To answer Leisa's question.
Jeff and I think it will be a very slow comeback for the market.
5 years...very possibly more. And it will come back very slowly, a little at a time.
But it will never be at the crazy height it was. That was a fluke.
And people will forget that. So YOU remember. It is extremely rare that it would shoot that high that fast and only happens under extreme circumstances. But the average Joe doesn't realize that, which is why speculators (people who buy for a quick buck) risk and often lose so mightily.
Jeff and I think it will be a very slow comeback for the market.
5 years...very possibly more. And it will come back very slowly, a little at a time.
But it will never be at the crazy height it was. That was a fluke.
And people will forget that. So YOU remember. It is extremely rare that it would shoot that high that fast and only happens under extreme circumstances. But the average Joe doesn't realize that, which is why speculators (people who buy for a quick buck) risk and often lose so mightily.
Real Estate cycles about every ten years. Up and down, up and down but not huge fluxes like this past one was.
It will return to its' OLD plateau or more likely even just below where the old base value was before the spike. The old adage that real estate always holds its' value is true. There is limited space on earth and real estate will continually be an increasingly limited resource. No matter what the fluxes are, it will always even out and always hold it's "real" value...eventually.
We believe that the spike pushed forward at an accelerated rate as a direct result of the hurricanes. There was already a trend of higher prices happening due to the increasing population of South Florida.
The prices get too high due to fewer houses/less space and so groups of people that still want to stay in Fl. move to the next lower priced area...usually just a county or two away....this pushes the population (in Fl) further North creating more jobs, need for housing, etc. etc.
This is a painfully slow effect but still gaining speed...not noticed by many but still there. California is an excellent example of this. There is no more land there and a 200,000 house here is a million there.
So take that trend here and add a few Cat Fives and you've got yourself a MARKET.
People fly high, go crazy and think it will last. But alas, it does NOT.
Jeff and I bought only TWO properties during this 2 year period. One solid investment, one at a riskier point.
The solid investment did not sell, did not sell, did not sell. It finally sold but at a low profit.
The riskier one was the one we had to auction and took a loss of $200,000. OUCH.
On a personal note, it is ironic that we moved here in semi-early retirement but now find ourselves practically starting over, but happier then I have ever been in my life. EVER. I LOVE it here.
It will return to its' OLD plateau or more likely even just below where the old base value was before the spike. The old adage that real estate always holds its' value is true. There is limited space on earth and real estate will continually be an increasingly limited resource. No matter what the fluxes are, it will always even out and always hold it's "real" value...eventually.
We believe that the spike pushed forward at an accelerated rate as a direct result of the hurricanes. There was already a trend of higher prices happening due to the increasing population of South Florida.
The prices get too high due to fewer houses/less space and so groups of people that still want to stay in Fl. move to the next lower priced area...usually just a county or two away....this pushes the population (in Fl) further North creating more jobs, need for housing, etc. etc.
This is a painfully slow effect but still gaining speed...not noticed by many but still there. California is an excellent example of this. There is no more land there and a 200,000 house here is a million there.
So take that trend here and add a few Cat Fives and you've got yourself a MARKET.
People fly high, go crazy and think it will last. But alas, it does NOT.
Jeff and I bought only TWO properties during this 2 year period. One solid investment, one at a riskier point.
The solid investment did not sell, did not sell, did not sell. It finally sold but at a low profit.
The riskier one was the one we had to auction and took a loss of $200,000. OUCH.
On a personal note, it is ironic that we moved here in semi-early retirement but now find ourselves practically starting over, but happier then I have ever been in my life. EVER. I LOVE it here.
This is also a thrilling time for people with a personality like mine. Back me into a corner, add some pressure and a challenge and I do my best work. I love the underdog. I root for the losers. I love being told "I can't." Because I know, that I CAN. Just watch me!
If you are an entrepreneur at heart as I was telling this lady today who was showing us a house, you BETTER be prepared for the downs as well as the ups!
You can play it safe and live safely and securely. Or you can risk it. There are all sorts of people. All sorts of benefits and deficits to both ways of living. You have to be willing to take the good and bad if you are the risk taker.
Anyway, so even though we may lose it all, we wouldn't have it any other way. We live our own lives. We are our own people and a small percentage of people like us make it all the way.
If you are an entrepreneur at heart as I was telling this lady today who was showing us a house, you BETTER be prepared for the downs as well as the ups!
You can play it safe and live safely and securely. Or you can risk it. There are all sorts of people. All sorts of benefits and deficits to both ways of living. You have to be willing to take the good and bad if you are the risk taker.
Anyway, so even though we may lose it all, we wouldn't have it any other way. We live our own lives. We are our own people and a small percentage of people like us make it all the way.
Many scoff at people like us...smugly talking about risk takers behind their backs...but we laugh in each other's arms! For we are happier, freer and way more in love. We live our lives rooting for everyone to win. Some cannot stand the success of others, and some feel others' success like it was their own. We are the latter. And we know how to be content on either side. Let me tell you how much easier that makes living life.
And we RUN into each others' arms every day and have done so since we met.
We BELIEVE in for better or worse for REAL. Which makes "worse" not all that bad!
And in the midst of all this, we buy a magazine, make a go of it, land a radio show...yep, it's a fun ride with the likes of us...if you like really scary rollercoasters!
So back to the market. Our advice? Stay put if you want to sell unless you really want to get out.
You know, there is just nothing wrong with letting the next person get the next bit of cream on the deal so if you want out, go.
But if you need the money out of the house/property, then you will have to wait.
Also, if you can buy, OMG, BUY! BUY BUY!
THIS is the moment to risk trying an investment property. Find the deal of the century because there are MANY. (we just looked at a 1881(yr) house today WAY bigger than ours, 3 car garage, on smaller property but almost 1/2 the cost of this one) So if you want to do it you should and you will make money if you can wait so if you are able now is the time to do it.
BUT! (yes, there is always a big fat one.) Here is the rule with investment property...if you cannot throw the money into the street, then do not do it. If you have trouble at ALL paying your monthly bills, do NOT do it. Too much risk.
So, that's about it. The market according to...well, no one of consequence actually.
And in the midst of all this, we buy a magazine, make a go of it, land a radio show...yep, it's a fun ride with the likes of us...if you like really scary rollercoasters!
So back to the market. Our advice? Stay put if you want to sell unless you really want to get out.
You know, there is just nothing wrong with letting the next person get the next bit of cream on the deal so if you want out, go.
But if you need the money out of the house/property, then you will have to wait.
Also, if you can buy, OMG, BUY! BUY BUY!
THIS is the moment to risk trying an investment property. Find the deal of the century because there are MANY. (we just looked at a 1881(yr) house today WAY bigger than ours, 3 car garage, on smaller property but almost 1/2 the cost of this one) So if you want to do it you should and you will make money if you can wait so if you are able now is the time to do it.
BUT! (yes, there is always a big fat one.) Here is the rule with investment property...if you cannot throw the money into the street, then do not do it. If you have trouble at ALL paying your monthly bills, do NOT do it. Too much risk.
So, that's about it. The market according to...well, no one of consequence actually.
3 comments:
great advice miss no one of consquence!! I'm with ya baby... I love seeing people succeed, it's a very hopeful thing, don't you think?!
We're in a place where we'd love to move "up" but literally can't take the risk... maybe in a year or two...Lord willing, and He doesn't call us out, sounds like we may have a little time, huh?
This was great.
Doug and I are in the "GO" category of all this. It's kinda hilarious to be putting a house on the market in the midst of all this craziness.
It will be fun to see what God does for both your family and ours as we embark on our next "grand adventure".
Thank You for the post, I love to hear what others think in regards to real estate. I love homes, and secretly thumb through Homes & Land and Farms & Land as a hobby.
The market did get ridiculous, but with it I wished we had sold and then moved into one of these honey of a deal homes ;) At least we bought well before the spike. I feel for people who bought such over priced homes.
Anyway we love it here, and will be content if we don't sell, but I dream of land and a old farmhouse and some chickens!
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