose/
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